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Show electorate giving the reason for the increased cost." The WPRS knew what problems it was facing with the repayment ceiling. In a memo dated October 20, 1977 from the Project Manager to the Regional director concerning the allocation of project cost for the Bonneville Unit through fy 79, the bottom line was: "It appears from this study that the M&I purpose has roughly 38 percent of the total allocation. If this proposition holds, about $50,000,000 total cost after fy 79 could be obligated without exceeding the repayment provided in the present contract." What was not factored in were the increasing construction problems on the project. The $50 million was insufficient to complete the features that would serve the M&I purpose. THE POWER PLAY As the problem became more acute, solutions began flowing, in the form of having power revenues picking up M&I costs, the position favored by the Conservancy District. The Regional Director advanced this, but with hints of caution. In a memo dated March 23, 1979, he stated: The modified repayment analysis as shown in the District's report demonstrates that revenues from CUP power could: repay costs allocated to the power system, assist in repayment of M&I and irrigation costs, and make a sizable contribution to the Basin Fund. Both CUP and CRSP systems are mutually benefited with the development of CUP power. However, in actual operation, the CUP power system would be operated as a part of the CRSP system while at the same time revenues from the Basin Fund would be used to assist in payment of M&I costs as well as irrigation. Although the District is justifying the use of Basin Fund revenues to assist M&I repayment by the contribution CUP power makes to the overall CRSP system, serious questions and concerns may be raised by the Upper Basin states and the Upper Colorado River Commission in behalf of other participating projects. As you know Mr. Commissioner, this whole exchange was prompted by a letter of February 21, 1979, by Robert Hilbert, President of CUWCD to Interior concerning the District's request for an alternative repayment program. The letter was answered by you on April 3, 1979. In it you stated: ... You are requesting that power customers subsidize not only irrigation costs but also costs associated with serving M&I water customers. We are not prepared to adopt this policy. In fact we may find it necessary to actively oppose any attempt to implement such a policy... ... it is our position that the repayment contract with your district should be leiieguLiateu so thai the United States has assurance of full repayment of the M&I water supply function by the appropriate beneficiaries. |
