# RESPONSES	TO	EPA’s	QUESTIONS	to	DOI 

# 1



# A. Regarding Responses to EPA

A3. Has Reclamation or Salt River Project conducted economic modeling or

additional analyses related to NGS ec onomic viability under different control

scenarios?

Reclamation’s response: The economic analysis efforts performed to-date by NGS

owners (through SRP) have been limited to providing accurate baseline data through

developing supportable cost estimates for known emission retrofit scenarios. A

determination of whether these BART changes alter the project’s economic viability can

only be determined on an owner-by-owner basis and is different for each individual NGS

owner. While the emphasis has been focused on BART-related financial impacts, a true

viability assessment cannot be made by each owner until other major NGS financial

considerations, such as lease extension costs, firming of coal prices, and other projected

regulatory mitigation costs, are better defined.



# Question A (3) Follow‐up	Questions

a) The	response	seems	to	indicate	th at	no	owners	of	Navajo	Generat ing	Station	(NGS),

including	BOR,	have	done	any	eco nomic	modeling	to	assess	the	ec onomic	viability	of

NGS	under	different	retrofit	sce narios.			Please	confirm	this	i nterpretation	of	DOI’s

response	that	DOI	(and	BOR)	have not	conducted	any	economic	ana lysis	of	the

project	independent	of	the	other	owners.

Reclamation’s Response: Subsequent	to	our	original response,	SRP	has	shared	its

raw	data	with	the	other	NGS	co‐owners	and	each	(including	Recla mation)	is

conducting	an	independent	evaluation	based	upon	each	owner’s	un ique	situation.

Reclamation’s	evaluation	will	be completed	in	about	2	months	an d	takes	into

consideration	relevant	and	pivotal	cost	factors	and	assumptions from	Reclamation’s

point	of	view.		Our	evaluation	al so	includes	MACT	consideration s	and	other	details

that	are	not	mentioned	herein.

Some	of	the	more	critical	factor s	that	must	be	considered	inclu de,	but	are	not

limited	to,	the	following:		BART requirements	and	associated	co sts;	the	effect	of

EPA’s	BART	decision	on	NGS’	MACT	decisions;	expected	significan t	increased	costs

associated	with	the	pending	Navajo	Nation	lease	extension;	incr eased	costs

associated	with	extending	the	co al	supply	agreement	with	Peabod y	Coal;	economic

adjustments	for	LADWP’s	imminent departure;	and	the	uncertainty of	the	cost

recovery	period	(see	also	response	to	A(3)(c)	below).

b) Does	DOI	(either	independently	or with	BOR)	plan	to	conduct	an analysis	of	the

economic	viability	of	SCR	on	the power	plant	(or	its	share	of	t he	plant)	or

specifically	any	independent	ana lysis	on	the	impact	of	a	BART	d etermination	of	SCR

on	CAP	water	rates?

# 2 Reclamation’s response: Please	see	response	A(3)(a)	above.		With	respect	to	water

rates,	Reclamation	has	reviewed	and	believes	that	Central	Arizo na	Water

Conservation	District’s	(CAWCD) estimates	are	reasonable	and	va lid;	however,	these

estimates	may	need	to	be	updated	to	include	the	mercury	MACT	re trofit	impacts

and	differences	in	our	assumptions.

Determining	how	to	proceed	with	MACT‐	and	BART‐related	installa tions	and

modifications	are	made even	more	difficult	because	of	as‐yet	un known	outcomes

associated	with	approvals,	costs and	timing	of	other	critical	d ecisions	related	to	the

operation	of	NGS	beyond	2019.		These	include	but	are	not	limite d	to	a	lease

extension	for	the	NGS	plant	property	with	Navajo	Nation,	future coal	supply

agreements	with	Peabody	Coal,	re vision	to	Peabody	Coal’s	life	o f	mine	permit,	and

extension	of	NGS’	water	supply	ag reement.		Many	of	these	involv e	Federal	approvals

which	will	add	yet	another	layer	of	timing	and	cost.

c) If	so,	please	share	all	of	the	relevant	input	assumptions	that would	be	used	by

DOI/BOR	in	modeling	incremental	power	cost	and	CAP	water	rate	i mpacts.

Reclamation’s response: We	are	taking	into	consideration	assumptions	and/or

considerations	that	include,	but are	not	limited	to,	those	list ed	below.

o	 Cost	to	install	SCR	and	SCR plus	BH	($550	million	[M]	to	$1.1 45	billion);

o	 Cost	of	additional	annual	O&M	( $12	M/yr	w/o	BH	to	$20	M/yr	w/ BH);

o	 Increased	cost	of	producing	power	(both	in	the	interim	and	po st‐2019)	as	a

result	of	NGS	lease	extension	te rms	currently	being	negotiated between	NGS

and	Navajo	Nation,	and	coal	suppl y	agreements	currently	being	n egotiated

between	NGS	and	Peabody	Coal;

o	 Cost	recovery	under	various	sc enarios,	e.g.,	short‐term	(with in	5	years);	and

long‐term	(20	to	30	years);

o	 Financial	impact	to	co‐owners’ share	for	LADWP’s	share	of	BAR T‐related

costs;	this	could	result	in	an	i ncrease	of	5.6	%	to	Reclamation ’s	share	of

BART‐related	expenses;

o	 Certainty	of	the	plant’s	abili ty	to	operate	beyond	2019	prior to	committing	to

any	capital	investment	f or	pollution	control;

o	 Future	regulatory	risks	including	cost	and	time	required	to	c omplete

environmental	compliance	for	pla nt	lease	and	rights‐of‐way	rene wals;

o	 Potential	NGS	ownership	change s	in	addition	to	the	loss	of	LA DWP	(e.g.,	NV

Energy);

o	 Cost	to	comply	with	mercury	MACT	($30	M	to	$600	M);

o	 Cost	of	additional	annual	O&M	o f	MACT	retrofits	(up	to	$3	M/y r);

o	 No	Federal	appropriation	assistance	is	made	available;

o	 The	risk	and	potential	cost of	carbon	emission	control;

o	 Cost	of	capital	(5	to	10%);

# 3 o	 Whether	or	not	cost	of	generat ing	power	can	all	be	recouped;

o	 Cost	point	at	which	Navajo	surplus	power	stops	providing	valu e	(Market

Rate);

o	 Economics	of	replacing	NGS	($1 .1	to	$1.2	M/MW	to	build	combin ed);

o	 Economics	of	shutting	down	one	unit;

o	 Impacts	to	Navajo,	Hopi,	and	C AP	tribes	in	particular;	and

o	 Water	rate‐specific	considerations:

 Effects	on	energy	comp onent	of	CAP	rate	(Currently	$53/acre‐foo t);



#  Effects	on	M&I	delivery	charge (Currently	$137/acre‐foot);

 Effects	on	water	related	capital	and/or	property	taxes;

 Indirect	effects	resulting	from	reduced	water	orders;

 Water	affordability	expectations	(maximum	$2/Acre‐Ft/	year);

 Historic	increases	in	CAP	rates (5.25%	for	energy	7.2%	fixed	O& M);

 Effects	on	CAP	tribes in	particular;	and

 The	electricity	market	alternative;

 Effect	on	DOI	(Reclamation)	annual	appropriation	requests

d) The	response	states	that	a	wide range	of	issues	would	require	b etter	definition	in

order	to	develop	an	accurate	via bility	assessment,	and	goes	on to	list	some	of	those

issues	indicating	that	some	of	t he	costs	may	not	be	known	for	s ome	period	of	time

into	the	future.		Although	specific	cost	figures	may	not	yet	be available,	what

estimated	costs	or	range	of	estimated	costs	would	DOI	suggest	u sing	in	an	economic

model	to	estimate	economic	viability?

Reclamation’s response: Confidential	negotiations	have	been	initiated	with	the

Navajo	Nation	on	a	lease	extension	beyond	2019	and	preliminary discussions	also

have	been	initiated	with	Peabody on	extending	the	Coal	Supply	A greement	through

2044.		So	far,	costs	for	these	Lif e‐of‐Plant	extension	actions are	within	the	same

order	of	magnitude	as	the	amorti zed	annual	costs	of	SCR	impleme ntation.		Life	of

Plant	decisions	need	to	consid er	the	additive	effects	of	all	ma jor	actions	thereby

increasing	the	sensitivity	of	ea ch	on	the	plant’s	economic	viab ility.

A9. Is there a surcharge to power sold from NGS that directly goes to CAP? If so,

what is that surcharge, and how is it used by CAP? How is that surcharge

regulated?

Reclamation’s response: Initially, three long-term (20-year) four-party contracts for an

estimated 400 MW of NGS surplus capacity were executed among the following:

Western, Reclamation, CAWCD, and SRP. Through these three contracts, SRP annually

purchased from Reclamation/Western the full United States power entitlement at the

Navajo production cost plus paid an additional fixed annual premium of roughly $47

million. SRP’s cost obligations increased monthly only to the degree the costs to

produce the power increased. Under that arrangement, SRP provided power for CAP

pumping with any SRP managed power resour ces it had including Reclamation’s or

SRP’s share of Navajo power. SRP recovered its costs for providing power for CAP

# 4 pumping by billing CAWCD for the metered quantity of power used, at the Navajo

production cost rate.

Through two of the long-term contracts, $25.2 million from the $47 million annual fixed

premium went to repay bonds acquired by CAWCD; this payment is referred to as the

“Additional Rate Component,” or ARC. The ARC was legislatively authorized to go

directly to repay bonds acquired by CAWCD (in part, to pay for construction of New

Waddell Dam). These bonds have now been repaid and collection of the ARC ceased as

of September 30, 2011. Under the third contract, the remaining $21.75 million were

deposited into the Development Fund. This represents, in part, reimbursement for the

United States’ share of NGS annual OM&R expenses as an amortization contribution

($1,812,500 monthly, or $21,750,000 annually). Through these three contracts, the

repayment contribution from power sales was well defined over roughly the last 20

years. These three contracts expired September 30, 2011. Beginning October 1, 2011,

Western will market any Navajo surplus in short and long-term contracts at market

based electricity prices. All revenues will be deposited into the Development Fund.



# Question A (9) Follow‐up	Questions

a) The	response	explains	how,	historically,	SRP	received	100%	of	t he	NGS	surplus	for	a

price	consisting	of	the	cost	of	production	(at	NGS)	plus	an	add itional	$47	million

annual	fixed	premium,	then	deliv ered	energy	(NGS	energy	and	oth er	SRP	supply)	to

the	CAP	for	which	CAWCD	paid	the cost	of	NGS	production	based	o n	metered

quantities	of	consumed	energy. With	SRP	no	longer	fulfilling	a contractual	role,	how

has	the	cost	structure	changed as	of	the	Oct	1,	2011	arrangemen t?

Reclamation’s response: To	clarify,	under	the	expired 4‐Party	Agreeme nt,	SRP	added

Reclamation’s	entire share	of	NGS	energy	to	their	e nergy	portfolio.		The	$47	million

surcharge	consisted	of	two	separate	components.		First,	SRP	pai d	a	$21.75	million

fixed	premium	or	consideration	f ee	for	the	use	of	Reclamation’s Power	entitlement

to	be	integrated	into	SRP’s	powe r	portfolio.		This	was	paid	out at	$1,812,500	each

month	and	deposited	into	the	Dev elopment	Fund	(Checking	Account Side).			Second,

SRP	paid	$25.2	million	as	an	“Additional	Rate	Component”	(ARC) (which	was	not

deposited	into	the	Development	F und).		This	was	paid	out	of	a	$ 6/MWHR	charge

collected	by	SRP,	which	was	paid	directly	to	a	trust	account	he ld	by	CAWCD	to	repay

bonds	acquired	by	CAWCD	to	pay	f or	construction	of	New	Waddell Dam.	In	addition

to	these	two	payments	totaling	$ 47	million,	SRP	paid	the	produc tion	cost	of

Reclamation’s	share	of	NGS	and	agreed	to	provide	CAWCD	with	the power	needed	to

operate	the	CAP	pumps,	for	which SRP	billed	CAWCD	at	the	NGS	pr oduction	cost

rate.		Through	this	arrangement, SRP	assumed	both	the	risks	and rewards	of

market‐based	energy	pricing.

Under	the	new	Western	marketing	program	which	began	October	1, 2011,

Reclamation	receives	NGS	surplus power	revenues	from	two	distin ct	sources,	with

Western	conducting	all	the	transactions	and	depositing	all	reve nues	into	the

Development	Fund	(Checking	Acco unt	Side).		The	first	is	an	annu al	payment	of	$25

million	plus	the	associated	produ ction	costs	(indexed)	for	purc hase	of	select	on‐

# 5 peak	power,	from	SRP	pursuant	to	a	20‐year	contract. 1 

# The	second	is	from

Western’s	marketing	of	the	remaining	surplus	power	at	market	ra tes.		This	second

amount	will	vary	because	it	is	d etermined	by	the	amount	of	surp lus	power	available

to	sell,	the	market	price	for	the	power,	term	and	packaging	of sale,	and	the	vagaries

of	supply	and	demand	for	the	pow er.		Western’s	marketing	strate gy	includes	selling

the	surplus	power	in	blocks	havi ng	variable	quantities,	duratio n	and	time‐of‐day,

and	seasonality.		Western’s	direc tive	to	optimize	NGS	surplus	r evenues	will

sometimes	result	in	selling	surpl us	power	at	market	prices	belo w	the	NGS

production	cost.		As	before,	CAWC D	continues	to	pay	for	all	the power	it	uses	to	run

the	CAP	pumps	at	the	NGS	power	p roduction	cost.		Also	see	more complete	detailed

description	of	Development	Fund under	answer	to	question	B(3)(a ).

b) Does	the	post‐Oct	2011	arrangemen t	with	Western	impact	the	deli very	of

transmission	services,	and	if	so,	how	does	DOI	project	that	may change	the	costs	for

CAWCD	to	receive	NGS	power?

Reclamation’s response: Under	normal	operating	conditions,	there	is	no	change.

Reclamation	is	now	responsible	f or	any	incremental	costs	associ ated	with	re‐

routing	power	due	to	outages.		U nder	the	current	arrangements, Western	will

charge	for	any	added	costs	to	pro vide	alternate	routing	during outages;	however,

we	do	not	believe	these	costs	fu nded	from	the	Development	Fund (Checking

Account)	should	be	substantial. (Under	the	original	4‐Party	Ag reement,	SRP	was

responsible	for	any	incremental costs	associated	with	re‐routin g	power	during

outages.)		This	should	not	affec t	CAWCD’s	power	costs	for	NGS	p ower,	since	they

pay	based	on	the	production	cost.

c) Please	provide	an	itemization	of the	monthly	historical	payment s	made	by	SRP	for

the	NGS	surplus	power	from	2006‐2010,	to	include	a	breakdown	of the	$47	million

annual	fixed	premium	into	the	Ad ditional	Rate	Component	(ARC)	c ontribution,

summarizing	all	net	revenues	that	went	into	the	Fund	each	month .		Also	please

include	all	volumes	delivered	to SRP,	all	volumes	sold	to	marke t	by	SRP	(including

prices),	and	all	volumes	of	power	delivered	to	CAWCD	for	CAP	pu mping.

Reclamation’s response: Table	1	below,	shows	the	re venues	received	from	SRP

under	the	4‐Party	Agreements,	an d	deposited	into	the	Developmen t	Fund	(Checking

Account)from	2006	through	2010.		The	monthly	amounts	shown	repr esent	monthly

payments	by	SRP	to	cover	Reclamat ion’s	share	of	NGS	power	produ ction	costs

which	were	billed	by	and	owed	to SRP	as	the	operator	of	the	pla nt	(therefore,	the

net	to	the	Development	Fund	Chec king	Account	was	zero).		SRP’s $21.75	million

fixed	premium	or	consideration	f ee	is	shown	as	an	annual	amount paid	to	the

Development	Fund	(Checking	Accoun t	Side)	for	the	opportunity	to receive	and

integrate	the	Federal	NGS	power	into	SRP’s	existing	portfolio	o f	power.		The

1 

# The original 4-Party Agreement, whic h expired September 30, 2011, contained a “first opportunity clause” which

provided SRP status as priority customer for purchasing a select portion of NGS surplus power under the current

marketing program.

# 6 Additional	Rate	Component	(ARC) of	$25.2	million	was	paid	by	SR P	directly	to	the

bond	trustee	for	repayment	of	CA WCD	bonds	that	provided	advance s	for	the

construction	of	New	Waddell	Dam	and	not	paid	to	the	Development Fund.

Table 1. Total Annual SRP Payments 2006

‐ 2010 (in $ thousands)

Under the 4

‐ Party Agreement

2006 2007 2008 2009 2010

OCT 6,581 7,501 6,710 9,486 9,382

NOV 7,018 7,249 6,905 9,868 7,731

DEC 6,861 7,144 6,843 8,175 9,802

JAN 7,029 8,462 7,970 10,831 11,533

FEB 8,643 9,261 9,782 11,748 9,665

MAR 7,588 7,734 6,477 9,592 9,443

APR 6,668 9,399 9,122 10,805 12,082

MAY 10,828 7,863 9,253 13,209 12,481

JUN 6,888 7,870 8,090 9,564 9,708

JUL 7,506 8,215 14,770 9,832 9,736

AUG 6,992 7,955 11,505 9,303 10,107

SEP 7,635 8,002 9,461 8,511 9,881

TOTAL 92,243 98,662 108,896 122,933 123,561

"Fixed Premium” Fee" 21,750 21,750 21,750 21,750 21,750

"ARC" (Not to Fund) 25,200 25,200 25,200 25,200 25,200

GRAND TOTAL $139,193 $145,612 $155,846 $169,883 $170,511

# 7 Table 2. NGS Power Delivered to SRP 2006

‐ 2010 and

CAP Pumping Energy Volumes 2006

‐ 2010 (MWH)

2006

(MWH) 2007

(MWH) 2008

(MWH) 2009

(MWH) 2010

(MWH)

CAP Pumping

Energy Volume 2,817,945 2,809,242 2,850,608 2,931,871 2,961,059

NGS Surplus

Energy Volume 1,444,920 1,471,529 1,407,432 990,314 1,031,332

NGS Total Energy

Volume to SRP 4,262,865 4,280,771 4,258,040 3,922,185 3,992,391

Volumes Sold By

SRP To Market Generally

Not Resold Generally

Not Resold Generally

Not Resold Generally

Not Resold Generally

Not Resold

SRP Sale Price Not

Tracked Not

Tracked Not

Tracked Not

Tracked Not

Tracked



# d) Please	describe	the	status	of	all	power	sales	activities	since Western	assumed	SRP’s

prior	role	of	marketing	NGS	surplus	power,	including	contracted volumes,	terms,

prices	and	material	contractual	provisions	that	impact/mitigate risk	for	the	seller.

Reclamation’s response :		To	clarify,	SRP	did	not	mar ket	NGS	surplus	power	before

October	1,	2011;	pursuant	to	the now	expired	4‐Party	Agreements ,	SRP	received	use

of	Reclamation’s	entire	share	of	NGS	energy	for	as	described	in answer	to	A(9)(a).

Western	did	not	assume	SRP’s	r ole	after	September	30,	2011;	how ever,	Western	is

now	responsible	for	marketing	Reclamation’s	share	of	NGS	power that	is	excess	to

CAP	pumping	needs	and	that	sold	to	SRP.

The	following	table	indicates	Wes tern’s	NGS	surplus	power	sales for	CY	2011	4th

quarter.		Sales	have	been	non‐fir m,	plant‐contingent,	day‐ahead ,	and	for	periods	less

than	1	month.

It	is	important	to	note	that	rou ghly	50	percent	of	all	annual	N GS	surplus	power

revenues	result	from	sales	during	the	summer	months	of	June,	Ju ly,	and	August.

These	first	3	months	are	not	indicative	of	the	future	sales,	si nce	they	are	short	term,

mostly	spot	market	sales.		Western	now	plans	to	employ	forward (longer	term)

sales	now	that	there	are	better projections	of	CAP	pumping	need s.		These	long	term

sales	transactions	should generate	higher	revenues

Table 3. Western Fourth Quarter 2011

Navajo Surplus Non

‐ Firm 2 

# Power Sales

2 

# Non-firm power is not guaranteed; it is interruptible an d/or as-available. Firm power, on the other hand, is

guaranteed and uninterruptible. Prices for non-firm power can be expected to be about 15 percent lower than for

firm power.

# 8 Energy Sold

MWH Average Non-firm

Sale Price



# $/MWH Revenue

$$

October 160,704 24.19 3,887,720

November 102,201 28.81 2,555,542

December 126,009 24.31 3,063,910

(e) Please	provide	recent	projections	of	NGS	surplus	sales	revenues and	projections	of

the	dollars	anticipated	to	be	deposited	into	the	Lower	Colorado River	Basin

Development	Fund.

Reclamation’s response: The	power	market	has	been	and continues	to	be	unusually

weak.		For	example,	in	compariso n	to	the	prices	in	the	table	ab ove,	NGS	on‐peak

power	was	sold	for	approximately $140/MWH	between	June	and	Augu st	2007.

Western	anticipates	the	2011	4 th 

# quarter	weighted	average	will	not	change

significantly	during	2012.		Weste rn	expects	to	market	the	bulk of	Reclamation’s

remaining	surplus	power	as	“non firm,”	which	typically	has	a	re duced	market	value

as	compared	to	“firm	power.”		Usi ng	these	assumptions,	the	net surplus	power

revenues	for	2012	are	anticipated to	be	approximately	$22.5	mil lion.		Western	plans

to	employ	forward	(longer	term) sale	transactions	and	various	o ther	techniques,

which	are	meant	to	improve	surplus	revenues	going	forward;	howe ver	it	is	difficult

to	predict	how	these	changes will	affect	f uture	sales.

(f) Please	confirm	that	the	$47	milli on	annual	fixed	premium	paid	b y	SRP	has	ceased	as

of	Oct	1,	2011.

Reclamation’s response: Yes,	SRP	no	longer	pays	the	$47	million	annual	fixed

amount.		SRP’s	involvement	now	i s	limited	to	one	long‐term	20‐y ear	contract	for	on‐

peak	power	for	a	period	of	20	ye ars	(see	response	to	Question	A (9)(a)	above).

B3. Can you share with us detailed financ ial statements for the Development and

Cooperative Funds to help us understand how these Funds work in terms of

current and future revenues and expenditures?

Reclamation’s response: The Development Fund was established pursuant to section

403 of the Colorado River Basin Project Act of 1968, as amended by the Hoover Power

Plant Act of 1984 and the 2004 AWSA. The Development Fund was originally

established to collect all revenues in connection with the operation of the CAP facilities.

Revenues are collected from a number of sources including the sale of surplus NGS

power for use in the State of Arizona. All these revenues are credited annually against

the annual repayment obligation of the CAWCD to the United States for construction of

the CAP. CAWCD is responsible for the repayment obligation of the project and pays the

United States a cash payment to make up any shortfall from collected revenues to the

Development Fund during the calendar year. However, if, in any year, the revenues

# 9 derived from the sale of surplus power exceed the annual repayment obligation, the

excess funds are allocated first to the paym ent of fixed OM&R for the delivery of CAP

water used by Arizona Indian Tribes. Section 107 of the AWSA provides for the

distribution of those excess revenues (see Section 107 language, Attachment 3). All

expenditures from the Development Fund are limited to those authorized by the AWSA.

The Cooperative Fund was established in the Treasury of the United States by Section

313 of the Southern Arizona Water Rights Settlement Act of 1982 (SAWRSA) and

reauthorized in the 2004 AWSA. Approximately $10.5 million were deposited into the

Cooperative Fund from various settlement parties at the time the fund was established.

The fund is invested and managed by the Office of the Special Trustee, Department of

the Interior, pursuant to SAWRSA for the benefit of the Tohono O’odham Nation.

Allowable expenditures from the Cooper ative Fund are amounts determined by the

Secretary of the Interior (Secretary) to be necessary to carry out the obligations of the

Secretary under SAWRSA, including paying the variable cost (energy) component for

the delivery of CAP water ordered by the San Xavier and Schuk Toak Districts of the

Tohono O’odham Nation. The fixed OM&R costs associated with delivery of CAP water

are paid from the Development Fund pursuant to the AWSA. If funds are not available

from the Development Fund to pay the fixed OM&R costs, the total cost associated with

delivery of CAP water to the two Districts will be paid from the Cooperative Fund. It is

important to note that only interest earned on the original investment income or revenues

derived from the sale or lease of effluent or effluent credits can be expended from the

Cooperative Fund.



# Question B (3) Follow‐up	Questions

a) The	response	does	not	directly	respond	to	the	request	for	finan cial	information.

Please	provide	detailed	financial	information	regarding	the	Dev elopment	and

Cooperative	funds	including,	if	available,	annual	financial	sta tements	or	similar

documentary	evidence	of	income and	expense	for	the	funds.

Reclamation’s Response: After	reflecting	on	our	answers regarding	the	Development	Fun d,

we	felt	it	was	important	that	we	give	a	more	complete	descripti on	of	the	Development

Fund	and	how	it	operates. The Lower Colorado River Basin Development Fund (Development

Fund) was established pursuant to Section 403 of the Colorado River Basin Project Act of 1968,

as amended by the Hoover Power Plant Act of 1984 and the Arizona Water Settlements Act,

Public Law 108–451, December 10, 2004 (AWSA). It wa s originally established to collect all

authorized revenues associated with the CAP faci lities, as well as pay for certain CAP-related

expenditures. Revenues that are deposited into the Development Fund (Checking Account Side)

are collected from a number of sources including CAWCD 3 

# annual repayment obligation, and

sale of Reclamation’s share of NGS power which is surplus to th e needs of the CAP (referred to

as NGS surplus power). Expenditures paid from the Development Fund (Checking Account

Side) include NGS power genera tion costs associated with Re clamation’s share of power

produced, NGS transmission-related expenses , and NGS oversight costs. Called the

Development Fund collectively, it functions in a way as both as a “checking” account and a

3 

# CAWCD presently operates the CAP and is responsible for repaying the Federal government for the non-Federal

share of the CAP’s capital (construction) costs; currently CAWCD’s repayment obligation is approximately $55M

each year.

# 10 “money-market” account. The “checking” accoun t tracks the revenues and expenditures on a

calendar year basis. The “money market” accoun t consists of deposits from the “checking”

account of any net revenues that exist as of December 31 st 

# each year. These funds are then used

to fund Federal obligations established by the AWSA. The “checking” account function of the

Development Fund is tracked by a Source and Disposition of Funds report which is prepared by

Reclamation’s Lower Colorado Regional Office on a monthly basis (see Exhibit 1 of the

Attachment).

Various aspects and components of the Development Fund are not pa rticularly stra ightforward;

therefore, we provide some additional info rmation concerning a few key aspects of the

Development Fund and how it works, below.

 CAWCD’s Repayment Obligation. CAWCD is responsible for repaying the Federal

government for a portion of the costs related to construction of th e CAP, pursuant to a

Master Repayment Agreement. Reclamati on bills CAWCD annually in January for the

current year’s repayment obligation (see E xhibit 2 of the Attach ment). The annual

repayment obligation is based upon an amortiz ed repayment schedule (see Exhibit 3 of

the Attachment). Although CAWCD is respon sible for the entire annual payment, net

revenues in the Development Fund’s annual “checking” account as of December 31 st 

# of

the previous year are used to offset this ob ligation. That is to say, the “Total Funds

Available for Repayment” identified in the Source & Disposition of Funds December

statement in Exhibit 1 is then applied against the estimated $55M repayment obligation,

as reflected in Reclamation’s annual bill to CAWCD (noted on line entitled “TOTAL

CREDIT DUE ($28,351,189)” in Exhibit 2). Both the net revenue from the “checking”

account (that is applied towards CAWCD’ s repayment obligation) and CAWCD’s

payment, for the remaining balance due of the current year’s repayment obligation, are

then moved to the “money-market” account side of the Development Fund. At least until

2046 (when CAWCD’s repayment obligation will be considered as paid off), there will

continue to be revenue deposited into the “money-market” account side of the

Development Fund, equal to the amount of CAWCD’s annual repayment obligation.

 Revenues from NGS Surplus Sales. As of October 1, 2011, Western is responsible for

the marketing and sale of NGS surplus power. 4 

# One long-term 20-year contract for NGS

surplus power has been entered into with SRP for purchase and use of a select portion of

on-peak NGS surplus power for $25 million annually plus its associated production costs

(indexed). This sale was av ailable to SRP under the origin al 4-Party Agreement, which

contained a “first opportunity clause” providing SRP status as a priority customer under

the current marketing program.

 Collection of Reclamation’s Portion of NGS Ex penses. SRP, which is one of the owners

of the NGS, is also responsible for its operation and upkeep, including ensuring

compliance with all regulatory requirem ents. As the NGS operator, SRP bills

Reclamation monthly for NGS operation, ma intenance, and replacement costs (OM&R

costs, also referred to as NGS power pr oduction costs), based upon Reclamation’s 24.3 %

4 

# Prior to October 1, 2011, sale and use of NGS surplus power were governed by a 4-Party Agreement, the details of

which are provided in our response to EPA’s follow-up question A.A(x)(y).

# 11 share of the power produced by the plant. As of October 1, 2011, R eclamation then bills

CAWCD for the NGS power reserved by CA WCD to operate the CAP system, based

upon the NGS OM&R costs paid by Reclam ation. These production cost payments,

made by CAWCD to Reclamation, are deposit ed into the Development Fund’s “checking

account”; they are then disbursed during the calendar year to wards payment of

Reclamation’s share of NGS power production costs. Power production costs associated

with NGS surplus power are paid from re venues generated into the checking account

from various sources.

Section 107 of the AWSA provided additional aut hority to fund various activities rather than

return the “checking account” funds at the e nd of the year to Treasury. All AWSA

expenditures authorized under the settlement are funded from the Development Fund (money

market side). Disbursements are made accordi ng to priorities established by the AWSA, which

grouped the disbursements into two “cascades.”

 First Cascade – Includes all revenues receiv ed from the “checking account side” up to the

CAP repayment amount. Disbursements ar e allowed based on the following set of

priorities:

1. Fixed OM&R charges associated with the de livery of CAP water to Indian tribes;

2. Gila River Indian Community Water OM &R Trust Fund and Rehabilitation of

Indian portion of San Carlos Irrigation Project (SCIP);

3. The following without regard to prior ity, except New Mexico paid first:

 New Mexico Unit Fund

 GRIC – PMIP Construction (CAP Project)

 Tohono O’odham CAP projects

 San Carlos Apache CAP project

 SCIDD Lining (Non-Indian SCIP Rehabilitation

 Future Indian Water Settlement Subaccount

 Federal Firming Costs

 Federal cost to implement

4. Payment of the costs of c onstructing CAP distribution systems for non- settlement

tribes.

 Second Cascade – Was established to recogni ze that years might exist where revenue

from NGS surplus power sales, “checking account,” might exceed the CAP repayment.

These revenues had a separate priority structure for disbursement as follows:

1. Fixed OM&R charges associated with the de livery of CAP water to Indian tribes;

2. Final year’s payment on CAP repayment obligation;

3. U.S Treasury General Fund to reimburse fixed OM&R costs for CAP Indian

deliveries and Indian water rights previ ously paid from the Development Fund;

4. U.S Treasury General Fund to 9(d) debt made non-reimbursable under Settlement

Act;

5. U.S Treasury General Fund.

The Cooperative Fund is not managed by Recl amation and is really only tangentially

impacted and we do not believe it is relevant to th ese discussions.

# 12 To	help	illustrate	how	the	Devel opment	Fund	works,	Attachment	1 to	these

responses	includes	three	exhibits:

 Exhibit	1	is	a	copy	of	the	Devel opment	Fund’s	“Source	and	Dispo sition	of	Funds”

for	the	period	ending	December	2011,	which	includes	a	list	of	s pecific	revenues

(sources)	and	expenses	(disposit ions)	that	flow	into	and	out	of the	Development

Fund,	along	with	a	short	des cription	of	these	entries.

 Exhibit	2	is	a	copy	of	Reclamati on’s	bill	to	CAWCD	for	its	2012 CAP	repayment

obligation.		This	bill	identifies the	amount	credited	towards	C AWCD’s	2012

annual	obligation,	based	upon	th e	net	balance	of	the	Developmen t	Fund’s	on

December	31,	2011.

 Exhibit	3	is	a	copy	of	the	amort ization	schedule	for	CAWCD’s	an nual	payments.

B4. How much will revenues from surplus power sales decrease if SCR were

required on one unit, 2 units, and 3 units?

Reclamation’s response: Installation of SCR would add to energy production costs,

since Reclamation would be responsible for 24.3 percent of the total SCR installation

costs. It is difficult, however, to determine what the net revenue impacts would be if SCR

is required on one, two, or all three units at NGS other than to say net revenues from

surplus power sales would decrease. Net revenues to the Development Fund equal the

difference between power production costs and revenues from sale of surplus power

generation. Roughly one-third of Reclamation’s share of the megawatt-hours generated

at NGS ends up as surplus power; however, as of October 1, 2011, Western will market

NGS surplus power in short- and long-term c ontracts at market-based electricity prices.

Due to market price fluctuations, it is not possible to estimate NGS surplus power net

revenues going forward.



# Question B (4) Follow‐up	Questions

a) The	response	states	that	revenue s	from	surplus	power	sales	will decrease	if	SCR	is

required	since	the	difference	be tween	production	cost	and	marke t	price	would	be

reduced	due	to	added	production	cost.		In	comparison	to	prior	y ears,	where	SRP	was

responsible	for	sales	of	excess power,	has	DOI/BOR	completed	an y	analysis	to

determine	how	market	prices	them selves	would	have	impacted	Fund revenues	if

the	current	agreement	with	Western	had	been	in	place	historical ly,	perhaps	for	the

most	recent	5	years?

Reclamation’s response: Please	note	that	in	prior	yea rs,	SRP	was	NOT	responsible

for	sale	of	excess	power;	rather, SRP	obtained	use	of	Reclamati on	energy	produced

at	the	plant.		Reclamation	did	a “back‐cast”	look	taking	into	c onsideration	historical

market	values.		The	results	were based	on	the	assumption	that	5 0	%	of	the	sales

would	have	occurred	off‐peak	and the	rest	on‐peak.		The	most	dr amatic	market

# 13 effect	observed	was	roughly	$10 million	in	lost	revenue.		The	s tudy	was	performed

almost	2	years	ago	and	did not	include	year	2011.

b) What	wholesale	market	price	fore cast	is	DOI/BOR	consulting	when it	calculates

potential	lost	revenues	going	forward?		When	was	that	forecast produced	and	what

are	the	monthly	price	projections?

Reclamation response: Western	and	Reclamation	consult	the	U.S.	Energy

Information	Administration	(EIA) as	well	as	other	forecast	prov iders	and	natural

gas	forecasts.		We	are	particularly	interested	in	pricing	forec asts	for	the	Palo	Verde

and	Mead	trading	hubs,	which	are near	where	the	majority	of	NGS sale	transactions

are	based.		Western	has	advised that	the	monthly	market	value	f or	power	in	2012

should	closely	track	the	Palo	Ve rde	Index	weighted	average	obse rved	during

calendar	year	2011,	provided	belo w.		The	low	prices	we	are	expe riencing	currently

are	considered	unusual.

Table 4. PALO VERDE INDEX WEIGHTED AVERAGE PRICE

FOR CALENDAR YEAR 2011

YEAR 2011 Firm 2011 Non-Firm

MONTH ON PEAK OFF PEAK ON PEAK OFF PEAK



# JANUARY $34.38 $24.33 $25.00 $20.00

FEBRUARY $35.21 $23.58 $39.00 $5.00

MARCH $28.44 $36.64 $36.00 $14.49

APRIL $34.67 $18.84 $44.00 $17.26

MAY $35.05 $14.59 $34.72 $12.86

JUNE $38.85 $9.34 $30.00 $9.65

JULY $44.77 $21.21 $47.00 $20.03

AUGUST $42.75 $25.25 $38.28 $15.00

SEPTEMBER $40.18 $25. 01 $18.67 $12.00

OCTOBER $34.56 $23.74 $57.00 $21.80

NOVEMBER $33.57 $24.48 $48.00 $21.80

DECEMBER $32.00 $25.24 $28.94 $28.00

# 14 

# B. Regarding Responses to NREL

1(c). By what budgetary mechanisms did the federal government pay for its share

of the original cost of NGS and for subsequent emission control additions?

Reclamation’s response : Reclamation used CAP construction appropriations to fund the

original cost of NGS and installation of the SO2 scrubbers. These costs were allocated

to project purposes as reimbursable costs. CAP reimbursable costs are being repaid to

the United States annually over a 50-year ti me period by CAWCD, the entity currently

responsible for operating the CAP. Subsequent emission controls were included as part

of the annual operation, maintenance, and replacement expenses for which Reclamation

was billed for its share (24.3%). Reclamation’s share of NGS OM&R expenses was

initially paid from the Lower Colorado Basin Development Fund (Development Fund).



# Question 1 (c) Follow‐up	Questions

a) The	response	states	that	Reclama tion’s	share	of	OM/R	expenses	w ere	originally	paid

from	the	Lower	Colorado	River	Ba sin	Development	Fund.		Is	that no	longer	the	case?

Reclamation’s response: Yes,	OM&R	is	paid	out	of	the	Development	Fund	as

described	in	answer	to	question B(3)(a).			Remember,	CAWCD	pays to	the

Development	Fund	(Checking	Accoun t)	the	costs	of	production	for energy	used	for

CAP	purposes.

b) If	so,	how	are	they	paid	today? See	answer	to	B(3)(a)	above

Question 1 (c) Follow‐up	Questions

a) Does	the	option	to	use	CAP	const ruction	appropriations	(as	was done	for	the	SO2

scrubbers)	remain	open	for	future incremental	capital	costs	ass ociated	with

environmental	upgrades?

Reclamation’s response: In	the	late	1990s,	when	the	original	NGS	SO2	scrubber

installation	work	was	required,	the	CAP	project	had	not	yet	bee n	placed	into

repayment	status	and	the	final	c osts	for	construction	of	the	en tire	CAP	(canals,

pumping	plants,	NGS,	etc.)	was	s till	under	discussion.			Ultima tely,	both	entities

agreed	that	it	was	appropriate	to	seek	Federal	appropriations	a s	part	of	the

construction	costs	of	the	projec t.				CAWCD’s	repayment	obligat ion	calculations

included	these	costs	as	part	of the	entire	cost	of	CAP	construc tion.		Low	NOx	burners

were	installed	a	decade	later	aft er	the	project	was	placed	into repayment	status	and

Federal	appropriations	were	not	considered	appropriate;	therefo re,	these	costs

were	included	in	the	OM&R	compon ent	of	the	NGS	operating	costs. Absorbing	these

costs	into	OM&R	for	NGS	without creating	significant	budgetary impacts	on	CAP

water	users	was	possible	at	the	t ime	only	through	the	deferral of	other	planned	NGS

OM&R	actions.

# 15 While	Reclamation	believes	any	f urther	cost	at	NGS	for	BART	or other	OM&R

activities	is	the	responsibility	of	CAWCD	as	part	of	OM&R,	the possibility	of	Federal

appropriations	has	not	been	compl etely	ruled	out	by	some	as	a	w ay	to	soften	or

offset	the	initial	funding	for	B ART	compliance.		If	ultimately funded	by	CAWCD	as	an

OM&R	expense,	it	would	be	recove red	by	passing	these	costs	on	t o	CAP	water	users

through	increases	to	the	Energy	Rate	component	of	CAP	water	rat es.

1(d) How much excess power from NGS has the Western Area Power

Administration (Western) sold on the gov ernment’s behalf annually over the

past 15 years, and what were the values of those sales annually?

Reclamation response : Over the last 15 years, the Central Arizona Project has received

a net of about $47 million annually. Three long-term (20-year) four-party contracts for an

estimated 400 MW of NGS surplus capacity were executed among the following:

Western, Reclamation, CAWCD, and SRP. Western did not actively market (sell) any

NGS Surplus during this period, other than their efforts at the front end of crafting the

three original Four-Party contracts Through these three contracts, SRP annually

purchased from Reclamation/Western the full United States power entitlement at the

Navajo production cost plus paid an additional fixed annual premium of roughly $47

million. SRP’s cost obligations increased monthly only to the degree the costs to

produce the power increased. On an annual basis. the revenues received for operational

costs were netted out to zero within the overall LCBDF accounting because CAWCD

disbursements offset the SRP deposits . Under that arrangement, SRP provided power

for CAP pumping with any SRP managed power resources it had including

Reclamation’s or SRP’s share of Navajo power. SRP recovered its costs for providing

power for CAP pumping by billing CAWCD for the metered quantity of power used, at

the Navajo production cost rate.

Through two of the long-term contracts, $25.2 million from the $47 million annual fixed

premium went to repay bonds acquired by CAWCD; this payment is referred to as the

“Additional Rate Component,” or ARC. The ARC was legislatively authorized to go

directly to repay bonds acquired by CAWCD (in part, to pay for construction of New

Waddell Dam). These bonds have now been repaid and the ARC has stopped being

collected as of September 30, 2011. Under the third contract, the remaining $21.75

million are deposited into the Development fund. This represents, in part, reimbursement

for the United States’ share of NGS annual OM&R expenses as an amortization

contribution ($1,812,500 monthly, or $21,750,000 annually). Through these three

contracts, the repayment contribution from power sales was well defined over roughly

the last 20 years.

These three contracts expired September 30, 2011. Beginning October 1, 2011,

Western will market any Navajo surplus in short and long-term contracts at market

based electricity prices. All revenues will be deposited into the Development Fund .



# Question 1 (d) Follow‐up	Questions

a) Of	the	annual	400	MWs	allotted	to SRP,	what	was	the	annual	aver age	amount	of

MWs	used	for	CAP	pumping?

# 16 Reclamation’s response: Please	see	Table	2	in	respons e	to	Question	A(9)(3)	above

which	indicates	the	annual	CAP	p umping	energy	volume,	in	MWH,	f or	2006,	2007,

2008,	2009,	and	2010,	as	well	as	the	annual	surplus	energy	volu me	for	those	same

years.

b) How	did	SRP	cover	its	$47	million annual	fixed	premium	if	the	v olume	of	water	sold

to	CAWCD	was	sold	at	the	cost	of	production?

Reclamation’s response: Under	the	4‐Party	Agr eement	(which	expired

September	30,	2011),	SRP	was	able to	use	(for	its	own	purposes) all	of

Reclamation’s	share	of	power	and	agreed	to	provide	power	for	CA P	pump	load.

Availability	of	this	surplus	pow er	provided	SRP	with	additional flexibility	in

managing	its	entire	portfolio. Additionally,	SRP	could	recover this	premium	through

the	rate	structure	it	charged	to	all	SRP	customers.		We	believe SRP	was	able	to

realize	a	net	savings	which	woul d	otherwise	not	have	been	avail able.

c) Was	SRP	by	contract	restricted	from	selling	NGS	power	on	the	we stern	wholesale

market?

Reclamation’s response: SRP	was	not	restricted	from	selling	NGS	surplus	power;

however,	SRP	has	a	significant	r etail	load	to	serve	its	custome rs	and	likely	only	a

small	amount	would	have	been	marketed.

Question 1 (d) Follow‐up	Questions

a) Under	the	new	NGS	surplus	contra ct	(Oct	1,	2011)	is	a	set	porti on	of	the	revenue

from	excess	power	sales	($21.75 million)	to	continue	to	be	set aside	in	the	Lower

Colorado	River	Basin	Development Fund	for	amortization	of	CAWCD repayment

obligation?

Reclamation response: With	the	expiration	of	the	4 ‐Party	Agreement	on	September

30,	2011,	SRP	no	longer	pays	the	$21.75	million	fixed	premium	o r	consideration	fee.

As	indicated	in	response	to	Ques tion	A(9)(a),	under	the	new	Wes tern	marketing

program,	Reclamation	receives	in to	the	Development	Fund	(Checki ng	Account)	NGS

surplus	power	revenues	from	two distinct	sources.		The	first	so urce	is	an	annual

payment	from	SRP	of	$25	million	( indexed)	pursuant	to	a	20‐year contract	for

purchase	of	select	on‐peak	power .		The	second	source	is	revenue generated	from

Western’s	sale	of	the	remaining surplus	power	on	the	open	marke t.		There	is	no	set

aside.

b) What	happens	if	the	amount	of	re venue	obtained	from	excess	powe r	sales	exceeds

the	set	aside?

# 17 Reclamation’s response: As	explained	above	there	are	no “set‐asides.”		Whatever	net

revenues	exist	at	the	end	of	the calendar	year	are	applied	to	C AWCD’s	repayment

obligation	and	retained	in	the	D evelopment	Fund	for	the	long	te rm	purposes

authorized	under	AWSA.

1(e). Please provide a description of the new excess power marketing contract that

will be in place in October 2011.

Reclamation response : The new contract divides up responsibilities among Western,

Reclamation & CAWCD. It assigns future NGS surplus marketing responsibilities to

Western and Reclamation. Responsibility for managing CAP pump load has been

transferred to CAWCD, including scheduling, delivery, regulation, balancing, reserves,

and their associated costs. Revenues collected for excess energy sales under the new

contract will depend on the net of market pricing and power production costs at the time

of the sale. All revenues from the sale of Reclamation’s NGS surplus power will be

deposited into the Development Fund. Western and Reclamation have already made

one sale of excess power to SRP. SRP purchased surplus NGS capacity and energy to

be taken between the months of June and August of each year beginning 2012 until

September 30, 2031. SRP will pay $25 million escalated each year for this power.



# Question 1 (e) Follow‐up	Questions

a) Please	provide	additional	information	regarding	the	SRP	seasona l	surplus	power

purchase,	including	the	annual	v olumes	and	rate	of	escalation.

Reclamation’s response :		SRP’s	First	Opportunity	Cont ract	results	in	SRP	acquiring

300MW	of	a	super‐peak	product	annu ally,	defined	as	an	8‐hour	en ergy	product,	7

days	per	week	for	the	months	of	June	through	August,	up	to	220, 800	MWH	per	year.

The	annual	premium	starts	out	at $25	million	in	the	first	year and	escalates	annually

at	3	%.		The	premium	will	be	res et	one	time	after	10	years	on	a formula	based	on	the

ratios	of	forward	natural	gas	pr ices	and	the	3	%	escalation	wil l	continue	for	the	last

10	years	of	the	contract.		SRP	is	required	to	pay	the	actual	pr oduction	costs	for	this

power,	with	the	cost	escalation	increases	capped	at	4	%	per	yea r,	reset	to	actual

costs	every	4	years.

b) 

# Please	indicate	the	date	that	the	transaction	was	priced,	point of	receipt	and	any

ancillary	charges	paid	by	SRP	or	the	seller.

Reclamation’s response: The	new	contract	prices	and	terms	are	based	upon	an

effective	date	of	October	1,	201 1,	with	SRP	primarily	taking	de livery	of	this	acquired

NGS	surplus	at	substations	near Phoenix	(Westwing)	and/or	near Hoover	Dam

(Mead),	as	well	as	other	mutually agreed	to	points.		Any	ancill ary	charges	are	the

responsibility	of	SRP	as	the	customer.

2(b). What is the breakdown of the revenues into and out of the Lower Colorado

River Basin Development Fund each of the past 5 years? What are the revenue

projections and assumptions for the next 5 years?

# 18 Reclamation response : See table below.

DEVELOPMENT FUND REVENUES AND USES (2002-2016)

Dollars ($1,000)

YEAR REVENUE STREAM INVESTMENT

REVENUE (1) EXPENSES (2)



# 2002 58,744 0 0

2003 50,032 0 0

2004 54,634 0 0

2005 69,222 4,139 0

2006 45,282 13,407 0

2007 51,282 16,711 0

2008 59,248 7,451 0

2009 55,363 501 0

2010 66,562 461 156,424

2011 68,165 8,223 79,721

2012 55,311 8,156 97,729

2013 54,458 7,471 136,943

2014 53,604 5,971 110,357

2015 57,768 4,955 123,921

2016 56,747 3,731 152,319



# Question 2 (b) Follow‐up	Questions

a) The	table	provided	for	the	Lower	Colorado	River	Basin	Developme nt	Fund	Revenue

and	Expenses	seems	to	reflect	an	increasing	trend	of	expenses	e xceeding	revenues.

Is	this	correct?

Reclamation response: These	long‐term	funding	obligations	were	created	as	a	result

of	the	AWSA	and	vary	over	time. During	the	first	10	years,	the expenses	shown	are

closely	tied	to	construction	projects	and	are	increasing	in	nat ure.		These	expenses

are	not	related	in	any	way	to	th e	OM&R‐related	expenses	at	NGS and	come	from	the

money	market	side	of	the	Development	Fund.

b) If	so,	is	there	a	contingency	pl an	to	re‐adjust	revenues	and	ex penses	in	order	that

the	Fund	remains	whole?

Reclamation’s response: The	authorized	expenditures of	Development	Fund	(Money

Market	Side)	revenues	under	the	AWSA	vary	over	time.		Expenses include

construction	activities	that	have	a	definite	end‐date,	while	pa yments	of	fixed	OM&R

for	tribal	water	uses	will	continue	to	increase.		The	structure of	the	AWSA

recognized	that	over	time	the	fu nd	may	not	be	sustainable	and	o ther	mechanisms

might	need	to	be	explored.		Rev enues	in	excess	of	the	$55	milli on	repayment

obligation	from	NGS	surplus	powe r	sales,	although	not	a	guarant eed	source	of

revenue,	were	anticipated	to	be one	possible	solution	for	meeti ng	the	potential

shortfall.

# 19 3(f). Please explain the financial mechan ism for using Reclamation’s portion of

NGS power for CAP.

Reclamation response: As explained in # A. 1) d. above, prior to September 30, 2011,

each year on a monthly basis, SRP purchased from Reclamation/Western all Navajo

surplus power and power used for CAP pumping, at the Navajo production cost, plus a

fixed annual premium of roughly $47 million. Under that arrangement, SRP provided

power for CAP pumping with any SRP managed power resource it had including

Reclamation’s or SRP’s share of Navajo power. SRP then billed CAWCD for the

metered quantity of power used, at the Navajo production cost rate. From the roughly

$47 million recovered, a portion of the premium ($25.2 million) was used to repay bonds

(the ARC). These bonds have been repaid, and the $25 million are no longer collected.

The remaining $21.75 million were deposited into the Development Fund to be applied

towards CAWCD’s annual repayment to the Federal government.

Beginning October 1, 2011, this process changed. The United States’ portion of NGS

power now is divided into two types: reserved and surplus. CAWCD manages and pays

Reclamation for reserved power at the NGS production cost. The remaining production

costs, plus a profit, are expected to be recovered by Western through sales of surplus

NGS power. The full revenue from Western surplus power sales will be transferred to

Reclamation for deposit into the Development Fund. If CAWCD is somehow able to

recover any profit from its management of reserved power, this profit will also be

transferred to Reclamation for deposit into the Development Fund. The net revenues

above cost in the Development Fund are credited annually against the annual

repayment obligation of CAWCD to the United States for construction of the CAP.

CAWCD is responsible for the repayment obligation of the project and pays the United

States a cash payment to make up any shortfall from collected revenues to the

Development Fund during the calendar year.



# Question 3 (f) Follow‐up	Questions

a) Prior	to	Oct	1,	if	SRP	paid	for Reclamation/Western’s	share	of NGS	at	the	value	of

the	cost	of	production	plus	a	$ 47	million	annual	fixed	premium, then	resold	the

power	to	CAWCD	at	‘the	cost	of	p roduction,’	how	was	the	$47	mil lion	recovered	if

the	buy/sell	arrangement	was	se t	at	the	cost	of	production?

Reclamation’s response :		SRP’s	sale	of	Reclamation’s share	of	NGS	power	at	the

power	production	cost	rate	applie d	only	to	the	power	delivered to	CAWCD	for

pumping	CAP	water.		SRP	had	no	pricing	restrictions	on	its	use of	the	remaining

portion	of	Reclamation’s	share	of	NGS	(approximately	1.4TWh	per year).

b) Who	paid	the	$47	million	annual	f ixed	premium	value	needed	to	m ake	SRP	whole?

Reclamation’s response :		As	we	have	attempted	to	clari fy	in	our	response	to	Question

A(9)(a)	above,	prior	to	October	1,	2011,	SRP	paid	$21.75	millio n	as	a	fixed	premium

or	consideration	fee	f or	the	use	of	Reclamation’s	entire	share of	NGS	power,		and

$25.2	million	Additional	Rate	Component	to	the	Bond	Trustee.		I n	return,	SRP

# 20 provided	all	the	power	required to	operate	the	CAP	system	and	d eliver	CAP	water	to

CAWCD’s	customers,	billing	CAWCD at	the	NGS	production	cost	rat e.		SRP	was	able

to	add	to	its	own	portfolio	Recla mation’s	entire	share	of	NGS. Due	to	SRP’s	large

customer	base,	SRP	could	recover this	premium	through	the	rate structure	it

charged	to	its	customers.

Question 3 (f) Follow‐up	question

a) In	the	answer	to	Question	1(d), it	is	stated	that	the	$21.75	mi llion	deposited	in	the

Development	Fund	was	used	for	“r eimbursement	for	the	United	Sta tes’	share	of	NGS

annual	OM&R	expenses.”		In	Questi on	3	(f),	it	is	stated	that	th e	same	$21.75	million

was	used	for	“CAWCD’s	annual	repayment	to	the	Federal	Governmen t.”		How	are

these	two	statements	consistent?

Reclamation’s response :		Please	see	the	Reclamation’s response	to	Question	A(9)(a).

Question 3 (f) Follow‐up	Question

a) 

# Again,	it	is	stated	in	the	second	paragraph,	“The	revenue	in	th e	Development	Fund	is

credited	annually	against	the	ann ual	repayment	obligation	of	CA WCD	to	the	United

States	for	construction	costs	of the	CAP.”	(emphasis	added)		Un der	this	scenario,

who	and	how	are	payments	made	for	annual	OM&R	expenses,	includi ng	the	OM&R

expense	linked	to	the	ownership	share	of	Reclamation/Western?

Reclamation’s response :		The	answers	to	previous	que stions	should	now	adequately

address	this	question.

### LOWER COLORADO RIVER BASIN DEVELOPMENT FUND Exhibit 1

SOURCE & DISPOSITION OF FUNDS

PROJECT 1225 FUND V4 0

FOR THE PERIOD ENDING DECEMBER 2011

Available for Repayment CALENDAR YEAR

MONTH AVAILABL E CALENDAR YEA R CALENDAR YEA R AVAILABLE

I SOURCES OF FUNDS DECEMBER ADJUSTMENT S DECEMBER TO DATE 2011 ADJUSTMENT S FOR REPAYMEN T

a Nava j o Miscellaneous Revenue [1]

b Nava j o Surplus Sales [1]

c Calpine

d Parker Davis

e Transmission Line Loss Revenue ( Miscellaneous )

Nava j o Ener g y Char g e ( NEC )

f CAWCD Applied Advance ( 1CU30-P1212 ) [2 ]

Nava j o Consideration Fee

d Hoover 4.5 Mills

g SO2 Credit Sales

-

h EPA Credi t

i Ri g ht of Use/Miscellaneous - Available

SRP Interest from O&M Bills

j Non-Recurrin g Items

-

Total Sources of Funds - Available for Repaymen t

II DISPOSITION OF FUNDS

Ri g ht of Use Expense & Licenses - Availabl e

- - - - - -

SO2 Credit Sales

- - - - - -

a Salt River Pro j ect - Nava j o Generatin g Station

i Capital Equipmen t

ii Insurance Expens e

iii O&M Expense

iv Materials & Supplies

v Fue l

vi Coal Expense

vii Indenture of Leas e

viii Liti g atio n

b Transmission System s

i Arizona Public Service - Southern O& M

ii Arizona Public Service - Southern Capita l

iii Nevada Power - Wester n

iv Liberty Phase Shifte r

v McCullou g h Switchin g Station - SR P

v McCullou g h Switchin g Station - CAWC D

vi WAPA - CAP Transmissio n

c Nava j o Oversi g ht

i WAPA Oversi g ht - Four Party A g reemen

ii WAPA Nava j o Surplus Sales - P121 2

ii WAPA Trans Purchases - P121 2

iii USB R

Non-Recurrin g Items

Total Dispositions of Funds - Available for Repaymen t

NET INCREASE/DECREASE IN AVAILABLE FOR REPAYMEN

INTERES T

INTEREST CAWCD ADVANCE PAYMENT S

TOTAL FUNDS AVAILABLE FOR REPAYMEN T



### Not Available for Repayment CALENDAR YEAR

MONTH NOT AVAILABL E CALENDAR YEA R CALENDAR YEA R NOT AVAILABLE

SOURCES OF FUNDS DECEMBER ADJUSTMENT S DECEMBER TO DATE 2011 ADJUSTMENT S FOR REPAYMEN T

CAWCD McCullou g h Reimbursement

CAWCD Repayment Obli g atio n

CAWCD Reimbursement for Oversi g h t

CAWCD Advance ( 1CU30-P1212 ) [2 ]

SO2 Credit Sales

Ri g ht of Use/Miscellaneous - Not Available

Non-Indian Revenue/Advance s

Recreation Admin Reimbursement ( credited in workplan )

Non-Recurrin g Items [3] 1

Total Sources of Funds - Not Available for Repaymen t

DISPOSITION OF FUNDS

O&M CAWCD Contract Administratio n

O&M Federal Interest Oversi g ht

O&M CAWCD Requested Wor k

McCullou g h Switchin g Station - CAWC D

Ri g ht of Use Expense & Licenses - Not Availabl e

Trans to R344 - AWS A

Non-Indian Cost s

Non-Recurrin g Items

Total Dispositions of Funds - Not Available for Repaymen t

NET TOTAL FUNDS NOT AVAILABLE FOR REPAYMEN

FUND BALANCE ACTIVITY - DECEMBE R

FUND BALANCE ACTIVITY - BEGINNING OF PERIOD

FUND BALANCE ACTIVITY - ENDING OF PERIO D

FOOTNOTES

[1] Nava j o Surplus Sales - $824,080.32 payment from the City of Los An g eles was for surplus Nava j o ener g y. This was recorded as "Misc Revenue" by WAPA; therefore this i s

bein g reclassified as Nava j o Surplus Sales on the S&D

. [2] CAWCD Advance - Althou g h $9,204,826 was applied in December for November's advance this was actually reflected on November's S&D; therefore the $9,204,82 6

is not reflected on December's S& D

[3] Non-Recurrin g Items - $12 million payment from CAWCD pursuant to Section 6 ( d )( ii ) of the Stipulation A g reement. Payment shall be applied as a prepayment of the las

$12 million due on the non-interest bearin g portion of CAWCD's repayment obli g atio n

CAP2011.xlsx DEC

2/6/2012TotalYear Stage I Stage II Stage I Stage II Principal Interest Total Interest Bearing Non-Interest Baring Balance1994 915,777,096-338,712,077-12,544,8928,926,53721,471,429915,777,096338,712,0771,254,489,1731995 903,253,776-338,690,505-12,544,89230,186,74142,731,633903,253,776338,690,5051,241,944,2811996 891,712,185-337,687,205-12,544,89229,801,02142,345,913891,712,185337,687,2051,229,399,3901997 880,231,495286,140,529336,623,003105,832,79816,464,62532,206,49148,671,1161,166,372,024442,455,8011,608,827,8251998 868,884,835282,220,796335,424,771105,832,79816,464,62538,469,95054,934,5751,151,105,631441,257,5691,592,363,2001999 857,507,127278,301,062334,257,587105,832,79816,464,62537,958,71054,423,3351,135,808,189440,090,3851,575,898,5742000 845,889,604274,381,329333,330,219105,832,79816,464,62537,439,45553,904,0801,120,270,933439,163,0171,559,433,9502001 834,463,848270,461,596332,211,083105,832,79820,228,09336,926,60857,154,7011,104,925,444438,043,8811,542,969,3252002 819,255,489266,541,863331,111,083105,832,79820,228,09336,287,34756,515,4401,085,797,352436,943,8811,522,741,2332003 804,047,129262,622,129330,011,083105,832,79820,228,09335,648,08755,876,1801,066,669,258435,843,8811,502,513,1392004 788,838,770258,702,396328,911,083105,832,79821,404,01335,008,82656,412,8391,047,541,166434,743,8811,482,285,0472005 773,630,411253,606,743327,811,083105,832,79821,404,01334,330,26655,734,2791,027,237,154433,643,8811,460,881,0352006 758,122,052248,511,090327,011,083105,832,79821,404,01333,641,68055,045,6931,006,633,142432,843,8811,439,477,0232007 742,613,692243,415,436326,211,083105,832,79821,404,01232,953,09354,357,105986,029,128432,043,8811,418,073,0092008 727,105,333238,319,783325,411,083105,832,79825,167,48032,264,50757,431,987965,425,116431,243,8811,396,668,9972009 707,833,506233,224,130324,611,083105,832,79825,167,47931,450,14656,617,625941,057,636430,443,8811,371,501,5172010 688,561,680228,128,477323,811,083105,832,79825,167,48130,635,78555,803,266916,690,157429,643,8811,346,334,0382011 669,289,853223,032,823323,011,083105,832,79826,343,40029,821,42456,164,824892,322,676428,843,8811,321,166,5572012 650,018,026216,761,250322,211,083105,832,79826,343,40028,967,76355,311,163866,779,276428,043,8811,294,823,1572013 630,746,199210,489,677321,411,083105,832,79826,343,39928,114,10354,457,502841,235,876427,243,8811,268,479,7572014 611,474,373204,218,104320,611,083105,832,79826,343,40127,260,44353,603,844815,692,477426,443,8811,242,136,3582015 592,202,546197,946,530319,811,083105,832,79831,361,35726,406,78257,768,139790,149,076425,643,8811,215,792,9572016 567,912,762191,674,957319,011,083105,832,79831,361,35625,385,42256,746,778759,587,719424,843,8811,184,431,6002017 543,622,979185,403,384318,211,083105,832,79831,361,35624,364,06155,725,417729,026,363424,043,8811,153,070,2442018 519,333,196179,131,811317,411,083105,832,79832,929,25023,342,70156,271,951698,465,007423,243,8811,121,708,8882019 494,843,412171,292,344316,811,083105,832,79832,929,24922,262,25755,191,506666,135,756422,643,8811,088,779,6372020 470,353,629163,452,878316,211,083105,832,79832,929,25021,181,81354,111,063633,806,507422,043,8811,055,850,3882021 445,863,845155,613,411315,611,083105,832,79832,929,25020,101,37053,030,620601,477,256421,443,8811,022,921,1372022 421,374,062147,773,944315,011,083105,832,79840,456,18519,020,92659,477,111569,148,006420,843,881989,991,8872023 389,357,343139,934,478314,411,083105,832,79840,456,18517,688,93358,145,118529,291,821420,243,881949,535,7022024 357,340,625132,095,011313,811,083105,832,79840,456,18516,356,93956,813,124489,435,636419,643,881909,079,5172025 325,323,906124,255,545313,211,083105,832,79842,808,02515,024,94557,832,970449,579,451419,043,881868,623,3322026 293,157,188114,064,238312,761,083105,832,79842,808,02513,609,34056,417,365407,221,426418,593,881825,815,3072027 260,990,469103,872,932312,311,083105,832,79842,808,02512,193,73555,001,760364,863,401418,143,881783,007,2822028 228,823,75193,681,625311,861,083105,832,79842,808,02510,778,13053,586,155322,505,376417,693,881740,199,2572029 196,657,03283,490,319311,411,083105,832,79844,062,5149,362,52453,425,038280,147,351417,243,881697,391,2322030 163,235,82573,299,012310,961,083105,832,79844,062,5147,904,99451,967,508236,534,837416,793,881653,328,7182031 129,814,61763,107,706310,511,083105,832,79844,062,5146,447,46450,509,978192,922,323416,343,881609,266,2042032 96,393,40952,916,399310,061,083105,832,79844,454,4874,989,93449,444,421149,309,808415,893,881565,203,6892033 62,951,40242,333,119309,631,883105,832,79844,454,4873,518,60947,973,096105,284,521415,464,681520,749,2022034 29,488,59431,749,840309,223,483105,832,79844,454,4882,046,58846,501,07661,238,434415,056,281476,294,7152035 -21,166,560304,840,869105,832,79844,454,488707,38645,161,87421,166,560410,673,667431,840,2272036 -10,583,280270,969,661105,832,79844,454,487353,69344,808,18010,583,280376,802,459387,385,7392037 --237,098,454105,832,79844,454,487-44,454,487-342,931,252342,931,2522038 --203,227,24695,249,51944,454,488-44,454,488-298,476,765298,476,7652039 --169,356,03884,666,23944,454,487-44,454,487-254,022,277254,022,2772040 --135,484,83174,082,95944,454,488-44,454,488-209,567,790209,567,7902041 --101,613,62363,499,67944,454,488-44,454,488-165,113,302165,113,3022042 --67,742,41552,916,39944,454,487-44,454,487-120,658,814120,658,8142043 --33,871,20842,333,11944,454,487-44,454,487-76,204,32776,204,3272044 ---31,749,84010,583,280-10,583,280-31,749,84031,749,8402045 ---21,166,56010,583,280-10,583,280-21,166,56021,166,5602046 ---10,583,28010,583,280-10,583,280-10,583,28010,583,28022,958,297,0716,957,918,53614,721,539,7344,815,392,3121,646,462,500971,347,5292,617,810,029Payment Due BalanceBeginning Balance Beginning BalanceInterest Bearing Non-Interest Bearing

### LOWER COLORADO RIVER BASIN DEVELOPMENT FUND Exhibit 1

SOURCE & DISPOSITION OF FUNDS

PROJECT 1225 FUND V4 0

FOR THE PERIOD ENDING DECEMBER 2011

Available for Repayment CALENDAR YEAR

MONTH AVAILABL E CALENDAR YEA R CALENDAR YEA R AVAILABLE

I SOURCES OF FUNDS DECEMBER ADJUSTMENT S DECEMBER TO DATE 2011 ADJUSTMENT S FOR REPAYMEN T

a Nava j o Miscellaneous Revenue [1]

b Nava j o Surplus Sales [1]

c Calpine

d Parker Davis

e Transmission Line Loss Revenue ( Miscellaneous )

Nava j o Ener g y Char g e ( NEC )

f CAWCD Applied Advance ( 1CU30-P1212 ) [2 ]

Nava j o Consideration Fee

d Hoover 4.5 Mills

g SO2 Credit Sales

-

h EPA Credi t

i Ri g ht of Use/Miscellaneous - Available

SRP Interest from O&M Bills

j Non-Recurrin g Items

Total Sources of Funds - Available for Repaymen t 11,251,465.75

- 11,251,465.75 168,872,577.35

- 168,872,577.35

II DISPOSITION OF FUNDS

Ri g ht of Use Expense & Licenses - Availabl e

- - - - - -

SO2 Credit Sales

- - - - - -

a Salt River Pro j ect - Nava j o Generatin g Station

i Capital Equipmen t

ii Insurance Expens e

iii O&M Expense

iv Materials & Supplies

v Fue l

vi Coal Expense

vii Indenture of Leas e

viii Liti g atio n

b Transmission System s

i Arizona Public Service - Southern O& M

ii Arizona Public Service - Southern Capita l

iii Nevada Power - Wester n

iv Liberty Phase Shifte r

v McCullou g h Switchin g Station - SR P

v McCullou g h Switchin g Station - CAWC D

vi WAPA - CAP Transmissio n

c Nava j o Oversi g ht

i WAPA Oversi g ht - Four Party A g reemen

ii WAPA Nava j o Surplus Sales - P121 2

ii WAPA Trans Purchases - P121 2

iii USB R

Non-Recurrin g Items

- - - - - Total Dispositions of Funds - Available for Repaymen t 11,082,152.24

- 11,082,152.24 140,939,874.36

- 140,939,874.36

NET INCREASE/DECREASE IN AVAILABLE FOR REPAYMEN 169,313.51

- 169,313.51 27,932,702.99

- 27,932,702.99

INTERES T 77,556.81 77,556.81 366,711.36 366,711.36

INTEREST CAWCD ADVANCE PAYMENT S 21,375.29 21,375.29 51,774.31 51,774.31

TOTAL FUNDS AVAILABLE FOR REPAYMEN T 169,313.51 98,932.10 268,245.61 27,932,702.99 418,485.67 28,351,188.66



### Not Available for Repayment CALENDAR YEAR

MONTH NOT AVAILABL E CALENDAR YEA R CALENDAR YEA R NOT AVAILABLE

SOURCES OF FUNDS DECEMBER ADJUSTMENT S DECEMBER TO DATE 2011 ADJUSTMENT S FOR REPAYMEN T

CAWCD McCullou g h Reimbursement

CAWCD Repayment Obli g atio n

CAWCD Reimbursement for Oversi g h t

CAWCD Advance ( 1CU30-P1212 ) [2 ]

SO2 Credit Sales

Ri g ht of Use/Miscellaneous - Not Available

Non-Indian Revenue/Advance s

Recreation Admin Reimbursement ( credited in workplan )

Non-Recurrin g Items [3]

Total Sources of Funds - Not Available for Repaymen t 13,696,549.26

- 13,696,549.26 42,808,476.42

- 42,808,476.42

DISPOSITION OF FUNDS

O&M CAWCD Contract Administratio n

O&M Federal Interest Oversi g ht

O&M CAWCD Requested Wor k

McCullou g h Switchin g Station - CAWC D

Ri g ht of Use Expense & Licenses - Not Availabl e

Trans to R344 - AWS A

Non-Indian Cost s

Non-Recurrin g Items

Total Dispositions of Funds - Not Available for Repaymen t 103,902.80

- 103,902.80 57,565,292.96

- 57,565,292.96

NET TOTAL FUNDS NOT AVAILABLE FOR REPAYMEN 13,592,646.46

- 13,592,646.46 ( 14,756,816.54 )

- ( 14,756,816.54 )

FUND BALANCE ACTIVITY - DECEMBE R 13,761,959.97

FUND BALANCE ACTIVITY - BEGINNING OF PERIOD ( 586,073.52 )

FUND BALANCE ACTIVITY - ENDING OF PERIO D 13,175,886.45

FOOTNOTES

[1] Nava j o Surplus Sales - $824,080.32 payment from the City of Los An g eles was for surplus Nava j o ener g y. This was recorded as "Misc Revenue" by WAPA; therefore this i s

bein g reclassified as Nava j o Surplus Sales on the S&D

. [2] CAWCD Advance - Althou g h $9,204,826 was applied in December for November's advance this was actually reflected on November's S&D; therefore the $9,204,82 6

is not reflected on December's S& D

[3] Non-Recurrin g Items - $12 million payment from CAWCD pursuant to Section 6 ( d )( ii ) of the Stipulation A g reement. Payment shall be applied as a prepayment of the las

$12 million due on the non-interest bearin g portion of CAWCD's repayment obli g atio n

CAP2011.xlsx DEC

2/6/2012TotalYear Stage I Stage II Stage I Stage II Principal Interest Total Interest Bearing Non-Interest Baring Balance1994 915,777,096-338,712,077-12,544,8928,926,53721,471,429915,777,096338,712,0771,254,489,1731995 903,253,776-338,690,505-12,544,89230,186,74142,731,633903,253,776338,690,5051,241,944,2811996 891,712,185-337,687,205-12,544,89229,801,02142,345,913891,712,185337,687,2051,229,399,3901997 880,231,495286,140,529336,623,003105,832,79816,464,62532,206,49148,671,1161,166,372,024442,455,8011,608,827,8251998 868,884,835282,220,796335,424,771105,832,79816,464,62538,469,95054,934,5751,151,105,631441,257,5691,592,363,2001999 857,507,127278,301,062334,257,587105,832,79816,464,62537,958,71054,423,3351,135,808,189440,090,3851,575,898,5742000 845,889,604274,381,329333,330,219105,832,79816,464,62537,439,45553,904,0801,120,270,933439,163,0171,559,433,9502001 834,463,848270,461,596332,211,083105,832,79820,228,09336,926,60857,154,7011,104,925,444438,043,8811,542,969,3252002 819,255,489266,541,863331,111,083105,832,79820,228,09336,287,34756,515,4401,085,797,352436,943,8811,522,741,2332003 804,047,129262,622,129330,011,083105,832,79820,228,09335,648,08755,876,1801,066,669,258435,843,8811,502,513,1392004 788,838,770258,702,396328,911,083105,832,79821,404,01335,008,82656,412,8391,047,541,166434,743,8811,482,285,0472005 773,630,411253,606,743327,811,083105,832,79821,404,01334,330,26655,734,2791,027,237,154433,643,8811,460,881,0352006 758,122,052248,511,090327,011,083105,832,79821,404,01333,641,68055,045,6931,006,633,142432,843,8811,439,477,0232007 742,613,692243,415,436326,211,083105,832,79821,404,01232,953,09354,357,105986,029,128432,043,8811,418,073,0092008 727,105,333238,319,783325,411,083105,832,79825,167,48032,264,50757,431,987965,425,116431,243,8811,396,668,9972009 707,833,506233,224,130324,611,083105,832,79825,167,47931,450,14656,617,625941,057,636430,443,8811,371,501,5172010 688,561,680228,128,477323,811,083105,832,79825,167,48130,635,78555,803,266916,690,157429,643,8811,346,334,0382011 669,289,853223,032,823323,011,083105,832,79826,343,40029,821,42456,164,824892,322,676428,843,8811,321,166,5572012 650,018,026216,761,250322,211,083105,832,79826,343,40028,967,76355,311,163866,779,276428,043,8811,294,823,1572013 630,746,199210,489,677321,411,083105,832,79826,343,39928,114,10354,457,502841,235,876427,243,8811,268,479,7572014 611,474,373204,218,104320,611,083105,832,79826,343,40127,260,44353,603,844815,692,477426,443,8811,242,136,3582015 592,202,546197,946,530319,811,083105,832,79831,361,35726,406,78257,768,139790,149,076425,643,8811,215,792,9572016 567,912,762191,674,957319,011,083105,832,79831,361,35625,385,42256,746,778759,587,719424,843,8811,184,431,6002017 543,622,979185,403,384318,211,083105,832,79831,361,35624,364,06155,725,417729,026,363424,043,8811,153,070,2442018 519,333,196179,131,811317,411,083105,832,79832,929,25023,342,70156,271,951698,465,007423,243,8811,121,708,8882019 494,843,412171,292,344316,811,083105,832,79832,929,24922,262,25755,191,506666,135,756422,643,8811,088,779,6372020 470,353,629163,452,878316,211,083105,832,79832,929,25021,181,81354,111,063633,806,507422,043,8811,055,850,3882021 445,863,845155,613,411315,611,083105,832,79832,929,25020,101,37053,030,620601,477,256421,443,8811,022,921,1372022 421,374,062147,773,944315,011,083105,832,79840,456,18519,020,92659,477,111569,148,006420,843,881989,991,8872023 389,357,343139,934,478314,411,083105,832,79840,456,18517,688,93358,145,118529,291,821420,243,881949,535,7022024 357,340,625132,095,011313,811,083105,832,79840,456,18516,356,93956,813,124489,435,636419,643,881909,079,5172025 325,323,906124,255,545313,211,083105,832,79842,808,02515,024,94557,832,970449,579,451419,043,881868,623,3322026 293,157,188114,064,238312,761,083105,832,79842,808,02513,609,34056,417,365407,221,426418,593,881825,815,3072027 260,990,469103,872,932312,311,083105,832,79842,808,02512,193,73555,001,760364,863,401418,143,881783,007,2822028 228,823,75193,681,625311,861,083105,832,79842,808,02510,778,13053,586,155322,505,376417,693,881740,199,2572029 196,657,03283,490,319311,411,083105,832,79844,062,5149,362,52453,425,038280,147,351417,243,881697,391,2322030 163,235,82573,299,012310,961,083105,832,79844,062,5147,904,99451,967,508236,534,837416,793,881653,328,7182031 129,814,61763,107,706310,511,083105,832,79844,062,5146,447,46450,509,978192,922,323416,343,881609,266,2042032 96,393,40952,916,399310,061,083105,832,79844,454,4874,989,93449,444,421149,309,808415,893,881565,203,6892033 62,951,40242,333,119309,631,883105,832,79844,454,4873,518,60947,973,096105,284,521415,464,681520,749,2022034 29,488,59431,749,840309,223,483105,832,79844,454,4882,046,58846,501,07661,238,434415,056,281476,294,7152035 -21,166,560304,840,869105,832,79844,454,488707,38645,161,87421,166,560410,673,667431,840,2272036 -10,583,280270,969,661105,832,79844,454,487353,69344,808,18010,583,280376,802,459387,385,7392037 --237,098,454105,832,79844,454,487-44,454,487-342,931,252342,931,2522038 --203,227,24695,249,51944,454,488-44,454,488-298,476,765298,476,7652039 --169,356,03884,666,23944,454,487-44,454,487-254,022,277254,022,2772040 --135,484,83174,082,95944,454,488-44,454,488-209,567,790209,567,7902041 --101,613,62363,499,67944,454,488-44,454,488-165,113,302165,113,3022042 --67,742,41552,916,39944,454,487-44,454,487-120,658,814120,658,8142043 --33,871,20842,333,11944,454,487-44,454,487-76,204,32776,204,3272044 ---31,749,84010,583,280-10,583,280-31,749,84031,749,8402045 ---21,166,56010,583,280-10,583,280-21,166,56021,166,5602046 ---10,583,28010,583,280-10,583,280-10,583,28010,583,28022,958,297,0716,957,918,53614,721,539,7344,815,392,3121,646,462,500971,347,5292,617,810,029Payment Due BalanceBeginning Balance Beginning BalanceInterest Bearing Non-Interest Bearing