MEMORANDUM

to:                       family farm alliance members and interested parties  

from:           dan Keppen, executive Director

subject:   site security oversight hearing

date:            June 22, 2006

Earlier today in Washington, D.C., western water user representatives participated in an oversight hearing conducted by the House Water and Power Subcommittee. As noted in previous Alliance correspondence, the Bureau of Reclamation (Reclamation) – which owns and operates federal multi-purpose dams throughout the Western United States – has embarked on its own aggressive security program, and the agency’s customers have growing concerns about how this program will be funded, and who will pay the bill.

The Alliance was invited to participate in this hearing and endorsed the inclusion of Russ Harrington of the Central Valley Project Water Association (CALIFORNIA) on the witness panel. Dick Erickson, secretary-manager of the East Columbia Basin Irrigation District (WASHINGTON), testified on behalf of the National Water Resources Association (NWRA). Joe Raeder, the Alliance’s DC representative, attended the hearing and reported that it went very well, and noted that committee staffers were very complimentary of Russ Harrington’s testimony (attached).

According to Joe, all of the water and power agency witnesses made essentially the same points in their testimony:  Security improvements are a national responsibility and should be funded entirely by the federal government. If some of those costs must be reimbursable, then Congress should use legislation to allocate the costs.  Witnesses reported that Reclamation’s policy keeps changing and it now appears that the agency is moving towards a policy that would make all costs, including hardening, fully reimbursable. Customer witnesses believe there needs to be improved transparency regarding costs and the justification for specific improvements.  Tight congressional oversight is essential.

The power agency witnesses all said that the current allocation of costs puts an unfair burden on power customers.  They said that all beneficiaries, including fish and wildlife and recreation should pay a share, and they implied, but didn't specifically state, that water users should bear a larger part of the burden.  For example, two of the power witnesses noted that if a dam were destroyed or severely damaged, it would be relatively easy to replace the power generated at the facility, but it would be extremely difficult, if not impossible, to replace the water service.  They said that a "fair" allocation of costs should be based on risks.

Chairman Radanovich said that there needs to be legislation to address the issues raised by the witnesses.  Rep. Grace Napolitano, the Ranking Democrat, said that while she believes firmly in the "beneficiary pays" principle when it comes to water projects, security costs obviously have a national benefit and costs should be allocated to recognize that. She also expressed concern about the lack of transparency at Reclamation and the uncertainty faced by water and power agencies because they don't know how much security improvements will cost.

A few of the witnesses suggested that the best way to keep costs under control is to put a cap on them.

In his testimony as the sole government witness, Reclamation Deputy Commissioner Larry Todd noted that Reclamation is consulting with stakeholder groups – including the Alliance and NWRA - on site security policy.