[Senate Report 108-365]
[From the U.S. Government Publishing Office]
Calendar No. 724
108th Congress Report
SENATE
2d Session 108-365
======================================================================
PROVO RIVER PROJECT TRANSFER ACT
_______
September 28, 2004.--Ordered to be printed
_______
Mr. Domenici, from the Committee on Energy and Natural Resources,
submitted the following
R E P O R T
[To accompany S. 1876]
The Committee on Energy and Natural Resources, to which was
referred the bill (S. 1876) to authorize the Secretary of the
Interior to convey certain lands and facilities of the Provo
River Project, 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 out all after the enacting clause and insert in lieu
thereof the following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Provo River Project Transfer Act''.
SEC. 2. DEFINITIONS.
In this Act:
(1) Agreement.--The term ``Agreement'' means the contract
numbered 04-WC-40-8950 and entitled ``Agreement Among the
United States, the Provo River Water Users Association, and the
Metropolitan Water District of Salt Lake & Sandy to Transfer
Title to Certain Lands and Facilities of the Provo River
Project''.
(2) Association.--The term ``Association'' means the Provo
River Water Users Association, a nonprofit corporation
organized under the laws of the State.
(3) District.--The term ``District'' means the Metropolitan
Water District of Salt Lake & Sandy, a political subdivision of
the State.
(4) Pleasant grove property.--
(A) In general.--The term ``Pleasant Grove Property''
means the 3.79-acre parcel of land acquired by the
United States for the Provo River Project, Deer Creek
Division, located at approximately 285 West 1100 North,
Pleasant Grove, Utah, as in existence on the date of
enactment of this Act.
(B) Inclusions.--The term ``Pleasant Grove Property''
includes the office building and shop complex
constructed by the Association on the parcel of land
described in subparagraph (A).
(5) Provo reservoir canal.--The term ``Provo Reservoir
Canal'' means the canal, and any associated land, rights-of-
way, and facilities acquired, constructed, or improved by the
United States as part of the Provo River Project, Deer Creek
Division, extending from, and including, the Murdock Diversion
Dam at the mouth of Provo Canyon, Utah, to and including the
Provo Reservoir Canal Siphon and Penstock, as in existence on
the date of enactment of this Act.
(6) Salt Lake Aqueduct.--The term ``Salt Lake Aqueduct''
means the aqueduct and associated land, rights-of-way, and
facilities acquired, constructed, or improved by the United
States as part of the Provo River Project, Aqueduct Division,
extending from, and including, the Salt Lake Aqueduct Intake at
the base of Deer Creek Dam to and including the Terminal
Reservoirs located at 3300 South St. and Interstate Route 215
in Salt Lake City, Utah, as in existence on the date of
enactment of this Act.
(7) Secretary.--The term ``Secretary'' means the Secretary of
the Interior.
(8) State.--The term ``State'' means the State of Utah.
SEC. 3. CONVEYANCE OF LAND AND FACILITIES.
(a) Conveyances to Association.--
(1) Provo reservoir canal.--
(A) In general.--In accordance with the terms and
conditions of the Agreement and subject to subparagraph
(B), the Secretary shall convey to the Association, all
right, title, and interest of the United States in and
to the Provo Reservoir Canal.
(B) Condition.--The conveyance under subparagraph (A)
shall not be completed until the Secretary accepts
future arrangements entered into by the Association,
the District, the Central Utah Water Conservancy
District, and the Jordan Valley Water Conservancy
District providing for the operation, ownership,
financing, and improvement of the Provo Reservoir
Canal.
(2) Pleasant grove property.--In accordance with the terms
and conditions of the Agreement, the Secretary shall convey to
the Association, all right, title, and interest of the United
States in and to the Pleasant Grove Property.
(b) Conveyance to District.--
(1) In general.--In accordance with the terms and conditions
of the Agreement, the Secretary shall convey to the District,
all right, title, and interest of the United States in and to
the Salt Lake Aqueduct.
(2) Easements.--
(A) In general.--As part of the conveyance under
paragraph (1), the Secretary shall grant to the
District permanent easements to--
(i) the National Forest System land on which
the Salt Lake Aqueduct is located; and
(ii) land of the Aqueduct Division of the
Provo River Project that intersects the parcel
of non-Federal land authorized to be conveyed
to the United States under section 104(a) of
Public Law 107-329 (116 Stat. 2816).
(B) Purpose.--The easements conveyed under
subparagraph (A) shall be for the use, operation,
maintenance, repair, improvement, or replacement of the
Salt Lake Aqueduct by the District.
(C) Limitation.--The United States shall not carry
out any activity on the land subject to the easements
conveyed under subparagraph (A) that would materially
interfere with the use, operation, maintenance, repair,
improvement, or replacement of the Salt Lake Aqueduct
by the District.
(D) Boundaries.--The boundaries of the easements
conveyed under subparagraph (A) shall be determined by
the Secretary, in consultation with the District.
(E) Revocation of withdrawals.--On conveyance of the
easement to the land described in subparagraph (A)(i),
the Secretary, subject to the easement and any terms
and conditions of the Agreement, shall revoke any
public land orders withdrawing National Forest System
land for the Aqueduct Division of the Provo River
Project.
(F) Transfer of administrative jurisdiction.--
(i) In general.--On conveyance of the
easement to the land described in subparagraph
(A)(ii), the Secretary, subject to the
easement, shall transfer to the Secretary of
Agriculture administrative jurisdiction over
the land.
(ii) Administrative site.--The land
transferred under clause (i) shall be
administered by the Secretary of Agriculture as
an administrative site.
(G) Administration.--The easements conveyed under
subparagraph (A) shall be administered by the Secretary
of Agriculture in accordance with section 501(b)(3) of
the Federal Land Policy and Management Act of 1976 (43
U.S.C. 1761(b)(3)).
(c) Consideration.--
(1) Association.--
(A) In general.--In exchange for the conveyance under
subsection (a)(1), the Association shall pay the
Secretary an amount that is equal to the sum of--
(i) the net present value of any remaining
debt obligation of the United States with
respect to the Provo Reservoir Canal; and
(ii) the net present value of any revenues
from the Provo Reservoir Canal that, based on
past history--
(I) would be available to the United
States but for the conveyance of the
Provo Reservoir Canal under subsection
(a)(1); and
(II) would be deposited in the
reclamation fund established under the
first section of the Act of June 17,
1902 (43 U.S.C. 391), and credited
under the terms of Reclamation Manual/
Directives and Standards PEC 03-01.
(B) Deduction.--In determining the net present values
under clauses (i) and (ii) of subparagraph (A), the
Association may deduct from the net present value such
sums as are required for the reimbursement described in
the Agreement.
(2) District.--
(A) In general.--In exchange for the conveyance under
subsection (b)(1), the District shall pay the Secretary
an amount that is equal to the sum of--
(i) the net present value of any remaining
debt obligation of the United States with
respect to the Salt Lake Aqueduct; and
(ii) the net present value of any revenues
from the Salt Lake Aqueduct that, based on past
history--
(I) would have been available to the
United States but for the conveyance of
the Salt Lake Aqueduct under subsection
(b)(1); and
(II) would be deposited in the
reclamation fund established under the
first section of the Act of June 17,
1902 (43 U.S.C. 391), and credited
under the terms of Reclamation Manual/
Directives and Standards PEC 03-01.
(B) Deduction.--In determining the net present values
under clauses (i) and (ii) of subparagraph (A), the
District may deduct from the net present value such
sums as are required for the reimbursement described in
the Agreement.
(d) Payment of Costs.--In addition to amounts paid to the Secretary
under subsection (c), the Association and the District shall, in
accordance with the Agreement, pay the Secretary--
(1) any necessary and reasonable administrative and real
estate transfer costs incurred by the Secretary in carrying out
the conveyance; and
(2) \1/2\ of any necessary and reasonable costs associated
with complying with--
(A) the National Environmental Policy Act of 1969 (42
U.S.C. 4321 et seq.);
(B) the Endangered Species Act of 1973 (16 U.S.C.
1531 et seq.); and
(C)(i) the National Historic Preservation Act (16
U.S.C. 470 et seq.); and
(ii) any other Federal cultural resource laws.
(e) Compliance With Environmental Laws.--
(1) In general.--Before conveying land and facilities under
subsections (a) and (b), the Secretary shall comply with all
applicable requirements under--
(A) the National Environmental Policy Act of 1969 (42
U.S.C. 4321 et seq.);
(B) the Endangered Species Act of 1973 (16 U.S.C.
1531 et seq.); and
(C) any other law applicable to the land and
facilities.
(2) Effect.--Nothing in this Act modifies or alters any
obligations under--
(A) the National Environmental Policy Act of 1969 (42
U.S.C. 4321 et seq.); or
(B) the Endangered Species Act of 1973 (16 U.S.C.
1531 et seq.).
SEC. 4. EXISTING CONTRACTS.
(a) Deer Creek Division Construction Contract.--Notwithstanding the
conveyances under subsections (a) and (b)(1) of section 3, any portion
of the Deer Creek Division, Provo River Project, Utah, that is not
conveyed under that section shall continue to be operated and
maintained by the Association, in accordance with the contract numbered
I1r-874, dated June 27, 1936, and entitled the ``Contract Between the
United States and Provo River Water Users Association Providing for the
Construction of the Deer Creek Division of the Provo River Project,
Utah''.
(b) Provo River Project and Jordan Aqueduct System Contracts.--Any
written contract of the United States in existence on the date of
enactment of this Act relating to the operation and maintenance of any
division or facility of the Provo River Project or the Jordan Aqueduct
System is confirmed and declared to be a valid contract of the United
States that is enforceable in accordance with the express terms of the
contract.
(c) Use of Central Utah Project Water.--
(1) In general.--Subject to paragraph (2), any entity with
contractual Provo Reservoir Canal or Salt Lake Aqueduct
capacity rights in existence on the date of enactment of this
Act may, in addition to the uses described in the existing
contracts, use the capacity rights, without additional charge
or further approval from the Secretary, to transport Central
Utah Project water on behalf of the entity or others.
(2) Limitations.--An entity shall not use the capacity rights
to transport Central Utah Project water under paragraph (1)
unless--
(A) the use is expressly authorized by the entity
responsible for operation and maintenance of the
Central Utah Project water facility; and
(B) carrying Central Utah Project water through Provo
River Project facilities would not--
(i) materially impair the ability of the
Central Utah Water Conservancy District or the
Secretary to meet existing express
environmental commitments for the Bonneville
Unit; or
(ii) require the release of additional
Central Utah Project water to meet those
environmental commitments.
(d) Authorized Modifications.--The Agreement may provide for--
(1) the modification of the 1936 Repayment Contract for the
Deer Creek Division of the Provo River Project to reflect the
partial prepayment, the adjustment of the annual repayment
amount, and the transfer of the Provo Reservoir Canal and the
Pleasant Grove Property; and
(2) the modification or termination of the 1938 Repayment
Contract for the Aqueduct Division of the Provo River Project
to reflect the complete payout and transfer of all facilities
of the Aqueduct Divsion.
(e) Effect of Act.--Nothing in this Act impairs any contract
(including subscription contracts) in effect on the date of enactment
of this Act that allows for or creates a right to convey water through
the Provo Reservoir Canal.
SEC. 5. EFFECT OF CONVEYANCE.
On conveyance of any land or facility under subsection (a) or (b)(1)
of section 3--
(1) the land and facilities shall no longer be part of a
Federal reclamation project;
(2) the Association and the District shall not be entitled to
receive any future reclamation benefits with respect to the
land and facilities, except for benefits that would be
available to other nonreclamation facilities; and
(3) the United States shall not be liable for damages arising
out of any act, omission, or occurrence relating to the land
and facilities, but shall continue to be liable for damages
caused by acts of negligence committed by the United States or
by any employee or agent of the United States before the date
of conveyance, consistent with chapter 171 of title 28, United
States Code.
SEC. 6. REPORT.
If a conveyance required under subsection (a) or (b)(1) of section 3
is not completed by the date that is 18 months after the date of
enactment of this Act, the Secretary shall submit to Congress a report
that--
(1) describes the status of the conveyance;
(2) describes any obstacles to completing the conveyance; and
(3) specifies an anticipated date for completion of the
conveyance.
PURPOSE
The purpose of S. 1876, as ordered reported, is to
authorize the Secretary of the Interior to convey certain lands
and facilities of the Provo River Project.
BACKGROUND AND NEED
The Bureau of Reclamation holds title to the Provo River
Project, which provides approximately 100,000 acre-feet of
supplemental irrigation and domestic water supply each year to
the counties of Wasatch, Summit, Utah, and Salt Lake in the
State of Utah. Up to one million people receive water from the
Project. The Project includes Deer Creek Dam and Reservoir on
the Provo River, the Salt Lake Aqueduct and Terminal
Reservoirs, the Murdock Diversion Dam on the Provo River, the
Provo Reservoir Canal, and several transbasin diversion and
conveyance facilities. The Aqueduct Division is comprised of
the Salt Lake Aqueduct and Terminal Reservoirs; the remaining
features are included in the Deer Creek Division.
S. 1876 would transfer the Project's Provo Reservoir Canal
and the Pleasant Grove Property to the Provo River Water Users
Association (``Association''). The bill would also transfer the
Project's Salt Lake Aqueduct to the Metropolitan Water District
of Salt Lake and Sandy, Utah (``District''). The Bureau has
been working collaboratively with the Association and the
District on this proposed title transfer since November 2002.
In August 2003, the parties entered into a Memorandum of
Agreement regarding cost-sharing for the proposal.
The Provo Reservoir Canal is an open canal and is
approximately 21.5 miles long. Beginning at the Murdock
Diversion Dam at the mouth of Provo Canyon, the canal runs
northwest along the Wasatch foothills, to the south end of Salt
Lake County. The Canal is currently operated by the Association
pursuant to a contract with the Bureau. The transfer will
facilitate covering the canal in order to conserve water,
improve water quality, and ensure public safety. As private
owners, the Association expects to secure tax-free bonds to
finance the project.
The Pleasant Grove Property is a 3.79 acre office building
site located in north Pleasant Grove, Utah. The Association has
completed a new $2 million Office and Shop Complex. The title
to the underlying land is held by the Federal Government, and
it is the Committee's understanding that no federal dollars
have been used in the construction of the new buildings.
The Salt Lake Aqueduct is a 42-mile-long, 69-inch diameter
pipeline that runs from the intake structure, located at the
base of Deer Creek Dam, to two finished water reservoirs in
south Salt Lake City. There is a diversion point near the mouth
of Provo Canyon where water can be diverted from the Aqueduct
into the Jordan Aqueduct System (JAS) or vice versa. The JAS is
a system of Central Utah Project (CUP) water conveyance
facilities that serve the Utah Valley Water Treatment Plant,
which is owned and operated by Central Utah Water Conservancy
District, and the Jordan Valley Water Treatment Plan, which is
operated by the Jordan Valley Water Conservancy District. The
Aqueduct is currently operated by the District pursuant to a
contract with the Bureau. The transfer will allow the District
to obtain tax-exempt financing for rehabilitation of the
Aqueduct.
During the May 19, 2004 hearing on the measure conducted by
the Subcommittee on Water and Power, the Administration
testified that it generally supports transferring ownership of
certain Reclamation project facilities to non-Federal entities.
At that time, the Administration stated that it had several
concerns with S. 1876 as introduced, and preferred certain key
agreements be completed prior to transfer of title. In the
intervening four months, the parties have worked to address the
Administration's concerns. It is the Committee's understanding
that both the Master Title Transfer Agreement and the 3-Pipe
Agreement (also known as the Multi-Party Operating Agreement)
are in draft final form. Representatives of the Administration
have indicated to the Committee staff that the execution of
these agreements is expected in the immediate future and that
they support enactment of the legislation at this time.
LEGISLATIVE HISTORY
S. 1876 was introduced by Senator Bennett on November 18,
2003, and referred to the Committee on Energy and Natural
Resources. H.R. 3391, the companion measure to this bill, was
introduced by Representative Cannon (R-UT) on October 29, 2003,
and referred to the House Committee on Resources. The Resources
Committee's Subcommittee on Water and Power conducted a hearing
on H.R. 3391 on October 30, 2003. A hearing on S. 1876 was
conducted by the Energy Committee's Subcommittee on Water and
Power on May 19, 2004. The Committee on Energy and Natural
Resources, on September 15, 2004, favorably reported S. 1876,
as amended.
COMMITTEE RECOMMENDATION
The Senate Committee on Energy and Natural Resources, in an
open business session on September 15, 2004, by a unanimous
voice vote of a quorum present, recommends that the Senate pass
S. 1876, if amended as described herein.
COMMITTEE AMENDMENT
The amendment in the nature of a substitute makes a series
of mostly technical changes to S. 1876 as introduced. In
addition, the substitute amendment makes the following
substantive changes:
1. Conditions the conveyance of the Provo Reservoir Canal
on the Secretary of the Interior's acceptance of future
arrangements of the Association, the District, the Central Utah
Water Conservancy District, and the Jordan Valley Water
Conservancy District, governing the operation, ownership,
financing, and improvement of the Provo Reservoir Canal.
2. Provides that the boundaries of the easements that are
necessary for the conveyance of the Aqueduct to the District
are to be determined by the Secretary, in consultation with the
District.
SECTION-BY-SECTION ANALYSIS
Section 1 contains the short title.
Section 2 defines terms used in the Act.
Section 3(a)(1)(A) directs the Secretary of the Interior to
convey to the Association all right, title, and interest of the
United States in and to the Provo Reservoir Canal.
Subsection 3(a)(1)(B) conditions the Canal's conveyance on
the Secretary of the Interior's acceptance of future
arrangements governing the operation, ownership, financing, and
improvement of the Canal. The parties to such future
arrangements will be the Association, the District, the Central
Utah Water Conservancy District, and the Jordan Valley Water
Conservancy District.
Subsection 3(a)(2) directs the Secretary of the Interior to
convey to the Association all right, title, and interest of the
United States in and to the Pleasant Grove Property.
Subsection 3(b)(1) directs the Secretary of the Interior to
convey to the District all right, title, and interest of the
United States in and to the Salt Lake Aqueduct.
Subsection 3(b)(2)(A) directs the Secretary of the Interior
to grant permanent easements to the District as part of the
Aqueduct's conveyance. The easements are to cover (I) the
National Forest System Land where the Aqueduct is located and
(ii) the Project's Aqueduct Division land that intersects the
parcel of non-Federal land authorized to be conveyed in section
104(a) of Public Law 107-329 (116 Stat. 2816).
Subsection 3(b)(2)(B) provides that these easements are to
be conveyed for the use, operation, maintenance, repair,
improvement, or replacement of the Salt Lake Aqueduct by the
District.
Subsection 3(b)(2)(c) prohibits the Federal Government from
carrying out activities on the lands covered by the easements
that materially interfere with the use, operation, maintenance,
repair, improvement or replacement of the Salt Lake Aqueduct by
the District.
Subsection 3(b)(2)(D) provides that the easements'
boundaries are to be determined by the Secretary, in
consultation with the District.
Subsection 3(b)(2)(E) directs the Secretary of the
Interior, on conveying the easement described in subparagraph
(A)(i), to revoke any public land orders withdrawing National
Forest System land for the Project's Aqueduct Division. Such
action shall be subject to both the governing easement and the
terms and conditions of the Transfer Title Agreement.
Subsection 3(b)(2)(F) directs the Secretary of the Interior
to transfer administrative jurisdiction over the land covered
by the easement described in subparagraph (A)(ii) to the
Secretary of Agriculture. The Secretary of Agriculture is
directed to administer this transferred land as an
administrative site.
Subsection 3(b)(2)(G) directs the Secretary of Agriculture
to administer the conveyed easements in accordance with the
provisions of the Federal Land Policy and Management Act of
1976.
Subsection 3(c) sets forth the formula for determining the
payment owed by both the Association and the District to the
Secretary of the Interior for the respective Provo River
Project conveyances. The formula requires payment of the net
present value of any remaining debt obligation, as well as the
net present value of any historical revenues that would have
been paid to the Federal Government. The formula further allows
a deduction for reimbursements described in the Title Transfer
Agreement.
Subsection 3(d) directs both the Association and the
District to pay to the Secretary of the Interior the following
additional costs: (1) necessary and reasonable administrative
and real estate transfer costs associated with the conveyances;
and (2) one-half of any necessary and reasonable costs
associated with certain applicable environmental and historical
preservation laws. These additional costs shall be paid in
accordance with the Title Transfer Agreement.
Subsection 3(e) directs the Secretary of the Interior to
comply with certain environmental laws and any other law
applicable to the land and facilities prior to the conveyance
of such land and facilities. The Subsection also confirms that
the obligations pursuant to both the National Environmental
Policy Act and the Endangered Species Act are in no way altered
or modified by S. 1876.
Section 4 confirms that all existing contracts covering
parts of the Provo River Project not conveyed by S. 1876 are
not in any way impaired. Section 4(a) covers the existing Deer
Creek Division Construction Contract and section 4(b) covers
the existing Provo River Project and Jordan Aqueduct System
Contracts.
Subsection 4(c) confirms that those entities with existing
contractual capacity rights to either the Provo Reservoir Canal
or Salt Lake Aqueduct may use those rights to transport CUP
water on behalf of itself or others. Such use is not subject to
additional charge, and further approval from the Secretary is
not required. However, such use is limited in that (1) the use
must be expressly authorized by the entity responsible for the
operation and maintenance of the CUP water facility and (2) the
transport of CUP water through the Provo River Project
facilities must not materially impair the existing
environmental commitment for the Bonneville Unit or require the
release of additional CUP water to meet those environmental
commitments.
Subsection 4(d) authorizes any modifications to the
applicable repayment contracts that are necessary as a result
of the conveyances.
Subsection 4(e) provides that S. 1876 does not impair any
existing contract, including subscription contracts, regarding
the conveyance of water via the Provo Reservoir Canal.
Section 5(a) provides that the transferred land and
facilities are no longer part of a Federal reclamation project.
Subsection 5(b) provides that the Association and the
District are no longer entitled to reclamation benefits with
respect to the transferred land or facilities, except for
benefits that would be available to other non-reclamation
facilities.
Subsection 5(c) provides that the United States shall only
be liable for damages caused by acts of negligence, committed
prior to the conveyance of the land or facilities, by the
Federal Government or by an employee or agent of the Federal
Government.
Section 6 directs the Secretary of the Interior to submit a
report to Congress if the land or facilities covered by
subsections (a) or (b)(1) of section 3 are not conveyed within
18 months from the date of the bill's enactment. The report
must describe the status of the conveyance and any obstacles to
completing the conveyance. The report must also specify a
target completion date.
COST AND BUDGETARY CONSIDERATIONS
The Congressional Budget Office estimate of the costs of
this measure has been requested but was not received at the
time the report was filed. When the report is available, the
Chairman will request it to be printed in the Congressional
Record for the advice of the Senate.
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. 1876. The Act is not a regulatory measure in
the sense of imposing government-established standards or
significant 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. 1876.
EXECUTIVE COMMUNICATIONS
On September 17, 2004, the Committee on Energy and Natural
Resources requested legislative reports from the Department of
the Interior and the Office of Management and Budget setting
forth executive views on S. 1876. These reports had not been
received at the time the report on S. 1876 was filed. The
testimony provided by the Department of the Interior at the
Subcommittee hearing follows:
Statement of John W. Keys, III, Commissioner, Bureau of Reclamation,
U.S. Department of the Interior
The Department of the Interior (Department) has an active
title transfer program and supports transferring ownership of
certain Reclamation project facilities to non-Federal entities,
particularly in cases where transfers could create
opportunities, not just for those who receive title, but for
other stakeholders and the public as well. While we believe
this transfer has the potential to create such opportunities,
the Department has several concerns with S. 1876, as it was
introduced. It is our understanding that the proponents of this
transfer intend to suggest a number of specific revisions to S.
1876 which could help to resolve some of our concerns.
Background
The Provo River Project stores and delivers water from the
Provo River for irrigation and municipal and industrial uses
along the Wasatch Front, a highly urbanized area, located
within Utah and Salt Lake Counties. The three features of the
project under consideration for transfer are the 22-mile-long
Provo Reservoir Canal; a 3.79-acre office building site, which
would be transferred to the Provo River Water Users Association
(Association); and the 42-mile-long Salt Lake Aqueduct, which
would be transferred to the Metropolitan Water District of Salt
Lake & Sandy (District).
Reclamation began discussing this transfer with the
Association and the District in November 2002. Since that time
much work has been done and a great deal of progress has been
made.
In August 2003, Reclamation, the Association, and the
District signed an agreement entitled ``Contributed Funds Act
and Memorandum of Agreement'' (Contract No. 03-WC-40-8800)
which articulated the respective roles, responsibilities, and
cost obligations for carrying out the title transfer process.
Since that time, several other water user entities, including
the Central Utah Water Conservancy District (Central) and the
Jordan Valley Water Conservancy District (Jordan Valley) also
have become involved. A title transfer work group made up of
these entities and Reclamation was formed to discuss the issues
of importance to the entities involved, and that work group has
been meeting regularly.
In order to initiate the public review process required
under the National Environmental Policy Act (NEPA), the title
transfer work group assembled a list of more than 2,000
individuals, agencies, and other entities having a potential
interest in this transfer. This list includes a large number of
owners of private property located adjacent to the transfer
facilities. It also includes several State and Federal agencies
and environmental and recreational interest groups. On
September 29, 2003, an initial scoping letter describing the
proposal was mailed to all on this list. Public scoping
meetings were held on October 27, 28, and 30, 2003 in Sandy,
Lehi, and Provo respectively. Many concerns and issues were
raised at these meetings and in subsequent calls, letters and
e-mails by interested stakeholders. To enable anyone else with
interests and concerns to have an opportunity to voice them,
the official public comment period was held open until November
26, 2003.
As the lead agency, Reclamation is in the process of
completing a draft environmental assessment. The Department of
the Interior's Central Utah Project Completion Act Office, the
U.S. Forest Service, and the National Park Service are
cooperating agencies. The draft environmental assessment is
expected to be released to the public for review and comment by
the end of May 2004.
S. 1876
S. 1876 requires the Secretary to convey to the Provo River
Water Users Association, pursuant to a transfer agreement still
being drafted, all right, title, and interest of the United
States in certain lands, rights-of-way, and facilities that are
part of the Provo River Project in Utah. The bill does not
impair any existing contracts that allow for, or create a
right, to convey water through the Provo Reservoir Canal.
Section 6 of S. 1876 requires that the Association and the
Metropolitan Water District of Salt Lake & Sandy pay or
contribute to administrative costs, real estate transfer costs,
and the costs of compliance with the National Environmental
Policy Act of 1969 (NEPA), the Endangered Species Act of 1973
(ESA), the National Historic Preservation Act, and other
Federal cultural resource laws included in the transfer
agreement. S. 1876 clearly states in Section 7 that before any
property is conveyed, the Secretary must complete all actions
required under NEPA, the ESA, and all other applicable laws.
Section 6 also requires the Association and the District to pay
the net present value of the property being transferred.
Finally in Section 9, the bill makes it clear that, upon
conveyance of the land and facilities, the United States will
not be liable for future occurrences on those lands and
facilities, and the Association and District will not be
entitled to receive any future Reclamation benefits with
respect to the transferred properties, except those benefits
available to other non-Reclamation facilities.
Issues of Concern
Despite the Administration's support for the transfer of
these lands and facilities, we have a number of concerns about
S. 1876 as drafted.
Agreements: During the course of its deliberations, the
members of the work group identified several written agreements
among the parties that are needed in order to ensure that the
transfer achieves its intended purposes without adversely
impacting the other affected parties. At present, many of the
identified agreements are being drafted by the work group, but
none have been completed or signed. Section 3(a) of the bill
partially addresses this issue by requiring that the
Association provide the Secretary with certification, prior to
transfer. We are concerned that this does not fully address our
situation or the issue.
We believe that completing the agreements prior to passage
of the legislation will expedite implementation of the
transfer. Our experience has shown that transfers move more
expeditiously when involved parties complete preliminary work,
including written agreements, before proceeding with
legislation. In many cases where agreements were not completed
before legislation was passed, significant delays occurred
while issues were identified, negotiated, and satisfactorily
addressed in agreements.
If agreements are not completed prior to passage of the
legislation, then we believe the legislation should specify
that certain minimum requirements be included in the
agreements. For example, Section 2(8) of the bill defines a
transfer agreement among the United States, the District and
the Association and requires the transfer to be completed in
accordance with the terms of that transfer agreement. While the
work group has been actively engaged in drafting the transfer
agreement, it is not yet finalized or signed. This transfer
agreement should include descriptions and maps of land
interests to be transferred, including rights-of-way. Also, at
a minimum, the agreement defined in Section 2(8) should include
terms which: (1) provide for orderly and efficient transfer and
protect public interests; (2) preserve access for operation and
maintenance of nearby facilities which will continue to be
federally owned; (3) provide for coordinated operation of
transferred and retained portions of the Provo River Project;
and (4) ensure the Department can continue to fulfill its
obligations.
Certification of Agreements: Section 3(a) directs the
Secretary to convey the lands and facilities of the Project
when the Association has certified that the agreements entered
into are satisfactory to the Association, District, Central,
and Jordan Valley. Since many of the features and facilities of
the Project will not be conveyed and because of the close
relationship between this project and the Central Utah Project,
which will not be transferred, the Secretary will be a party to
several of these agreements. As such, we believe that both the
Association and the Secretary should certify the agreements are
satisfactory.
Operational Access: The canal and the aqueduct to be
transferred in S. 1876 are in close proximity and operationally
related to the Central Utah Project which will remain in
Federal ownership. For example, for a sizeable portion of its
alignment, the canal lies so near key Central Utah Project
facilities that lack of access to the canal right-of-way would
make operation and maintenance of those Central Utah Project
facilities difficult. Conversely, operation and maintenance of
the canal would be problematic without access to Central Utah
Project lands. Therefore, as indicated above, it is important
that provisions for reciprocal access are included in the
agreement defined in Section 2(8) of the bill.
National Forest System: In several locations, the Salt Lake
Aqueduct crosses lands lying within the boundaries of the Uinta
and Wasatch-Cache National Forests under the jurisdiction of
the U.S. Forest Service. Prior to constructing the aqueduct,
Reclamation withdrew significant blocks of land in locations
where the aqueduct alignment crosses through these National
Forests. At present, operation and maintenance of the aqueduct
by the District within National Forest boundaries is possible
solely because the aqueduct is federally owned and located upon
Reclamation withdrawals. Any revocation of Reclamation's
withdrawals will return primary jurisdiction of these areas to
the U.S. Forest Service. S. 1876 needs to address this issue or
it will significantly delay conveyance of the lands and rights-
of-way and will negatively impact the District's ability to
operate and maintain the facilities once transferred. We also
recommend the transfer agreement defined in Section 2(8)
include a suitable provision covering replacement of
withdrawals with a linear permanent easement for the District.
We recommend that the Department of the Interior issue the
easement of the Aqueduct. At that point, the Bureau of
Reclamation would revoke the withdrawal on the National Forest
System lands, and then the Forest Service would administer the
easement.
Timpanogos Interagency Land Exchange Act (P.L. 107-329): On
December 6, 2002, Congress passed the Timpanogos Interagency
Land Exchange Act (TILEA), P.L. 107-329. This Act authorizes
the acquisition of land and construction of an interagency
administrative and visitor facility by the National Park
Service and the U.S. Forest Service at the entrance to American
Fork Canyon. The proposed exchange would be with a private
landowner who is willing to trade property in Highland City,
Utah, for six parcels of National Forest Land. The private
property proposed to be acquired for the site of the
administrative and visitor facility is bisected by a strip of
land owned in fee title by the United States and administered
by Reclamation for the aqueduct. If fee title were transferred
to the District at this location, the administrative and
visitor facility site would be bisected by a strip of District-
owned lands. To avoid this situation, we believe the transfer
agreement defined in Section 2(8) should provide for the
Secretary to convey an appropriate permanent easement to the
District for the aqueduct where it bisects the administrative
and visitor facility site and then to transfer jurisdiction
over the same area to the U.S. Forest Service to be
administered as part of the administrative and visitor facility
site.
Impact on the On-Going Utah Lake Basin Water Delivery
System EIS: Central and the Department recently released a
draft environmental impact statement (EIS) for the Utah Lake
Basin Water Delivery System (ULS) to the public. This draft EIS
indicates that about 24,000 acre-feet of CUP M&I water would be
conveyed through the Provo Reservoir Canal for use in Salt Lake
County, which is proposed for transfer under S. 1876. As part
of this legislation, or the transfer agreement for these
facilities, it is important to ensure that this transfer does
not impact the NEPA compliance process for the ULS or, more
importantly, prevent the utilization of the canal to convey CUP
M&I water.
Technical Issues
In addition to the policy and procedural issues identified
above, we have identified several minor technical corrections
to S. 1876 that are needed in order to facilitate completion of
the transfer.
Include Both Reservoirs at the Salt Lake Aqueduct: In the
definition for the Salt Lake Aqueduct, S. 1876 refers to the
``Terminal Reservoir located at 3300 South and I-215.'' There
are in fact two reservoirs located at the terminus of the Salt
Lake Aqueduct. We believe any transfer should include both.
Therefore, Section 2(g) of the bill should be amended to change
``Terminal Reservoir'' to ``Terminal Reservoirs''.
Make Consistent with Existing Contributed Funds Act
Agreement and Memorandum of Agreement: On August 21, 2003
Reclamation, the Association, and the District signed an
agreement entitled ``Contributed Funds Act Agreement and
Memorandum of Agreement'' (Contract No. 03-WC-40-8800)
(Contributed Funds Act Agreement) to formalize, among other
things, the cost-sharing obligations of the various parties for
transfer-related expenses. To ensure that the legislation is
consistent with the already signed Contributed Funds Act
Agreement, Section 6(a) of the bill should be amended to read
``The Secretary shall require, as a condition of the conveyance
under section 3, that the Association and the District pay all
administrative costs and real estate transfer costs, and half
of costs associated with compliance with the National
Environmental Policy Act of 1969, the Endangered Species Act,
the National Historic Preservation Act, and other federal
cultural resource laws, all as described in the Agreement.''
This would make it consistent with the terms of the existing
Contributed Funds Act Agreement.
Modify Payment Requirement: Section 6(b)(1) requires the
Association to pay ``the net present value of the Provo
Reservoir Canal and the Pleasant Grove Property''. Similarly,
Section 6(b)(2) requires the District to pay ``the net present
value of the Salt Lake Aqueduct.'' We believe the intent of
these sections is to require the transfer recipients to pay,
not the net present value of a facility (potentially, a very
large sum), but rather the present value of the remaining
obligations for that facility. Therefore, we recommend these
portions of Section 6(b) be amended to read:
(1) ``In addition to subsection (a) the Secretary
shall also require, as a condition of the conveyances
under Sections 3(a) and 3(b), that the Association pay
to the United States the net present value of the
remaining debt obligation, including future
miscellaneous revenue streams, attributable to the
Provo Reservoir Canal and the Pleasant Grove Property,
as described in the Agreement; Provided, however, that
the Association may deduct from the net present value
such sums as are required to accomplish the
reimbursement described in the Contributed Funds Act
Agreement.''
(2) ``In addition to subsection (a) the Secretary
shall also require, as a condition of the conveyance
under Section 3c), that the District pay to the United
States the net present value of the remaining debt
obligation, including future miscellaneous revenue
streams, attributable to the Salt Lake Aqueduct, as
described in the Agreement; Provided, however, that the
Association may deduct from the net present value such
sums as are required to accomplish the reimbursement
described in the Contributed Funds Act Agreement.''
National Environmental Policy Act Citation: Section 7
should be modified to correct an error in the citation for the
National Environmental Policy Act of 1969 (42 U.S.C. 4321, et
seq.).
Conclusion
The Department recognizes significant benefits that may be
achieved by the proposed title transfer. Much work has already
been accomplished. If the above-mentioned issues and technical
corrections can be addressed, I believe the Department could
support passage of this legislation.
Mr. Chairman, we appreciate the excellent work and
cooperation we have had with the District, the Association,
Central, Jordan Valley, the Central Utah Project Completion Act
Office, the U.S. Forest Service and the National Park Service.
We look forward to continuing that effort and to working with
Senator Bennett, Committee staff, as well as the Association,
the District, the Title Transfer Working Group and anyone else
to craft provisions necessary to resolve these issues. That
concludes my testimony. 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. 1876 as ordered
reported.