OCR Text |
Show 609 expenses of operation and maintenance" and "repayment within 50 years from the date of completion of said work" of all advances made for construction, including an allocation to flood control, with a qualified provision for interest at 4% per annum on amounts advanced but unpaid.617 Significantly, the Act required that power contracts be made with a view to obtaining "reasonable returns," and contain provisions whereby,' at the end of 15 years from the date of execution and every ten years thereafter, there shall be read- justment, upon the demand of either party:618 either upward or downward as to price, as the Secretary of the Interior may find to be justified by competitive conditions at distributing points or competitive cenj ters * * *. The Boulder Canyon Project Adjustment Act effected sev- eral changes pertinent here. In lieu of periodic rate adjust- ments upon a basis of competitive conditions, rates are sta- bilized for a period from June 1, 1937 to May 1, 1987; the in- terest rate is reduced from 4% to 3% and applied to all of the Government's investment except the allocation to flood control; and contract payments are required to be sufficient to cover costs of operation and maintenance and replacements, an amount equal to 100% of the principal of the Government's investment plus 3% interest on all but the allocation to flood control, plus an amount in lieu of taxes to the states wherein the project is located, as well as sums for annual transfer to the Colorado River Development Fund.619 417 Act of December 21,1928, § 4(b), 45 Stat. 105T, 1059, 43 U. S. C. 617c(b). 618 § 5(a), 45 Stat. 1060, 43 U. S. O. 617d(a). 619 Act of July 19, 1940, 54 Stat. 774, 43 U. S. C. 6I8-6I80. See also Sen. Rep. No. 1784, 76th Cong., 3d sess., p. 9, (1940). This report also points out that: "In authorizing all later projects Congress has preferred a defi- nite standard of rates, related to the amount required to retire the Govern- ment's investment. It seems fair to extend that principle to Boulder Dam; every interest involved, including the Interior Department, the States and the power contractors, prefer such a definite standard, each being willing to forego the speculative advantage to it of certain possibilities under the old law in consideration of the removal of its equally speculative hazards." IMd. |