Northwest Salmon Recovery Act of 1998

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Northwest Salmon Recovery Act of 
1998''.

SEC. 2. FINDINGS.

    The Congress finds that:
            (1) In order to deal with significant changes in the 
        Nation's electric utility industry, and to continue to enjoy 
        the considerable benefits the Pacific Northwest receives from 
        the Federal Columbia River Power System through the Bonneville 
        Power Administration, new tools are needed to ensure that the 
        electric power customers of the Administration repay all the 
        costs associated with the system, including the public 
        obligations to restore fish and wildlife, meet treaty and trust 
        obligations, and pay the United States Treasury and the 
        Washington Public Power Supply System bondholders.
            (2) In addition, new tools are needed to ensure salmon 
        recovery and promote conservation and renewable resources in 
        the Pacific Northwest region.

SEC. 3. DEFINITIONS.

    For purposes of this Act:
            (1) The term ``Administration'' means the Bonneville Power 
        Administration.
            (2) The term ``Administrator'' means the Administrator of 
        the Bonneville Power Administration.
            (3) The term ``Council'' means the Pacific Northwest 
        Electric Power and Conservation Planning Council established by 
        the Pacific Northwest Electric Power Planning and Conservation 
        Act.
            (4) The term ``Commission'' means the Federal Energy 
        Regulatory Commission.
            (5) The terms ``region'' and ``Pacific Northwest'' have the 
        meaning provided for such terms by section 3(11) of the Pacific 
        Northwest Electric Power Planning and Conservation Act.
            (6) The term ``Secretary'' means the Secretary of the 
        Interior.
            (7) The term ``States'' means the States of Oregon, 
        Washington, Idaho, Montana, and Alaska.
            (8) The term ``tribes'' means the following federally 
        recognized Indian tribes: Confederated Salish and Kootenai 
        Tribes, Shoshone-Bannock Tribe, Nez Perce Tribe, Kootenai Tribe 
        of Idaho, Coeur d'Alene Tribe, Shoshone-Paiute Tribes, Burns-
        Paiute Tribe, Confederated Tribes of Warm Springs, Confederated 
        Tribes of Umatilla, and Confederated Tribes of Yakama, Spokane 
        Tribe, Colville Tribe, and Kalispel Tribe.
            (9) The term ``unified plan'' means the unified plan 
        developed under section 4 of this Act.
            (10) The term ``WPPSS'' means the Washington Public Power 
        Supply System.

SEC. 4. GOVERNANCE.

    The Secretary of the Interior shall, in consultation with the 
Federal, State, and tribal governments in the Pacific Northwest, 
develop a unified plan for salmon recovery in the region by December 
31, 1999. The goal of this plan shall be to restore sustainable, 
naturally reproducing salmon populations to support tribal and 
nontribal harvest and cultural and economic practices. The plan shall 
address treaty, trust, and Endangered Species Act responsibilities, the 
fish mitigation and enhancement requirements of the Pacific Northwest 
Electric Power Planning and Conservation Act, the water quality 
standards under the Clean Water Act, and the United States-Canada 
Pacific Salmon Treaty commitments. Implementation of the unified plan 
and the Northwest Power Planning Council's fish and wildlife program 
shall be overseen by the Secretary of the Interior. The Secretary shall 
promulgate a rule, in accordance with the applicable requirements of 
title 5 of the United States Code, applicable environmental 
requirements, and other applicable requirements of law, containing the 
plan developed under this section.

SEC. 5. FISCAL ACCOUNTABILITY.

    (a) Accounting System.--
            (1) Requirements.--Not later than 12 months after the date 
        of the enactment of this Act, the Secretary of Energy and the 
        Secretary of the Treasury, in consultation with the Office of 
        Management and Budget and the General Accounting Office, shall 
        establish an accounting system for the Administration that 
        meets each of the following requirements:
                    (A) Repayment of costs to the united states 
                treasury.--The accounting system shall ensure that all 
                costs repayable to the United States Treasury are paid 
                in a timely manner. The accounting system shall provide 
                for independent, outside reviews of Administration 
                repayment studies and include the views of the Federal 
                Energy Regulatory Commission. Such reviews shall assess 
                assumptions and methodologies, application of 
                appropriate interest rates, and whether all power-
                related costs are included for repayment.
                    (B) Fish and wildlife costs.--The accounting system 
                shall properly and accurately identify costs allocable 
                to compliance with the restoration of fish and wildlife 
                in the region, including treaty, trust, and Endangered 
                Species Act responsibilities of the Administrator, the 
                fish mitigation and enhancement requirements of the 
                Pacific Northwest Electric Power Planning and 
                Conservation Act, and the water quality standards under 
                the Clean Water Act. The Administration is prohibited 
                from allocating to fishery restoration accounts the 
                costs of spills or releases of water that result in 
                power loss or which are required for purposes of flood 
                control, irrigation, navigation, or other authorized 
                activities.
            (2) Accounting principles and requirements.--The accounting 
        system shall provide procedures to ensure regular consultation 
        with Federal, State, and tribal governments in the region, 
        tracking of the costs associated with each of the 
        Administrator's significant responsibilities, including those 
        referred to in paragraph (1).
            (3) Public availability.--The system shall contain 
        procedures to ensure that the books and records of the 
        Administration, including all accounting records regarding the 
        costs allocated to fishery restoration, public purposes, and 
        the WPPSS debt, are available to the public.
            (4) Compliance.--The system shall contain procedures for 
        the filing of complaints with the Secretary of Energy by 
        interested persons seeking to ensure compliance with this 
        section.
    (b) Fish and Wildlife Budget Management and Accountability.--The 
Secretaries of the Interior, Energy, Commerce, and the Army shall 
implement (until the unified plan takes effect) the Memorandum of 
Agreement and Annex on Budget Management and Accountability adopted in 
September 1996, including procedures for effective regional involvement 
and accountability in the expenditure of moneys from the 
Administration's fund pursuant to section 4(h)(10) of the Pacific 
Northwest Electric Power Planning and Conservation Act. The following 
procedures shall apply to administration of the Memorandum of Agreement 
and the unified plan:
            (1) Open and accurate methods for tracking the funding, 
        implementation, and performance of activities.
            (2) Independent scientific review of activities funded 
        pursuant to this Act. Such independent scientific review shall 
        be undertaken by an independent scientific advisory board 
        appointed by the Secretary of the Interior, in consultation 
        with the region's State and tribal governments. Appointments to 
        the Board will take into account recommendations from the chair 
        of the National Research Council.
            (3) Coordinated and integrated project prioritization 
        processes for selection of activities (under both the unified 
        plan and the Council's fish and wildlife program) to be funded 
        pursuant to this Act to be implemented by State and tribal 
        governments and the Secretaries of the Interior, Energy, 
        Commerce, and the Army for all fish and wildlife expenditures 
        pursuant to this Act, using consistent criteria that allow for 
        choices among direct, reimbursable and capital, and other 
        expenditure categories.
            (4) Effective procedures for resolution of disputes 
        regarding budget management and accountability.
    (c) Repeal.--Section 4(h)(10)(D) of the Pacific Northwest Electric 
Power Planning and Conservation Act (16 U.S.C. 839b(h)(10)(D)) is 
hereby repealed.

SEC. 6. PAYMENTS TOWARD THE NATURAL RESOURCES RECOVERY FUND AND THE 
              WPPSS DEBT.

    (a) Natural Resources Recovery Fund.--
            (1) Establishment.--The Secretary of the Interior shall 
        establish a Natural Resources Recovery Fund. The Fund shall be 
        managed by the Secretary.
            (2) Uses of fund.--The Secretary of the Interior shall 
        expend amounts in the Fund in a manner consistent with the 
        Memorandum of Agreement referred to in section 5 until the 
        unified plan takes effect. When the unified plan takes effect, 
        the Fund shall be administered in a manner consistent with such 
        unified plan. If no unified plan exists, the Secretary of the 
        Interior shall allocate funds in consultation with States, 
        tribes, and Federal agencies. Amounts in the Fund shall be used 
        for the restoration of fish and wildlife in the region, 
        including meeting treaty, trust, and Endangered Species Act 
        responsibilities, the fish mitigation and enhancement 
        requirements of the Pacific Northwest Electric Power Planning 
        and Conservation Act, and implementation of measures necessary 
        to meet the water quality standards under the Clean Water Act. 
        Moneys in the Fund may also be used to promote conservation and 
        renewable energy projects.
            (3) Source of monies.--All fees collected under paragraph 
        (4) shall be deposited in the Fund, and such fees shall be 
        available without further appropriation for the purposes set 
        forth in paragraph (2).
            (4) Distribution fee.--Each public and investor-owned 
        utility that purchases electric power from the Administrator 
        and makes retail sales of electric power in the region shall 
        collect and deposit in the Fund a fee in the amount of 3 mills 
        per kilowatt hour on all retail electric power sales made by 
        such utility in the region during the 15 calendar years 
        following the date of the enactment of this Act. During such 
        15-year period, the Administrator shall collect from each 
direct service industrial customer of the Administrator (as defined in 
section 3(8) of the Pacific Northwest Electric Power Planning and 
Conservation Act) a fee in the amount of 3 mills per kilowatt hour.
    (b) Payments of WPPSS Debt.--In order to ensure that the costs of 
repayment of Washington Public Power Supply System debt is repaid and 
fairly allocated to all Administration customers, the Administrator 
shall establish, collect, and use for repayment of the WPPSS debt each 
of the following fees and charges:
            (1) Fee or surcharge for certain new contracts.--The 
        Administrator shall require each direct service industrial 
        customer (as defined in section 3(8) of the Pacific Northwest 
        Electric Power Planning and Conservation Act) that enters into 
        a new contract with the Administrator for the delivery of 
        electric energy by the Administrator during the period 
        beginning after the date of the enactment of this Act and 
        ending in the year 2006 to pay either a fee established by the 
        Administrator or an additional percentage surcharge over the 
        otherwise applicable rates.
            (2) Exit charge.--The Administrator shall require each 
        wholesale power purchaser receiving electric energy as of the 
        year 2006 that does not enter into a contract with the 
        Administration for the delivery of power after the year 2006 to 
        pay an exit charge in such amount as may be established by the 
        Administrator.
            (3) Amount of fee, surcharge, or exit charge.--Fees, 
        surcharges, and exit charges received by the Administrator 
        under this subsection shall be established at such level as the 
        Administrator deems necessary to insure that the direct service 
        industrial customers referred to in paragraph (1) and the 
        wholesale power purchasers referred to in paragraph (2) pay an 
        equitable portion of the Washington Public Power Supply System 
        debt based upon each purchaser's historic purchases.
    (c) Relationship to Rates.--The fees, surcharges, and exit charges 
imposed as provided in this section shall be in addition to the rates 
established as provided in sections 7 and 8.

SEC. 7. RATES FOR POWER SALES BY BONNEVILLE POWER ADMINISTRATION.

    (a) Rates, Terms, and Conditions.--
            (1) In general.--All rates and charges made, demanded, or 
        received by the Administrator for the sale of electric energy 
        by the Administration to its electric energy customers (other 
        than the fees, surcharges, and charges referred to in section 
        6) shall recover from such customers, over a reasonable period 
        of years, in accordance with sound business principles, all 
        costs incurred by the United States for the generation and 
        marketing of electric energy sold by the Administration, 
        including meeting treaty, trust, and Endangered Species Act 
        responsibilities, the fish mitigation and enhancement 
        requirements of the Northwest Power Act, and the water quality 
        standards under the Clean Water Act.
            (2) Commission approval.--Rates established under this 
        section shall become effective only upon a determination by the 
        Commission that such rates meet the requirements of paragraph 
        (1). The Commission may modify proposed rates submitted by the 
        Administrator and establish terms and conditions to meet the 
        requirements of paragraph (1).
    (b) Existing Rates.--All rates, terms, and conditions for the sale 
of electric energy at wholesale by the Administration placed into 
effect on a final basis pursuant to any authority prior to the date of 
enactment of this Act shall remain in full force and effect unless the 
Commission determines, after a hearing held upon its own motion or upon 
complaint, that the rates, terms, and conditions are inconsistent with 
subsection (a) of this section and establishes new rates, terms, and 
conditions. Such new rates, terms, and conditions shall not result in 
rates for such sales that are in excess of the comparable market rate 
for electricity in the Western System Coordinating Council.

SEC. 8. FEDERAL ENERGY REGULATORY COMMISSION REGULATION OF BONNEVILLE 
              POWER ADMINISTRATION TRANSMISSION RATES.

    (a) In General.--The transmission of electric energy by the 
Administration shall be subject to the provisions of parts II and III 
of the Federal Power Act (except sections 204, 207, 209, 214, and 305), 
and the Commission shall have jurisdiction under such parts II and III 
over the rates, terms, and conditions of such transmission. Such 
provisions of the Federal Power Act and the rules, regulations, and 
policies of the Commission thereunder shall apply to such transmission 
by the Administration to the same extent and in the same manner as such 
provisions apply to the transmission of electric energy by a public 
utility otherwise subject to the jurisdiction of the Commission under 
part II of such Act, except that rates charged by the Administration 
for the transmission of electric energy shall be sufficient to recover 
all costs for compliance with treaty, trust, and Endangered Species Act 
responsibilities, the fish mitigation and enhancement requirements of 
the Pacific Northwest Electric Power Planning and Conservation Act, and 
the water quality standards under the Clean Water Act.
    (b) Separation.--(1) The financial and accounting system 
established for the Administration under section 5 shall assure the 
separation of all costs, revenues, and other fiscal matters associated 
with transmission from the costs, revenues, and other fiscal matters 
associated with power sales. The Commission shall review and approve or 
disapprove such administrative separation and assure that only costs 
properly allocable to transmission rates are recovered through 
transmission rates. Nothing in this paragraph shall be construed to 
limit or affect the authority of the Administrator to impose a 
transmission fee as part of cost recovery measures under subsection 
(c)(1)(B)(ii).
    (2) Except for purposes of assuring such transmission access as is 
necessary for purposes of meeting treaty, trust, and Endangered Species 
Act responsibilities, the fish mitigation and enhancement requirements 
of the Northwest Power Act, and the water quality standards under the 
Clean Water Act, the Commission shall take such steps as may be 
necessary to assure that no preference is accorded to the 
Administration for the transmission of power sold by the 
Administration.
    (c) Cost Recovery Adjustment.--(1) Whenever, during the period 
beginning October 1, 2001, and ending September 30, 2016, the 
Administrator, in accordance with account procedures established under 
section 5, determines that either--
            (A) the Administration's reserves have fallen below 
        $800,000,000, or
            (B) a 10-year forecast indicates that in any 1 future year, 
        the Administration has less than a 95 percent probability of 
        meeting a payment to the United States Treasury,
the Administrator shall submit to the Commission a transmission rate 
increase under this subsection and implement the following cost 
recovery measures designed to correct, within 5 years, such reserve 
deficiency or reduced payment ability forecast:
            (i) the Administrator shall adjust wholesale power rates 
        (up to the market rate for electricity in the Western System 
        Coordinating Council) to meet the revenue requirement set forth 
        in subparagraph (A) or (B), as the case may be; and
            (ii) if increasing wholesale rates up to the market rate of 
        electricity in the Western System Coordinating Council is not 
        sufficient to meet such requirement, the Administrator shall 
        implement a transmission fee to generate revenues sufficient to 
        meet such requirement but not in excess of $100,000,000 a year.
    (2) The Commission shall approve, disapprove, or modify any 
transmission rate increase submitted under this subsection within 30 
days after the date of submission. The Commission shall approve such 
increase if the Commission determines that such rate increase meets the 
requirements of this subsection and that the Administrator has taken 
reasonable steps to avoid such increase by using its authority under 
section 4(h)(10)(C) of the Pacific Northwest Electric Power, Planning 
and Conservation Act (16 U.S.C. 838b(h)(10)(D)).

Summary: Northwest Salmon Recovery Act of 1998 - Instructs the Secretary of the Interior to develop a unified plan for salmon recovery in the Pacific Northwest region whose goal is to restore sustainable naturally reproducing salmon populations to support tribal and nontribal harvest, cultural, and economic practices. Requires such plan to address: (1) treaty, trust, and Endangered Species Act responsibilities, (2) specified statutory requirements governing fish mitigation and enhancement, (3) water quality standards under the Clean Water Act. And (4) the United States-Canada Pacific Salmon Treaty commitments. Directs the Secretaries of Energy and of the Treasury to establish an accounting system for the Bonneville Power Administration that meets prescribed criteria. Directs the Secretaries of the Interior, Energy, Commerce, and the Army to implement a specified Memorandum of Agreement and Annex adopted in 1996, including procedures for effective regional involvement and accountability in the expenditure of moneys from the Administration's fund. Prescribes administrative procedures applicable to such Memorandum of Agreement and to the unified plan. Repeals the mandate to the Northwest Planning Council to appoint an Independent Scientific Review Panel. Directs the Secretary of the Interior to establish a Natural Resources Recovery Fund for fish and wildlife restoration in the Pacific Northwest region, and for conservation and renewable energy projects. Directs the Administrator to assess specified fees and charges to ensure that the repayment costs of Washington Public Power Supply System debt is repaid and allocated to all Administration customers. Provides that such fees and charges shall be in addition to: (1) rates for power sales by the Administration. And (2) Administration transmission rates. Requires that all rates and charges received for the sale of electric energy by the Administration to its electric energy customers recover all federally incurred costs for electric energy generation and marketing, including meeting certain statutory responsibilities. Places the transmission of electric energy by the Administration within the purview of the Federal Power Act, and grants the Federal Energy Regulatory Commission jurisdiction over transmission rates, terms, and conditions. Requires rates charged by the Administration for electric energy transmission to be sufficient to recover all costs for compliance with specified statutory responsibilities. Prescribes procedures for cost recovery adjustments by the Administration.