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Memorandum of Understanding whereby funds will be advanced on a quarterly basis from the Bureau of Reclamation to the Bureau of Indian Affairs based on projected expenditures of the tribes. Disbursements to the tribes will then be made by the Bureau of Iadian Affairs. Reclamation will provide technical expertise with respect to the work and will approve fund transfers from the Bureau of Indian Affairs to the tribes.

Question. I note you are proposing $1.32 million for recreation facilities. Development of recreation facilities has fallen behind most other aspects of the project. Many opportunities to acquire recreation lands will, I fear, be lost, given the current rate of development. Could you economically utilize an additional amount, say $500,000 to $800,000 for these activities?

Ansver. There is the capability of expending the additional sum of $700,000 in fiscal year 1989; however, this discretionary increase for a lower priority activity runs counter to the President's goal of reducing the large Federal deficit, and there are some limitations other than funding which will also affect the progress of the recreation program. On April 13, 1988, the Supreme Court of the State of North Dakota affirmed a district court decision which diminished the capability of the State, as represented by the Garrison Diversion Conservancy District, to provide its required 50 percent natching component for the recreation program. The State had previously conveyed to the United States 62,370 acres of the bed of Devils Lake for a credit of $3,637,750 toward its cost-sbare component of the recreation and for fish and wildlife enhancenent. In accordance with a contract dated February 25, 1971, $2,037.750 of that credit bad been allocated to the recreation program credit. Further, it was conteaplated that additional higher lands comprising 20,676 acres under and around Devils Lake would be conveyed for substantial additional credits in the future. The Court determined that the State's ownership of the lakebed constitutes an area substantially less than bad previously been asserted by the State of North Dakota. The State had claimed its ownership extended to the neander line which was asserted to be the ordinary high-water mark of Devils Lake at statehood. The court ruled that the ordinary high-water work is ambulatory, following the fluctuating level of Devils Lake. The extent to which cost-share credits and potential future credits vill be adjusted as a result of the court's decision has not yet been determined. The State has the option of providing its cost share in cash.

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QUESTIONS SUBMITTED BY SENATOR MELCHER

Middle Creek Project

Question. On January 5, 1988, your agency approved a loan application under the Small Reclamation Projects Act for the Middle Creek Project in Montana. The State of Montana has expended over $600,000 to prepare its loan application and is committed to contributing a total of $1,298,975 for this project. The proposed federal share amounts to $3,896,925. Does the Bureau of Reclamation have the capability to provide these funds and administer the loan?

Answer. The President's budget for FY 1989 did not include funding for Middle Creek Project because the loan application had not been approved when the FY 1989 budget was developed. However, the Bureau does have $1,600,000 capability in FY 1989 for work on the Middle Creek Project. This discretionary increase for a lower priority activity runs counter to the President's goal of reducing the large Federal deficit.

Question. The State of Montana submitted its completed loan application for the Middle Creek Project to the Bureau of Reclamation in April 1987, and thereby allowed the Bureau of Reclamation sufficient time to approve that loan in FY 1987. Due to delays within the agency, the loan was not approved until FY 1988, and the interest rate increased from the FY 1987 rate of 7-1/2 percent to the 9-3/8 percent specified for FY 1988. In view of this circumstance, would your agency be able to establish the interest rate for this loan .at the FY 1987 rate of 7-1/2 percent?

Answer. The interest rate is not set by the year in which the loan application is approved, but by the signing of the repayment contract, This requirement is set forth in the Small Reclamation Projects Act, Public Law 84-984, as amended. We would not be able to change the rate without Congressional authorization.

Crow Creek Pumping Unit

Question. There is an effort underway in Montana to modify the Crow Creek Pump Plant on the Crow Creek Pumping Unit of the Pick-Sloan/Missouri Basin project. What Is the Bureau's capability to co-fund and complete this project?

Answer. The Bureau's capability for fiscal year 1989 to co-fund and complete this project is $150.000, however this discretionary increase for a lower priority activity runs counter to the President's goal of reducing the large Federal deficit.

SUBCOMMITTEE RECESS

Senator JOHNSTON. The subcommittee will stand in recess subject to the call of the Chair.

(Whereupon, at 3:12 p.m. Wednesday, March 2, the subcommittee was recessed to reconvene at 10 a.m. Tuesday, March 15.)

ENERGY AND WATER DEVELOPMENT
APPROPRIATIONS FOR FISCAL YEAR 1989

TUESDAY, MARCH 15, 1988

U.S. SENATE,
SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS,

Washington, DC. The subcommittee met at 10:15 a.m. in room SD-124, Senate Dirksen Office Building, Hon. J. Bennett Johnston (chairman) presiding.

Present: Senators Johnston, Sasser, McClure, Spector, and Domenici.

DEPARTMENT OF ENERGY

ENERGY SUPPLY, RESEARCH AND DEVELOPMENT ACTIVITIES

STATEMENT OF DONNA R. FITZPATRICK, ASSISTANT SECRETARY FOR

CONSERVATION AND RENEWABLE ENERGY

SOLAR AND RENEWABLE PROGRAMS

Senator JOHNSTON. Good morning. I apologize for being late. Jimmy Stewart, one and the same, the original, was by my office to lobby this morning. When the movies call, I must attend. [Laughter.

This morning, we will receive testimony on the fiscal year 1989 budget request for several important research programs and functions of the Department of Energy. We will receive testimony on the Solar and Renewable Energy Program from Assistant Secretary Donna R. Fitzpatrick; and then from the Office of Energy Research with Dr. James F. Decker, Acting Director, will cover High Energy Physics, including the SSC, nuclear physics, basic energy sciences, university research, magnetic fusion energy, biological and environmental research, multiprogram laboratories, and basic research user facilities.

Finally, we will also receive testimony on the Environment, Safety and Health Program of the Department from Garry W. Gibbs, Acting Assistant Secretary for Environment, Safety and Health.

Miss Fitzpatrick, please proceed.

RENEWABLE OVERVIEW

Miss FITZPATRICK. Thank you, Mr. Chairman.

I have a statement for the record, and if I may, I would like to summarize it.

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