Laserfiche WebLink
<br />01376 <br /> <br />returns to the Treasury. If, for example, the Bonneville Unit <br />irrigation costs were increased by $450 million, the elimination of <br />apportionment would lose the Treasury over $470 million in present <br />value dollars. <br /> <br />Previous Inauiries <br /> <br />The large sums of revenue expected to accumulate in the Treasury as a <br />result of apportionment have drawn periodic scrutiny in recent years. <br />The U.S. General Accounting Office (GAO) issued 4 reports in the late <br />1980s with the contents of these reports ranging ,from general <br />overviews to examinations of various impacts on investment recovery <br />from power sale revenues. The latest draft report, in 1990, examined <br />the exclusion of indefinitely deferred projects from the power rate <br />base as specified by the 1983 agreement between Reclamation and <br />Western. The GAO suggested that the rescheduling of the deferred <br />projects had cost the United States $3.4 billion. However, the GAO <br />did not pursue the issue. <br /> <br />The Office of the Inspector General (IG) also examined the timing of <br />apportioned revenue in an April 25, 1989, report. The report <br />recommended that mainstem irrigation assistance for participating <br />projects be repaid in equal annual installments over the individual <br />participating project repayment periods. The IG concluded that these <br />straightline payments will force a 1.16mill/kWh increase in the power <br />rate causing a net increase of over $80 million (present value) in <br />returns to the Treasury. Reclamation declined to comply with the IG <br />recommendation based on an opinion of the Office of the Regional <br />Solicitor that, "[tlhe recommendation requires concurrent amortization <br />of both storage units and participating projects, and therefore, would <br />require new legislation to be implemented." The conflict is that <br />under the requirements of the current CRSP Act, payments for <br />participating projects authorized under Section 5(e) are subsequent to <br />payments under Sections 5(c) (1), operation and maintenance costs of <br />CRSP, and 5ld), CRSP investment costs. It is important to note that <br />this opinion may also be relevant to the "without apportionment" <br />scenario conducted by Western. As previously stated, the repayment of <br />capital costs allocated to electric plant is extended from the years <br />2018 through 2024 (see Exhibit 5). This action would place the timing <br />of Section 5(d) repayment concurrent with the timing of Section 5(e) <br />assistance. Any changes in the authorizing legislation will need to <br />address this, conflict. <br /> <br />5 <br />