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Statement of Larry Todd, Deputy Commissioner, Policy, Administration and Budget
Bureau of Reclamation
U.S. Department of the Interior
Before the
Resources Committee
Subcommittee on Water and Power
U.S. House of Representatives
on
HR 4204
To direct the Secretary of the Interior to transfer ownership of the American River Pump Station Project, and for other purposes

February 08, 2006

Mr. Chairman, I am Larry Todd, Deputy Commissioner of the Bureau of Reclamation. Thank you for the opportunity to appear before you today. The Department supports H.R. 4204, a bill to transfer ownership of the American River Pump Station Project to Placer County Water Agency (PCWA) upon completion of construction.

The American River Pump Station replaces a permanent pumping plant constructed by PCWA in the late 1960's on the North Fork of the American River. The principal function of the original pumping plant was to convey water supply from PCWA's Middle Fork Project to the Auburn Ravine Tunnel for use in Placer County, California.

Reclamation initiated construction of Auburn Dam in 1967. Construction of the dam was authorized by the Act of September 2, 1965 (P.L. 89-161, 79 Stat. 615). At the time construction of the dam was beginning, PCWA maintained a pumping station just upstream from the proposed dam site. The pumping station could not remain in place during construction of the Auburn Dam.

In lieu of condemnation by the United States, PCWA entered into a Land Purchase Agreement with Reclamation in 1972, transferring PCWA's land and facilities in the American River canyon to the United States, but not their water rights. The Land Purchase Agreement obligated Reclamation to deliver 25,000 acre-feet of Middle Fork Project water annually to PCWA until Auburn Dam was completed, at which time PCWA would divert all their water from the reservoir. To fulfill this obligation under terms of the Land Purchase Agreement, every year since 1972 Reclamation has installed a temporary pump station each April. The temporary facility remains in service until November when it is removed because of high winter flows that typically inundate the site.

Construction of Auburn Dam was halted in 1975 and has yet to be resumed. In the interim, Placer County has become increasingly urbanized. Consequently, PCWA will soon require year-round access to its full water supply from the Middle Fork Project. This demand substantially exceeds the capacity of the temporary facility. In addition, installation and removal of the temporary pump station each year is becoming increasingly costly.

Considering the circumstances, Reclamation and PCWA determined that a new permanent pumping plant was the best long-term solution for providing PCWA access to its water. PCWA further determined that it had needs for a higher-capacity pump than Reclamation would be obligated to provide. In 2003, Reclamation and PCWA entered into a cost-share agreement for the construction of a permanent pumping plant which stipulates that PCWA will pay all incremental costs of materials and construction necessary to enable the pumping plant to deliver water above the capacity negotiated to meet Reclamation's obligations to PCWA and that title will be transferred to PCWA upon completion of the permanent pumping plant, currently scheduled for 2008. The title transfer is contingent upon statutory authority, as provided in H.R. 4204.

H.R. 4204 would not impact other Central Valley Project (CVP) water or power contractors. The completed project will not be operationally or financially integrated with the CVP, nor will it provide benefits to other CVP water and power contractors. Georgetown Divide Public Utility District could potentially access water through agreements with PCWA. Total costs for the completed project are projected to be approximately $55 million, and the cost share agreement provides that the Federal share for construction is approximately 70 percent. Although the payment of fair market value is normally a requirement for transfer of facilities from Federal ownership, given the circumstance that Reclamation is responsible for the destruction of PCWA's original pumping plant and obligated to provide equivalent water deliveries, and the expense of annually installing annual pump stations, the cost share agreement protects the interest of taxpayers in this case. Transferring title will also relieve the Federal Government of the obligations and liabilities of operating and maintaining the facility.

That concludes my testimony. I am pleased to answer any questions.