27154 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices

DEPARTMENT OF AGRICULTURE

Forest Service

RIN 0596–AA47

Hydropower Applications

AGENCY: Forest Service, USDA.

ACTION: Notice of proposed policy and

procedures; request for public comment.

SUMMARY: The Forest Service proposes

to revise current policy and procedures,

implemented in February 1987,

concerning administration of

hydropower authorizations and the

processing of proposals for hydropower

projects affecting National Forest

System lands. This notice contains the

proposed revision, clarifies the current

policy, and modifies procedures. These

revisions are necessary to make agency

policy and procedures consistent with

regulatory changes by the Federal

Energy Regulatory Commission (FERC)

and to address issues raised in appeals

related to authorizing hydropower

projects. This proposed revision also

includes revised fee structures that

developers would pay for hydropower

projects on National Forest System

lands exempted from FERC licensing.

The fees were revised to ensure that the

United States receives fair market value

for the use of National Forest System

lands for hydropower development.

Public comment is invited.

DATES: Comments must be received in

writing on or before July 21, 1995.

ADDRESSES: Send written comments to

Director of Lands (2770), 4th Floor,

South Wing, Auditors Building, Forest

Service, USDA, P.O. Box 96090,

Washington, DC 20090–6090.

The public may inspect comments

received on this proposed policy in the

Office of the Director of Lands, 4th

Floor, South Wing, Auditors Building,

201 14th Street, SW., Washington, DC,

between the hours of 8:30 a.m. and 4:30

p.m. Those wishing to inspect

comments are encouraged to call ahead

(202–205–1367) to facilitate entry into

the building.

FOR FURTHER INFORMATION CONTACT:

Questions about this proposal or

requests for the entire Forest Service

Handbook 2709.15, Hydropower

Handbook, should be addressed to J.

Kenneth Myers, Assistant Director,

Realty Management Group, Lands Staff

202–205–1248.

SUPPLEMENTARY INFORMATION:

Background and Need for Policy

Presently, there are more than 240

non-Federal hydropower projects on

National Forest System lands that are

either licensed or exempted from

licensing by the Federal Energy

Regulatory Commission (FERC).

Hydropower developers must receive

authorization from both FERC and the

Forest Service to construct and operate

projects on National Forest System

lands. The Forest Service is authorized

under the Federal Power Act (16 U.S.C.

791 et seq.) to set mandatory terms and

conditions in a FERC license necessary

to protect National Forest System

resources. The Forest Service also has

authority under the Federal Land Policy

and Management Act (FLPMA) (43

U.S.C. 1701) to issue special use

authorizations for the occupancy and

use of National Forest System lands for

hydropower purposes. Both the Forest

Service and FERC must review

applications for proposed hydropower

projects for adequacy and prepare

environmental analyses under the

National Environmental Policy Act (42

U.S.C. 4371 et seq.).

Hyrdopower development proposals

affecting National Forest System lands

nearly quadrupled in 1981 as a result of

legislation promoting the construction

of energy projects utilizing renewable

resources, namely, the Public Utility

Regulatory Policies Act of 1978 (16

U.S.C. 260) and the Energy Security Act

of 1980 (Pub. L. 96–294; 42 U.S.C.

8855). In 1984, the Supreme Court in

Escondido Mutual Water Co. v. LoJolla

Band of Mission Indians, 466 U.S. 765

(1984) (hereafter ‘‘Escondido ruling’’),

clarified the role of the Secretary of

Agriculture in the licensing of

hydropower projects on National Forest

System lands. The Escondido ruling

makes it clear that when National Forest

System lands are to be occupied by a

hydropower project, the Secretary may

impose conditions on a FERC license

necessary for the adequate protection

and utilization of the National Forest.

This affirmation of the Secretary’s

authority was incorporated into a

February 1987 revision of Forest Service

Manual Chapter 2770, which sets our

broad direction to Forest Service

managers on how to respond to

applications for FERC licenses.

Simultaneously, the agency issued a

new Handbook (FSH 2709.15) in

February 1987 to provide field direction

on hydropower licenses and permits.

In August 1989, the forest Service

initiated a process to identify the topics

or aspects of the agency’s hydropower

project direction that need revision.

Numerous modifications to existing

policy and procedures were identified

during the process. As a result, the

agency is proposing a revision of all

hydropower direction in the Manual

and Handbook. A discussion of the

important modifications follows.

Because of the length of the Handbook,

only the proposed Manual direction and

the following parts of the Handbook are

set forth at the end of this Federal

Register notice: (1) The Forest Service

conditions for a FERC license, (2)

special use authorization provisions for

licensed projects, (3) direction on

charging fees to hydropower developers,

and (4) direction on rehabilitating dams

in wilderness areas. Those interested in

reviewing a copy of the entire Handbook

may obtain a copy by calling the FOR

FURTHER INFORMATION CONTACT listed in

the beginning of this notice.

Modifications to Existing Policy and

Procedures

1. Recognition of Hydropower as an

Appropriate Use of National Forest

System Lands

Current Forest Service policy

recognizes hydropower as an

appropriate use of National Forest

Service land but the policy is not clearly

stated.

In the proposed Manual revision, this

agency policy is rewritten and clarified.

These changes appear in the draft Forest

Service Manual (FSM) in sections FMS

2770.2 and 2770.3. In summary, (1)

energy is a recognized use of National

Forest System lands; (2) hydropower is

a valuable energy resource and a

legitimate use of National Forest System

lands; (3) sites with hydropower

development potential are unique and

rare; (4) the Forest Service will

favorably consider hydropower

development that does not conflict with

other important uses or allocations of

National Forest System resources; and

(5) potential hydropower use should be

carefully considered in the forest

planning process.

2. Resource Balance

The Forest Service must balance

energy development with protection

and use of National Forest System

resources. Furthermore, the agency

strives to mitigate adverse

environmental impacts whenever

possible. The Forest Service often sets

instream flow requirements and requires

other measures necessary for the

adequate protection and utilization of

National Forest System resources.

Consistent with the Escondido ruling,

FERC is precluded from requiring a less

stringent instream flow than the Forest

Service’s required flow even if their

information indicates less stringent

flows are justified and in the public

interest.

Consistent with its responsibility to

administer National Forest System lands
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27155

in the public interest, the Forest Service

reviews and considers

recommendations of other agencies, as

well as the licensee, in developing its

position. The agency, however, will not

simply include recommendations of

other agencies as part of its mandatory

conditions. Independent analysis of all

recommendations by the Forest Service

is necessary to put in perspective the

project’s impact against the Forest

Service’s general responsibility to

protect all National Forest System

resources. The Manual direction is

being revised to reflect the Forest

Service’s obligation to balance resource

needs in arriving at decisions related to

hydropower development. The

proposed revisions appear in the

proposed Manual in FSM 2770.3 and

2773.2.

3. Relicensing Policy

The Manual lacks specific Forest

Service policy relicensing hydropower

projects and the role of the agency.

Under the proposed revision, the

Forest Service would use the authority

under section 4(e) of the Federal Power

Act to condition the license of a project

being relicensed. The responsibility has

been affirmed by FERC. The proposed

policy would recognize that such

projects have been part of the

environment for 50 years or more and

that the Forest Service should not

attempt, by virtue of its conditioning

authority, to recreate the pre-license

environment. However, the agency

would mitigate unacceptable impacts to

resources. The proposed changes appear

in the Manual in FSM 2776.

4. Unlicensed Projects

The Forest Service does not have a

policy regarding unlicensed

hydropower projects. Before 1976, the

Federal Power Commission (now FERC)

allowed the Forest Service to authorize

by a special use authorization minor

hydropower projects. This authority was

withdrawn in 1976; however, several

unlicensed projects still exit on National

Forest System lands. The agency

proposes policy and guidance regarding

the special use authorizations for

unlicensed projects which would

encourage their owners to obtain

appropriate authorization for FERC.

This proposed change appears in the

Manual in FSM 2772.24. The agency

shall not authorize amendments to these

projects unless they first comply with

FERC’s regulations.

5. Cooperative Forest Service/FERC

Environmental Assessments

Until recently, the Forest Service and

FERC prepared separate environmental

assessments but prepared

environmental impact statements as

cooperating agencies. The Forest Service

has recently adopted an environmental

analysis process that is generally

conducted cooperatively with FERC.

The new process is explained in the

proposed Manual in FSM 2773.

6. Recreation Plans and Development

The Forest Service proposes to clarify

direction regarding recreation

development and other recreation

mitigation and enhancement needs

associated with hydropower project

development.

A new Manual section (FSM 2774)

has been developed, in accordance with

section 4(e) of the Federal Power Act,

addressing recreation development at

hydropower projects. This proposed

section clarifies the licensee’s full

responsibility for the recreation needs

resulting from project development and

operation. And, even though the Forest

Service could operate recreation

facilities at a hydropower project

according to a written agreement with

the licensee, the licensee would remain

financially responsible for the

operation, as well as for the

construction, maintenance, and

replacement of the recreation facilities.

Several items related to recreation plan

development, operation, liability, and

user fees may be the subject of voluntary

and consensual agreement between the

Forest Service and the licensee. These

items may include, but are not limited

to, licensee responsibility for

construction, operation, maintenance,

and replacement of recreation facilities

on National Forest System lands,

collection of fees to offset Forest Service

operating costs, and the need for

recreation planning for lands beyond

the area directly influenced by the

project.

7. Wild and Scenic Rivers

The Forest Service proposes to update

the direction relating to hydropower

development affecting designated and

potential Wild and Scenic Rivers. The

authority for this direction is section 7

of the Wild and Scenic Rivers Act (16

U.S.C. 1271–1287). The Forest Service

proposes to prepare eligibility

determinations for rivers not in the Wild

and Scenic Rivers System that are

affected by a hydropower proposal.

Such determinations shall be prepared

in a timely manner, usually

accompanying the initial 4(e) report.

Rivers found eligible for inclusion

through this process would then be

studied by the Forest Service for

suitability. This Wild and Scenic River

suitability study would be completed

within 18 months or in conjunction

with the environmental document for

the hydropower project. While not

legally bound to do so, it has been

FERC’s practice to refrain from acting

upon the license application until

completion of the suitability study if the

Forest Service makes timely

determinations. Under the proposed

policy, for rivers found suitable under

this process, the Forest Service shall

forward recommendations for Wild and

Scenic River designation to the

Secretary of Agriculture for review and

submission to Congress. Once a

suitability determination is made and

for a period not to exceed three years

after Congress has received the formal

recommendation for Wild and Scenic

River designation from the Secretary,

the Forest Service shall use its authority

under section 4(e) of the Federal Power

Act to protect a suitable river from

impacts that would ‘‘invade or

unreasonably diminish the values’’

which make it eligible and suitable for

inclusion in the Wild and Scenic Rivers

System. If Congress fails to take action

to protect the proposed river within

three years, the Forest Service shall

manage the river as a multiple-use

resource and resume consideration of

the original hydropower proposal. The

proposed changes appear in the Manual

in FSM 2775.1

For Congressionally designated rivers

and designated study rivers, the Manual

has been updated to clarify the

procedures for section 7 determinations

pursuant to the Wild and Scenic Rivers

Act. The updated direction is in the

Manual in FSM 2775.1

8. Term of the Special Use

Authorization.

Current Forest Service direction for a

special use authorization of a

hydropower project exempted from the

FERC licensing requirements does not

address the amortization or financing

period of the project.

The Forest Service proposes to revise

its direction for special use

authorizations for exempt projects to

require the issuing officer to consider

the amortization and financing periods

of a project in determining the term of

the special use authorization. The

proposed change appears in the Manual

in FSM 2772.4.

9. Fees

A proposed Forest Service policy on

hydropower fees for licensed projects

was published in the Federal Register

in 1984 (49 FR, p. 23902, June 8, 1984).

Due to the length of time since that

notice, the agency is again seeking

comments on a revised fee structure
27156 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices

proposed in section 65.3 of the

Handbook.

a. Fees for Projects Exempt from

Licensing

In 1987, the Forest Service

implemented policy that set fair market

value for use of National Forest System

lands by hydropower projects exempted

from licensing by FERC at three percent

of the gross power sales from the

project. This was based upon a market

survey of land rental fees charged for

hydropower use on private land. Upon

administrative appeal, that policy was

rescinded pending public notice and

opportunity to comment. This notice

seeks that involvement. In the interim,

the Forest Service has been charging fair

market value for the use of National

Forest System lands, as determined by

appraisal. Fees for the few projects that

receive an exemption from licensing

from FERC are contained in section 65.3

of the Handbook.

b. Fees for Licensed Projects

To date, Forest Service policy has

been that it has the authority to collect

fees for hydropower projects licensed by

FERC. The Forest Service, however,

presently waives the collection of fees

for these projects since FERC already

collects fees for the use of National

Forest System land; although the fees

collected by FERC for run-of-the-river

projects (projects that operate whereby

instantaneous inflow to the project

equals instantaneous outflow) are often

far below the market value of the use of

those lands for power purposes.

The Forest Service proposes that, for

licensed projects, fees shall not be

charged because to do so may be

inconsistent with the Federal Power Act

(16 U.S.C. 803(e)) (FSH 2709.15, sec.

65.2).This position is consistent with

the Federal Land Policy and

Management Act (43 U.S.C. 1702(a)(9))

which does not require the collection of

fees where another statute, in this case

the Federal Power Act, also provides for

fee collection.

10. New Mandatory 4(e) License

Conditions

The Forest Service is proposing to

update and revise those conditions

required to be incorporated in all

licenses issued by FERC for projects

occupying National Forest System

lands. These conditions would be

applied to all proposed projects that

would occupy National Forest System

lands. Once these conditions have gone

through the public notice process and

are included in the final Handbook, they

will not be subject to appeal under

Department of Agriculture

administrative appeal regulations at 36

CFR 215 and 251. The proposed

revisions of mandatory license

conditions appear in the draft Handbook

in section 55.6, exhibit 01.

11. New Special Use Authorization

Provisions

The Forest Service proposes to revise

the special use authorization conditions

for hydropower projects (FSH 2709.15,

sec. 77, ex. 01). These revisions are

based on issues raised in appeals related

to the open-ended nature of special use

authorization conditions. Those

provisions identified as mandatory will

no longer be subject to appeal if they are

incorporated into the final notice of

policy.

12. Other License and Special Use

Authorization Conditions

Other proposed conditions which

may be used or adapted for use for a

proposed project have also been

developed in standardized form (Form

FS 2700–4g) and are proposed in the

Handbook. These conditions may be

applied to projects as site-specific needs

dictate. Their application is appealable,

since the authorized Forest Officer has

the discretion to require them. These

conditions can be found in the

Handbook in section 55.6, exhibit 01,

and in section 77, exhibit 01.

13. Open-ended Nature of the Specialuse Authorization

Under existing procedures, the

licensee of a FERC-licensed hydropower

project on National Forest System lands

obtains a special use authorization from

the Forest Service after FERC issues a

license. (The FERC license contains an

explicit clause to this effect as a

condition of the license.) This

procedure places the licensee in the

awkward position of accepting a license

without knowing what conditions the

special use authorization may impose

on the project’s operation.

The Forest Service proposes to revise

the Handbook procedures to limit the

use of open-ended Forest Service

conditions in the license (issued by

FERC) and in the special use

authorization issued by the Forest

Service (Form FS–2700–4g); instead, the

Forest Service would provide

prospective licensees with a special use

authorization prior to, and contingent

upon, issuance of a license. This

reversal of the special use authorization

process will ensure that licensees will

know ahead of time the requirements

and costs associated with the special

use authorization throughout the term of

the license. In order to guard against

modification in the design or operation

of the project subsequent to issuance of

the special use authorization, the

special use authorization would contain

a provision which states that it is to

become effective only if the project is

licensed substantially as it was

proposed during the time the Forest

Service was developing the conditions

for the special use authorization. These

changes would require modification of

the Forest Service special use

authorization (FSH 2709.15, sec. 77, ex.

01, Form FS–2700–4g) and of the FERC

license conditions currently required by

the Forest Service (FSH 2709.15, sec.

55.6, ex. 01, condition 101).

14. Revocation of the Special Use

Authorization

Current policy provides for revocation

of a hydropower project special use

authorization based on breach of the

terms or conditions therein or for

reasons to further the public interest.

Since FERC already has procedures in

place which permit revocation of the

license upon a public interest

determination, the Forest Service

believes that revocation of a special use

permit on the basis of the public interest

is redundant and adds unnecessary

uncertainty to operations under the

license. Therefore the Forest Service

proposes to eliminate public interest as

a basis for revocation of the special use

authorization. The proposed change

appears in the Handbook in section 77,

exhibit 01, condition V.B.

15. Modification of the Special Use

Authorization

At any time during the license term,

which varies from 30 to 50 years, FERC

may reopen and amend the license if it

is in the public interest. Furthermore,

FERC must review the project as a new

proposal when the licensee applies for

a license renewal when the license term

ends. Currently, FERC licenses contain

a mandatory condition under section

4(e) of the Federal Power Act that

allows the Forest Service to unilaterally

change the terms of special use

authorizations for hydropower projects

after 30 years, subject to loosely defined

guidelines.

Forest Service special use regulations

(36 CFR 251) provide for revision of

special use authorization conditions at

specified intervals to reflect changing

times and conditions if the term of the

special use authorization exceeds 30

years.

Based on its review, the agency

proposes to provide for revision of

conditions in hydropower project

special use authorization only if the

project is amended or when the license

terminates and the relicensing process is
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27157

initiated. In those cases where the

Forest Service determines that special

use authorization revision is necessary

and appropriate prior to license

termination or project amendment, the

agency proposes to petition FERC to

reopen the license. If FERC grants a

Forest Service petition, FERC will be

able to balance the need to amend the

license against the hardship such

amendment would cause the licensee.

The Forest Service believes this system

is more equitable than the current

unilateral right of the agency to

periodically change a special use

authorization if its term is greater than

30 years. Under this proposal, the Forest

Service would no longer require a

section 4(e) condition for reopening the

FERC license at intervals. This proposed

change appears in the draft Handbook in

section 77, exhibit 01, condition I.D.

16. Continuation of the Special Use

Authorization During Annual Licenses

The current Forest Service special use

authorization does not provide for any

interim authorization between

termination of the original license and

issuance of a new license through the

relicensing process. During this period,

a hydropower project operates on an

annual license, which generally is

granted and renewed by FERC as a

matter of course until relicensing is

completed.

The Forest Service proposes to modify

the terms and conditions of the special

use authorization for hydropower

projects to provide that it remains in

force for a particular project during

relicensing as long as (1) FERC issues

annual licenses and (2) there is not a

critical need to immediately modify the

authorization to provide for protection

and management of National Forest

System resources before the issuance of

a new license and special use

authorization. The proposed change

appears in the draft Handbook in

section 77, exhibit 01, condition II.A.

17. Improvement Relocation

The current special use authorization

for hydropower projects requires the

licensee to move hydropower and

appurtenant facilities, if necessary, to

accommodate future government access

needs. This provision subjects the

license to uncertainty regarding project

costs. Accordingly, the Forest Service

proposes to modify this provision

slightly. Rather than speaking solely to

relocation of facilities, the proposed

direction would recognize that

modification of hydropower facilities

also may be appropriate under certain

circumstances. The special use

authorization also would make explicit

that this provision would apply only in

furtherance of Federal Government

purposes. In other words, the licensee

would not incur additional costs to

accommodate other forest users absent a

Federal need. Instead, other forest users

would have to pay for facility relocation

or modification expenses resulting from

their actions or needs. The proposed

change appears in the Handbook in

section 77, exhibit 01, condition III.I.

18. Nonexclusive Use of National Forest

System Lands

The Forest Service may permit other

uses of National Forest System lands

within FERC-licensed project

boundaries which do not materially

interfere with the hydropower project.

To this end, the special use

authorization expressly prohibits

exclusive use of National Forest System

lands for project purposes and

authorizes other nonconflicting uses on

lands within a FERC-licensed project

boundary. On the other hand, FERC

typically authorizes licensees to exclude

other uses from lands within the project

boundary and holds the licensee

responsible for accidents occurring

therein. Due to this inconsistency

between the Forest Service and FERC

requirements concerning exclusive use

of project lands, licensees contend that

they may be held liable in tort claims for

injuries occurring on project lands by

users over which they had no

knowledge or control.

The agency agrees that the licensee

should not be held liable for injuries or

damage caused by the actions of another

Forest Service permittee if the licensee

had no knowledge of or control over the

other permittee. The Forest Service does

not believe it is in the interest of sound

management of National Forest System

lands to change its policy of authorizing

nonconflicting uses within the licensed

boundary; however, the agency does

believe it is appropriate to revise the

standard terms and conditions of the

special use authorization for licensed or

relicensed projects to permit the

exclusion of the public from certain

areas within the project boundaries for

safety reasons. This proposed revision

appears in the draft Handbook in

section 77, exhibit 01, as condition I.G.

19. Plan Approvals, Amendments, and

Approval Authority

Current license and special use

authorization provisions reserve to the

Forest Service authority to approve

project construction, design and

mitigation plans. Based on this

authority there is the potential for

delays and additional costs resulting

from (1) required Forest Service

approval of plans, (2) Forest Service

authority to modify plans, (3) Forest

Service authority to require

amendments to the project, (4) Forest

Service authority to suspend

construction operations for

noncompliance with the terms of the

special use authorization, and (5) Forest

Service final approval authority. There

is some question regarding the extent to

which the Forest Service can exercise

control over a FERC license through this

reserved authority.

In order to provide the licensee

greater certainty regarding project

operation, the Forest Service proposes

to modify its standard 4(e) license

condition that currently allows the

Forest Service to impose changes in the

operation and location of project

facilities once a project has been

licensed and issued a special use

authorization. The intent of this

proposal is to limit the discretion of the

Forest Service by requiring Forest

Service consistency in the agency’s

review and approval of project plans.

For example, if the Forest Service had

initially approved the concept of a

powerhouse on the south side of a

stream, it should not require the

licensee to move the powerhouse to the

north side during review of the final

plan absent compelling information

(justifying the change) not available

during the initial review.

The proposed license conditions also

provide for expedited higher level

resolution of disputes regarding Forest

Service approval of plans and Forest

Service imposed suspensions. While the

Forest Service will consult with FERC

and the licensee on such disputes to the

extent possible, it ultimately is and will

remain the Forest Service’s

responsibility to make the final

determination when licensee actions

affect surface resources on National

Forest System lands. Note that FERC has

responsibility for dam safety and overall

public safety, and therefore the Forest

Service should not interfere with

FERC’s responsibilities in these areas.

These changes appear in the Handbook

in section 55.6, exhibit 01, conditions

102, 105, and 106.

20. Annual Review of Project

A standard license condition used by

the Forest Service requires the licensee

to meet annually with the Forest Service

and review the project with a

subsequent report to FERC. In order to

reduce the amount of paperwork and

reviews and to increase flexibility, the

Forest Service proposes to modify the

condition to require a meeting only

every 5 years or for a period mutually

agreeable to the Forest Service and the
27158 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices

licensee. The proposed change is in the

draft Handbook in section 55.6, exhibit

01, condition 104.

21. Project Rehabilitation in Wilderness

The existing Manual and Handbook

do not address hydropower project

maintenance and rehabilitation in units

of the National Wilderness Preservation

System. These projects were in place

before the establishment of the

wilderness area. Direction would be

incorporated in the Hydropower

Handbook with this proposed revision.

Maintenance and rehabilitation of

hydropower projects in wilderness is

necessary for safety and other reasons

but it would be achieved subject to the

provisions and intent of the Wilderness

Act (16 U.S.C. 1131–1136). Decisions on

access to the project would consider,

among other things, the type of

rehabilitation, the most reasonable and

efficient method to conduct such work,

the manner in which the original project

was constructed, and ways in which to

minimize the impact on wilderness

values. Due to the restrictions imposed

by the Wilderness Act, project

rehabilitation must often be done by

primitive means and will be more costly

than similar project maintenance and

rehabilitation outside designated

wilderness. Nevertheless, necessary

project rehabilitation would be allowed.

The proposed revision is in the

handbook, section 64.7.

Environmental Impact

This proposed policy would establish

direction to Forest Service employees

on the review, authorization, and

administration of hydropower proposals

on National Forest System lands. The

environmental impacts of proposed

projects will be addressed in

environmental documents specific to

each proposed project. Section 31.1b of

Forest Service Handbook 1909.15 (57 FR

43180, Sept. 18, 1992) excludes from

documentation in an environmental

assessment or impact statement ‘‘rules,

regulations, or policies to establish

Service-wide administrative procedures,

program processes, or instructions.’’ The

agency’s preliminary assessment is that

this policy falls within this category of

actions and that no extraordinary

circumstances exist which would

require preparation of an environmental

assessment or environmental impact

statement. A final determination will be

made upon adoption of the final policy.

Controlling Paperwork Burdens on the

Public

This policy does not contain any

recordkeeping or reporting requirements

or other information collection

requirements as defined in 5 CFR 1320

and, therefore, imposes no paperwork

burden on the public. Accordingly, the

review provisions of the Paperwork

Reduction Act of 1980 (44 U.S.C. 3507)

do not apply. The Forest Service uses

information provided to FERC as a basis

for reviewing hydropower project

impacts on National Forest System

lands. Any further additional

information is covered by the Forest

Service’s special use regulations (36

CFR part 251).

Regulatory Impact

This proposed policy has been

reviewed under USDA procedures and

Executive Order 12866 on Regulatory

Planning and Review. It has been

determined that this is not a significant

rule. The policy will not have an annual

effect of $100 million or more on the

economy nor adversely affect

productivity, competition, jobs, the

environment, public health or safety,

nor State or local governments. This

rule will not interfere with an action

taken or planned by another agency nor

raise new legal or policy issues. Finally,

this action will not alter the budgetary

impact of entitlements, grants, use fees,

or loan programs or the rights and

obligations of recipients of such

programs. Accordingly, this proposed

policy is not subject to OMB review

under Executive Order 12866.

Moreover, this proposed policy has

been considered in light of the

Regulatory Flexibility Act (5 U.S.C. 601

et seq.), and it has been determined that

this action will not have a significant

economic impact on a substantial

number of small entities as defined by

that Act. In short, little or no effect on

the National economy will result from

this policy, since this action consists

primarily of technical and

administrative changes to existing

policy and procedures. In fact, it may

reduce costs to the Government and

users of the National Forest System.

Takings Executive Order

This proposed policy has been

analyzed in accordance with the

principles and criteria contained in

Executive Order 12630, and it has been

determined that this proposed policy

does not pose the risk of taking of

Constitutionally protected private

property.

First, special use authorizations are

not private property compensable under

the Fifth Amendment if taken by the

Government. The special use

authorization is a benefit or privilege

bestowed on a private individual to use

National Forest System lands. In the

event that special use authorizations are

found to have certain contractual rights

associated with them, those rights are

consensual in nature and require the

prior informed consent of the parties to

form the agreement. Such consensual

agreements generally do not result in

takings claims against the Government.

Finally, the proposed policy does not

purport to modify the existing special

use authorizations. Instead, only special

use authorizations that will be issued

after the date this guidance is adopted

will be subject to the revisions and

clarification described herein.

Comments Invited

The proposed policy and procedures

for hydropower uses of National Forest

System lands would replace existing

policy and procedures contained in the

Forest Service Manual (FSM 2770) and

Forest Service Handbook (FSH 2709.15).

The text of the Manual and sections of

the Handbook containing the Forest

Service standard license 4(e) conditions

and the Forest Service special use

authorization conditions for licensed

projects are set out at the end of this

notice. Single copies of the entire

Handbook are available free of charge

upon request to the FURTHER

INFORMATION CONTACT listed at the

beginning of this notice. The Forest

Service invites written comments and

will analyze and consider those

comments in the development of the

final notice of policy which will be

published in the Federal Register.

Dated: May 15, 1995.

David G. Unger,

Associate Chief.

Proposed Manual Revision

Note: The Forest Service organizes its

directive system by alpha-numeric codes and

subject headings. Only those sections of the

Forest Service Manual and Handbook that are

the subject of this notice are set out here. The

audience of this direction is Forest Service

employees charged with reviewing,

processing, and approving hydropower

proposals on National Forest System lands.

Title 2700—Land Uses Management

Chapter 2770—Federal Power Act

Projects

Contents

2770.1 Authority

2770.2 Objectives

2770.3 Policy

2770.4 Responsibility

2770.41 Chief

2770.42 Director of Lands, Washington

Office

2770.43 Regional Forester

2770.6 Federal Energy Regulatory

Commission (FERC) Responsibility and

Authority

2771. Forest Service involvement with

FERC on Hydropower Projects
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27159

2771.1 Response to Applications

2771.11 Response to License Applications

2771.12 Response to Preliminary Permit

Applications

2771.13 Response to Exemption

Applications

2771.2 Requirements

2771.21 Section 4(e) Reports

2771.22 Section 4(e) Conditions

2771.23 Projects Exempted from Licensing

2771.24 National Forest Purposes

2771.25 Recommendation that Project is

Not in Public Interest

2771.3 Coordination

2771.31 Other Actions within Project

Boundaries

2771.32 Project Surrender, Termination, or

Abandonment

2771.33 Federal Takeover of Project

Facilities

2771.4 Federal Power Act and Powersite

Withdrawals

2771.41 Exchange within Federal Power

Act and Powersite Withdrawals

2771.42 Retraction of Licensed Project

Boundaries and Withdrawals

2772 Special-Use Authorizations

2772.1 Applications

2772.2 Authorization of Projects

2772.21 Authorization of Licensed Projects

2772.22 Denial of Special-use

Authorization to Licensed Project

2772.23 Authorization of Projects under

Preliminary Permit

2772.24 Authorization of Projects Exempt

from Licensing

2772.25 Requirement To Have Special-use

Authorization

2772.3 Conditions

2772.4 Term

2772.5 Revocation or Suspension of

Special-use Authorization

2772.6 Special-use Authorization Fees

2773 Environmental Analysis

2773.1 Environmental Analysis and

Documentation

2773.11 Licensed Projects

2773.12 Projects Exempted from Licensing

2773.2 Mitigation

2774 Recreation Uses at Hydropower

Projects

2774.1 Licensee Responsibility

2774.2 Facility Operation, Maintenance,

and Replacement

2774.3 Campgrounds

2774.4 Signs

2774.5 Project Recreation Plan

2774.6 Recreation Planning during

Relicensing

2775 Special Management Areas

2775.1 Projects Proposed in Wild and

Scenic River Areas

2775.11 Projects Proposed on All Other

Waterways

2775.12 Projects Proposed on Wild and

Scenic Rivers on Lands in Conservation

Units in Alaska

2775.2 Projects Proposed in Designated

Wilderness Areas

2775.3 Projects Proposed in Roadless Study

Areas

2775.4 Projects Proposed in Research

Natural Areas

2775.41 Projects Proposed in Candidate

Research Natural Areas

2775.5 Projects Proposed in Other Special

Areas

2775.51 Projects Proposed in Study Special

Areas

2775.6 Projects Proposed in StateDesignated Special Areas

2775.7 Projects Proposed in National

Monuments

2776 Relicensing

2776.1 Section 4(e) Conditions in New

License

2776.2 Removal of Project

Title 2700—Land Uses Management

Chaper 2770—Federal Power Act

Projects

This chapter covers the review of

proposals for hydropower projects; the

use of authority granted by section 4(e)

of the Federal Power Act (16 U.S.C.

797(e)) to set conditions in licenses for

hydropower projects issued by the

Federal Energy Regulatory Commission

(FERC) for the protection and utilization

of National Forest System lands; the

granting of special-use authorizations

for hydroelectric projects; and the

granting of special-use authorizations

for primary transmission lines subject to

licensing by FERC that are partly or

wholly on National Forest System land.

The chapter also covers the relationship

of the Forest Service and FERC during

project planning, construction, and

operation.

2770.1—Authority

See FSM 2701.1 for statutory

authorities that govern the general

issuance and administration of special

use authorizations on National Forest

System lands. The following statutes

and regulations specifically govern the

issuance and administration of

hydropower projects on National Forest

System lands:

1. The Federal Power Act of August

26, 1935 (49 stat. 847; 16 U.S.C. 797).

This act grants the Forest Service the

authority to require conditions in a

Federal Energy Regulatory Commission

(FERC) license for a hydropower project

on National Forest System lands.

2. The Wild and Scenic Rivers Act of

October 2, 1968 (82 Stat. 906; 16 U.S.C.

1271–1287). This act, specifically in

sections 7(a), 7(b) and 5(d), sets forth

Forest Service responsibilities for

determining acceptability for projects

that impact designated and study wild

and scenic rivers. Section 7 gives the

Secretary of Agriculture the authority to

determine whether a proposed project

would be on or directly affect a wild

and scenic river or would degrade or

unreasonably diminish the values for

which the river was designated. Under

section 5(d), the Forest Service is

authorized to study rivers for suitability

for designation as wild and scenic.

3. Title V. Section 501, Federal Land

Policy and Management Act of October

21, 1976, as amended (90 Stat. 2743; 43

U.S.C. 1761–1771). Title V of the

Federal Land Policy and Management

Act (FLPMA) authorizes the Secretary of

Agriculture to issue, renew, or grant

permits or easements to occupy, use, or

traverse National Forest System lands

for the generation, transmission, and

distribution of electric power. Under

section 501, as amended by the Energy

Policy Act of October 24, 1992 (106 Stat.

2776; 42 U.S.C. 13201), permits or

easements are not required for the

continued operation of projects licensed

by FERC or exempted as of October 24,

1992, unless additional project area or

the project had received a permit or

easement under section 501 of FLPMA

at some time in the past.

4. Title 36, Code of Federal

Regulations, Part 297, Subpart A. This

regulation provides direction

concerning projects affecting wild and

scenic rivers administered in whole or

in part by the Secretary of Agriculture.

2770.2—Objectives

1. To facilitate hydropower

production where it is compatible with

the purposes for which a National

Forest was created or acquired.

2. To ensure that planning,

construction, and operation of

hydropower projects are performed in a

manner that provides adequate

protection and utilization of National

Forest System lands and resources.

3. To ensure that Forest Service

planning and the evaluation of the

hydropower proposals recognize the

rarity of sites which are suitable for

potential hydropower development

because of a unique combination of

resources and circumstances.

2770.3—Policy

1. Hydropower development is an

appropriate use of National Forest

System land, unless one or more of the

following circumstances exist:

a. Hydropower development is

inconsistent with and would interfere

with the purposes for which the affected

area was created or acquired as

determined by the following: The

Organic Administration Act, the

Multiple Use-Sustained Yield Act,

subsequent acts making special

designations within the National Forest

System, and legislation or Presidential

proclamation specifically establishing a

National Forest.

b. Hydropower development is

inconsistent with the management

direction in the Forest land and

resource management plan, and

significant adverse effects on the
27160 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices

management and utilization of National

Forest System resources cannot be

mitigated sufficiently to achieve plan

consistency with the Forest plan.

c. The project is not in the public

interest (FSM 2771.25)

2. Weight energy resource

development with the protection and

utilization of other National Forest

resources when determining what

mitigation is necessary to provide the

best balance of protection and

utilization of those resources.

3. Cooperate and coordinate activities

in the development of the Nation’s

energy resources for hydropower with

the Federal Energy Regulatory

Commission (FERF); Federal, State, and

local resource agencies; tribal

governments; coordinating bodies, such

as the Northwest Power Planning

Council; and potential developers.

2770.4—Responsibility

2770.41—Chief

1. For projects proposed in designated

wilderness areas or other special areas

which require Presidential approval:

a. The Chief reserves authority to

approve reports and sign

correspondence that make

recommendations to the Secretary for

approval of projects when the Forest

Service considers them to be in the

public interest, and

b. The Chief may deny approval for

projects when the Forest Service

considers them not to be in the public

interest (FSM 1923 and FSM 2323).

2. The Chief also reserves the

authority to approve a Forest Service

recommendation to FERC that the

Federal Government take over a project

whose license period is ending (FSM

2771.33).

2770.42—Director of Lands, Washington

Office

Except for the authority reserved to

the Chief (FSM 2770.41), the Director of

Lands, Washington Office has authority

and responsibility to:

1. Approve reports and sign

correspondence to the Federal Energy

Regulatory Commission (FERC) relating

to activities under the Federal Power

Act, as amended.

2. Represent the Department of

Agriculture in contacts with FERC at the

National level in matters relating to

hydropower projects (FSM 1043).

3. Coordinate the review of matters

pertaining to hydropower projects with

other agencies of the Department.

4. Control the assignment of Forest

Service personnel as witnesses in FERC

hearings, secure Office of the General

Counsel review, and approve testimony

prior to its being filed with FERC.

5. Review prior to signature, any

Regional Forester decision for

hydropower project proposals involving

section 7 of the Wild and Scenic Rivers

Act. (See review and routing procedures

in FSH 2709.15, sec. 24.41)

6. Review prior to signature, any

Regional Forester decision involving

section 4(e) of the Federal Power Act,

except when the Director specifically

waived such a review because the

Regional Forester has staff sufficiently

experienced in hydropower procedures.

(See review and routing procedures in

FSH 2709.15, sec. 52.2)

7. Approve recommendations to FERC

for the Federal Government to take over

hydropower project facilities (FSM

2771.33).

2770.43—Regional Forester

The Regional Forester has authority

and responsibility to:

1. Subject to the delegations of

authority to the Washington Office

Director of Lands in FSM 2770.42,

paragraphs 5 and 6, approve reports and

signed correspondence to FERC on

behalf of the Secretary of Agriculture

relating to licensing activities under the

Federal Power Act, as amended,

including reports under section 4(e) of

the Federal Power Act, except as noted

in the following paragraph 8. This

authority may not be redelegated.

2. Establish Region-wide quidelines

for analysis and administration of

hydropower projects on National Forest

System lands.

3. Coordinate with FERC staff as

necessary.

4. Maintain an information base for

use in managing Federal Power Act

project activities.

5. Respond to FERC on behalf of the

Secretary of Agriculture on applications

for licenses. Coordinate review of

applications for FERC licenses, field

investigations, and preparation of 4(e)

reports.

6. Respond to FERC on behalf of the

Secretary of Agriculture on applications

for preliminary permits and exemptions.

7. Establish procedures for contacting

licensees or special-use holders at least

5 years prior to the expiration of their

license or special-use authorization to

ascertain their intentions concerning

continuation of the project.

8. For projects proposed in wilderness

areas or other areas which require

Presidential approval:

a. Prepare, for the Chief’s review, the

environmental impact statement (EIS)

necessary for the Secretary to make

recommendations to the President

concerning such projects.

b. Approve reports recommending to

the Chief approval of projects when the

Forest Service considers them to be in

the public interest.

c. Approve reports and sign

correspondence for denial of approval

when the Forest Service considers

projects not to be in the public interest.

The authority to sign the

recommendation to the Chief or to deny

approval for a project may not be

redelegated.

9. Subject to the delegation of

authority to the Washington Office

Director of Lands (FSM 2770.42, para. 5

and 6) approve reports and sign

correspondence to FERC on behalf of

the Secretary of Agriculture relating to

decisions made under section 7 of the

Wild and Scenic Rivers Act for

hydropower projects.

10. As appropriate, authorize Forest

Supervisors to correspond directly with

FERC on all administrative and

construction matters during

construction and operation of a project.

11. Issue special-use authorizations

for hydropower projects that have been

licensed or exempted from licensing by

FERC. The authority to issue special-use

authorizations for these projects may be

redelegated to the Forest Supervisor, but

the authority may not be redelegated by

the Forest Supervisor to lower level

officials.

2770.6—Federal Energy Regulatory

Commission (FERC) Responsibility and

Authority

Forest Service officers must

coordinate actions regarding

hydropower matters with the Federal

Energy Regulatory Commission (FERC).

Review the information regarding FERC

in FSH 2709.15, chapter 10.

2771.—Forest Service Involvement With

FERC on Hydropower Projects

For a summary of the typical steps

involved in the hydropower approval

and administration process, see FSH

2709.15, sec. 28.

2771.1—Response to Applications

2771.11—Response to License

Applications

Use the 4(e) report (FSM 2771.2) to

state the official position of the

Secretary regarding the licensing of

specific projects affecting National

Forest System land and resources (FSH

2709.15, ch. 50). Where appropriate,

include comments on the effects of the

project on the programs of the

Department of Agriculture. Also, see

FSM 2774.5 for coordination with

license applicants on recreation project

plans.
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27161

2771.12—Response to Preliminary

Permit Applications

The Regional Forester must provide

comments to FERC on potential

problems, concerns, and conditions for

applications for preliminary permits on

projects affecting National Forest

System lands and resources. Do not

prepare a 4(e) report for a preliminary

permit; submit these comments through

correspondence.

2771.13—Response to Exemption

Applications

The Regional Forester shall identify

potential problems and provide

comments and recommendations to

FERC on applications for exemptions.

Incorporate standard and special

conditions required on exemptions in

the special-use authorization. Do not

prepare 4(e) report for an exemption;

submit these comments through

correspondence.

2771.2—Requirements

2771.21—Section 4(e) Reports

Respond to a Federal Energy

Regulatory Commission (FERC) notice

that an application for license is ready

for environmental analysis with a report

pursuant to section 4(e) of the Federal

Power Act (hereafter called a 4(e) report)

for any project that would occupy

National Forest System land. An

original and 8 copies of the 4(e) report

must be provided to FERC within 60

days of the FERC notice. FERC’s

regulations allow FERC to consider 4(e)

conditions filed after the 60-day

deadline as recommendations rather

than mandatory conditions. The

exception is when FERC grants the

Forest Service an extension of time

because of extenuating circumstances or

because the Forest Service and FERC are

conducting a cooperative environmental

analysis under the National

Environmental Policy Act (NEPA). In

these cases the Forest Service must

provide preliminary 4(e) reports within

the 60-day timeframe and final 4(e)

conditions within 45 days after the

cooperative NEPA analysis is completed

(FSH 2709.15, sec. 13.32).

Regional Foresters shall transmit draft

4(e) reports (preliminary and final) to

the Washington Office Director of Lands

for procedural review prior to the

Regional Forester’s decision and

transmittal to FERC in conformance

with the review and routing procedures

in FSH 2709.15, section 52.2. However,

if the Washington Office Director of

Lands notifies the Regional Forester that

such reviews are not necessary because

of sufficient Regional staff experience in

hydropower matters, the Regional

Forester may send 4(e) reports to FERC

without Washington Office review. The

Regional Forester shall send copies of

the signed 4(e) reports to the

Washington Office Director of Lands.

The 4(e) report should provide FERC

with:

1. A statement of the conclusion as to

the project’s consistency or interference

with the purposes for which the

National Forest was created or acquired,

and as appropriate, advice on whether

the project is in the public interest (FSM

2771.24 and 2771.25 and FSH 2709.15,

sec. 27).

2. Appropriate comments regarding

the project application for license.

3. Conditions (FSM 2771.22) to be

included in the FERC license necessary

for the adequate protection and

utilization of the National Forest System

lands and resources (FSH 2709.15, ch.

50).

4. The appropriate environmental

documentation and documentation of

decision in support of the conditions

that the Forest Service will require in

the license 4(e) conditions) and in the

special-use authorization (FSH 2709.15,

ch. 30).

5. A copy of the special-use

authorization that will be issued if the

project is licensed (FSH 2709.15, sec.

77). See FSH 2709.15, chapter 50, for

instructions on responding to FERC

under various situations.

2771.22—Section 4(e) Conditions

For a project which would occupy

National Forest System lands, the Forest

Service may impose conditions through

the 4(e) report the FERC must make part

of any license it issues for the project.

Such conditions must be reasonable and

necessary for the adequate protection

and utilization of National Forest

System lands and resources.

Do not impose the recommendations

of other agencies as 4(e) conditions

without an independent analysis by the

Forest Service so that they become

Forest Service conditions. Generally,

limit 4(e) license conditions to those

measures that have substantial effects

on the economics or siting of the

project. Other conditions of a more

routine nature relating to project

impacts on National Forest Systems

lands may be imposed through the

special-use authorization (FSM 2772.3).

(See FSH 2709.15, sec. 21.4, for limits

on the scope of 4(e) conditions for

amendments to a license see also FSH

2709.15, sec. 52.23, 55.1, and 55.6).

Chapter 70 of the Handbook contains

direction on the forms to complete for

various special-use permits for

hydropower projects. (See FSH 2709.15,

sec. 77, ex. 01 through 04).

2771.23—Projects Exempted From

Licensing

An exemption from licensing (FSH

2709.15, sec. 12) by FERC does not grant

or imply a grant to any land-use rights

to the exemptee. Advise FERC of

substantial concerns regarding potential

effects of exempt project proposals on

National Forest resources. Make an

independent determination of whether

to authorize such projects (FSM 2772.2).

2771.24—National Forest Purposes

FERC may not license projects which

it finds would be inconsistent and that

would interfere with the purposes for

which the National Forest was created

or acquired (section 4(e) of the Federal

Power Act). Those purposes are defined

in the Organic Administration Act of

1897 (16 U.S.C. 473 et. seq.) and

expanded by the Multiple-Use

Sustained-Yield Act of 1960 (16 U.S.C.

528 et. seq.) and subsequent acts (FSM

2701.1). In addition, some National

Forest enabling legislation or

proclamations state specific purposes.

Since Congress has the authority to

change or expand the National Forests,

those purposes do not have to have been

stated at the time the National Forest

was originally reserved or acquired to be

‘‘purposes for which they were created

or acquired.’’ Specific legislation (the

Wilderness Act for example; 16 U.S.C.

1131–1136) and specific designations

(Research Natural Areas for example)

also determine the purposes for which

portions of the National Forests are

created or acquired.

Through the Forest and Rangeland

Renewable Resources Planning Act of

1974 (16 U.S.C. 1601 et seq; as amended

by the National Forest Management Act

of 1976), Congress requires land and

resources management planning to

determine management direction for the

National Forests. Such plans must be

consistent with the purposes for which

those lands were created or acquired.

Therefore, also use the Forest land and

resource management plan in

determining the consistency of a project

with the purposes for which the

National Forest was created or acquired.

Fully disclose to FERC in the 4(e)

report, a recommendation concerning

the nature and extent of any significant

inconsistency or interference the project

would cause for those purposes. FERC

makes the decision whether to authorize

the project through licensing. In so

doing, FERC makes the actual

determination regarding whether the

project is inconsistent with or would

interfere with the purposes for which

the National Forest was created or

acquired.
27162 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices

2771.25—Recommendation That Project

is Not Public Interest

The Forest Service is not responsible

for determining or recommending

whether a hydropower project (with an

application for license) is in the public

interest. Consider making such a

recommendation to FERC if the

available information supports such a

conclusion. Make sure the 4(e) report

fully explains the nature and extent of

reasons for the Forest Service

recommendation. Use the Forest land

and resource management plan as a

basis for evaluating the needs of the

public.

FERC makes the actual determination

of whether the project is in the public

interest under section 10(a) of the

Federal Power Act.

2771.3—Coordination

2771.31—Other Actions Within Project

Boundaries

Do not initiate non-project related

resource management activities or

authorize use by others on lands

covered by a hydropower project use

authorization or license unless it is

determined that such activities or uses

will not adversely affect project

operations and will not conflict with the

terms and conditions of the project

special-use authorization or license.

Also, prior to granting special-use

authorizations to third parties, the

authorized officer must review with the

Federal Energy Regulatory Commission

(FERC) and the affected licensee

proposed non-project uses within the

boundaries of licensed projects.

2771.32—Project Surrender,

Termination, or Abandonment

FERC is responsible for procedures for

termination, surrender, and

abandonment of licensed projects (18

CFR Part 6). See FSM 2772.5 for

termination requirements for Forest

Service special-use authorizations (36

CFR 251.60).

2771.33—Federal Takeover of Project

Facilities With Expired License

Federal takeover of a project whose

license period is ending is a rarely used

process which requires Congressional

action. If warranted, the Forest Service

may file a recommendation with FERC

that the United States exercise its right

to take over a hydropower project no

earlier than five years before the license

expires and no later than the end of the

comment period for a notice of an

application for a new license, a

nonpower license, or an exemption. The

Forest Service rarely would propose to

the Federal Energy Regulatory

Commission (FERC) that the United

States take over a project. The Chief

must approve a Forest Service

recommendation for the Federal

Government to take over project

facilities. If a project is taken over, the

Federal Government must compensate

the licensee for the net investment. See

Title 18, Code of Federal Regulations,

Part 16, Subpart C, sections 16.14

through 16.17, for procedures for

recommending to FERC for Federal

takeover of a project. See FSM 2716.4

for direction regarding Forest Service

takeover of unlicensed projects by

default, surrender, abandonment, and so

forth.

2771.4—Federal Power Act and

Powersite Withdrawals

(For further direction see FSH

2709.15, sec. 21.8.)

2771.41—Exchange Within Federal

Power Act and Powersite Withdrawals

Lands withdrawn for power purposes

within licensed project boundaries are

available for disposal through exchange

or other means only after:

1. FERC vacates or amends the

withdrawal, and thus opens (restores)

the lands for exchange and other related

actions, or

2. FERC makes a determination that

the lands may be conveyed subject to a

reservation in the patent or deed under

section 24 of the Federal Power Act.

2771.42—Retraction of Licensed Project

Boundaries and Withdrawals

When a project boundary contains

National Forest System lands that are in

excess of what is needed for the project,

the authorized officer should formally

request that the licensee and FERC

retract the boundary; then, request FERC

to vacate (terminate) the withdrawal of

these excess lands.

When withdrawn lands are associated

with an inactive project (that is, one not

currently authorized or being

considered by FERC for some type of

action), request FERC to vacate the

withdrawal.

2772—Special-Use Authorizations

FSH 2709.11, Special Uses Handbook,

provides direction on the authorization

and administration of special uses on

National Forest System land. Chapters

60 and 70 of FSH 2709.15, Hydropower

Handbook, provide detailed instructions

for special-use authorizations related to

hydropower projects on the following

forms: Form FS–2700–4e, Special-Use

Permit Exempted or Unlicensed

Hydropower Project; Form FS–2700–4g,

Special-Use Permit, Licensed

Hydropower Project; and Form FS–

2700–4f, Special-Use Permit,

Hydropower Investigation.

2772.1—Applications

Applicants for Federal Energy

Regulatory Commission (FERC) licenses,

preliminary permits, and exemptions

from licensing must also apply to the

Forest Service for authorization when

projects involve National Forest System

land (36 CFR 251 Part B; FSM 2772.25).

Authorizing officers should encourage

applicants to file applications for

special use authorizations with the

Forest Service concurrently with filing a

FERC license or exemption application.

2772.2—Authorization of Projects

Project special-use authorizations

shall become effective only after the

project is licensed or exempted from

licensing by FERC.

2772.21—Authorization of Licensed

Projects

Issue special-use authorizations for all

hydropower projects licensed by FERC

in accordance with FSM 2772.25. If the

Forest Service determines that a project

(whose proponent is seeking a license)

should not be constructed on National

Forest System land, then the Forest

Service must advise FERC, before the

licensing decision is made, that the

project is inconsistent or would

interfere with National Forest purposes

or that it would not be in the public

interest. Promptly notify the

Washington Office Director of Lands is

issuance of a special-use authorization

to a project licensed by FERC might

violate a law or cause unacceptable

damage to National Forest System

resources before preparing a section 4(e)

report.

2772.22—Denial of Special-Use

Authorization to Licensed Project

Licensed projects may not be denied

a special-use authorization (FSM

2772.21)

2772.23—Authorization of Projects

Under Preliminary Permits

The Forest Service may issue

investigative special use permits to

authorize studies to be carried out by

prospective applicants that have

received a FERC preliminary permit. An

investigative special-use permit (FS–

2700–4f) may be issued to allow

investigation of potential projects. This

type of permit must contain conditions

necessary for resource protection

commensurate with the scope of

investigation (FSH 2709.15, sec. 62.11

and 74).
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27163

2772.24—Authorization of Projects

Exempt From Licensing

For a project exempted from licensing

by FERC, the Forest Service may issue

a special-use authorization (Form FS–

2700–4e) if it determines the project is

an appropriate use of National Forest

System lands and is in the public

interest. (See FSH 2709.15, sec. 53.2, for

additional information on exemptions.)

2772.25—Requirement To Have Specialuse Authorization

Pursuant to the Federal Land Policy

and Management Act (FLPMA) of

October 21, 1976, the holder of a FERC

license or a hydropower project

proponent who is exempt from licensing

also must obtain a Forest Service

special-use authorization. This

requirement to have a special-use

authorization applies to original

licenses (first license for project) and

new licenses issued as a result of

relicensing. However, pursuant to the

Energy Policy Act of 1992 (42 U.S.C.

13201), a special use authorization is

not required for the continued operation

of licensed or exempted projects that

had not received a authorization under

section 501 of FLPMA at any time prior

to the passage of the Act unless FERC

determines that additional National

Forest System lands would be affected.

Before passage of FLPMA, FERC

licensees were not required to have a

Forest Service special-use authorization.

See FSH 2709.15, section 63.1, for

direction regarding the reasonable and

orderly phase-in of FLPMA

requirements in regard to licensed and

relicensed projects.

A special-use authorization is also

required for the use of National Forest

System lands affected by a material

license amendment, even if the current

license was issued prior to passage of

FLPMA. See FSH 2709.15, section 63.1

for direction regarding the reasonable

and orderly phase-in of FLPMA

requirements in regard to amendments

of license.

2772.3—Conditions

Special-use authorizations for

licensed projects (Form FS–2700–4g)

shall authorize the occupancy and use

of National Forest System lands. In

addition to the mandatory standard

provisions (FSH 2709.15 sec. 72), the

special-use authorization shall include

those conditions and requirements

which are necessary for comprehensive

and compatible use of land, water, and

hydropower resources consistent with

the purposes for which the National

Forests are managed (FSM 2772.5, and

FSH 2709.15, sec. 62.13 and 72). These

conditions, however, should not

duplicate what is already required in

the FERC license.

1. In the Forest Service special-use

authorization for a FERC-licensed

project (Form FS–2700–4g), do not

include conditions and requirements

that:

a. Substantially affect power

production capability (through limits on

water use or through high costs), or

b. Substantially affect facility siting.

Such requirements are to be imposed

through conditions in the section 4(e)

report (FSM 2771.21).

2. The limitations on conditions in

special use authorizations in the

preceding paragraph 1 do not apply to:

a. A Federally owned dam under the

jurisdiction of the Forest Service, or

b. A project exempted from licensing

by FERC.

Special-use authorizations for projects

exempted from licensing (Forms FS–

2700–4e) by FERC must also include

conditions to protect the public interest

normally covered by the FERC license

(FSH 2709.15, sec. 12, 62.12, and 73).

An investigation special-use permit

(Form (FS–2700–4f) may be issued to

allow investigation of potential projects.

This type of permit must contain

conditions necessary for resource

protection commensurate with the

scope of investigation (FSH 2709.15,

sec. 62.11 and 74).

2772.4—Term

For FERC-licensed projects, issue a

special-use authorization (Form FS–

2700–4g) for the same term as the

license. For projects exempted from

licensing by FERC, the authorized

Forest Service officer shall determine

the term of the permit (Form FS–2700–

4e), up to 30 years. Temporary facilities

and investigations may be authorized

for up to 3 years (Form FS–2700–4f)

(FSH 2709.15, sec. 62.1).

2772.5—Revocation or Suspension of

Special-Use Authorization

A special-use authorization for a

FERC-licensed project (Form FS–2700–

4g) has a term matching that of the

license and normally is not revoked

unless and until the license terminates.

However, a special-use authorization for

a licensed project may be revoked or

suspended for breach of its conditions,

if negotiations to remedy the breach in

consultation with FERC such as those

outlined in FSH 2709.15, section 64, fail

to obtain the compliance of the holder

(see also FSM 2771.32). Special-use

authorizations for FERC-exempted

projects may be revoked in accordance

with 36 CFR 251.60.

2772.6—Special Use Authorization Fees

See FSH 2709.15, section 65 for

policy on charging fees for:

1. Investigation permits,

2. Licensed project authorizations,

and

3. Exempted project authorizations.

2773—Environmental Analysis

2773.1—Environmental Analysis and

Documentation

(FSM 1950, FSH 1909.15, FSH

2709.15, ch. 30.) If an environmental

impact statement (EIS) is to be prepared,

FERC usually will be the lead Federal

agency. Line officers should request

FERC to designate the Forest Service as

a cooperating agency when National

Forest System lands are affected. When

an environmental assessment (EA) is to

be prepared, the Forest Service and

FERC will usually perform a cooperative

environmental analysis and prepare a

cooperative EA.

2773.11—Licensed Projects

The Federal Energy Regulatory

Commission (FERC) is responsible for

National Environmental Policy Act

(NEPA) compliance for projects licensed

by FERC. The Forest Service is

responsible for NEPA compliance on

decisions regarding the determination of

the conditions imposed through the 4(e)

report (FSM 2771.21); and special-use

permit conditions necessary for the

protection and utilization of National

Forest System lands; and compatibility

decisions under Section 7 of the Wild

and Scenic Rivers Act.

2773.12—Projects Exempted From

Licensing

When National Forest System lands

are involved, the Forest Service is

responsible for NEPA compliance for

projects exempt from licensing by FERC.

2773.2—Mitigation

Determine the effects of the project as

proposed and the effects of identified

alternatives. Devise alternatives which

provide for mitigation of adverse

resource impacts. Analyze alternatives

and their associated resource protection

measures, and balance resource

protection needs and resource

utilization needs.

1. Identify measures necessary for the

adequate protection and utilization of

the National Forest and

a. Include the measures in the 4(e)

report which will then be incorporated

into the license; as appropriate, require

implementation plans as a 4(e)

condition or as a condition of the

special-use authorization to provide

site-specific details for applying those

measures on the ground; and/or
27164 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices

b. Include them as appropriate in the

special-use authorization.

2. The effects of a project should be

known before authorization is granted

through the license or special-use

authorization. Therefore, determine

resource protection measures in the

environmental analysis before

authorization. The license or special-use

authorization may require plans to

implement the mitigation measures, but

in general, the plans would not be used

to determine the impacts (FSH 2709.15,

sec. 55.23).

3. Required mitigation measures must

be reasonable and necessary for the

adequate protection and utilization of

the National Forest and should be

designed to prevent unnecessary

impacts to forest resources. As noted in

FSM 2271.22, do not require, through

4(e) conditions, measures that do not

meet that standard.

4. Tradeoffs in uses of the National

Forest can be evaluated and certain

enhancement measures may be required

through 4(e) conditions for the adequate

protection and utilization of the

National Forest. For example, in

allowing an important hydropower

development, a resource or use (such as

dispersed recreation) may be severely

impacted or eliminated from the

affected area—an unmitigated impact.

Through evaluation of the project,

another related resource or use (such as

developed recreation) may be enhanced

by actions or developments (such as

campgrounds) the licensee could

provide. Such enhancements may be

required through section 4(e) conditions

as offsetting the impacts of the

development. Carefully negotiate such

enhancements with the potential

licensee to obtain agreement if possible.

In cases where it may be difficult to

substantiate project impacts with the

need for enhancement, be aware that

such measures may be challenged by the

potential licensee for their imposition as

4(e) conditions. Seek the advice of the

Washington Office Lands Staff before

requiring offsetting enhancement

without the potential licensee’s consent.

5. Developing offsite resources as

mitigation for resources lost by

development in the project area is

acceptable as called for by a balanced

evaluation of the effects of the project.

However, it is not necessary that

resource losses be mitigated by such

offsite replacement. Determine whether

offsite replacement is appropriate based

on the evaluation of effects of the

project and the balancing of the

hydropower needs with resource needs;

consider whether potentially lost

resources are unique or in short supply;

and determine the feasibility of

replacing the resources. See FSM

2276.1, for offsite mitigation direction

regarding projects in relicensing.

2774—Recreation Uses at Hydropower

Projects

(See also FSM 2314 for additional

direction.)

2774.1—Licensee Responsibility

Licensees and exemptees are

responsible for providing recreation and

interpretive facilities to mitigate (FSM

2773.2) the recreation pressures induced

by the construction and operation of the

hydropower facilities. That induced

recreation need is often the result of

reservoir construction or stream flow

alterations that create a water attraction

or new access to existing roads (such as

by snow removal). These attractions

may invite the recreating public to

existing locations in increased numbers,

to new places, and to places or at times

not previously used.

Require developers of hydropower

facilities that induce or displace

recreational use of the National Forest to

provide facilities and otherwise mitigate

those increases and losses in recreation

use in an appropriate manner,

consistent with the Forest land and

resource management plan. Specify

necessary facilities and mitigation

measures as conditions in the 4(e) report

submitted to FERC (FSH 2709.15, ch.

50). Forest Service requirements for

recreation facilities and mitigation

measures must be reasonable and

necessary for the adequate protection

and utilization of the National Forest

and its resources (Federal Power Act,

sec. 4(e); 16 U.S.C. 797(e)).

Hold the licensee or exemptee

responsible for construction, operation,

maintenance, and replacement of

recreation facilities that accommodate

project-induced use or mitigate impacts

from projects constructed through

licenses or exemption issued by the

Federal Energy Regulatory Commission

(FERC). Do not relieve the licensee of

the obligation to provide those facilities

and to cover the costs for facility

operation, maintenance, and

replacement.

See FSH 2709.15, section 24.2, for

additional direction on Forest Service

and licensee responsibilities; in

particular, see section 24.22 regarding

displaced recreation uses.

2774.2—Facility Operation,

Maintenance, and Replacement

Control licensee’s construction,

operation, maintenance, and

replacement of recreation facilities on

National Forest System lands through

the project special-use authorization

(FSM 2772, FSH 2709.15, ch. 60).

Negotiation is the preferred method of

determining which party should assume

operation and maintenance of licenseeconstructed project recreation facilities

(FSM 2774.2). If negotiations fail, the

Forest Service may require the licensee

to turn over operation and maintenance

of these facilities on National Forest

System lands to the Forest Service as

long as the standards of FSH 2709.15,

section 24.31 are met.

When it is desirable for the Forest

Service to operate the recreation

facilities (FSH 2709.15, sec. 24.3),

negotiate a memorandum of

understanding (FSH 2709.15, sec. 42.2)

with the licensee for such operation at

the licensee’s expense. Ownership of

facilities is not necessary for the Forest

Service to operate facilities through a

memorandum of understanding or

license conditions. Use a collection

agreement to allow the licensee to make

payments for Forest Service operation,

maintenance, and replacement of

facilities.

Licensees may be allowed to operate

Forest Service-owned facilities through

the authority of the Granger-Thye Act

(16 U.S.C. 580(d); see FSM 2711.7). The

licensee may improve National Forest

facilities and the facilities operated by

the licensee under authorization of the

Forest Service project special-use

authorization by adding appropriate

conditions from the standard GrangerThye permit (FSM 2713.12a).

Negotiate shared financial

responsibility with the licensee when

facilities are constructed which

accommodate both project induced

recreation and non-project induced

recreation.

See FSH 2709.15, section 24.3, for

additional direction on determining

who is responsible for operating,

maintaining, and replacing recreation

facilities.

Generally, do not accept ownership of

recreation facilities constructed by the

licensee. Such acceptance may make the

Forest Service responsible for operation

and maintenance of the facility, as well

as replacement. If the licensee desires to

transfer ownership to the Forest Service,

ensure that the transfer agreement

specifies the licensee’s continuing

responsibility, including replacement of

facilities as appropriate. In addition,

make sure that project-induced facilities

remain within the project boundary so

that they remain within the jurisdiction

of the FERC license.

2774.3—Campgrounds

Campgrounds constructed on

National Forest System lands, regardless
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27165

of who builds, operates, or maintains

them, are to be identified and managed

as National Forest campgrounds. They

are subject to Forest Service standards

and to National programs, such as the

‘‘Golden Age and Golden Access

Passports.’’

Monitor literature produced by the

licensee to ensure that campgrounds are

identified as National Forest

campgrounds and as licensed and/or

operated by the licensee as required by

a condition of the special use

authorization or FERC license.

2774.4—Signs

Recreation facility signs must be from

the Forest Service family of signs for

campgrounds (FSM 7160 and FSH

7109.11). Give visible and equal credit

in such signs to the licensee for its role

in the campground development,

construction, and operation, as

appropriate. The licensee is responsible

for the cost of such signs.

Interpretive signs for the project are

the responsibility of the licensee, except

to the extent they interpret the Forest

Service mission or activities.

Coordinate with FERC and the

licensee with regard to placement and

design of signs required by FERC for the

project.

2774.5—Project Recreation Plan

As part of the application for a FERC

license, a project applicant normally

prepares a project recreation plan to

address future recreation needs

associated with the project. The Forest

Service should work with a license

applicant to ensure that the applicant’s

plan adequately anticipates and plans

for future recreation needs. In the plan,

develop and include criteria or

measurable events that will trigger

future additional facility needs.

Do not use open-ended special-use

authorization or 4(e) conditions for the

FERC license to require unspecified

future recreation developments;

however, provide flexibility for

modifying the project recreation plan if

unanticipated needs for different

recreation developments arise in the

future. Keep in mind that costs for any

future modifications must be within the

total cost of the future recreation

expansion required in the license.

2774.6—Recreation Planning During

Relicensing

Recreation guidelines for relicensing

existing FERC-licensed projects are the

same as for original licenses. Needs

induced by the project are the

responsibility of the licensee, regardless

of when those needs were originally

induced or who is currently meeting

those needs.

The Forest Service has constructed

many recreation facilities in the past to

accommodate recreation induced by

FERC-licensed projects when the

licensee would not construct the

facilities. During relicensing, use

appropriate 4(e) conditions (FSH

2709.15, ch. 50) to require the licensee

to assume appropriate financial

responsibility for those facilities

constructed by the Forest Service,

unless the Forest Service has reasons to

retain this responsibility (see also

related direction in FSM 2774.2 and

FSH 2709.15, sec. 24.15).

2775—Special Management Areas

2775.1—Projects Proposed in Wild and

Scenic Rivers Areas

Rivers and study rivers designated for

protection under sections 3 or 5(a) of the

Wild and Scenic Rivers Act (16 U.S.C.

1271 et seq.) may not be used for

hydropower projects on or directly

affecting such rivers. Hydropower

projects not on or directly affecting a

designated wild and scenic river, but

having some indirect affects on the

river, may be permitted only where they

do not invade or unreasonably diminish

the existing wild and scenic river values

(this provision also affects rivers

designated for study under section 5(a)

of the Wild and Scenic River Act).

By law, the Secretary of Agriculture

must make the determination of

whether a project is ‘‘on or directly

affecting’’ the designated river or would

‘‘invade or unreasonably diminish the

values for which the river was

designated,’’ in accordance with section

7 of the Wild and Scenic Rivers Act.

This is called a section 7 determination.

This authority has been delegated to the

Regional Forester, who must make this

determination prior to issuance of an

exemption or license by FERC on rivers

administered by the Department of

Agriculture. See FSM 2354.04 and

2770.4 for the delegation of authority for

making this determination. For further

direction on wild and scenic rivers, see

FSH 2709.15, sec. 25; 36 CFR Part 297;

and FSH 1909.12, ch. 8.

2775.11—Projects Proposed on All

Other Waterways

The proposed use of rivers on

National Forest System lands for

hydropower projects must be consistent

with the requirements of section 5(d) of

the wild and Scenic Rivers Act which

Authorizes the Forest Service to study

the Suitability of rivers for wild and

scenic protection through the forest

planning process. Therefore, the

Regional Forester must ensure that

eligibility determinations have been

completed for all National Forest rivers

proposed for use by hydropower

projects by the time of the interim 4(e)

report (FSH 2709.15, sec. 25; FSM

2354). If the river is not eligible for

inclusion in the Wild and Scenic Rivers

System, note that fact in the interim 4(e)

report to FERC. If the river is eligible for

inclusion in the Wild and Scenic Rivers

system, ask FERC to delay the licensing

decision until the suitability

determination for inclusion in the Wild

and Scenic Rivers System has been

completed as outlined in FSH 2709.15,

section 25.3. This requirement to

complete eligibility requirements and, if

the river is eligible, to complete

suitability determinations applies to

rivers identified on the Nation-wide

Rivers Inventory and to rivers identified

for consideration through Forest land

and resource management plans (FSM

1924).

2775.12—Wild and Scenic Rivers on

Lands in Conservation Units in Alaska

Dams and hydropower plants on a

designated wild and scenic river in

Alaska would not be an appropriate use

and could not be licensed by FERC if

they are ’’on or directly affecting’’ the

river (Wild and Scenic Rivers Act, sec.

7, and sec. 1107 of the Alaska National

Interest Lands Conservation Act

(ANILCA; 94 Stat. 2464; 16 U.S.C.

3167)). A transportation or utility

system, including linear facilities

associated with a hydropower project,

may use lands within the boundaries of

a designated river in Alaska National

Forests when the following conditions

are met (16 U.S.C. 3167(b)):

1. Facilities do not interfere with or

impede the streamflow of and

transportation on the river.

2. The transportation or utility system

(linear facilities, such as pipelines,

ditches, tunnels and powerlines; 16

U.S.C. 3162(4)) is located and

constructed in an environmentally

sound manner.

2775.2—Projects Proposed in

Designated Wilderness Areas.

(FSM 2320), and FSH 2709.15, sec.

26.) A new hydropower project may

occupy land in a wilderness only if the

President approves (16 U.S.C.

1133(d)(4)). The Secretary of Agriculture

is responsible for a recommendation to

the President to approve a hydroelectric

use in a designated wilderness. The

Chief is responsible for the

recommendation to the Secretary to

approve such a hydroelectric use. The

Regional Forester is responsible for

evaluating such a proposal. The
27166 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices

Secretary, Chief, or Regional Forester

(FSM 2770.4) may determine that a

proposal is not in the public interest

and dismiss the project proposal.

Even though the Forest Service is

responsible for initiating a

recommendation for a project in

wilderness, the Federal Energy

Regulatory Commission (FERC) is

responsible for the environmental

impact statement (EIS) needed to

evaluate proposed licensing of the

project (FSM 2773). Such an EIS

generally is prepared with the

cooperation of the Forest Service

through the Regional Forester.

If the Chief determines that a

proposed project in wilderness is in the

public interest, the Chief transmits the

EIS, along with the recommendation, to

the Department of Agriculture for the

Secretary’s recommendation to the

President for a decision. If the President

approves the project and the associated

use of the wilderness, the Regional

Forester must submit a 4(e) report to

FERC consistent with that decision.

A special-use authorization (Form

FS–2700–4f) for study of a potential

hydropower development and other

non-ground-disturbing activities in a

wilderness may be issued without

Presidential approval (FSM 2772.3, and

FSH 2709.15, sec. 62.11 and 74).

Existing facilities in wilderness areas

that have been properly authorized by a

FERC license continue to be authorized

by that license. See FSH 2709.15,

section 64.7, for further guidance on

administering existing projects in the

wilderness.

2775.3—Project Proposed in Roadless

Study Areas

Roadless study areas include

legislatively unreleased Roadless Area

Review and Evaluation II (RARE II)

areas, further planning areas, and

Congressionally mandated wilderness

study areas (FSM 1923 and FSM 2320).

When roadless study lands are

included in an application for license

for a proposed hydropower project,

advise FERC through an interim 4(e)

report (or other appropriate

correspondence) of the study and

pending land allocation decision.

Recommend that FERC:

1. Reject the application for license

and advise the applicant to reapply if

the lands in question are allocated to

non-wilderness uses that would not

conflict with hydropower development,

or

2. Delay the licensing decision until

the land allocation decision is made,

preferably through the Forest land and

resource management plan. If the land

use decision must be made before the

forest land and resource management

plan can be implemented, conduct a

suitable analysis in compliance with the

National Environmental Policy Act

(FSM 1920; FSH 1909.12 and 1909.15).

Generally, grant investigation specialuse authorizations (Form FS–2700–4f)

in these areas only for study and other

non-ground-disturbing activities.

2775.4—Projects Proposed in Research

Natural Areas

Most surface hydropower facilities

would be incompatible with the

purposes of a research natural area

(FSM 4063). However, the research

natural area management plan may

allow for hydropower or similar uses; in

this case, evaluate a proposed project

and respond to FERC in a 4(e) report.

Coordinate advice to FERC and the

issuance of any special-use authorizing

actions within the research natural area

with the Research Station Director.

1. If a proposed hydropower project is

incompatible with the purposes of the

research natural area, then:

a. In response to a notice of

application to FERC for license, or in

the 4(e) report, inform FERC that such

surface uses would be incompatible

with the purposes of the research

natural area.

b. Do not issue a special-use

authorization for a project exempted

from licensing by FERC when the

project includes surface lands within a

research natural area boundary.

2. When the Station Director believes

that the hydropower values that would

be forgone are of greater public benefit

than keeping the research natural area

fully protected, the Station Director may

request, with Regional Forester

concurrence, that the Chief reconsider

or modify the designation order

establishing the research natural area

(see direction on authority of Station

Directors in FSM 4062).

3. In general, do not issue an

investigation special-use authorization

(Form FS–2700–4f) to a project

proposing to use lands of a research

natural area; however, a non-ground

disturbing investigation special-use

authorization may be issued in

situations such as:

a. The research natural area’s

management plan allows actions which

include or are similar to those proposed

by the hydropower project;

b. There would be no direct or

indirect modification to the ecological

processes of the research natural area;

for example, a tunnel under the research

natural area might not adversely affect

the area; or

c. The Station Director anticipates

that a proposed hydropower

development may have significant

public benefits.

2775.41—Projects Proposed in

Candidate Research Natural Areas

When candidate research natural area

lands are included in an application for

license for a proposed hydropower

project, advise FERC of the study and

pending land allocation decision.

Recommend that FERC:

1. Reject the application for license

and advise the applicant to reapply if

these lands are allocated to non-research

natural area uses that would not conflict

with hydropower development, or

2. Delay the licensing decision until

the land allocation decision is made,

preferably through the Forest land and

resource management plan. If the land

use decision must be made before the

land and resource management plan can

be implemented, conduct a suitable

analysis in compliance with the

National Environmental Policy Act

(FSM 1920; FSH 1909.12 and 1090.15).

Issue investigation special-use

authorizations (Form FS–2700-4f) for

candidate research natural areas where

no ground disturbance will take place.

Coordinate the issuance of any specialuse authorizing actions within the

candidate research natural area with the

Research Station Director.

2775.5—Projects Proposed in Other

Special Areas

1. Other special areas may be

established by the Forest land and

resource management plan or unit plan

for which the Forest Service may

determine that a proposed hydropower

development would not be compatible.

Special interest areas established by the

Forest Service may include:

a. Scenic, geological, botanical,

zoological, and paleontological areas

(FSM 2360.2).

b. Cultural resources areas (FSM

2361).

c. National scenic or historic trails

(FSM 2353.4).

d. Other special land allocations

established through the forest land and

resource management plan or other

procedure where hydropower

development would be incompatible.

2. Other special land allocations may

have been established by legislation,

such as national recreation areas, where

hydropower development may be

incompatible.

3. When hydropower use would be

incompatible with the management and

purposes for establishing the special

area, take the following actions:

a. In response to a notice of

application to FERC for license, inform

FERC in the 4(e) report that such use
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27167

would be incompatible with National

Forest purposes of the special

management area (FSH 2709.15, sec.

26.4).

b. In response to an application for

special-use authorization for a project

exempted from licensing by FERC, do

not issue a special-use authorization for

such a project that includes lands

within the special management area.

4. When project impacts can be

adequately mitigated to protect the

management and purposes for

establishing the special management

area, impose appropriate conditions on

the license and special-use

authorization through the 4(e) report or

through the special-use authorization

alone for a project exempted from

licensing.

2775.51—Projects Proposed in Study

Special Areas

When study special management area

lands are included in an application for

license for a proposed hydropower

project, advise FERC of the study and

pending land allocation decision.

Recommend that FERC:

1. Reject the application for license

and advise the application to reapply if

the lands in question are allocated to

non-special area uses that would not

conflict with hydropower development,

or

2. Delay the licensing decision until

the land allocation decision is made,

preferably through the Forest land and

resource management plan. If the land

use decision must be made before the

Forest land and resource plan can be

implemented, conduct a suitable

analysis in compliance with the

National Environmental Policy Act

(FSM 1920; FSH 1909.15).

Issue investigation special-use

authorizations (Forms FS–2700–4f) for

study special areas, and as appropriate,

carefully regulate potential ground

disturbance.

2775.6—Projects Proposed in StateDesignated Special Areas

The States may designate special

areas, such as State wild and scenic

rivers, wild trout streams, and State

game refuges, which may include

National Forest System land. State laws

may prohibit State permits for

hydropower projects on these special

areas, but these laws are not binding on

Federally authorized projects. However,

in the spirit of cooperation, give such

State laws and areas very careful

analysis when considering hydropower

projects. Under section 4(e) of the

Federal Power Act, the Forest Service is

not authorized to:

1. Impose conditions on the license to

ensure protection of the State’s

designated special areas; or

2. Impose conditions on the license to

protect other State interests not directly

a result of the need for ‘‘adequate

protection and utilization of the

National Forest.’’

However, the Forest Service and the

State may request that FERC provide

protections which promote the interest

of the state-designated area.

2775.7—Projects Proposed in National

Monuments

FERC is prohibited from licensing a

project that would occupy lands of a

national monument administered by the

Forest Service or other Federal agency

(41 Stat. 1353; 16 U.S.C. 797(a)); such

action would require an act of Congress.

2776—Relicensing

In general, follow the same

procedures for projects whose owners

are applying for a new license under

relicensing procedures as used for those

for projects whose applicants are

applying for an original license. The

procedural differences apply mainly to

the project owners, not the Forest

Service (sec. 15 of the Federal Power

Act, 16 U.S.C. 808; 18 CFR Part 16,

subpart B, sec. 16.8 through 16.13).

2776.1—Section 4(e) Conditions in

Relicensing

The Forest Service may specify 4(e)

conditions in a new license issued by

FERC under relicensing procedures.

Such conditions must be reasonable and

necessary for the adequate protection

and utilization of the National Forest as

it exists at the time of relicensing.

Existing projects provide public

benefits and have been in place long

enough to be the ‘‘normal’’ situation

where they exist. Therefore avoid

disruption of these projects and

carefully evaluate the need for change.

However, it is essential to require

reasonable measures to protect the

environment. For example, it may be

reasonable to provide fish passage over

a dam, but not to restore a stream

fishery that was converted to a lake

fishery. Do not seek in relicensing

offsite replacement of resources lost

during the original licensing decision.

Generally, limit the resource

protection measures to those which the

project could afford to provide and still

operate; avoid as much as possible

actions that would cause projects to

operate in a marginal economic

condition.

2776.2—Removal of Project

If special circumstances indicate a

project that is under consideration for

relicensing should be removed,

recommend in a 4(e) report to FERC that

no new license be issued and that the

area be restored. Do not use the

conditioning authority under section

4(e) of the Federal Power Act to force

removal of a project. See FSM 2771.33,

for direction regarding Federal takeover

of a project.

Proposed Handbook Revision

Following are the sections of the

Hydropower Handbook (FSH 2709.15)

cited in this Federal Register notice. For

a copy of the entire Handbook, call the

FOR FURTHER INFORMATION CONTACT

listed at the beginning of the notice.

This Handbook provides detailed

direction to Forest Service personnel for

evaluating hydropower project

proposals and for coordinating with the

Federal Energy Regulatory Commission

(FERC). See FSM 2770 for policy and

overall direction on Forest Service

hydropower matters.

64.7—Administration of Projects in

Wilderness Areas

Facilities in wilderness areas that

have been properly authorized by a

FERC license will continue to be

authorized by that license. When FERC

relicenses a project, the Forest Service

issues a companion special-use

authorization (Form FS–2700–4g),

usually under the Federal Land Policy

and Management Act (FLPMA) (FSM

2770.1). Since FLPMA authority cannot

be used for facilities in a wilderness, use

the Organic Act (16 U.S.C. 551) for the

Forest Service authorization of that

portion of the project in the wilderness.

These hydropower projects are

considered as valid existing rights and

administered as such under section 4(c)

of the Wilderness Act of September 3,

1964 (16 U.S.C. 1133(c); FSM 2775.2).

Existing special use authorizations

may be modified for maintenance and

reconstruction work on projects in

wilderness areas. Any modifications to

such facilities must be made in

conformance with the requirements of

the license and any special-use

authorization, and section 4(c) of the

Wilderness Act, except that

modifications to increase storage

capacity or similar improvements must

receive Presidential approval (sec.

4(d)(4) of the Wilderness Act).

Hydropower dams in wilderness areas

must meet the requirements of Federal

and State law, including the Wilderness

Act, the Dam Safety Act (33 U.S.C.

467a–367n), the Federal Power Act, the
27168 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices

law and regulation that provides for the

special use authorization, and the terms

of the authorization. The Wilderness

Act provides for the maintenance of

existing dams and related facilities in

wilderness areas if they are valid

existing rights.

Maintenance can include work that

will improve the safety of the dam, such

as enlarging the spillway or increasing

the freeboard on the dam. In some

instances the installation of a water

measuring device may be added when

required by State law and when there is

no suitable location available outside of

the wilderness area.

FSM 2320 provides direction for

evaluating proposed improvements and

reconstruction of facilities, including

access alternatives to the dam or water

conveyance system. Consideration of

proposals for work on dams and related

access should be made on a case-by-case

basis using the NEPA process (FSM

1950), balancing wilderness values with

licensee rights and public safety.

Historic methods of access and

economics also should be considered in

the analysis.

Hydropower projects licensed by

FERC do not qualify for an easement

under the Act of October 27, 1986 (Pub.

L. 99–5545, the ‘‘Ditch Bill’’; FSM

2770.1) which amended parts of the

Federal Land Policy and Management

Act of 1976 (43 U.S.C. 1761(c)).

65—Special-Use Authorization Fees

Fees may be charged for investigation

special use permits (Form FS–2700–4f),

as well as for project special use

authorizations.

65.1—Investigation Permit Fee

Unless the market conditions indicate

that a higher fee is appropriate, charge

$200.00 for the term of a hydropower

investigation permit (Form FS–2700–4f).

65.2—Licensed Project Authorization

Fee

Waive the fee for this type of

authorization since FERC already

charges fees for the use of National

Forest System land.

The holder shall pay a fee, as

described in section 65.31, for areas

outside the license boundary that are

under temporary permit.

65.3—Exempted Project Authorization

Fee

65.31—Fee for Construction Period

(Minimum Operation Fee)

Charge the annual minimum fee of 10

percent of the land value of the area

under permit for periods when power is

not being sold. At the option of the

Regional Forester, determine such land

value by appraisal or other sound

business practices. The holder shall pay

the minimum fee in advance at the

beginning of each year. Calculate the fee

for temporary permits issued for

temporary areas outside the main permit

area at 10 percent, annually, of the land

value of the area under those permits.

65.32—Operation Fee

Unless local market conditions

indicate otherwise, the holder shall pay

a fee of 3 percent of the gross power

sales from the start of project operation

until the end of the fifth year. From the

start of the sixth year to the end of the

tenth year, the holder shall pay a fee of

5 percent of the gross power sales. The

fee from the start of the eleventh year

until the end of the term of the

authorization may increase up to 10

percent. Determine the final rate

through a reevaluation of the market,

during the tenth year.

The holder pays the minimum

operation fee (sec. 65.31) in advance

each year and that amount is credited

toward the operation fee. The holder

does not start paying the quarterly

operation fees each year until the year’s

accumulated operation exceeds the

minimum operation fee. The holder

pays the operation fee quarterly, within

45 days of the end of each quarter,

unless the average annual fee is less

than $2,000 (in which case the holder

pays at the end of the year).

65.33—Fee Adjustment of Mixed

Ownership

Adjust the operation fee when the

Federal Government land under permit

is less than 90 percent of the total linear

distance actually occupied by the

project excluding access roads and

transmission lines. Make the adjustment

by measuring slope-distance length of

the project from the outlet of the lowest

powerhouse tailrace to the upstream

edge of the impoundment created by the

diversion. The percentage of that length

that is on Government land is the

percentage of the total fee that is due the

Government. For example, if the

government owns 800 feet of a 1,000-

foot-long project, the initial operation

fee would be 80 percent of 3 percent of

the gross power sales or 2.4 percent of

the gross power sales.

If there is more than one diversion,

include the additional lengths of those

other diversions from the point of

intersection with those already

measured in the total length.

65.34—Transmission Line Fee

The holder shall pay a separate fee for

the area under permit for the

transmission line portion of the project

if such a line is the only facility under

permit or if the transmission line

exceeds 2,500 feet on National Forest

System land to the point of

interconnection with an existing

transmission line. A separate special use

authorization for a transmission line

greater than 2,500 feet is not necessary,

but may be used at the discretion of the

authorizing officer; that is, the

authorizing officer has the discretion to

charge an additional fee for the

transmission line within the

hydropower permit, instead of issuing a

separate transmission line permit for

lines over 2,500 feet. Determine fees by

the procedures for transmission line fees

(see also sec. 62.24).

65.35—Conduit Exemption Fee

While conduit exemptions cannot be

issued for projects that occupy Federal

lands, FERC grants exemptions to such

projects as long as the powerhouse is

not on Federal lands and there is no

new construction on Federal lands; for

example when the powerhouse would

be on non-Federal lands and the

existing water pipeline or ditch on

Federal lands does not need

modification.

Regardless of FERC’s action, treat the

project in its entirety when calculating

fees. Consistent with section 65.33,

measure the linear distance of the water

system from the powerhouse to the

upper end of the diversion or to the next

powerhouse, if any. The percentage of

that length that is on National Forest

System land is the percentage of the

total fee that would be charged.

BILLING CODE 3410–11–M
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27169
27170 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27171
27172 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27173
27174 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27175
27176 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27177
27178 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27179
27180 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27181
27182 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27183
27184 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27185
27186 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27187
27188 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27189
27190 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27191
27192 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27193
27194 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27195
27196 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27197
27198 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27199
27200 Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices
Federal Register / Vol. 60, No. 98 / Monday, May 22, 1995 / Notices 27201

[FR Doc. 95–12337 Filed 5–19–95; 8:45 am]

BILLING CODE 3410–11–C