59–010 

Calendar No. 51 

110TH CONGRESS REPORT " ! SENATE 1st Session 110–25 

NORTH UNIT IRRIGATION DISTRICT ACT OF 2007 

FEBRUARY 16, 2007.—Ordered to be printed 

Mr. BINGAMAN, from the Committee on Energy and Natural 

Resources, submitted the following 

R E P O R T 

[To accompany S. 266] 

The Committee on Energy and Natural Resources, to which was 

referred the bill (S. 266) to provide for the modification of and 

amendatory repayment contract between the Secretary of the Interior and the North Unit Irrigation District, and for other purposes, 

having considered the same, reports favorably thereon without 

amendment and recommends that the bill do pass. 

PURPOSE

The purpose of S. 266 is to provide for the modification of an 

amendatory repayment contract between the Secretary of the Interior and the North Unit Irrigation District, and for other purposes. 

BACKGROUND AND NEED

Created in 1916, the North Unit Irrigation District (District) provides water necessary to irrigate approximately 59,000 acres of 

land in central Oregon. Approximately 900 farms and ranches receive irrigation water from the District for farming and ranching. 

The District receives water from the Deschutes Project, a Bureau 

of Reclamation (Reclamation) project and the Crooked River pumping plant, a private project constructed by the District. In the mid1950’s, the United States and the District renegotiated the District’s repayment contract. Public Law 83–573 approved the renegotiated repayment contract. The renegotiated contract limits the 

amount of water that the District can receive from a Reclamation 

project to the water necessary to irrigate 49,818 acres of land. Because Congress approved the renegotiated contract, any changes to 

that contract must also be approved by Congress. 

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S. 266 would amend the Contract between the United States and 

the District in order to address several issues that were not contemplated when the contract was approved 50 years ago. S. 266 

would amend the repayment contract to allow the District to participate in a conserved water project, which would allow the District to provide water from the Deschutes Project to irrigators who 

are presently irrigating roughly 9,000 acres of land with water 

from the Crooked River pumping plant. Under the current repayment contract, adding these 9,000 acres would exceed the cap of irrigated lands that may receive Deschutes Project water. Adding the 

9,000 acres will allow the District to use less Crooked River water 

and leave more water in that river. Reclamation believes that leaving more water in Crooked River and the District’s participation in 

State conserved water projects will benefit fish and wildlife in both 

the Crooked and Deschutes River. Amending the repayment contract from a variable to a fixed term will also result in financial 

benefits to the United States. 

LEGISLATIVE HISTORY

S. 266 was introduced on January 11, 2007 by Senator Smith for 

himself and Senator Wyden and referred to the Committee on Energy and Natural Resources. At its business meeting on January 

31, 2007, the Committee ordered S. 266 favorably reported. 

During the 109th Congress, the Committee considered similar 

legislation, S. 2502, introduced by Senator Smith on April 4, 2006. 

Senator Wyden was a co-sponsor. The Subcommittee on Water and 

Power held a hearing on S. 2502 on June 28, 2006. S. Hrg. 109–

677. No further action occurred on S. 2502 prior to the sine die adjournment of the 109th Congress. A companion measure, Section 5 

of H.R. 5079, was considered by the House of Representatives 

under suspension of the rules and passed by a voice vote on September 25, 2006. 

COMMITTEE RECOMMENDATION

The Senate Committee on Energy and Natural Resources, in an 

open business meeting on January 31, 2007, by a voice vote of a 

quorum present, recommends that the Senate pass S. 266. 

SECTION-BY-SECTION ANALYSIS

Section 1 provides the short title. 

Section 2 amends the Act of August 10, 1954 (68 Stat. 679, chapter 663) by adding some abbreviated references to section 1 of the 

Act, and then adding two new sections. The first added section 

(‘‘Sec. 3. Additional Terms’’) sets forth, as described, specific 

amendments or terms to be added to the Contract between the 

United States and the North Unit Irrigation District. The second 

added section (‘‘Sec. 4. Future Authority to Renegotiate’’) authorizes the Secretary of the Interior (acting through the Commissioner 

of Reclamation) to renegotiate terms of the Contract under certain 

conditions. 

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COST AND BUDGETARY CONSIDERATIONS

The following estimate of costs of this measure has been provided 

by the Congressional Budget Office: 

S. 266—North Unit Irrigation District Act of 2007 

S. 266 would amend certain provisions of a contract between the 

Department of the Interior and Oregon’s North Unit Irrigation District. CBO estimates that enacting this bill would have no significant impact on the federal budget. 

S. 266 would amend the North Unit’s Irrigation District repayment contract with the Department of the Interior. Under current 

law, payments under that contract will be completed within the 

next 35 to 45 years. S. 266 would amend the terms of the district’s 

contract with the department by setting a fixed annual payment 

and requiring the district’s total obligation to be paid to the department by 2044. CBO estimates that enacting S. 266 would increase 

offsetting receipts by less than $100,000 a year. (Such collections 

are a credit against direct spending.) Enacting this bill would not 

affect revenues. 

S. 266 contains no intergovernmental or private-sector mandates 

as defined in the Unfunded Mandates Reform Act and would impose no costs on state, local, or tribal governments. The bill would 

authorize the Secretary of the Interior to modify a repayment contract with the North Unit Irrigation District. Other modifications 

to the contract would increase the number of acres eligible for irrigation and allow the district to use conserved water to support 

wildlife. Those modifications would generally benefit the district, 

and any costs they might incur would be incurred voluntarily. 

The CBO staff contacts for this estimate are Julie Middleton (for 

federal costs), and Lisa Ramirez-Branum (for the state and local 

impact). The estimate was approved by Peter H. Fontaine, Deputy 

Assistant Director for Budget Analysis. 

REGULATORY IMPACT EVALUATION

In compliance with paragraph 11(b) of rule XXVI of the Standing 

Rules of the Senate, the Committee makes the following evaluation 

of the regulatory impact which would be incurred in carrying out 

S. 266. The bill is not a regulatory measure in the sense of imposing Government-established standards or significant responsibilities on private individuals and business. 

No personal information would be collected in administering the 

program. Therefore, there would be no impact on personal privacy. 

Little, if any, additional paperwork would result from the enactment of S. 266. 

EXECUTIVE COMMUNICATIONS

Because S. 266 is similar to legislation considered during the 

109th Congress, the Committee did not request Executive Agency 

views. The testimony provided by the Bureau of Reclamation on S. 

2502 at the Subcommittee hearing in the 109th Congress follows: 

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STATEMENT OF WILLIAM E. RINNE, ACTING COMMISSIONER, 

BUREAU OF RECLAMATION

Madam Chairwoman and members of the Subcommittee, 

I am William Rinne, Acting Commissioner of the Bureau 

of Reclamation. Thank you for the opportunity to testify on 

S. 2502. The Department supports S. 2502. 

The North Unit Irrigation District receives water from 

the Bureau of Reclamation’s Deschutes Project and the 

District’s privately developed Crooked River pumping 

plant in Oregon. Over 900 small farm and ranch families 

in Oregon’s Deschutes Basin rely upon the District for the 

delivery of irrigation water. Since the District’s formation 

a century ago, these families have shifted from dryland 

wheat to alfalfa hay, grass seed, garlic seed, and carrot 

seed, as well as raising cattle, sheep, horses, and other 

livestock. 

In the mid-1950s, Reclamation and the District renegotiated the District’s repayment contract in accordance with 

section 7, subsection (a), of the Reclamation Project Act of 

1939. Pursuant to the Act of August 10, 1954, Congress 

approved the contract along with an authorization for the 

construction of Haystack Dam and regulating reservoir. 

The contract established the maximum irrigable acreage 

that can receive Reclamation project water at 49,818 acres. 

S. 2502 will resolve several limitations in the District’s 

contract, enabling the District to more efficiently manage 

its water supplies. Because Congress approved the District’s contract, changes to the contract which are beyond 

the scope of the Contracting Officer’s authority must also 

be approved to Congress. 

Oregon law requires irrigation districts that participate 

in a publicly financed ‘‘conserved water project’’ to dedicate 

a portion of conserved water resulting from the project to 

instream flows for fish, wildlife or other purposes (ORS 

537.455 et seq.). The District has self-financed over $8 million in conservation activities, and would like to consider 

participation in a publicly financed program. Unfortunately, the underlying Project authorization and the District’s contract do not allow it to dedicate water to 

instream uses. S. 2502 amends the District’s contract so 

the District can comply with State law if it chooses to participate in a conserved water project. 

A related change to the District’s contract would allow 

the District to deliver Deschutes Project water to families 

who are irrigating approximately 9,000 acres of land in the 

District with non-project water diverted by the District’s 

Crooked River pumping plant. All of these lands are within the District’s present boundary, have been irrigated for 

decades, and have appurtenant water rights issued by the 

State, but they exceed the current contract’s ceiling of approximately 49,818 acres. Using Deschutes Project water 

on these lands will allow the District to divert less Crooked River water and leave more water instream. 

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S. 2502 will benefit fish and wildlife by enabling the District to use less water from the Crooked River, and participate in State conserved water projects that return a portion of the conserved water to the Deschutes River. The 

United States would also realize financial benefits in the 

form of accelerated repayment of Project construction costs 

through the annual participation of an additional 9,000 

acres in Project repayment. The District’s current contract 

is based on a variable repayment plan, which means that 

rather than paying fixed annual installments, the District’s annual payments vary based on factors such as crop 

production. Thus it is difficult or impossible to predict 

when the District would pay out its contract if this bill is 

not enacted. This legislation not only increases the number 

of acres in Project repayment, but also requires the District to pay its remaining obligation of $6,649,371 in fixed 

annual installments. 

The Administration also supports the language that this 

bill inserts at the end of the bill, in section 4 to be inserted 

into the underlying act. This provision gives the Secretary 

the authority to renegotiate this contract upon mutually 

agreeable terms without having to have Congress approve 

of changes agreed upon between the District and the Secretary. This provision reflects the general rule that repayment contracts do not require Congressional approval. 

The legislation is specific to the District; it would not affect any other district in the Deschutes Project, their patrons, or any others in Oregon. The District will continue 

to comply with all applicable state and federal laws including the Reclamation Reform Act of 1982. 

On behalf of the Department, I would like to compliment 

the District on its proactive approach to addressing the 

water management issues it is facing, as well as obtaining 

the support of other interested parties in the local community. We are pleased to support this legislation. 

I am happy to respond to any questions. 

CHANGES IN EXISTING LAW

In compliance with paragraph 12 of rule XXVI of the Standing 

Rules of the Senate, changes in existing law made by the bill S. 

266, as ordered reported, are shown as follows (existing law proposed to be omitted is enclosed in black brackets, new matter is 

printed in italic, existing law in which no change is proposed is 

shown in roman): 

ACT OF AUGUST 10, 1954 (68 Stat. 679, ch. 663) 

AN ACT To approve an amendatory repayment contract negotiated with the North 

Unit irrigation district, to authorize construction of Haystack Reservoir on the 

Deschutes Federal reclamation project, and for other purposes. 

Be it enacted by the Senate and House of Representatives of the 

United States of America in Congress assembled, That the contract 

with the North Unit irrigation district (referred to in this Act as the ‘‘District’’) in form substantially similar to that approved by the district directors on July 31, 1953 (referred to in this Act as the ‘‘Conmstockstill on PROD1PC66 with HEARING

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tract’’), which has been negotiated by the Secretary of the Interior 

pursuant to section 7, subsection (a), of the Reclamation Project Act 

of 1939 (53 Stat. 1187, 1192; 43 U.S.C., 1946 edition, sec. 485), is 

approved and the Secretary of the Interior is authorized to execute 

it on behalf of the United States. 

* * * * * * * 

SEC. 3. ADDITIONAL TERMS. 

On approval of the District directors and notwithstanding project 

authorizing legislation to the contrary, the Contract is modified, 

without further action by the Secretary of the Interior, to include the 

following modifications: 

(1) In Article 8(a) of the Contract, by deleting ‘‘a maximum 

of 50,000’’ and inserting ‘‘approximately 59,000’’ after ‘‘irrigation service to’’. (2) In Article 11(a) of the Contract, by deleting ‘‘The classified 

irrigable lands within the project comprise 49,817.75 irrigable 

acres, of which 35,773.75 acres are in Class A and 14,044.40 

in Class B. These lands and the standards upon which the classification was made are described in the document entitled 

‘Land Classification, North Unit, Deschutes Project, 1953’ which is on file in the office of the Regional Director, Bureau 

of Reclamation, Boise, Idaho, and in the office of the District’’ and inserting ‘‘The classified irrigable land within the project 

comprises 58,902.8 irrigable acres, all of which are authorized 

to receive irrigation water pursuant to water rights issued by 

the State of Oregon and have in the past received water pursuant to such State water rights.’’. (3) In Article 11(c) of the Contract, by deleting ‘‘, with the approval of the Secretary,’’ after ‘‘District may’’, by deleting ‘‘the 

49,817.75 acre maximum limit on the irrigable area is not exceeded’’ and inserting ‘‘irrigation service is provided to no more 

than approximately 59,000 acres and no amendment to the District boundary is required’’ after ‘‘time so long as’’. 

(4) In Article 11(d) of the Contract, by inserting ‘‘, and may 

further be used for instream purposes, including fish or wildlife 

purposes, to the extent that such use is required by Oregon 

State law in order for the District to engage in, or take advantage of, conserved water projects as authorized by Oregon State 

law’’ after ‘‘herein provided’’. 

(5) By adding at the end of Article 12(d) the following: ‘‘(e) 

Notwithstanding the above subsections of this Article or Article 

13 below, beginning with irrigation season immediately following the date of enactment of the North Unit Irrigation District Act of 2006, the annual installment for each year, for the 

District, under the Contract, on account of the District’s construction charge obligation, shall be a fixed and equal annual 

amount payable on June 30 the year following the year for 

which it is applicable, such that the District’s total construction 

charge obligation shall be completely paid by June 30, 2044.’’. 

(6) In Article 14(a) of the Contract, by inserting ‘‘and for 

instream purposes, including fish or wildlife purposes, to the 

extent that such use is required by Oregon State law in order 

for the District to engage in, or take advantage of, conserved 

water projects as authorized by Oregon State law,’’ after ‘‘and 

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incidental stock and domestic uses’’, by inserting ‘‘and for 

instream purposes, as described above,’’ after ‘‘irrigation, stock 

and domestic uses’’, and by inserting ‘‘, including natural flow 

rights out of the Crooked River held by the District’’ after ‘‘irrigation system’’. (7) In Article 290a( of the Contract, by inserting ‘‘and for 

instream purposes, including fish and wildlife purposes, to the 

extent that such use is required by Oregon State law in order 

for the District to engage in, or take advantage of, conserved 

water projects as authorized by Oregon State law’’ after ‘‘provided in article 11’’. (8) In Article 34 of the Contract, by deleting ‘‘The District, 

after the election and upon the execution of this contract, shall 

promptly secure final decree of the proper State court approving 

and confirming this contract and decreeing and adjudging it to 

be a lawful, valid, and binding general obligation of the District. The District shall furnish to the United States certified 

copies of such decrees and of all pertinent supporting records.’’ after ‘‘for that purpose.’’. 

SEC. 4. FUTURE AUTHORITY TO RENEGOTIATE. 

The Secretary of the Interior (acting through the Commissioner of 

Reclamation) may in the future renegotiate with the District such 

terms of the Contract as the District directors determine to be necessary, only upon the written request of the District directors and 

the consent of the Commissioner of Reclamation. 

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