KENNEWICK DIVISION EXTENSION

THURSDAY, FEBRUARY 23, 1967

U.S. SENATE,

SUBCOMMITTEE ON WATER AND POWER RESOURCES,

COMMITTEE ON INTERIOR AND INSULAR AFFAIRS,

Washington, D.C.

The subcommittee met, pursuant to notice, at 10:05 a.m., in room 3110, New Senate Office Building, Senator Clinton P. Anderson, presiding.

Present: Senators Anderson, Jackson, Moss, Allott, and Jordan of Idaho.

Also present: Senator Hatfield.

Staff members present: Jerry T. Verkler, staff director; Stewart French, chief counsel; Roy M. Whitacre, professional staff member; and William J. Van Ness, special counsel.

Senator ANDERSON. This is an open public hearing on a bill involving water resource development in the State of Washington. The bill is S. 370, which would authorize the construction, operation, and maintenance of the Kennewick division extension, Yakima project, in the State of Washington.

This measure was introduced by the distinguished chairman of the Interior Committee, Senator Jackson, for himself and his senior colleague from the State of Washington, Senator Magnuson.

Without objection the text of the bill, together with the reports from the executive agencies, will be printed at this point in the record. (The data referred to follow:)

[S. 370, 90th Cong., 1st sess.]

A BILL To amend the Act of June 12, 1948 (62 Stat. 382), in order to provide for the construction, operation, and maintenance of the Kennewick division extension, Yakima project, Washington, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Act of June 12, 1948 (62 Stat. 382), is hereby amended as follows:

(a) Insert the words "and Kennewick division extension", after the words "Kennewick division" in section 1 and add the following items to the principal units listed in said section: "Kiona siphon" and "Relift pumping plants".

(b) Insert at the end of section 3 the following: "Costs of the Kennewick division extension allocated to irrigation which are determined by the Secretary to be in excess of the water users' ability to repay within a fifty-six-year repayment period following a ten-year development period, to the extent they may be in excess of Yakima project net power revenues in that period after meeting the requirements specified in (1), (2), and (3) above shall be returned to the reclamation fund from revenues derived by the Secretary from the disposition of power marketed through the Bonneville Power Administration from the McNary Dam project: Provided, That section 5 of this Act shall not be applicable to the revenues derived from the McNary Dam project."

SEC. 2. No water shall be delivered to any water user on the Kennewick division extension for a period of ten years from the date of enactment of this authorizing Act for the production on newly irrigated lands of any basic agricultural commodity, as defined in the Agricultural Act of 1949, or any amendment thereof, if the total supply of such commodity for the marketing year in which the bulk of the crop would normally be marketed is in excess of the normal supply as defined in section 301(b) (10) of the Agricultural Adjustment Act of 1938, as amended, unless the Secretary of Agriculture calls for an increase in production of such commodity in the interest of national security.

SEC. 3. There are authorized to be appropriated for the new works associated with the Kennewick division extension $5,155,000 (October 1964 prices) plus or minus such amounts, if any, as may be required by reason of changes in the cost of construction work of the types involved therein, as shown by engineering cost indexes, and, in addition, such sums as may be required to operate and maintain the extension.

Hon. HENRY M. JACKSON,

U.S. DEPARTMENT OF THE INTERIOR,

OFFICE OF THE SECRETARY, Washington, D.C., February 21, 1967.

Chairman, Committee on Interior and Insular Affairs,

U.S. Senate,

Washington, D.C.

DEAR SENATOR JACKSON: This responds to your request for the views of this Department on S. 370, a bill "To amend the Act of June 12, 1948 (62 Stat. 382), in order to provide for the construction, operation, and maintenance of the Kennewick division extension, Yakima project, Washington, and for other purposes." This bill is identical to S. 794, 89th Congress, as passed by the Senate on February 10, 1965.

We recommend enactment of the bill if amended as suggested hereinafter. S. 370 would authorize the Secretary of the Interior to construct, operate, and maintain the Kennewick division extension, a 6,300-acre irrigation development of the Kennewick division, Yakima project, Washington. This would be accomplished through appropriate amendments to the Act of June 12, 1948 (62 Stat. 382), which authorized the Kennewick division. The bill provides that financial assistance from McNary Dam power revenues shall be available to repay costs allocated to irrigation which are beyond the ability of the water users to repay and which cannot be met from net power revenues of the Yakima project itself

The existing Kennewick division serves about 19,000 acres of land. Section 6 of the Act of June 12, 1948, authorized the Secretary of the Interior to construct extra capacity in the division's main canal to provide for the future irrigation of approximately 7,000 acres of land in addition to the then proposed development, and to recognize the cost of providing such capacity as a deferred obligation to be paid at such time as the additional area was brought into the project. main canal was constructed with extra capacity at a cost of $341,000, which has since been carried as a deferred obligation.

The

The Kennewick division extension would utilize the extra capacity thus provided, together with additional works which would be constructed, to deliver an irrigation water supply to the 6,300 acres of extension lands. Specific new works required are a hydraulic pump at the Chandler pumping plant to lift additional water into the main canal, through which the water would flow for 6.7 miles. There it would be diverted into the Kiona siphon, which would carry the water 5,800 feet across Badger Draw to the extension lands. Six relift pump plants, six main canals, a system of laterals and drainage works, and electrical transmission facilities to serve the pumping installations are the remaining new facilities required. Power and energy for irrigation water pumping for the extension will be made available from the Federal Columbia River power system at charges determined by the Secretary of the Interior.

Most of the lands of the Kennewick division extension are presently dry. About 100 acres of the best lands have been planted to dry land wheat. The balance supports only sage brush and native grasses used for livestock grazing. Under project development the primary land use expected would be for growing feed and general row crops. Lesser acreages of fruit and specialty crops-grapes, sweet cherries, prunes, peaches, apricots, mint, and asparagus-would also probably be produced. The soil and climate are well suited to all the foregoing crops. The Kennewick Irrigation District has long been interested in full development of the irrigable lands in the area. The district supported development of the entire area when the Kennewick division lands were brought under irrigation. Nearly all the lands in the extension have been in the district for many years.

The Kennewick division extension is basically an irrigation development, but benefits to wildlife resources will also be realized. The Fish and Wildlife Service reports that irrigation of these lands will be beneficial to upland game birds. Opportunities to develop significant benefits to recreation, flood control, municipal and industrial water supply, or other purposes are not available.

The total investment in the Kennewick division extension would be $6,141,700, reflecting an updating of the cost estimate in our feasibility report (H.D. 296, 88th Congress) which was $5,250,400 (January 1962 prices). This current estimate up of $5,325,000 in construction costs (October 1966 prices); $341,400 in deferred costs of the Kennewick division attributable to enlarged main canal capacity and assignable to the division extension; $189,000 for the extension's pro rata share of storage costs of the Yakima project, $27,000 for settlers assistance, and a $259,300 suballocation of the commercial power allocation of the Federal Columbia River power system costs to irrigation.

Of the foregoing costs, $6,009,500 is allocated to irrigation and $132,200 to fish and wildlife enhancement. The irrigation of extension lands will enhance upland game habitat. Since there will be no separable costs incurred for this purpose, under provisions of the Federal Water Project Recreation Act, the costs allocated to fish and wildlife enhancement would be nonreimbursable. Costs allocated to irrigation would be reimbursable without interest. The total costs allocated to irrigation include $259,300 as the pumping power suballocation which will be repaid by the annual pumping power charge. The remaining reimbursable irrigation costs amount to $5,750,200, of which irrigators could repay $1,716,960 or about 30 percent. Financial assistance in the amount of $4,033,240 needed to achieve repayment of the remaining reimbursable irrigation costs would be due in Fiscal Year 2040. This assistance would be obtained from net power revenues from the Federal Columbia River power system in accordance with section 2 of the Act of June 14, 1966 (80 Stat. 200), as amended by section 6 of the Act of September 7, 1966 (80 Stat. 707). The conditions prescribed by this legislation for the use of net power revenues from the Federal Columbia River power system for irrigation assistance can be met by the Kennewick division extension, as shown below.

(1) Maximum permissible aid

Maximum allowable aid in 20 consecutive years, $600 million. Total authorized aid due F.Y. 2021 through F. Y. 2040, $245 million.

(2) Net power revenues must be available

System payout studies indicate net revenues in the amount needed will be available.

(3) Construction schedule must be arranged so that the assistance will not cause an

increase in BPA power rates

The construction schedule for Kennewick division extension as now contemplated is compatible with this requirement.

Policies in effect at the time the Kennewick division was authorized required that all reimbursable project costs be repaid from revenues derived from the project. This required an overall repayment period of 66 years for the facilities built under the 1948 Act. S. 370, which would authorize the Kennewick division extension by adding it to the authorization of the 1948 Act, would make the same repayment period applicable to the extension. We believe that this is appropriate even though current congressional policy is that reimbursable reclamation project costs shall be returned in full within 50 years. The extension water users will be using many of the same facilities, and will bear a prorated share of the district operation, maintenance, and replacement costs as do other Kennewick division water users. It is equitable that their repayment obligation should run for the same number of years as other division water users. Irrigation water users make annual payments toward retiring irrigation cost allocations in accordance with their ability to pay. Thus, the effect of a longer repayment period is that the water users bear more of the irrigation costs.

Section 5 of the Act of June 12, 1948, provides that one-fifth of the revenues derived from the interest component for power rates of the Kennewick division, Yakima project, may be applied toward repayment of Kennewick division irrigation costs assigned for return from power revenues. Under S. 370 this arrangement would extend to the Kennewick division extension as well. The proviso appearing at the end of section 1 of the bill is intended to limit the availability for financial assistance to irrigation of power revenues derived as interest on revenues attributable to the Kennewick division power facilities (Chandler powerplant) and to insure that revenues derived from the interest component of power rates

of the McNary Dam project, which the bill contemplates as the source of supplementary financial assistance for the extension, shall not be available for financial assistance to the extension. As we have indicated above, the source of supplementary financial assistance should be changed from the McNary Dam to the entire Federal Columbia River power system.

To conform S. 370 to the foregoing discussion, lines 5 though 13 on page 2 should be deleted and the following substituted:

"Shall be charged to and returned to the reclamation fund in accordance with the provisions of section 2 of the Act of June 14, 1966 (80 Stat. 200), as amended by section 6 of the Act of September 7, 1966 (80 Stat. 707): Provided, That section 5 of this Act shall not be applicable to the revenues derived from the Federal Columbia River power system. Power and energy required for irrigation water pumping for the Kennewick extension shall be made available by the Secretary from the Federal Columbia River power system

at

charges determined by him."

Several years may elapse between authorization of the Kennewick extension and execution of construction contracts. Therefore, we recommend that section 3, establishing the appropriations ceiling, be amended to establish the ceiling at the current construction cost estimate with a provision for cost indexing. This could be accomplished by substituting the following for section 3:

"SEC. 3. There are authorized to be appropriated for the new works associated with the Kennewick division extension $5,352,000 (October 1966 prices) plus or minus such amounts, if any, as may be required by reason of changes in the cost of construction work of the types involved therein, as shown by engineering cost indexes, and, in addition, such sums as may be required to operate and maintain the extension."

A statement of personnel and other requirements that enactment of this legislation would entail is enclosed in accordance with the provisions of Public Law 801, 84th Congress.

The Bureau of the Budget has advised that there is no objection to the presentation of this report from the standpoint of the Administration's program.

Sincerely yours,

CHARLES F. LUCE, Under Secretary of the Interior.

KENNEWICK DIVISION EXTENSION, YAKIMA PROJECT, WASH. Estimated additional personnel and funds for construction (in compliance with Public Law 801, 84th Cong.) 1

19.0

20.0

1.0

Hon. HENRY M. JACKSON,

EXECUTIVE OFFICE OF THE PRESIDENT,

BUREAU OF THE BUDGET,

Washington, D.C., February 21, 1967.

Chairman, Committee on Interior and Insular Affairs,

U.S. Senate, Washington, D.C.

DEAR MR. CHAIRMAN: This is in response to your letter of January 24, 1967, requesting the views of the Bureau of the Budget on S. 370, a bill "To amend the Act of June 12, 1948 (62 Stat. 382), in order to provide for the construction, operation, and maintenance of the Kennewick division extension, Yakima project, Washington, and for other purposes."

The Kennewick division extension would make irrigation water available to an additional 6,300 acres of land which for the most part are presently unirrigated. The total investment is presently estimated at $6,141,700, and the additional authorization required is approximately $5,352,000.

The Department of the Interior, in a report being submitted to your committee, recommends amendments to reflect recently enacted legislation regarding power assistance to irrigation and increases in construction costs.

The Bureau of the Budget would have no objection to enactment of S. 370 if amended as recommended by the Department of the Interior.

Sincerely yours,

WILFRED H. ROMMEL, Assistant Director for Legislative Reference.

Senator ANDERSON. This measure has been favorably considered by this committee and by the Senate in previous sessions of Congress. In the 89th Congress, this committee held hearings and reported favorably on the Kennewick Division extension. The bill-at that time S. 794-was passed by the Senate on February 10, 1965.

The hearings from the 89th Congress on this bill will be incorporated, by reference, into the record of these hearings. That record set forth statements and communications from officials and local people in the districts where this project is situated, explaining the need for the legislation and endorsing the bill.

The subcommittee is fortunate to have as our first witness the author of the bill, Senator Jackson of Washington.

STATEMENT OF HON. HENRY M. JACKSON, A U.S. SENATOR FROM THE STATE OF WASHINGTON

Senator JACKSON. Mr. Chairman, my statement this morning is on behalf of myself and my colleague from the State of Washington, Senator Magnuson. We are requesting that early and favorable action be taken by the subcommittee on S. 370, a bill to provide for the construction, operation, and maintenance of the Kennewick division extension, Yakima project, Washington. This bill is identical to S. 794, which passed the Senate during the 89th Congress.

The purpose of S. 370 is to bring 6,300 acres of land in the Kennewick division under irrigation. This would be accomplished through appropriate amendments to the act of June 12, 1948, which authorized the Kennewick division. The act of 1948 authorized the Secretary of the Interior to construct extra capacity in the division's main canal to provide for future irrigation of approximately 7,000 acres. would make use of this extra capacity.

S. 370

The project has an extremely high benefit to cost ratio in excess of 4 to 1.

While basically an irrigation development, there would also be benefits to wildlife resources.