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[Senate Report 109-168]
[From the U.S. Government Publishing Office]

                                                       Calendar No. 269
109th Congress                                                   Report
                                 SENATE
 1st Session                                                    109-168

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        PACTOLA RESERVOIR REALLOCATION AUTHORIZATION ACT OF 2005

                                _______
                                

                October 27, 2005.--Ordered to be printed

                                _______
                                

   Mr. Domenici, from the Committee on Energy and Natural Resources, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 819]

     The Committee on Energy and Natural Resources, to which 
was referred the bill (S. 819) to authorize the Secretary of 
the Interior to reallocate costs of the Pactola Dam and 
Reservoir, South Dakota, to reflect increased demands for 
municipal, industrial, and fish and wildlife purposes, having 
considered the same, report favorably thereon without amendment 
and recommend that the bill do pass.

                         PURPOSE OF THE MEASURE

    The purpose of S. 819 is to authorize the Secretary of the 
Interior to reallocate costs of the Pactola Dam and Reservoir, 
South Dakota, to reflect increased demands for municipal, 
industrial, and fish and wildlife purposes.

                          BACKGROUND AND NEED

    The Pactola Dam and Reservoir is part of the Rapid Valley 
Unit under the Pick-Sloan Missouri Basin Program. It was 
authorized by the Flood Control Act of 1944 (P.L. 78-534) to 
provide supplemental municipal water for Rapid City, South 
Dakota and supplemental irrigation water for the Rapid Valley 
Conservancy District (District). Other authorized purposes 
include fish and wildlife management and flood control. The 
Department of the Interior's Bureau of Reclamation (Bureau or 
Reclamation) is responsible for the operation and maintenance 
of the Pactola Dam and Reservoir.
    The 40-year term Pactola Reservoir water purchase contract 
between the United States and Rapid City for municipal and 
industrial water supply expired in October 1992. A second long-
term Pactola Reservoir water purchase contract between the 
United States and the District for irrigation water supply 
expired in January 2001.
    In 1992, the Bureau began discussions with Rapid City and 
the District to renegotiate the water supply contracts in order 
to meet municipal, industrial, irrigation, recreation, 
wildlife, fisheries, and instream flow needs. Instead of 
contracting with the Federal Government for water from Pactola 
Reservoir, the District opted to execute a separate subcontract 
with Rapid City to provide a supplemental water supply when 
needed. Reclamation has negotiated a new long-term contract 
with Rapid City. The new contract provides the city with a 
49,000 acre-feet water storage right in Pactola Reservoir. 
Under the contract, the Bureau retains 6,000 acre-feet of 
storage to be used for other authorized uses such as fish and 
wildlife purposes.
    An Environmental Assessment for the Pactola Reservoir Water 
Service Contract Renewal has been completed and a Finding of No 
Significant Impact was signed on October 20, 2000. 
Congressional authority is needed to reallocate these contracts 
costs from irrigation purposes to municipal, industrial, and 
fish and wildlife purposes. Once Congress grants authority to 
reallocate these costs, the Bureau can execute the negotiated 
contract with Rapid City.

                          LEGISLATIVE HISTORY

    S. 819 was introduced by Senator Johnson on April 15, 2005, 
and referred to the Committee on Energy and Natural Resources. 
The Water and Power Subcommittee held a hearing on S. 819 on 
July 12, 2005. At the business meeting on September 28, 2005, 
the Committee on Energy and Natural Resources ordered S. 819 
favorably reported without amendment.

                        COMMITTEE RECOMMENDATION

    The Committee on Energy and Natural Resources, in open 
business session on September 28, 2005, by unanimous vote of a 
quorum present, recommends that the Senate pass S. 819.

                      SECTION-BY-SECTION ANALYSIS

    Section 1 sets forth the short title.
    Section 2 sets forth congressional findings that it is 
appropriate to reallocate costs of the Pactola Dam and 
Reservoir to reflect increased demands for municipal, 
industrial, and fish and wildlife purposes and that such a cost 
reallocation needs Congressional approval.
    Section 3 authorizes the Secretary of the Interior to 
reallocate the construction costs of Pactola Dam and Reservoir, 
Rapid Valley Unit, Pick-Sloan Missouri Basin Program, South 
Dakota, from irrigation purposes to municipal, industrial, and 
fish and wildlife purposes.

                   COST AND BUDGETARY CONSIDERATIONS

    The following estimate of costs of this measure has been 
provided by the Congressional Budget Office.

               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

S. 819--Pactola Reservoir Reallocation Authorization Act of 2005

    S. 819 would authorize the Bureau of Reclamation to 
reallocate the construction costs of Pactola Dam and Reservoir 
from irrigation purposes to municipal and industrial and fish 
and wildlife purposes. This would allow the bureau to provide 
water to Rapid City, South Dakota, under a new contract that 
would replace expired contracts for supplemental irrigation and 
municipal and industrial water. CBO estimates that enacting S. 
819 would not have a significant effect on the federal budget.
    Enacting this legislation would allow the bureau to enter 
into a new water service contract that would generate a small 
increase in receipts over existing interim contracts. Based on 
information from the bureau, CBO estimates that increase in 
contract payments would be about $100,000 annually. Such 
payments are recorded in the budget as offsetting receipts (a 
credit against direct spending).
    S. 819 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would impose no cost on state, local, or tribal governments. 
Enacting this bill would benefit the Rapid Valley Irrigation 
District by reallocating the construction costs of Pactola Dam 
and Reservoir from irrigation purposes to municipal, 
industrial, and fish and wildlife purposes.
    The CBO staff contact for this estimate is Mike Waters. 
This 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. 819.
    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. 819, as ordered reported.

                        EXECUTIVE COMMUNICATIONS

    The testimony provided by the Department of the Interior at 
the Subcommittee hearing on S. 819 follows:

     Statement of John W. Keys, III, Commissioner, U.S. Bureau of 
                Reclamation, Department of the Interior

    My name is John Keys. As Commissioner of the Bureau of 
Reclamation, I am pleased to appear today in support of S. 819, 
the Pactola Reservoir Reallocation Authorization Act of 2005.
    Mr. Chairman, S. 819 would authorize the Secretary of the 
Interior to reallocate construction costs of Pactola Dam and 
Reservoir, Rapid Valley Unit, and the Pick-Sloan Missouri Basin 
Program, South Dakota, to municipal, industrial, and fish and 
wildlife purposes. This reallocation reflects the increasing 
water demands from Pactola Reservoir for municipal and 
industrial purposes, specifically within Rapid City and 
throughout the surrounding areas, and for fish and wildlife 
purposes in and along Rapid Creek.

                               background

    Rapid Valley Unit is served, in part, by the Pactola 
Reservoir. Located on Rapid Creek in the Black Hills of South 
Dakota approximately 15 miles west of Rapid City, Pactola was 
constructed between 1952 and 1956. The Rapid Valley Irrigation 
District (District) consists of 8,900 acres of privately 
developed land and associated irrigation diversion and supply 
works. The irrigable land is situated along Rapid Creek 
immediately downstream of the City. Pactola Reservoir 
supplemented the Districts' 8,000 acre-foot water supply from 
Deerfield Dam. The Rapid Valley Unit provides a full water 
supply for Rapid City (including Ellsworth Air Force Base), 
flood protection, recreation, and fish and wildlife.
    On October 20, 1952, the City entered into a 40-year water 
service contract for municipal and industrial water supply from 
Pactola Reservoir. Since the contract's expiration in 1992, 
annual water service contracts have been issued to provide 
water to the City until a replacement contract can be executed. 
The District also executed a 40-year water service contract 
with the U.S. on January 6, 1961, for a supplemental irrigation 
water supply from Pactola Reservoir. This contract expired in 
2001 and the District decided to not renew it. The District 
will rely on its natural flow rights, return flows from the 
City's water treatment plant, water purchased from the City, 
and water from the Deerfield Dam and Reservoir.
    Reclamation has negotiated a new repayment contract with 
Rapid City. However, the McGovern Amendment to the Department 
of Energy Organization Act prohibits Reclamation from 
reallocating multipurpose construction costs without specific 
Congressional approval. Therefore, execution of the negotiated 
contract is contingent on authority from Congress to reallocate 
the construction costs of Pactola Dam and Reservoir currently 
allocated to irrigation purposes to municipal, industrial, and 
fish and wildlife purposes.

                               conclusion

    Passage of this Act will provide Reclamation with authority 
to enter into a new long-term contract with Rapid City to 
provide a water storage right of 49,000 acre-feet in Pactola 
Reservoir. This contract will secure a reliable water supply 
for the city and the surrounding area to support expected 
growth well into the future. Reclamation will retain 6,000 acre 
feet of storage in the reservoir to be used for fish and 
wildlife, and other authorized beneficial purposes.
    I am pleased to answer any questions.

                        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 the bill S. 819, as ordered 
reported.

                                  
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