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<br /> <br />United States Department of the Interior <br /> <br />APPENDIX 3 <br />Page 1 of 3 <br /> <br />BUREAU OF RECLAMATION <br />\Vashington, D.C. 20240 <br /> <br />IN UPL\OREFER TO: <br /> <br />MAY 2 3 1994 <br /> <br />D-1200 <br /> <br />MEMORANDUM <br /> <br />To: <br /> <br />Office of Inspe 'or General 1f$ <br />Attention: s\stant ~S1' or G~eral for Audits <br />Dani~l ~. Bear 14.... <br />.Commlssloner fUL~ <br />Subject: Draft Audit R ort on "Development Status of the Dolores and the <br />Animas-La Plata Projects. Bureau of Reclamation." (W-IN-BOR-004-93) <br /> <br />From: <br /> <br />~.#: <br />/...t:;, <br />",,::'. <br /> <br />) <br /> <br />The Bureau of Reclamation (Reclamation) offers the following comments in <br />response to the recommendations in the subject report. Additional comments on <br />the.text of the report are attached. <br /> <br />Recommendation 1 <br /> <br />Revise, to the extent practicable. the cost allocation and repayment <br />arrangements for the Dolores Project to (a) exclude indirect irrigation <br />benefits and (b) recover prior operating deficits with interest. <br /> <br />ResDonse <br /> <br />Reclamation concurs with part (a) of this recommendation. Indirect <br />irrigation benefits were used in the cost allocation presented in <br />the April 1977 Definite Plan Report (DPR). However, in the 1988 <br />Supplement to the DPR. the cost allocation was changed and costs <br />were allocated to irrigation based on Jse of facilities rather than <br />benefits. This method of 'allocation conforms to the General <br />Accounting Office's March 1992 Central Valley cost allocation report <br />(GAO/RCED-92-74) recommendation for cost allocation of Reclamation <br />projects. A final cost allocation, reflecting the revision cited in <br />the 1988 Supplement, will be finalized pending the completion of a <br />significant portion of the project construction. <br /> <br />Regarding part (b), it is not clear that existing Reclamation law <br />provides the authority for the recovery of capitalized operation and <br />maintenance costs other than through capital repayment. Therefore, <br />Reclamation will request an opinion from the Regional Solicitor's <br />Office on this matter. Upon receipt of the Solicitor's opinion. <br />Reclamation will respond to part (b). <br /> <br />The responsible individual is the Projects Manager, Durango Projects <br />Office. The final cost allocation will be completed by October 31. <br />1996. An opinion regarding part (b) will be requested by June 1. <br />1994, ' <br /> <br />~~ <br />,:., <br /> <br />~'\ <br /> <br />., <br /> <br />" <br /> <br />20 <br />