WSP04600

• File Number: 8277.100
• Description: Salinity Projects Not Located in Colorado - Colorado River Salinity Control Forum
• Basin: Colorado Mainstem
• Date: 2/1/1996
• Title: Report to Congress on the Bureau of Reclamation Basinwide Program
• Water Supply Pro - Doc Type: Report/Study

APPENDIX A
BASIN FUND REPAYMENT CAPACITY

Introduction

Colorado River Basin Salinity Control Program targets and costs have been
identified that would allow the program to continue to meet the water
quality standards. Assuming that a $22.5-million-per-year program is
funded (this includes both U.S. Department of Agriculture (USDA) and
U.S. Department of the Interior expenditures), section 205 of the Colorado
River Basin Salinity Control Act of 1974 (Act) requires power users within
the Colorado River Basin States (Basin States) (Wyoming, Utah, Colorado,
California, Nevada, New Mexico, Arizona) to repay 30 percent of the
program's costs in the year following the Government's expenditure (or pay
interest on the balance owed). This appendix analyzes the repayment
obligations and the Lower Basin Fund's repayment capability.

All of the salinity control program's costs are first appropriated by Congress
and then reimbursed under the terms in section 205 of the Act. Funds for
reimbursement are collected through a surcharge on power generated at
Bureau of Reclamation (Reclamation) facilities. These monies are deposited
in funds held in two separate trusts by Reclamation (co=only called the
Upper Basin Fund and Lower Basin Development Fund). The surcharge in
the Upper Colorado River Basin (Upper Basin) is adjusted periodically to
match the Upper Basin's repayment needs by adjusting the energy costs to
power users. The surcharge in the Lower Colorado River Basin (Lower
Basin) is fixed by law at 2-112 mils. Since the Lower Basin Development
Fund's revenues are limited, both repayment obligations and the Lower
Basin Development Fund's capability to repay are analyzed (see table
following page A-2). The analysis shows that sufficient revenues will accrue
to the Lower Basin Development Fund to repay the costs of the salinity
control program.

Cost Allocations and Repayment

The reimbursable portion paid by the power users varies from 25 percent for
projects authorized by the 1974 Act to 30 percent for those projects author-
ized in subsequent amendments. The costs are further allocated between
the Upper and Lower Basin with 15 percent of the costs allocated to the
Upper Basin and 85 percent to the Lower Basin. Although this allocation is
reviewed annually by the Colorado River Basin Salinity Control Advisory
Council (Advisory Council), it has not been changed in its 20-year history.

Paradox, Las Vegas Wash, and Grand Valley Units.-For units author-
ized under the original 1974 Act, 25 percent of the costs are repayable.
Construction costs are repaid over the life of the facilities without interest
(up to 50 years). Operation and maintenance (O&M) costs are repaid (in
full) in the year following the expenditure.

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