19–010 

Calendar No. 273 

112TH CONGRESS REPORT " ! SENATE 2d Session 112–111 

SOUTH UTAH VALLEY ELECTRIC CONVEYANCE ACT 

JANUARY 13, 2012.—Ordered to be printed 

Filed, under authority of the order of the Senate of December 17, 2011 

Mr. BINGAMAN, from the Committee on Energy and Natural 

Resources, submitted the following 

R E P O R T 

[To accompany S. 500] 

The Committee on Energy and Natural Resources, to which was 

referred the bill (S. 500) to direct the Secretary of the Interior to 

convey certain Federal features of the electric distribution system 

to the South Utah Valley Electric Service District, and for other 

purposes, having considered the same, reports favorably thereon 

with amendments and recommends that the bill, as amended, do 

pass. 

The amendments are as follows: 

1. On page 4, lines 1 and 2, strike ‘‘pursuant to the provisions 

of this Act’’ and insert ‘‘as soon as practicable after the date of enactment of this Act and in accordance with applicable law,’’. 

2. On page 6, line 23, strike ‘‘but shall’’ and all that follows 

through page 7, line 3, and insert ‘‘including the transaction of 

April 7, 1986, between the Strawberry Water Users Association 

and the Strawberry Electric Service District’’. 

3. On page 7, lines 6 and 7, strike ‘‘24 months after the date of 

the enactment of this Act’’ and insert ‘‘1 year after the date of enactment of this Act, not later than 30 days after that date’’. 

PURPOSE

The purpose of S. 500, as ordered reported, is to direct the Secretary of the Interior to convey certain Federal features of the electric distribution system to the South Utah Valley Electric Service 

District. 


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BACKGROUND AND NEED

The Strawberry Valley Project in Utah was initiated by the Bureau of Reclamation in 1906 and currently includes the Strawberry 

Dam and Reservoir, diversion dams, canals, several power plants, 

and an electric transmission and distribution system. The Strawberry Valley Project is connected to the Bonneville Unit of the Central Utah Project and comprises about 45,000 irrigable acres in the 

area of Spanish Fork, Utah. The Strawberry Water Users Association operates and maintains the project and is responsible for generation and transmission of power on the project. Two of the power 

plants were constructed by the water users association and later 

transferred to the Bureau of Reclamation. Approximately 1,550 

kilowatts of power are developed in three power plants on the 

project. All three power plants are operated by the Strawberry 

Water Users Association. In 1986, the association conveyed its interest in the electric distribution system fixtures, lands, and power 

poles to the South Utah Valley Electric Service District. The purpose of this legislation is to clarify certain issues that were not sufficiently resolved in connection with the prior transfer. 

LEGISLATIVE HISTORY

Senator Hatch introduced S. 500 on March 7, 2011. The bill is 

co-sponsored by Senator Lee. The Subcommittee on Water and 

Power held a hearing on S. 500 on June 23, 2011 (S. Hrg. 112– 

129). A similar bill, H.R. 461, was introduced by Representatives 

Chaffetz and Bishop on January 26, 2011. H.R. 461 was reported 

as amended by the House Committee on Natural Resources on September 23, 2011 (H. Rept. 112–217). H.R. 461, as amended, passed 

the House of Representatives on October 24, 2011. The Committee 

on Energy and Natural Resources ordered reported both S. 500, as 

to conform to H.R. 461 as passed by the House, and H.R. 461, without amendment, at its business meeting on November 10, 2011. 

During the 111th Congress, similar legislation was introduced by 

Senator Hatch in the Senate, S. 3917, and Representative Chaffetz 

in the House, H.R. 6271. No further actions were taken. 

COMMITTEE RECOMMENDATION

The Senate Committee on Energy and Natural Resources, in 

open business session on November 10, 2011, by a voice vote of a 

quorum present, recommends that the Senate pass S. 500, if 

amended as described herein. 

COMMITTEE AMENDMENTS

During its consideration of S. 500, the Committee adopted three 

amendments. The first clarifies the Secretary’s duty to convey the 

electric distribution system to the South Utah Valley Electric Service District as soon as practicable after the date of enactment of S. 

500 and in accordance with applicable law. The second clarifies 

that the United States is not liable for damages arising from the 

sale of the electric distribution system by the Strawberry Water 

Users Association to the South Utah Valley Electric District on 

April 7, 1986. The third provides that if the conveyance is not completed within 1 year (instead of 24 months) after the date of enactment of S. 500, the Secretary must submit a report to Congress 


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within 30 days after the one-year anniversary of the date of enactment. 

SECTION-BY-SECTION ANALYSIS

Section 1 identifies the short title of the bill as the ‘‘South Utah 

Valley Electric Conveyance Act’’. 

Section 2 defines key terms used in the bill. 

Section 3(a) directs the Secretary of the Interior to convey all 

right, title, and interest currently owned by the United States to 

the District. Subsection (b) requires the conveyance to comply with 

all applicable environmental laws, including the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) and the Endangered Species Act of 1973 (16 U.S.C. 1531 et seq.). Subsection (c) 

excludes the Strawberry Valley Project power generation system 

and the Federally-owned portions of the 46 kilovolt transmission 

system, except for uses granted by license in Shared Power Poles 

described under section 3(a)(2), from being conveyed to the District. 

Section 4 specifies that the land and facilities conveyed by S. 500 

shall no longer be part of a Federal reclamation project, that the 

District shall not be entitled to any future Bureau of Reclamation 

benefits for the conveyed land and facilities, and that the United 

States shall not be liable for damages related to the land and facilities, including the 1986 transaction between the Strawberry Water 

Users Association and the South Utah Valley Electric Service District. 

Section 5 requires that if the conveyance under section 3 is not 

completed within one year of enactment of S. 500, the Secretary of 

the Interior shall submit a report to Congress that describes the 

status of the conveyance, any obstacles preventing completion of 

the conveyance, and specifies an anticipated new date for completion of the conveyance. 

COST AND BUDGETARY CONSIDERATIONS

The following estimate of costs of this measure has been provided 

by the Congressional Budget Office: 

S. 500—South Utah Valley Electric Conveyance Act 

S. 500 would direct the Secretary of the Interior, acting through 

the Bureau of Reclamation, to transfer the title of the electric distribution system located in Spanish Fork, Utah, to the South Utah 

Valley Electric Service District. Based on information from the Bureau of Reclamation, CBO estimates that enacting the bill would 

have no significant net impact on the federal budget. Enacting S. 

500 would have an insignificant impact on direct spending; therefore, pay-as-you-go procedures apply. The legislation would not affect revenues. 

The electric distribution system was developed as part of the 

Strawberry Valley Project in the 1920s. The Strawberry Water 

Users Association (SWUA), the nonfederal sponsor of the project, 

satisfied all federal repayment obligations associated with the 

project in 1974. In 1986, the SWUA spun off the South Utah Valley 

Electric Service District and the Bureau of Reclamation transferred 

financial responsibility for the operation and maintenance of the 

electric distribution system to the district. Under current law, the 

bureau oversees those operation and maintenance activities. 


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Under the bill, transfer of the title of the electric distribution system to the district would include all federally owned fixtures and 

the underlying federal land not shared by other facilities. In instances where the underlying federal land is also occupied by other 

facilities and in the case of shared power poles, permanent access 

and licensing privileges would be granted to the district to perform 

the required maintenance. 

Under S. 500, the Bureau of Reclamation would discontinue oversight of the facilities. In addition, the bureau would no longer collect licensing fees from utilities seeking easements to cross those 

federal lands. Based on information from the bureau, CBO estimates that the loss of those collections would have no significant 

net impact on the federal budget. 

On August 26, 2011, CBO transmitted a cost estimate for H.R. 

461, the South Utah Valley Electric Conveyance Act, as ordered reported by the House Committee on Natural Resources on July 20, 

2011. The two pieces of legislation and CBO’s cost estimates are 

the same. 

S. 500 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 CBO staff contact for this estimate is Aurora Swanson. The 

estimate was approved by Theresa Gullo, 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. 500. 

The bill is not a regulatory measure in the sense of imposing 

Government-established standards or significant economic responsibilities on private individuals and businesses. 

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. 500, as ordered reported. 

CONGRESSIONALLY DIRECTED SPENDING

S. 500, as reported, does not contain any congressionally directed 

spending items, limited tax benefits, or limited tariff benefits as defined in rule XLIV of the Standing Rules of the Senate. 

EXECUTIVE COMMUNICATIONS

The testimony provided by the U.S. Department of the Interior, 

Bureau of Reclamation at the June 23, 2011, Subcommittee hearing on S. 500 follows: 

STATEMENT OF GRAYFORD F. PAYNE, DEPUTY COMMISSIONER FOR POLICY, ADMINISTRATION AND BUDGET, BUREAU OF RECLAMATION, DEPARTMENT OF THE INTERIOR

Madam Chairman and Members of the Subcommittee, I 

am Grayford Payne, Deputy Commissioner for Policy, Administration and Budget at the Bureau of Reclamation 


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(Reclamation). I am pleased to provide the views of the Department of the Interior (Department) regarding S. 500, 

legislation authorizing the transfer of the Federal portion 

of the Strawberry Valley Project Electric Distribution System to the South Utah Valley Electric Service District 

(District). Reclamation supports the title transfer contemplated by this bill and recommends revisions be made 

to the bill, which I describe below. 

The Strawberry Valley Project (Project) is one of Reclamation’s earliest projects, and all Federal obligations associated with the Project are fully repaid. Reclamation developed hydropower generation from the beginning because 

electricity was required to build the Project. Early in the 

Project’s history, Reclamation transferred the operation 

and maintenance of most of the Project, including the 

Power System, to the Strawberry Water Users Association 

(Association). 

The Strawberry Valley Project Power System has three 

parts: the powerplants are the Generation System, the 

high-voltage lines running from the powerplants to the 

substations are the Transmission System, and the lowvoltage lines running from the substations to the customers are the Distribution System. 

In 1986, the Association spun off the District—creating 

an independent service district with the capability to operate and maintain the Transmission and Distribution Systems. At the same time, the Association proposed selling 

the Distribution System to the District. Reclamation approved the proposed sale on the condition that the Association not transfer any Federal facilities. At the time, Reclamation required that the sale be limited to those portions of the Distribution System owned by the Association—those parts that were not completed as part of the 

original Strawberry Valley Project; constructed with 

Strawberry Valley Project revenues; and constructed on 

Federal lands or interests in lands. The District paid approximately $2.7 million for the non-Federal portions of 

the Distribution System. Reclamation approved the sale. 

In 1986, Reclamation, the Association, and the District 

believed that most of the Distribution System was nonFederal. Later, it was determined that this was not accurate. 

The 1940 Repayment Contract between the United 

States and the Association states clearly that all additions 

to the Power System are Federal facilities; little or none of 

the Distribution System was owned by the Association. 

The District is chagrined at having paid the Association 

for facilities it did not receive. The purpose of this Act is 

to convey to the District what all parties believed the District acquired in 1986. 

The Act would likely have little effect on operation of the 

Strawberry Valley Project. The District would receive fee 

interest in those Federal lands on which the Distribution 

System is the only Federal feature. On Federal lands sharing both Distribution System and other Strawberry Valley 


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Project facilities, the legislation grants the District an 

easement for access to perform maintenance on the Distribution System fixtures. This provision preserves the interest of the United States and the public in the other 

Strawberry Valley Project facilities. As for the rest of the 

Project, the organizations would remain responsible for operating and maintaining the Generation System and the 

Transmission System on behalf of the United States. 

Because the Strawberry Valley Project is a paid-out Reclamation project, there is no outstanding repayment obligation associated with it. For this reason, the Act does not 

require any payment from the District in exchange for title 

to the Distribution facilities. In addition, the Act eliminates Reclamation’s obligations to oversee the maintenance of the Distribution System and to administer the associated lands. The result may be a slight reduction in 

Reclamation expenditures. 

The change in ownership under the bill will be relatively 

invisible to the public. Because the District has been operating and maintaining the Distribution System for several 

years, the public will witness a change in ownership but 

should not experience any change in operation. The Act 

will eliminate uncertainty about ownership and obligations 

associated with the Distribution System—which will likely 

lead to more efficient and effective operation of the Distribution System. 

The Department recognizes that there are benefits to be 

achieved by the proposed title transfer and has worked 

closely and cooperatively with the interested parties. Before the Department can support S. 500, we recommend 

two revisions: First, Section 3(a), directing that ‘‘the Secretary . . . shall convey and assign’’ the facilities to be 

transferred, should be changed to ‘‘the Secretary . . . is 

authorized to convey and assign’’, thereby allowing for 

completion of the necessary public input and scoping pursuant to the National Environmental Policy Act (NEPA). 

And second, language should be added to state that the 

District shall hold the United States harmless for any 

claim arising from the 1986 sale of the Distribution System and from actions under this legislation. 

In recent days, we have had discussions with the District about accelerating the NEPA process and making 

modifications to the legislation to address the concerns described in this testimony. As such, I am confident that we 

can work with the District, Senator Hatch, Representative 

Chaffetz, and the Subcommittee to reach our goal of supporting this legislation and transferring title to these facilities in a timely manner. 

This concludes my written statement. I am pleased to 

answer any questions. 


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CHANGES IN EXISTING LAW

In compliance with paragraph 12 of rule XXVI of the Standing 

Rules of the Senate, the Committee notes that no changes in existing law are made by S. 500, as ordered reported. 

Æ 


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