Answer. Flood control projects are normally exempt from liability by virtue of the Flood Control Act of 1928. Many of the Bureau's dams do not have flood control as an authorized benefit and, therefore, may not come under the protection of the act. Also, a failure of one of our dams because of a seismic disturbance may not receive any liability protection. COST-SHARING POLICY Question. To your knowledge, does the administration have a cost-sharing policy or a cost-reimbursement policy for Federal flood control projects? Answer. Presently, flood control is, by law, a nonreimbursable function. Cost sharing for flood control projects has, for the most part, been limited to provision of lands, easements, and rights-of-way by non-Federal entities. The Cabinet Council has deliberated the issue of recommending changes in cost sharing for each of the traditional water project purposes including flood control and agricultural, municipal, and industrial water, recreation, and fish and wildlife enhancement. Public input has been solicited in the Federal Register by Secretary Watt in behalf of the Cabinet Council. In the interim, both the Bureau and the Corps have proposed new projects embracing cost-sharing arrangements that differ from past practice. Regarding flood control, the Corps has proposed flood control projects that incorporated about 35 percent nonFederal financing. This does not necessarily represent the Cabinet Council's final position on flood control. LOAN PROGRAM Question. How many loan applications has the Bureau received from Arizona? Answer. We have received four loan applications from Arizona interests. Question. What is the status of those loans and do you have established priorities? Answer. The loan application for Roosevelt Irrigation District-Project No. 2 and the Ak-Chin Indian Community-East project have been approved but have not been funded. The Ak-Chin Indian Community-West project and the Gila River Farms-Project No. 2 applications are currently under review by the Bureau of Reclamation. In addition, a notice of intent to apply for a loan has been received from the Quechan Indian Tribe for a project. Other than the processing of category I loans before category II loans, we have not established any priorities. INSTALLATION OF ADDITIONAL PUMP, YUMA MESA PUMPING PLANT, GILA PROJECT, ARIZONA Question. In the fiscal year 1982 appropriations bill as it passed the House there was included $30,000 for an additional regulatory pump and related work at the Gila project's Yuma Mesa pumping plant in Arizona. You again testified as to this need during our hearings on the fiscal year 1983 appropriations. It is my understanding that this energy conservation addition is still needed but that you have not been able to proceed under the continuing resolution in fiscal year 1983; is that correct? Answer. Yes; both the Yuma Mesa Irrigation and Drainage District, Gila project, and the Unit B Irrigation and Drainage District, Yuma auxiliary project need the additional pump in order for them to operate the system more efficiently. YUMA MESA IRRIGATION AND DRAINAGE DISTRICT, GILA PROJECT UNIT B IRRIGATION AND DRAINAGE DISTRICT, YUMA AUXILIARY PROJECT Question. It is also my understanding that the needed funds are already fully covered by repayment contracts with the Yuma Mesa Irrigation and Drainage District, Gila project, and the Unit B Irrigation and Drainage District, Yuma auxiliary project, and that both are current in their obligations to the United States; is this correct? Answer. Yes; both the Yuma Mesa Irrigation and Drainage District and Unit B Irrigation and Drainage District are current in their repayment obligations to the United States. The Yuma Mesa Irrigation and Drainage District has approximately $368,000 of unused repayment coverage under its May 26, 1956, contract, and Unit B Irrigation and Drainage District has about $114,000 of repayment coverage remaining under its August 22, 1962, contract. The expenditure of funds for the proposed work would extend the repayment period more nearly to the full terms authorized for the contracts. Question. If language is included in the fiscal year 1984 appropriation bill similar to that included in fiscal year 1982, can you accomplish the work in the fiscal year 1984 Bureau of Reclamation budget now before this committee? Answer. Yes; provided that $475,000 is appropriated for the Yuma Mesa Irrigation and Drainage District. SUBCOMMITTEE RECESS Senator ABDNOR. The committee is in recess. [Whereupon, at 3:50 p.m. Wednesday, February 23, the subcommit tee was recessed to reconvene at 2 p.m. Thursday, February 24.] ENERGY AND WATER DEVELOPMENT TUESDAY, APRIL 12, 1983 U.S. SENATE, SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS, Washington, D.C. The subcommittee met at 2 p.m. in room SD-124, Dirksen Senate Office Building, Hon. Mark O. Hatfield (chairman) presiding. Present: Senators Hatfield, Stennis, and Sasser. TENNESSEE VALLEY AUTHORITY STATEMENT OF CHARLES H. DEAN, JR., CHAIRMAN ACCOMPANIED BY: S. DAVID FREEMAN, DIRECTOR RICHARD M. FREEMAN, DIRECTOR W. F. WILLIS, GENERAL MANAGER JOHN G. STEWART, ASSISTANT GENERAL MANAGER BILLY J. BOND, MANAGER, OFFICE OF AGRICULTURAL AND CHEMICAL DEVELOPMENT GEORGE H. KIMMONS, MANAGER, OFFICE OF ENGINEERING DESIGN AND CONSTRUCTION RICHARD L. MORGAN, JR., MANAGER, OFFICE OF ECONOMIC AND COMMUNITY DEVELOPMENT HUGH G. PARRIS, MANAGER, OFFICE OF POWER THOMAS H. RIPLEY, MANAGER, OFFICE OF NATURAL RESOURCES LARRY H. EDWARDS, MANAGER, OFFICE OF PLANNING AND BUDGET OPENING REMARKS Chairman HATFIELD. The hearing will come to order. Today, we are pleased to welcome to the committee the board of directors of the Tennessee Valley Authority who will present testimony in support of the fiscal year 1984 budget request. On May 18, 1983, we will celebrate the 50th anniversary of the signing of the act creating the Tennessee Valley Authority. Much has been accomplished over the past 50 years that benefits not only the people of the Tennessee Valley region but our country and other countries as well. The fertilizer development program is a prime example of how regional, TVA activities can support the Nation's balance of trade and also help feed millions of hungry people around the world. (325) This committee has strongly supported the efforts of the Tennessee Valley Authority and I certainly will be one member who will continue to do so. Yet at the same time, during these periods of shrinking budget resources, it is most important that each dollar provided be fully justified and used to the maximum potential. So even though we are friends of TVA and support your activities, we still have a responsibility to carefully review your budget request. I trust that we will have the help of the board and the TVA staff as we have had in the past, so this committee can develop a recommendation for 1984 which is realistic and allows TVA to carry out the objectives of the act. With that, let me extend a warm welcome to Charles H. Dean, chairman of TVA's board of directors; Directors S. David Freeman and Richard M. Freeman, who are here today; and the members of the staff of the Tennessee Valley Authority, who have traveled from Knoxville for this hearing. Mr. Dean, please proceed. PREPARED STATEMENT We will place your detailed statement in the record and then you can highlight it or present us with the slide presentation, whatever you have in mind. You may proceed. [The statement follows:] STATEMENT OF CHARLES H. DEAN, JR. I am pleased to be here today to review TVA's budget request of $122.5 million for fiscal year 1984. This request essentially holds the line at the level of fiscal year 1983 in recognition of the need for budget stringency. It is a tight budget that reflects a careful evaluation of program priorities by the TVA Board in light of its responsibilities under the TVA Act and the needs of the Tennessee Valley region and the Nation. We have cut back in less critical areas and focused available resources on those activities with greatest potential return. In this sense it is both a responsive and responsible budget request. We have also made a concerted effort to manage these priority activities with greater efficiency and effectiveness. Employment levels at TVA have been cut. Management control systems have been improved. TVA's internal audit and evaluation capability has been strengthened. Managers at all levels know they are personally accountable for achieving specific program goals within budget and on time. The Board of Directors reviews the operating performance of each line organization no less than quarterly. In some areas, such as the electric power system and the nuclear construction program, these reviews occur monthly. TVA is doing its best to provide a benchmark for cost-effective management |