29–010 

Calendar No. 467

108TH CONGRESS REPORT " SENATE ! 2d Session 108–250

WALLOWA LAKE DAM REHABILITATION AND WATER 

MANAGEMENT ACT OF 2004

MARCH 29, 2004.—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. 1355] 

The Committee on Energy and Natural Resources, to which was 

referred the bill (S. 1355) to authorize the Bureau of Reclamation 

to participate in the rehabilitation of the Wallowa Lake Dam in Oregon, and for other purposes, having considered the same, reports 

favorably thereon with an amendment and recommends that the 

bill, as amended, do pass. 

The amendment is as follows: 

Strike out all after the enacting clause and insert in lieu thereof 

the following:

SECTION 1. SHORT TITLE. 

This Act may be cited as the ‘‘Wallowa Lake Dam Rehabilitation and Water Management Act of 2004’’. 

SEC. 2. DEFINITIONS. 

In this Act: 

(1) ASSOCIATED DITCH COMPANIES, INCORPORATED.—The term ‘‘Associated 

Ditch Companies, Incorporated’’ means the nonprofit corporation established 

under the laws of the State of Oregon that operates Wallowa Lake Dam. 

(2) PHASE II AND PHASE III OF THE WALLOWA VALLEY WATER MANAGEMENT

PLAN.—The term ‘‘Phase II and Phase III of the Wallowa Valley Water Management Plan’’ means the Phase II program for fish passage improvements and 

water conservation measures, and the Phase III program for implementation of 

water exchange infrastructure, developed for the Wallowa River watershed, as 

contained in the document entitled ‘‘Wallowa Lake Dam Rehabilitation and 

Water Management Plan Vision Statement’’, dated February 2001, and on file 

with the Bureau of Reclamation. 

(3) SECRETARY.—The term ‘‘Secretary’’ means the Secretary of the Interior, 

acting through the Commissioner of Reclamation. 

(4) WALLOWA LAKE DAM REHABILITATION PROGRAM.—The term ‘‘Wallowa Lake 

Dam Rehabilitation Program’’ means the program for the rehabilitation of the 

Wallowa Lake Dam in Oregon, as contained in the engineering document entiVerDate jul 14 2003 04:27 Mar 30, 2004 Jkt 029010 PO 00000 Frm 00001 Fmt 6659 Sfmt 6621 E:\HR\OC\SR250.XXX SR250
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tled, ‘‘Phase I Dam Assessment and Preliminary Engineering Design’’, dated 

December 2002, and on file with the Bureau of Reclamation. 

SEC. 3. AUTHORIZATION TO PARTICIPATE IN PROGRAM. 

(a) GRANTS AND COOPERATIVE AGREEMENTS.—The Secretary may provide grants 

to, or enter into cooperative or other agreements with, tribal, State, and local governmental entities and the Associated Ditch Companies, Incorporated, to plan, design, and construct facilities needed to implement the Wallowa Lake Dam Rehabilitation Program and Phase II and Phase III of the Wallowa Valley Water Management Plan. 

(b) CONDITIONS.—As a condition of providing funds under subsection (a), the Secretary shall ensure that—

(1) the Wallowa Lake Dam Rehabilitation Program meets the standards of 

the dam safety program of the State of Oregon; 

(2) the Associated Ditch Companies, Incorporated, agrees to assume liability 

for any work performed, or supervised, with funds provided to it under this Act; 

and 

(3) the United States shall not be liable for damages of any kind arising out 

of any act, omission, or occurrence relating to a facility rehabilitated or constructed under this Act. 

(c) COST SHARING.— (1) IN GENERAL.—The Federal share of the costs of activities authorized under 

this Act shall not exceed 80 percent. 

(2) EXCLUSIONS FROM FEDERAL SHARE.—There shall not be credited against 

the Federal share of such costs—

(A) any expenditure by the Bonneville Power Administration in the 

Wallowa River watershed; and 

(B) expenditures made by individual agricultural producers in any Federal commodity or conservation program. 

(d) COMPLIANCE WITH STATE LAW.—The Secretary, in carrying out this Act, shall 

comply with otherwise applicable State water law. 

(e) PROHIBITION ON HOLDING TITLE.—The Federal Government shall not hold title 

to any facility rehabilitated or constructed under this Act. 

(f) PROHIBITION ON OPERATION AND MAINTENANCE.—The Federal Government 

shall not be responsible for the operation and maintenance of any facility constructed or rehabilitated under this Act. 

(g) OWNERSHIP AND OPERATION OF FISH PASSAGE FACILITY.—Any facility constructed using Federal funds authorized by this Act located at Wallowa Lake Dam 

for trapping and transportation of migratory adult salmon may be owned and operated only by the Nez Perce Tribe. 

SEC. 4. RELATIONSHIP TO OTHER LAW. 

Activities funded under this Act shall not be considered a supplemental or additional benefit under Federal reclamation law (the Act of June 17, 1902 (32 Stat. 388, 

chapter 1093), and Acts supplemental to and amendatory of that Act (43 U.S.C. 371 

et seq.)). 

SEC. 5. AUTHORIZATION OF APPROPRIATIONS. 

There is authorized to be appropriated to the Secretary to pay the Federal share of the costs of activities authorized under this Act $25,600,000. 

PURPOSE OF THE MEASURE

The purpose of S. 1355 is to authorize the Bureau of Reclamation 

to participate in the rehabilitation of the Wallowa Lake Dam in Oregon. 

BACKGROUND AND NEED

Wallowa Lake Dam is a privately owned dam constructed in 

1918 and raised in 1929. It is owned and operated by the Associated Ditch Companies, Inc. (ADC). Dam safety deficiencies have 

been identified by the U.S. Army Corps of Engineers and Oregon 

Water Resources Department, causing the reservoir to be held 

below full pool elevation since 1996. ADC, in conjunction with the 

Grande Ronde Model Watershed Council, the Bureau of Reclamation, and other local, State, and Federal agencies, developed the 

Wallowa Lake Dam Rehabilitation and Water Management ProVerDate jul 14 2003 04:27 Mar 30, 2004 Jkt 029010 PO 00000 Frm 00002 Fmt 6659 Sfmt 6602 E:\HR\OC\SR250.XXX SR250
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gram to address dam safety deficiencies and to tie correction of 

those deficiencies to larger environmental issues in the Wallowa 

River Basin. 

S. 1355 authorizes the Secretary of the Interior, acting through 

the Commissioner of Reclamation, to participate in: (1) the 

Wallowa Lake Dam Rehabilitation Program, in cooperation with 

ADC; and (2) phases II and III of the Wallowa Valley Water Management Plan, in cooperation with tribal, State, and local governmental entities. The Wallowa Lake Dam Rehabilitation Program, 

as described in the Vision Statement (February 2001), focuses on 

planning, designing, and constructing recommended improvements 

to Wallowa Lake Dam. When this phase is completed, ADC will be 

able to raise pool levels, working closely with the Oregon State 

Parks Department to assess the impact on nearby park facilities. 

Phase II of the Wallowa Valley Water Management Plan will 

focus on the planning and implementation of fish screens, automated head gates, and flow measurements devices at unscreened 

diversions. The Nez Perce Tribe is currently working with the Oregon Department of Fish and Wildlife to plan and implement fish 

recovery measures, and S. 1355 provides that only the Tribe may 

own and operate fish passage facilities constructed with Federal 

funds at Wallowa Lake Dam. 

Phase III focuses on planning, designing, and implementing the 

institutional framework and infrastructure, including pumps and 

pipelines, needed for a water exchange between the Wallowa River 

and the Lostine and Bear Creek Valley irrigation system. 

LEGISLATIVE HISTORY

S. 1355 was introduced by Senators Smith and Wyden on June 

26, 2003. The Subcommittee on Water and Power held a hearing 

on S. 1355 on October 15, 2003. S. Hrg. 108–271. At the business 

meeting on March 10, 2004, the Committee on Energy and Natural 

Resources ordered S. 1355 favorably reported, with an amendment 

in the nature of a substitute. 

During the 107th Congress, a similar measure, S. 1883, was introduced by Senators Smith and Wyden. The Subcommittee on 

Water and Power held a hearing on S. 1883 on June 6, 2002. The 

Committee on Energy and Natural Resources ordered S. 1883 favorably reported on July 31, 2002 with an amendment. S. 1883 

passed the Senate as title III of S. 2556 on November 20, 2002. 

COMMITTEE RECOMMENDATION

The Senate Committee on Energy and Natural Resources, in 

open business session on March 10, 2004, by a unanimous voice 

vote of a quorum present, recommends that the Senate pass S. 

1355, if amended as described herein. 

COMMITTEE AMENDMENT

During consideration of S. 1355, the Committee adopted an 

amendment in the nature of a substitute. The amendment in the 

nature of a substitute modifies the original test to: (1) clarify that 

the Secretary may provide grants to, or enter into cooperative 

agreements with, tribal, state, and local government entities and 

ADC, to plan, design, and construct facilities needed to implement 

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the Wallowa Lake Dam Rehabilitation Program and Phase II and 

Phase III of the Wallowa Valley Water Management Plan; (2) require the Secretary to ensure, as a condition of providing funds, 

that the Rehabilitation Program meet the standards of the dam 

safety program of the State of Oregon; (3) provide the ADC, as a 

condition of receiving funds, agrees to assume liability for work 

performed or supervised with funds under the Act; (4) provide a 

waiver of liability for the United States, as set forth in the amendment; and (5) reduce the authorization level to fund only the Federal share of the Wallowa Lake Dam Rehabilitation Program and 

Phase II and III of the Wallowa Valley Water Management Plan. 

The amendment is further described in the section-by-section analysis below. 

SECTION-BY-SECTION ANALYSIS

Section 1 entitles the bill the ‘‘Wallowa Lake Dam Rehabilitation 

and Water Management Act of 2004’’. 

Section 2 defines key terms used in the Act. 

Section 3(a) authorizes the Secretary to provide grants or enter 

into cooperative or other agreements with tribal, State, and local 

governmental entities and the Associated Ditch Company, Incorporated, to plan, design, and construct facilities needed to implement the Wallowa Lake Dam Rehabilitation Program and Phases 

II and III of the Wallowa Valley Water Management Plan. 

The Committee recognizes that this bill, by authorizing the Bureau of Reclamation to provide grant money for the rehabilitation 

of the Wallowa Dam, and for Phase II and Phase III of the 

Wallowa Valley Water Management Plan, provides a unique, costeffective means of enhancing flood control protection for downstream communities, and of reestablishing a fishery for the Nez 

Perce Tribe. 

The Wallowa Basin is aboriginal territory for the Nez Perce, who 

are co-managers with the Federal government of certain fish resources and support enactment of the bill. It will also help provide 

water for the recovery of ESA-listed species in an important subbasin within the Columbia River Basin, where actions by the Bureau of Reclamation are covered by the 2000 Columbia River biological opinion. The Nez Perce Tribe, as well as numerous State, 

Federal and local agencies have collaborated on this successful 

project since 1992. The management plan for the Wallowa Valley 

is consistent with action plans associated with the Bonneville 

Power Administration Fish and Wildlife Program and the Wallowa 

County/Nez Perce Tribe Salmon Habitat Recovery Plan. Rehabilitation of the dam is necessary to provide for additional water storage. 

With the ability to fill the lake to a higher elevation, the water 

rights holders have agreed to make an additional 4,300 acre-feet of 

water available each year, in accordance with State water law, to 

help Nez Perce Tribal Fisheries restore sockeye and coho salmon 

passage at the dam, and provide for the downstream water exchange, which will resolve issues related to Federally-listed salmon 

runs. The Committee notes that these circumstances are unique 

and the Committee does not intend this legislation to set precedent 

for Federal assistance to private projects. 

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Section 3(b)(1) requires the Secretary, as a condition of providing 

funds, ensure that the program meet the standards of the dam 

safety program in the State of Oregon. 

Section 3(b)(2) requires that as a condition of receiving funding, 

ADC assume liability for work performed or supervised with funds 

provided to it under this Act. 

Section 3(b)(3) provides a liability waiver for the United States 

for damages arising out of any act, omission, or occurrence, relating 

to a facility rehabilitated or constructed under this Act. 

Section 3(c) limits the Federal share of the cost of activities authorized under this Act to 80 percent. 

Section 3(c)(2)(A) excludes any expenditures by the Bonneville 

Power Administration from being credited against the Federal 

share of the costs. 

Section 3(c)(2)(B) excludes any expenditures made by individual 

agricultural producers in any Federal commodity or conservation 

program from being credited against the Federal share of the costs. 

Section 3(d) requires the Secretary to comply with applicable 

State water law. 

Section 3(e) prohibits the Federal Government from holding title 

to any facility rehabilitated or constructed under this Act. 

Section 3(f) provides that the Federal Government is not responsible for the operation and maintenance of any facility constructed 

or rehabilitated under this Act. 

Section 3(g) provides that any facility constructed using Federal 

funds for trapping and transporting migratory salmon may be 

owned and operated only by the Nez Perce tribe. 

Section 4 states that activities funded under this Act shall not 

be considered a supplemental or additional benefit under Federal 

reclamation law. 

Section 5 authorizes appropriations. 

COST AND BUDGETARY CONSIDERATIONS

The following estimate of costs of this measure has been provided 

by the Congressional Budget Office.

U.S. CONGRESS, 

CONGRESSIONAL BUDGET OFFICE, 

Washington, DC, March 19, 2004. 

Hon. PETE V. DOMENICI, 

Chairman, Committee on Energy and Natural Resources, 

U.S. Senate, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 1355, the Wallowa Lake 

Dam Rehabilitation and Water Management Act of 2004. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Julie Middleton. 

Sincerely, 

DOUGLAS HOLTZ-EAKIN, 

Director. 

Enclosure. 

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S. 1355—Wallowa Lake Dam Rehabilitation and Water Management Act of 2004

Summary: S. 1355 would authorize the Bureau of Reclamation to 

participate in the rehabilitation of the Wallowa Lake Dam in Oregon and the implementation of the Wallowa Valley Water Management Plan. The bill would limit the bureau’s share of the rehabilitation costs to 80 percent. Assuming appropriation of the necessary amounts, CBO estimates that implementing S. 1355 would 

cost $25 million over the 2005–2009 period. In addition, we estimate that implementing S. 1355 would result in additional net direct spending by the Bonneville Power Administration (BPA) of $5 

million over the 2005–2009 period. The federal government would 

not hold title to any facility rehabilitated or constructed under this 

bill, nor would the federal government be responsible for the operation and maintenance of those facilities. 

S. 1355 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA) 

and would impose no costs on state, local, or tribal governments. 

Estimated Cost to the Federal Government: The estimated budgetary impact of S. 1355 is shown in the following table. The costs 

of this legislation fall within budget function 300 (natural resources 

and environment).

By fiscal year, in millions of dollars—

2005 2006 2007 2008 2009

CHANGES IN SPENDING SUBJECT TO APPROPRIATION

Rehabilitation Spending by the Bureau of Reclamation: 

Estimated Authorization Level ............................................................. 5 7 7 7 0

Estimated Outlays ................................................................................ 2 4 7 7 5

CHANGES IN DIRECT SPENDING

Net BPA Spending: 

Estimated Budget Authority ................................................................. 5 0 0 0 0

Estimated Outlays ................................................................................ 2 2 1 1 1

1 Collections of less than $500,000. 

Basis of estimate: For this estimate, CBO assumes that S. 1355 

will be enacted by the end of fiscal year 2004 and that spending 

would occur at the same rate as similar bureau and BPA projects. 

Spending subject to appropriation 

Based on information from the Bureau of Reclamation, CBO estimates that the total cost of rehabilitating the Wallowa Lake Dam 

in Oregon and implementing the Wallowa Valley Water Management Plan would be about $32.6 million. S. 1355 would authorize 

the appropriation of $25.6 million for the bureau’s share of the cost 

of those projects. The remaining $7 million would be paid by the 

BOA and the Bonneville Power Foundation, a nonprofit organization. Based on information from the bureau, we expect that rehabilitation of the dam and implementation of the management plan 

would take five years and that funds will be appropriated in roughly equal installments over that period to complete the projects. Assuming appropriation of the authorized amount, we estimate that 

implementing the bill would cost the bureau $25 million over the 

2005–2009 period, and an additional $2 million after that period. 

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Direct spending 

Implementing S. 1355 also would result in additional direct spending by BPA of $5 million over the 2005–2009 period for structures to allow for safe passage of fish through the Wallowa Lake 

Dam projects authorized in the bill. Such spending is authorized 

under current law, but BPA would not make these investments 

without the bureau’s involvement in the Wallowa Lake projects. 

Because BPA must recover its costs through the sale of electricity, 

any additional spending would be offset by slightly higher proceeds 

from electricity sales over the next 15 to 20 years. Consequently, 

BPA’s additional spending would have a negligible net budgetary 

impact over many years. 

Intergovernmental and private-sector impact: S. 1355 contains no 

intergovernmental or private-sector mandates as defined in UMRA 

and would impose no costs on state, local, or tribal governments. 

Estimate prepared by: Federal Costs: Julie Middleton and Lisa 

Cash Driskill; Impact on State, Local and Tribal Governments: 

Marjorie Miller; and Impact on the Private Sector: Selena Caldera. 

Estimate 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. 1355. 

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. 1355. 

EXECUTIVE COMMUNICATIONS

On March 5, 2004, the Committee on Energy and Natural Resources requested legislative reports from the Department of the 

Interior and the Office of Management and Budget setting forth executive views on S. 1355. These reports had not been received at 

the time the report on S. 1355 was filed. The testimony provided 

by the Department of the Interior at the Subcommittee hearing follows:

STATEMENT OF JOHN W. KEYS, III, COMMISSIONER, BUREAU

OF RECLAMATION, DEPARTMENT OF THE INTERIOR

Mr. Chairman and Members of the Subcommittee I am 

John Keys, Commissioner of the Bureau of Reclamation. I 

appreciate the opportunity to present the Department’s 

views on S. 1355, a bill that would authorize Reclamation 

to participate in implementation of the Wallowa Lake Dam 

Rehabilitation Program and Wallowa Valley Water Management Plan in Oregon. Reclamation believes the 

Wallowa Lake Dam Rehabilitation Program and Wallowa 

Valley Water Management Plan are potentially worthVerDate jul 14 2003 04:27 Mar 30, 2004 Jkt 029010 PO 00000 Frm 00007 Fmt 6659 Sfmt 6969 E:\HR\OC\SR250.XXX SR250
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while, with numerous benefits. While we believe there may 

be merit to this proposed project, the Department does not 

support S. 1355, as currently drafted. 

Wallowa Lake Dam is a privately-owned dam constructed in 1918 and raised in 1929, and is owned and operated by the Associated Ditch Companies, Inc. (ADC). 

Dam safety deficiencies have been identified by the United 

States Army Corps of Engineers and Oregon Water Resources Department. ADC, in conjunction with the Grande 

Ronde Model Watershed, Reclamation, and other local, 

state, and Federal agencies, developed the Wallowa Lake 

Dam Rehabilitation Program to address dam safety deficiencies and developed the Wallowa Valley Water Management Plan to tie correction of those deficiencies to larger 

environmental issues in the Wallowa River Basin. The 

Dam Rehabilitation Program and Water Management Plan 

is a six year proposal with an estimated total cost of 

$38,800,000. S. 1355 sets out an 80/20 cost share for these 

efforts, under which the Federal government would pay 

$32 million funded through the Bureau of Reclamation. 

While the programs developed by the ACD and the 

Model Watershed provide a concept, they do not meet Federal standards established in the Principles and Guidelines 

for planning water development programs. Furthermore, 

the project may affect species listed under the Endangered 

Species Act (ESA). Should Reclamation be authorized to 

fund this project, a funding decision may constitute a 

major Federal action subject to consultation under Section 

7 of the ESA. It would also require environmental analysis 

in compliance with the National Environmental Policy Act 

(NEPA). The bill, as currently drafted, does not provide for 

Reclamation’s participation in the planning stages of the 

dam rehabilitation aspects of the project and separates 

dam rehabilitation from implementation of the water management plan. Consequently, it would be difficult for Reclamation to meet the environmental compliance requirements for the ESA and NEPA. Until adequate planning 

can be completed, the Administration can not support 

funding this project. 

The proposed bill would authorize Reclamation to provide funding to the ADC for dam rehabilitation activities, 

[nit] however, it does not provide administrative authority 

to transfer those funds. The legislation would need revision to provide Reclamation authority to issue grants. We 

would be pleased to work with the Committee in developing appropriate language. 

Finally, we are concerned that Reclamation’s participation in this program would adversely impact ongoing 

projects and operations. S. 1355 would authorize the use 

of Reclamation funds for a non-Federal purpose. Reclamation funds are limited and are targeted to perform essential functions at our projects, such as security, operations 

and maintenance (O&M), resource management, dam safety, and construction. In addition, despite the very high 

Federal cost share for the project under S. 1355, there is 

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no provision for repayment by project beneficiaries in accordance with Reclamation law. Funding for this project 

was not included in the President’s budget, and we can not 

support activities which detract from high priority work on 

current Bureau of Reclamation facilities. The Department 

cannot, therefore, support S. 1355. 

Thank you again for the opportunity to provide the Administration’s position on S. 1355. I would be happy to answer any questions you might have.

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. 1355 as ordered reported.

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