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<br />. <br /> <br />. <br /> <br />, <br /> <br />control construction and OM&R costs which are allocated to the Upper Colorado <br />River Basin. Based on the legislation, Western must pursue the rate adjustment <br />that is needed, and option 1 is not a viable alternative. <br /> <br />2. Obtain consent of the four Upper Division States to reapportion revenues <br />for repayment of the participating projects' investment costs. <br /> <br />Discussion: P.L. 84-485 has a special provision in section 5(e) stating that <br />revenues in excess of the requirements for paying operatjng costs and repay- <br />ing power and storage unit investment costs shall be apportioned among the <br />Upper Division States in the following proportions: Colorado - 46 percent; <br />New Mexico - 17 percent; Utah - 21.5 percent, and Wyoming - 15.5 percent. <br />The law states further that revenues so apportioned to each State shall be <br />used only for repayment of construction costs of participating projects or <br />parts of such projects in the State to which such revenues are apportioned <br />and shall not be used for such purpose in any other State without the consent, <br />as expressed through its legally constituted authority of the State to which <br />such revenues are apportioned. In the repayment study, revenues from the <br />Basin fund are apportioned to the States in accordance with the provisions of <br />section 5(e) of P.L. 84-485, based on Colorado's receiving just enough revenue <br />to meet its obligations in the year 2046. This results in credits to some <br />States in excess of amounts required for currently authorized participating <br />projects. A smaller rate adjustment would result if the four States would <br />ccnsent to a different apportionment. <br /> <br />Western met with representatives of the four States to apprise them of the <br />situation. The States' response was to adopt a resolution passed by the <br />Upper Colorado River Commission which supported the apportionment specified <br />in the legislation, as included in the power repayment studies. Therefore, <br />reapportionment by consent is not a viable option at this time. <br /> <br />3. Seek legislation to reapportion revenues among the four Upper Division <br />States. <br /> <br />Discussion: As noted in option 2, revenues from the Basin fund are apportioned <br />to the States in accordance with the provisions of section 5(e) of P.L. 84-485. <br />This results in credits to some States in excess of amounts required for <br />currently authorized participating projects. At one public information <br />forum there was a question whether Western would seek legislation to change <br />the apportionment among the States to eliminate the excess credit. <br /> <br />Western has considered the question. It is clear that credit will accrue <br />when the proposed rate increase is put into effect. Despite this, it is <br />equally clear that Western's charge is to operate the project in accord with <br />the express language of section 5(e) of the law regarding the handling of <br />revenues. Western follows legislative direction and feels it would <br />not be appropriate for it to seek legislative remedies of this kind. <br /> <br />4. Limit the investments shown in the study to those occurring in the <br />5-year cost evaluation period. <br /> <br />3 <br />