[Senate Report 111-144]
[From the U.S. Government Publishing Office]
Calendar No. 294
111th Congress Report
SENATE
2d Session 111-144
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WATER TRANSFER FACILITATION ACT
_______
March 2, 2010.--Ordered to be printed
_______
Mr. Bingaman, from the Committee on Energy and Natural Resources,
submitted the following
R E P O R T
[To accompany S. 1759]
The Committee on Energy and Natural Resources, to which was
referred the bill (S. 1759) to authorize certain transfers of
water in the Central Valley Project, and for other purposes,
having considered the same, reports favorably thereon with an
amendment and recommends that the bill, as amended, do pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Water Transfer Facilitation Act of
2009''.
SEC. 2. AUTHORIZATION OF WATER TRANSFERS, CENTRAL VALLEY PROJECT.
(a) In General.--Subject to subsection (b), the following voluntary
water transfers shall be considered to meet the conditions described in
subparagraphs (A) and (I) of section 3405(a)(1) of the Reclamation
Projects Authorization and Adjustment Act of 1992 (Public Law 102-575;
106 Stat. 4709):
(1) A transfer of irrigation water among Central Valley
Project contractors from the Friant, San Felipe, West San
Joaquin, and Delta divisions.
(2) A transfer from a long-term Friant Division water service
or repayment contractor to a temporary or prior temporary water
service contractor within the place of use in existence on the
date of the transfer, as identified in the Bureau of
Reclamation water rights permits for the Friant Division.
(b) Condition.--A transfer under subsection (a) shall comply with all
applicable Federal and State law.
SEC. 3. FACILITATION OF WATER TRANSFERS, CENTRAL VALLEY PROJECT.
As soon as practicable after the date of enactment of this Act, the
Secretary of the Interior, acting through the Director of the United
States Fish and Wildlife Service and the Commissioner of the Bureau of
Reclamation, using such sums as are necessary, shall initiate and
complete, on the most expedited basis practicable, programmatic
documentation to facilitate voluntary water transfers within the
Central Valley Project, consistent with all applicable Federal and
State law.
SEC. 4. REPORT ON CENTRAL VALLEY PROJECT WATER TRANSFERS.
(a) In General.--Not later than 180 days after the date of enactment
of this Act, the Commissioner of the Bureau of Reclamation (referred to
in this section as the ``Commissioner'') shall submit to the
appropriate committees of Congress a report that--
(1) describes the status of efforts to help facilitate and
improve the water transfers under this Act;
(2) evaluates potential effects of this Act on Federal
programs, Indian tribes, Central Valley Project operations, the
environment, groundwater aquifers, refuges, and communities;
and
(3) provides recommendations on ways to facilitate, and
improve the process for--
(A) water transfers within the Central Valley
Project; and
(B) water transfers between the Central Valley
Project and other water projects in the State of
California.
(b) Updates.--Not later than the end of the water year in which the
report is submitted under subsection (a) and each of the 4 water years
thereafter, the Commissioner shall update the report.
PURPOSE
The purpose of S. 1759 is to authorize certain transfers of
water in the Central Valley Project.
BACKGROUND AND NEED
The Central Valley Project (CVP) was originally authorized
in the 1930s to provide a water supply for irrigation and some
municipal purposes, for flood control, to improve navigation,
and to generate power. The Bureau of Reclamation manages and
operates the project. The Central Valley Project Improvement
Act (CVPIA) (sections 3401 et seq. of Public Law 102-575) was
enacted in 1992 and required certain changes in management of
the CVP, particularly for the protection, restoration, and
enhancement of fish and wildlife, and for other purposes,
including the facilitation of transfers of water within and
outside the CVP service area. Together with the California
State Water Code, section 3405(a)(1) of the CVPIA prescribes
the conditions under which CVP water is transferable.
S. 1759, as amended, provides that transfers of irrigation
water among CVP contractors from the Friant, San Felipe, West
San Joaquin, and Delta divisions, which are primarily located
south of the San Joaquin Delta, and certain transfers within
the Friant Division service area, shall be considered to meet
the existing requirements of subparagraphs (A) and (I) of
section 3404(a)(1) of the CVPIA. Those subparagraphs relate to
historical and consumptive water use. S. 1759 does not affect
any other provisions of the CVPIA and does not change the
status quo regarding the Bureau of Reclamation's programs to
transfer CVP water that is not covered by this bill. Testimony
provided to the Committee indicates that S. 1759, as amended,
will expedite the approval of additional transfers of certain
CVP water without adverse impact to CVP operations, other water
users, federal programs, Indian tribes, the environment or
existing requirements of the CVPIA.
LEGISLATIVE HISTORY
Senator Feinstein and Senator Boxer introduced S. 1759 on
October 7, 2009. On November 5, 2009, the subcommittee on Water
and Power held a hearing on S. 1759. At its meeting on December
16, 2009, the Committee on Energy and Natural Resources ordered
S. 1759 favorably reported, with an amendment in the nature of
a substitute.
COMMITTEE RECOMMENDATION
The Committee on Energy and Natural Resources, in open
business session on December 16, 2009, by voice vote of a
quorum present, recommends that the Senate pass S. 1759, if
amended as described herein.
COMMITTEE AMENDMENT
During its consideration of S. 1759, the Committee adopted
an amendment in the nature of a substitute. The amendment
includes a number of technical changes and new provisions that
clarify the intent of the original bill. The amendment is
explained in detail in the section-by-section analysis, below.
SECTION-BY-SECTION ANALYSIS
Section 1 identifies the short title of the bill as the
``Water Transfer Facilitation Act of 2009''.
Section 2(a) provides that transfers of water among
specific categories of CVP contractors shall be considered to
meet the existing requirements of subparagraphs (A) and (I) of
section 3404(a)(1) of the CVPIA.
Section 2(a)(1) relates to transfers of irrigation water
among CVP contractors from the Friant, San Felipe, West San
Joaquin, and Delta divisions and irrigation water transferred
pursuant to this provision would remain within a particular
division.
Section 2(a)(2) relates to transfers of water from a long-
term Friant Division water service or repayment contractor to
certain temporary or prior temporary water service contractors.
Section 2(b) requires that transfers of water that occur
pursuant to the terms of the legislation must comply with all
applicable state and federal law. Section 2(b) of S. 1759, as
introduced, included a specific reference to the San Joaquin
River Settlement and the San Joaquin River Restoration
Settlement Act. The amendment of section 2(b) to a more general
provision is intended to include the original provisions and
also ensure that transfers of water pursuant to the provisions
of S. 1759 comply with all other applicable state and federal
law.
Section 3 requires the Department of the Interior to
complete programmatic documentation, on the most expedited
basis practicable, to facilitate voluntary water transfers
within the CVP consistent with all applicable state and federal
law. The programmatic documentation would include environmental
documentation relating to the Endangered Species Act.
Section 4 requires the Bureau of Reclamation to submit a
report, within 180 days of enactment, to the appropriate
committees of Congress that describes the status of efforts to
help facilitate and improve the water transfers included under
the act, evaluates potential effects of the act on Federal
programs, Indian tribes, CVP operations, the environment,
groundwater, aquifers, refuges, and communities, and provides
recommendations on ways to facilitate and improve the process
for water transfers within the CVP and water transfers between
the CVP and other water projects. The report shall be updated
every year for 5 years following enactment.
COST AND BUDGETARY CONSIDERATIONS
The following estimate of costs of this measure has been
provided by the Congressional Budget Office:
S. 1759--Water Transfer Facilitation Act of 2009
Summary: S. 1759 would facilitate voluntary transfers of
water supplies between certain users of the Central Valley
Project (CVP) in California. Based on information from the
Bureau of Reclamation (the Bureau) and assuming the
availability of appropriated funds, CBO estimates that
implementing S. 1759 would increase discretionary spending by
$4 million over the 2011-2015 period. In addition, CBO
estimates that the bill would increase offsetting receipts (a
credit against direct spending) by $7 million over the 2011-
2015 period and $12 million over the 2011-2020 period. Enacting
this legislation would not affect revenues.
Pay-as-you-go procedures apply because enacting the
legislation would reduce direct spending.
S. 1759 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA)
and would impose no costs on state, local, or tribal
governments.
Estimated cost to the Federal Government: The estimated
budgetary impact of S. 1759 is shown in the following table.
The costs of this legislation fall within budget function 300
(natural resources and environment).
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By fiscal year, in millions of dollars--
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2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2011-2015 2011-2020
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CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Estimated Authorization Level..................... 4 0 0 0 0 0 0 0 0 0 4 4
Estimated Outlays................................. 2 1 1 0 0 0 0 0 0 0 4 4
CHANGES IN DIRECT SPENDING
Estimated Budget Authority........................ -2 -2 -1 -1 -1 -1 -1 -1 -1 -1 -7 -12
Estimated Outlays................................. -2 -2 -1 -1 -1 -1 -1 -1 -1 -1 -7 -12
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Basis of estimate: For this estimate, CBO assumes that this
legislation will be enacted in fiscal year 2010. Under current
law, CVP contractors pay certain fees to the Reclamation Fund
for water they consume. Amounts in the Reclamation Fund are
available to federal agencies subject to provisions in
appropriation acts. Contractors who are not able to consume all
the water they are entitled to under their contracts with the
CVP may transfer water to other contractors, subject to review
and approval by the Bureau. Such transfers often result in
additional payments to the Reclamation Fund.
In 2009, about 600,000 acre-feet of water--about 10 percent
of the water supplied in the CVP that year--was transferred
among water users. Those transfers generally occurred under an
expedited process using streamlined procedures for
environmental reviews. (The expedited process allows certain
water transactions to be automatically deemed to meet necessary
requirements for transfers.) However, under current law, that
expedited process is not available to all contractors in the
CVP.
S. 1759 would expand the number of contractors eligible to
participate in transfers using the expedited process and CBO
estimates that the volume of water voluntarily transferred
would increase. Based on information from the Bureau, CBO
estimates that developing streamlined procedures would cost $4
million, assuming appropriation of the necessary amounts.
Information from the Bureau also indicates that voluntary
transfers would increase by between 200,000 and 300,000 acre-
feet of water a year. In 2008 (the last year detailed
information is available), the Reclamation Fund received
incremental revenue of about $7 per acre-foot of water from
transfers. (Most transfers result in some incremental payment,
but occasionally result in a loss of receipts.) On balance, CBO
estimates that under S. 1759, the Reclamation Fund would
receive an additional $1 million to $2 million more per year.
Pay-as-you-go Considerations: The Statutory Pay-As-You-Go
Act of 2010 establishes budget reporting and enforcement
procedures for legislation affecting direct spending or
revenues. CBO estimates that enacting S. 1759 would reduce
direct spending.
CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR S. 1759, THE WATER TRANSFER FACILITATION ACT OF 2009, AS ORDERED REPORTED BY THE SENATE COMMITTEE ON ENERGY
AND NATURAL RESOURCES ON DECEMBER 16, 2009
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By fiscal year, in millions of dollars--
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2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2010-2015 2010-2020
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NET INCREASE OR DECREASE (-) IN THE DEFICIT
Statutory Pay-As-You-Go Impact............ 0 -2 -2 -1 -1 -1 -1 -1 -1 -1 -1 -7 -12
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Intergovernmental and private-sector impact: S. 1759
contains no intergovernmental or private-sector mandates as
defined in the UMRA and would impose no costs on state, local,
or tribal governments.
Estimate prepared by: Federal Costs: Aurora Swanson; Impact
on State, Local, and Tribal Governments: Melissa Merrell;
Impact on the Private Sector: Amy Petz.
Estimate approved by: Theresa Gullo, Deputy Assistant
Director for Budget Analysis.
REGULATORY IMPACT EVALUATION
In compliance with paragraph 11(b) of Rule XXVI of the
Standing Rules of the Senate, the Committee makes the following
evaluation of the regulatory impact which would be incurred in
carrying out S. 1757.
The bill is not a regulatory measure in the sense of
imposing Government-established standards or significant
economic responsibilities on private individuals and
businesses.
No personal information would be collected in administering
the program. Therefore, there would be no impact on personal
privacy.
Little, if any, additional paperwork would result from the
enactment of S. 1757, as ordered reported.
CONGRESSIONALLY DIRECTED SPENDING
S. 1759, as ordered reported, does not contain any
congressionally directed spending items, limited tax benefits,
or limited tariff benefits as defined in rule XLIV of the
Standing Rules of the Senate.
EXECUTIVE COMMUNICATIONS
Statement of Michael L. Connor, Commissioner, Bureau of Reclamation,
Department of the Interior
I am Mike Connor, Commissioner of the Bureau of
Reclamation. I am pleased to be here today to provide the views
of the Department of the Interior (Department) on S. 1759, the
``Water Transfer Facilitation Act.'' The Department supports S.
1759 with modification as explained below. Further analysis
would help to determine the role that this bill could play in
providing improved flexibility and efficiency for water
management in the Central Valley.
The Central Valley of California is experiencing a third
year of drought which has strained the resources of both the
State Water Project under the jurisdiction of the State of
California, and the Central Valley Project (CVP) operated by
Reclamation. The prolonged drought has created severe hardship
especially to farmers, farm workers, and related economies on
the west side of the San Joaquin River valley. The Department
is cognizant of the need for creativity and flexibility in
meeting the water demands of Californians served by the Central
Valley Project. The Department supports facilitating the
transfer of water from those areas having available water
supplies to areas experiencing shortage to the extent that
water transferred is not detrimental to the operations of the
CVP, does not cause harm to third parties, and does not create
adverse environmental consequences.
When they are done right, water transfers move water from
willing sellers to willing buyers in transactions that can
improve economic well-being, increase efficiency in water use,
and protect against negative externalities. There are many
situations where water transfers during periods of drought can
be used to ensure that available water is used in areas where
it is most needed, and S. 1759 is aimed at facilitating these
efficient water transfers. We recognize the potential of
voluntary water transfer as a mechanism to increase flexibility
into our water management system and respond to changes in
available water resources. However, we are also committed to
implementing review processes for all water transfers that will
effectively protect the broad range of interests that can be
impacted by changes in water use. Our goals as a Department
include ensuring efficient use of available water
infrastructure as well as maintaining vibrant communities and
protecting the environment.
Together with the California State Water Code, current
Federal law in Section 3405(a)(1) of the Central Valley Project
Improvement Act of 1992 (CVPIA) (Public Law 102-575, 106 Stat.
4709) prescribes those conditions under which CVP water is
transferable. While the proposed legislation establishes that
water transfers between and among specified South of Delta
divisions are presumed to meet the historical and consumptive
use requirements of subparagraphs (A) and (I) of section
3405(a)(1) of Public Law 102-575, the proposed legislation does
not change the obligation of the Department to protect the
public interest and the integrity of the CVP, and to otherwise
act in accordance with the provisions of the CVPIA. To this
end, if the proposed legislation is enacted, Reclamation will
review its procedures and ensure that administrative guidelines
are in place as necessary to assure that transfers of water
continue to serve the overall public interest. Specifically,
Reclamation will continue to ensure that transfers take place
without significant adverse impacts to other water users,
federal programs, Indian tribes, CVP operations, or the
environment. We suggest that these guidelines be expressly
incorporated into the items we report to Congress under Section
4(a) of the bill, under which Reclamation would submit reports
to Congress on the status of efforts to help facilitate and
improve the process for water transfers within the Central
Valley and water transfers between the CVP and the State Water
Project.
Under the CVPIA and contract provisions, Reclamation must
approve proposed water transfers and cannot approve transfers
unless the transfer is consistent with California water law.
Transfers are on a willing buyer, willing seller basis, and
Reclamation facilities can be used to deliver transferred water
only when approved by Reclamation. Reclamation collects various
charges, including operation and maintenance charges,
incremental conveyance costs, and CVPIA restoration fund
charges, together with the cost of service rates, as required
by law from the entities that transfer the water (the
transferors). Because of the diversity of CVP contractors and
the many different scenarios under which water transfers take
place, if S. 1759 were enacted there would probably be some
financial impacts that Reclamation would only be able to fully
calculate upon completion of a given transfer. For example,
depending on the contract in place with specific CVP
contractors, the legislation could generate additional revenue
for the CVPIA restoration fund and for the San Joaquin River
Restoration fund in some years in the Friant Unit of the CVP.
In this area in 2008, Friant contractors could have transferred
about 40,000 acre-feet to west-side CVP contractors in the San
Luis Unit under the proposed legislation. The transferred water
would have been subject to the CVPIA restoration fund charges
(about $9) under Title X of Public Law 111-11, Section
10009(c)(1)(B), as well as Friant surcharges, resulting in
additional revenues to the Restoration Fund.
If enacted, S. 1759 could strengthen Reclamation's ability
to facilitate appropriate water transfers. We would note,
additionally, that Reclamation already has a robust water
transfer program. This year in the CVP, Reclamation has
facilitated the transfer of over 600,000 acre feet of water by
and among CVP contractors, as well as users of State Water
Project water. This has been a record for the Reclamation since
on average there are approximately 250,000 acre feet of
transfers which are processed by the CVP and State Water
Project. For figures specific to only the federal CVP,
Reclamation has signed off on a total of 168 individual
transfers totaling approximately 435,286 acre feet of federal
contract water. All were accomplished within the accelerated
water transfers program using programmatic environmental
documentation. An additional 9,156 acre feet was transferred
among Sacramento Valley contractors using transaction-specific
environmental documentation.
Separate from the transfer program, a large volume of water
was delivered that was ``rescheduled,'' or held over in
storage, from the 2008 water year. Of the 337,307 acre feet of
water rescheduled in San Luis Reservoir from 2008 into 2009,
approximately 12,518 acre feet were eventually transferred,
approximately 50,000 acre feet remains in San Luis, and the
remainder was delivered to the party rescheduling it. Friant
Division contractors rescheduled approximately 55,615 acre feet
in Millerton Reservoir, and of that, 11,848 acre feet were
transferred. Cross Valley Contractors rescheduled 6,063 acre
feet of water from 2008, all of which together with 11,550 acre
feet of 2009 contract supply was transferred to Westside
contractors. These transfers were in addition to the
accelerated transfers described above.
In addition to the suggested change to Section 4(a) above,
the Department would also like to offer a technical change to
the proposed legislation. The Department suggests that the
initial reporting in Section 4(a) be set at six months from the
date of enactment to provide adequate time for meaningful
information to be available to Congress. Accordingly, we
suggest editing the reference in Section 4(b) to delete ``Not
later than July 15, 2010'' and to call for Reclamation to
update the report every 180 days after the date on which the
initial report is submitted to Congress.
With regard to Section 3 of S. 1759, the Fish and Wildlife
Service has confirmed that the Service could provide a
programmatic biological opinion to Reclamation on water
transfers if this is determined to be appropriate. The
consultation process would begin with a request from
Reclamation for consultation accompanied by a biological
assessment that describes Reclamation's water transfer program
and evaluates the potential effects of the program on listed
and proposed species and designated and proposed critical
habitat and determines whether any such species or habitat are
likely to be adversely affected by the program. The Service
could potentially expedite a programmatic biological opinion,
subject to the availability of appropriations.
I would also like to note that Reclamation is currently
working with the California Department of Water Resources in
developing consistent evaluation criteria for a long-term,
programmatic water transfer program designed to provide for
water transfers from State and Federal contractors North of the
Delta to contractors South of the Delta. These transfers will
continue to be subject to the consumptive and beneficial use
requirements in the State Water Code.
That concludes my prepared remarks. I would be pleased to
answer any questions.
CHANGES IN EXISTING LAW
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, the Committee notes that no
changes in existing law are made by the bill S. 1759, as
ordered reported.