[House Report 106-258]
[From the U.S. Government Publishing Office]
106th Congress Report
HOUSE OF REPRESENTATIVES
1st Session 106-258
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CLEAR CREEK DISTRIBUTION SYSTEM CONVEYANCE ACT
_______
July 26, 1999.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Young of Alaska, from the Committee on Resources, submitted the
following
R E P O R T
[To accompany H.R. 862]
[Including cost estimate of the Congressional Budget Office]
The Committee on Resources, to whom was referred the bill
(H.R. 862) to authorize the Secretary of the Interior to
implement the provisions of the Agreement conveying title to a
Distribution System from the United States to the Clear Creek
Community Services District, having considered the same,
reports favorably thereon without amendment and recommends that
the bill do pass.
PURPOSE OF THE BILL
The purpose of H.R. 862 is to direct the Secretary of
Interior to convey title for the Clear Creek Distribution
System to the Clear Creek Community Services District.
BACKGROUND AND NEED FOR LEGISLATION
Bureau of Reclamation (BOR) facility transfers has been of
particular interest to Congress, local irrigation districts,
and the Administration in recent years. Facility transfers
represent an effort to shrink the federal government and shift
the responsibilities for ownership into the hands of those who
can more efficiently operate and maintain them. As a result of
the National Performance Review (Reinventing Government II),
BOR, which is part of the Department of the Interior, initiated
a program in 1995 to transfer ownership of some of its
facilities to non-federal entities. However, to date, the
Administration has not presented a legislative proposal for
project transfers. During the 105th Congress, two legislatively
initiated BOR transfers bills were signed into law that
directed the Secretary of the Interior to convey all right,
title, and interest of the United States in and to specified
project facilities.
Much of the momentum for these transfers comes from local
irrigation districts that are seeking title to these projects.
The federal government holds title to more than 600 BOR water
projects throughout the West. A growing number of these
projects are now paid out and operated and maintained by local
irrigation districts. The districts seek to have the facilities
transferred to them since many of the districts now have the
expertise needed to manage the systems and can do so more
efficiently then the federal government. BOR has already
transferred operation and maintenance responsibilities for
about 400 of the projects to local irrigation districts. Under
the provisions of Section VI of the Reclamation Act of 1902,
title to project facilities remain with the United States
unless otherwise provided by Congress, even if project
beneficiaries have completed their repayment obligation.
Section VI of the Reclamation Act of 1902 states:
The Secretary of the Interior is hereby authorized
and directed to use the reclamation fund for the
operation and maintenance of all reservoirs and
irrigation works constructed under the provisions of
this act: Provided, That when the payments required by
this act are made for the major portion of the lands
irrigated from the waters of any of the works herein
provided for, then the management and operation of such
irrigation works shall pass to the owners of the lands
irrigated thereby, to be maintained at their expense
under such form of organization and under such rules
and regulations as may be acceptable to the Secretary
of the Interior: Provided, That the title to and the
management and operation of the reservoirs and the
works necessary for their protection and operation
shall remain in the Government until otherwise provided
by Congress.
32 Stat. 389; 43 U.S.C. Sec. Sec. 491, 498
Many of these projects were constructed in remote locations
and at a time when there were no local communities and
utilities near the BOR project. Furthermore, many of the States
in which theprojects were built did not have a sufficient tax
base to fund them. However, as the West became more populated, and with
the urbanization of these areas, the BOR now owns and operates public
facilities that would be owned, operated, and funded by private
corporations or local government agencies if they were constructed
today.
Legislative initiatives to transfer the title of BOR
facilities have been in play for many years. Two bills enacted
during the 105th Congress and signed into law directed the
Secretary of Interior to convey all right, title, and interest
of the United States in and to selected project features to the
Burley Irrigation District and the Canadian River Project. See
Public Law 105-351 and Public Law 105-316. In addition, Title
XIV of Public Law 102-575 directed the Secretary to transfer
the Rio Grande Project in New Mexico to the local irrigation
district, once the local irrigation district consented to amend
a contract.
Background of the Clear Creek distribution project
The facilities to be transferred are located in the Central
Valley Project's (CVP) Clear Creek South Unit, a portion of the
Trinity River Diversion, which was authorized by the Act of
August 12, 1955. The District is provided with CVP water
through the Muletown Conduit which extends from the outlet
works of Whiskeytown Dam to the terminus of the conduit at the
existing pressure-regulating control tank located at the
District's northern boundary.
The District was originally formed in 1963 to sign a two-
part contract with the BOR to provide a public water system for
homes and businesses in Anderson, California. The first part of
the contract was a water service contract that provided the
actual water to be used for the community's consumption. The
second part of the contract required BOR to finance the land,
pipes, gauges, valves and other physical facilities that make
up the original part of the community's water distribution
system.
The total cost of building the original system was to be
paid by Clear Creek over a period of forty years. However,
unlike other situations where the purchaser owns the facilities
at the end of the payment period, under the terms of the May
14, 1963, contract, the federal government retained ownership
of the original distribution system, the District office, and
other physical facilities even thought the debt was to be paid
completely by Clear Creek. This bill transfers title of the
distribution system to the Clear Creek Services District
without affecting the underlying water service contract and
relieves the federal government of all liability for its role
in owning and constructing the water distribution system.
committee action
H.R. 862 was introduced on February 25, 1999, by
Congressman Wally Herger (R-CA). The bill was referred to the
Committee on Resources, and within the Committee to the
Subcommittee on Water and Power. On March 11, 1999, the
Subcommittee met to mark up the bill. No amendments were
offered and the bill was ordered favorably reported to the Full
Committee by voice vote. On March 17, 1999, the Full Resources
Committee met to consider the bill. No amendments were offered
and the bill was then ordered favorably reported to the House
of Representatives by voice vote.
section-by-section analysis
Section 1. Short title
The short title of the bill is the Clear Creek Distribution
System Conveyance Act.
Section 2. Definitions
This sections provides three definitions for the bill.
Section 3. Conveyance of project
The section directs the Secretary of Interior to convey
several project components to the District, pursuant to an MOA
entered into between the BOR and the District. Specifically,
the agreement states:
Within one hundred eighty (180) days of the effective
date of this Agreement, the Secretary shall convey to
the District, by means of execution, delivery, and
recordation of a document in the form substantially set
forth in Appendix A attached, all right, title, and
interest of the United States in and to the
Distribution System, subject to the terms and
conditions in this agreement.
MOA, page 5 [emphasis added]
The agreement stipulates the irrigation conveyance system,
surface drainage, related lands, a control tank and various
other equipment and properties will be transferred. The
payments received to date through the existing repayment
contract constitute the full payment for transfer of the
project, while responsibilities for all duties and costs
associated with the operation, replacement, maintenance,
enhancement, and betterment of the distribution system shall be
assumed by the District.
Section 4. Relationship to existing operations
This section clarifies the effect of the transfer required
by H.R. 862 on existing operations of the Project.
Section 5. Relationship to certain contract obligations
This section clarifies that the conveyance under this Act
does not affect the District's existing water service contract
as specified and does not deprive the District of existing
entitlements to renewal of that contract or renewal by entering
into a long-term water service contract.
Section 6. Liability
Once title is transferred, the responsibility for the
transferred property fully resides with the District. For all
decisions and liabilities that may arise subsequently, the
District assumes all financial risks and benefits. Both future
cost and potential benefits should accrue to the Districts.
committee oversight findings and recommendations
Regarding clause 2(b)(1) of Rule X and clause 3(c)(1) of
Rule XIII of the Rules of the House of Representatives, the
Committee on Resources' oversight findings and recommendations
are reflected in the body of this report.
constitutional authority statement
Article I, section 8 and Article IV, section 3 of the
Constitution of the United States grant Congress the authority
to enact this bill.
compliance with house rule xiii
1. Cost of Legislation.--Clause 3(d)(2) of Rule XIII of the
Rules of the House of Representatives requires an estimate and
a comparison by the Committee of the costs which would be
incurred in carrying out this bill. However, clause 3(d)(3)(B)
of that Rule provides that this requirement does not apply when
the Committee has included in its report a timely submitted
cost estimate of the bill prepared by the Director of the
Congressional Budget Office under section 402 of the
Congressional Budget Act of 1974.
2. Congressional Budget Act.--As required by clause 3(c)(2)
of Rule XIII of the Rules of the House of Representatives and
section 308(a) of the Congressional Budget Act of 1974, this
bill does not contain any new budget authority, spending
authority, credit authority, or an increase or decrease in
revenues or tax expenditures. According to the Congressional
Budget Office, enactment of this bill could reduce federal
spending over the 2000-2004 period but any savings would be
``insignificant.''
3. Government Reform Oversight Findings.--Under clause
3(c)(4) of Rule XIII of the Rules of the House of
Representatives, the Committee has received no report of
oversight findings and recommendations from the Committee on
Government Reform on this bill.
4. Congressional Budget Office Cost Estimate.--Under clause
3(c)(3) of Rule XIII of the Rules of the House of
Representatives and section 403 of the Congressional Budget Act
of 1974, the Committee has received the following cost estimate
for this bill from the Director of the Congressional Budget
Office:
U.S. Congress,
Congressional Budget Office,
Washington, DC, March 31, 1999.
Hon. Don Young,
Chairman, Committee on Resources,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 862, the Clear
Creek Distribution System Conveyance Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Gary Brown.
Sincerely,
Steven M. Liberman,
(For Dan L. Crippen, Director).
Enclosure.
H.R. 862--Clear Creek Distribution System Conveyance Act
H.R. 862 would authorize the Secretary of the Interior,
acting through the Bureau of Reclamation, to convey all right,
title, and interest in and to the Clear Creek Distribution
System to the Clear Creek community Services District, which is
located in Shasta County, California. CBO estimates that
enacting the bill could reduce federal spending over the 2000-
2004 period, but that any such savings would not be
significant. Because these savings could take the form of a
reduction in direct spending, pay-as-you-go procedures would
apply. H.R. 862 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act. Local
governments might incur some costs as a result of the bill's
enactment, but these costs would be voluntary. The budgetary
impact of this legislation falls within functions 300 (natural
resources and environment) and 800 (general government).
H.R. 862 would absolve the federal government of potential
liabilities associated with the Clear Creek Distribution
System, including the cost of repairing an installation defect
that has resulted in frequent breaks in the water delivery
system. If H.R. 862 is not enacted, the federal government may
elect to repair the system with appropriated funds.
Alternatively, it is possible that the district would take
legal action against the United States and that the federal
government would be compelled to pay these costs. Based on
information provided by the Bureau of Reclamation, CBO
estimates that such costs could total about $1 million.
H.R. 862 also would excuse the district from repaying
amounts due to the federal government for the distribution
system. However, in light of the problem with the system and
the associated maintenance costs, the district may refuse to
pay these amounts even if H.R. 862 is not enacted. The
district's outstanding balance is $0.4 million. Its next
scheduled payment is in 2000, and currently scheduled payments
over the 2000-2004 period total about $0.1 million. (No
payments were scheduled over the past several years.)
The CBO staff contact for this estimate is Gary Brown. This
estimate was approved by Robert A. Sunshine, Deputy Assistant
Director for Budget Analysis.
COMPLIANCE WITH PUBLIC LAW 104-4
This bill contains no unfunded mandates.
PREEMPTION OF STATE, LOCAL OR TRIBAL LAW
This bill is not intended to preempt State, local or tribal
law.
CHANGES IN EXISTING LAW
If enacted, this bill would have no changes in existing
law.