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0403 . . In an August 19, 1981 faxogram, Regional Director Plummer informed Commissioner Broadbent that CUWCD had approved the necessary resolution. Plummer recommended that BuRec "(1) defer the costs associated with 60,000 acre-feet [reduction in CUWCD's entitlement], (2) assign the $38,000,000 of non-specific ad valorem tax reviews [sic] in the 1965 contract for repayment of the M&I obligation, and (3) accept the District's contribution [SlO million] to enhance our ability to undertake all scheduled work for the next two years." Plummer advised that "construction activities on the Bonneville Collection System can continue on this basis until early 1983 ..." On August 25, 1981, Acting BuRec commissioner Clifford Barrett informed Plummer that the proposal to defer certain M&I water supply costs and CUWCD's $10 million contribution were acceptable, but a decision on the use of the ad valorem tax revenues had been deferred. Use of the ad valorem tax was later approved in a February 23, 19H2 memorandum from Assistant Commissioner Eugene Hinds. Commissioner Broadbent outlined the above-mentioned series of events for Inspector General Richard Mulberry on November 24, 1981. Broadbent concluded, "We i:lelieve we have conformed to the recommendation, and now consider the matter closed." On /-larch 2, 1982 Regional Audit Manager Gerald Hicks informed Broadbent that he considered BuRec's action on the audit recommendations as "adequate" and would remove the audit from the fOllow-up system. However, this issue of the Bonneville Unit repayment contract is still not resolved. The legality of the use of the Hater Supply Act of 1958 is still in question, and despite Regional Director Plummer's warning that construction on Bonneville could continue only until early 1983, BuRec still has not negotiated a supplemental repayment contract. In January of 1984, BuRec reported that such a contract was not scheduled until Uecember 1984. Instead of initiating negotiations on a new contract at this time, the Bureau has developed a new strategy for postponing the day of reckoning. The Bureau has proposed to drastically redesign the Unit's Diamond Fork hydropower plant from a flow-through design of 133 megawatts to a pumped storage project of over 1,000 megawatts. Under the Bureau's cost allocation procedures, the share of total project costs allocated to power users goes up substantially, as might be expected. But it should also be noted that both the relative and absolute share of total costs allocated to M&1 users goes down as well. By dramatically scaling up the size of power features and associated power benefits, a portion of joint costs previously allocated to M&1 users is now allocated to power. On the strength of this revised Diamond Fork design, costs allocated to M&I dropped from $486 million in January 1983 to $388 million in February 1984. This lesser figure is now proposed as the target for reopening negotiations with CUWCD for a supplemental repayment contract. 88