Water Bills: HR 1393

Statement of Kira L. Finkler, Deputy Commissioner for

External and Intergovernmental Affairs

Bureau of Reclamation

U.S. Department of the Interior

Before the

Committee on Energy and Natural Resources

Subcommittee on Water and Power

United States Senate

H.R. 1393

April 27, 2010

Madam Chairman, I am Deputy Commissioner Kira Finkler, Deputy Commissioner for External and Intergovernmental Affairs at the Bureau of Reclamation (Reclamation). I am pleased to present the views of the Department of the Interior (Department) on H.R. 1393, a bill to amend the Lower Rio Grande Valley Water Resources Conservation and Improvement Act of 2000 (Act) to authorize additional projects and activities. For reasons I will discuss below, the Administration cannot support the bill.

H.R. 1393 authorizes an additional 19 water conservation projects, which include the replacement of canals and laterals with pipelines, the lining of canals and laterals, the installation of water measurement and telemetry systems, the renovation and replacement of pumping plants, and other activities that will result in the conservation of water. The legislation would enable the Secretary to fund up to 50% of the total cost of these projects once they meet the review criteria and project requirements in the Act. The purpose of this bill is to provide water saving measures to areas in Texas that continue to suffer from drought.

The Department lauds local and state efforts to improve and encourage water efficiency and to responsibly manage water quantity in the border region. The Department testified in general support (with some suggested revisions) of the original legislation that became P.L. 106-576 and of the subsequent amendment (P.L. 107-351). Together, these laws authorized 19 projects with a cost ceiling of $47,000,000. The amendments offered in H.R. 1393 appear to maintain the intent of the existing bill while authorizing an additional 19 projects with a cost ceiling of $42,356,145. Reclamation's Fiscal Year 2011 appropriations request for this program is $50,000, which does not include non-Federal funds. However, with the need to direct resources toward constructing ongoing projects, and to operate, maintain, and rehabilitate existing projects, we cannot support adding additional projects to the long list of already authorized projects awaiting Federal funding.

Implementation of P.L. 106-576

Since late December of 2000, when P.L. 106-576 was enacted, Reclamation has been working successfully and cooperatively with local entities in the Lower Rio Grande Valley, the Texas Water Development Board, and the Texas Agricultural Extension Service of Texas A&M University. The first requirement of the public law was issuance of criteria by which 15

Reclamation would administer the law and determine project eligibility for federal funding. These criteria were prepared, shared with state, local and other federal entities, and issued in late June 2001, within the six month timeframe required by the law.

Next, the irrigation districts involved with the 19 currently authorized projects and the Texas Water Development Board worked with Reclamation to begin planning, designing and construction of authorized projects. To date, Reclamation has approved 16 Project Reports and 13 of the projects have initiated construction, eight of which are substantially complete and under operation.

Project Scope and Cost

The emphasis placed by the Act on the initial 19 authorized projects is primarily on a project's scope, not upon its costs. For example, the scope of each authorized project is defined by the language in the Act itself and in the cited engineering report. In some cases, the specificity of this language has limited the authorization of (and therefore Reclamation's participation in) a project to only a portion of what an irrigation district has proposed to construct. The total project costs of each of these projects are not, however, specified in the legislation or in the cited engineering reports, but are determined once the authorized components are sufficiently developed in the Project Report and a project budget developed. In accordance with Section 4(b) of the Act, the Federal share of each project is then determined to be 50 percent of this total project cost.

In contrast, the emphasis that would be placed by H.R. 1393 on the second 19 projects considered for authorization would be on the project's cost, not upon its scope. Without changing the conditions for implementation of the first 19 projects, H.R. 1393 imposes different conditions for implementation on the proposed 19 projects. For example, unlike the previous two bills, Section 2(b) of H.R. 1393 would amend the Act to authorize virtually any project component that would result in the conservation of water or an improved supply of water, whether or not this component lies within the scope of the cited engineering report for that project. Also unlike the Act, H.R. 1393 would identify a maximum total cost for each project, half of the sum of which equals the identified ceiling. Furthermore, Section 3 of H.R. 1393 maintains separate ceilings for each of the groups of projects; namely, $47,000,000 (2001 dollars) for projects 1 thru 19, and $42,356,145 (2004 dollars) for projects 20 thru 38.

These differences, while not affecting the requirements for project qualification, would require somewhat different treatment of projects with regard to determining scope and cost, depending upon specific project authorizations.

Cost Indexing

After the budget authority for these 19 projects is given, H.R. 1393 includes the phrase "2004 dollars" in parentheses. This is similar to the language included in Section 4 (c) of the original 16 Act, as amended. To eliminate any question about Reclamation's authority to index costs for either group of 19 projects, Reclamation recommends that Section 4 (c) of the Lower Rio Grande Valley Water Resources Conservation and Improvement Act of 2000 (Public Law 106-576; 114 Stat. 3067) be amended by replacing these two phrases with the following: "plus or minus such amounts, if any, as may be justified by reason of ordinary fluctuations in construction costs as indicated by engineering cost indexes applicable to the types of construction involved herein."

Project Planning

The proposed legislation pre-authorizes projects that have had limited, if any, involvement from the Bureau of Reclamation in the project planning and development process, and which have not undergone Administration review. Although the Administration supports the efforts of local project beneficiaries to address their local water needs, we cannot support authorization nor provide funding for projects that have not undergone rigorous Administration review.

Conclusion

Madam Chairwoman, we recognize the importance of improving the efficiency of use and delivery of water in this part of the country. However, given the numerous other requirements on Reclamation's budget, such as funding the ongoing operation, maintenance, and rehabilitation of our existing projects and funding for ongoing authorized rural water projects and Native American settlements, we are unable to fund the activities that are already authorized. . The Federal government strives to leverage its resources to those projects that have benefits that exceed costs and foster locally-based solutions that do not require Federal investment in perpetuity.

In addition to the specific provisions identified in this testimony, Reclamation would be happy to work with the Committee to address any questions that may arise through the legislative process.

Madam Chairwoman, this concludes my testimony. I am pleased to answer any questions.