Statement of William Rinne, Deputy Commissioner
U.S. Department of the Interior
Before the
Energy and Natural Resources Committee
Subcommittee on Water and Power
U.S. Senate
S. 310
Newlands Project HQ and Yard Title Transfer

April 19, 2005

Madam Chairman, and members of the Committee, I am William Rinne, Deputy Commissioner of Reclamation. I am pleased to appear before this Subcommittee to provide the Administration's views on S. 310.

S. 310 would authorize the Secretary of the Interior to convey the Newlands Project Headquarters and maintenance yard facility to the Truckee-Carson Irrigation District. The facilities cover about 37 acres of Reclamation withdrawn property in Fallon, Nevada. Mr. Chairman, over the past couple years, we have been working very closely with the District to resolve each of the issues on the title transfer of the headquarters property. In June 2003, Reclamation and the President of the District's Board of Director's signed an extensive Memorandum of Agreement governing the proposed title transfer. Reclamation actively supports transferring title to state and local entities when in the mutual interest of affected parties. Based on this coordination, the Administration supports the concept of transferring the title for the property to the Truckee-Carson Irrigation District. However, we are concerned that S. 310 directs that the proceeds received by the United States for the lease and sale of Fallon Freight Yard, the transfer of which was authorized in P.L. 107-339, be treated as full payment for the 37 acres. Under this language, the District will not be required to pay anything for the property. Under Reclamation law and policy, the proceeds from the sale of acquired lands and lease revenues such as those from Fallon Freight yard are to be treated as a tail-end credit to the applicable project. In this case, the Newlands Project, not the District, our Contractor who operates and maintains the Project on behalf of the United States, should receive the credit. The lands associated with the headquarters property that is proposed to be transferred under S. 310 are withdrawn lands and thus the District has not repaid their value. If enacted as is, we are concerned the bill could set a precedent that would allow the District and other irrigation districts to make additional claims on lease or eventual sale revenues from Reclamation acquired lands. In conclusion, I would like to take this opportunity to compliment District Board President Ernest Schank and the District's Board of Directors for their diligence and commitment in working with us on the issues surrounding this transfer. I also commend Senator Ensign for his leadership. That concludes my statement. I would be happy to answer any questions.