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Show water at the present time within Nevada. This suggestion apparently was made originally with the intent of establishing a fund similar to that set up by the Colorado River Compact, whereby upstream States were enabled to make investigations of pos- sible resources developments within their borders. However, the suggestion has been interpreted by some to involve the general principle of reimburse- ment to upstream States for water used downstream, but originating within their borders. Nevada, Montana, Wyoming, and Idaho, all of which are sources of water used in downstream areas, would be eligible for such reimbursement, if the principle were accepted. It should be noted further in this connection that approximately 40 percent of the flow of the Columbia main stem originates in Canada. Conclusions If there is any question as to the amount of water to which the upstream State is entitled, resolution by mutual compact between the affected States ap- pears most feasible. Since the downstream devel- opments are federally installed and maintained and the entire Nation shares benefits derived from this water, a claim to reimbursement for the water passing the border does not appear valid. In the case of any upstream State, the answer might be that it can present no proof that water originating in the State will be used downstream in the Colum- bia Basin for the foreseeable projects. If an up- stream State is to receive payment for benefits, then it should also be willing to accept financial respon- sibility for the damages done by expected flows dur- ing time of flood. It is not likely that such a liability would be accepted. If upstream reimbursement becomes a serious issue in the Columbia the following are pertinent: (1) Where conflicts for beneficial use appear im- minent or even possible for water which enters interstate Howage, settlement should be sought by compact among the affected States as to the amounts o*f water to which each is entitled. Set- tlement wi th Canada, of course, would be sought by treaty. (2) Where region-wide power rates pre- vail, or are possible, the rate itself should be con- sidered a means of compensation to the upstream States, since it may provide lower rate power than they probably otherwise would enjoy. (3) The originating: State should be considered to lose title to all benefits from water crossing a State boundary and made use of in a downstream development, unless covered by compact, or especially provided for by other agreement. (4) A general basin fund for investigation of resource development possibili- ties, in which all States would share whether or not they have developments, would seem equitable and in the general interest. 6. The Place of the Interest Component and the Basin Account in Planning The Problem The use of a pooled basin account, including use of the interest component on power investment for irrigation repayment, in justifying specific program objectives. The Situation The use of the basin account, as it has been pro- posed for the Columbia Basin, has two primary ob- jectives : (1) To provide a basis for the establishment of power rates on a uniform basin or region-wide basis; (2) To provide a means for paying irrigation costs to the extent that they cannot be repaid by the water users, using the interest component on pooled power investment for that purpose.7 No reasonable objection can be advanced against considering a basin system of power projects as a unit to establish rates, provided that the formula- tion of the individual projects and the determina- tion of their economic feasibility have been con- sidered on a sound economic basis. Rates have been established on such a region-wide basis in the Tennessee Valley Authority, private utilities have followed the practice, and such procedure is es- sentially in effect today in the Columbia River Basin for the Bonneville and Grand Coulee Proj- ects. The objective of widespread use of power under near-uniform, basin-wide rates seems to be desirable. The controversy concerning basin accounts has not centered on the use of such accounts for the establishment of uniform rates, but on their use for the payment of irrigation construction costs. The question raised is not whether irrigation should be TThe interest component is estimated to be sufficient to care for any needed irrigation subsidy in the Columbia Basin, although reclamation law permits the use of other power revenues also, if necessary. 42 |
