Opinion ID: 343208
Heading Depth: 3
Heading Rank: 2

Heading: The 83rd Congress

Text: 46 The legislative history of CRSP encompasses hearings and debates in the 83rd and 84th Congresses. We review the history chronologically. 47
48 On April 2, 1953, three bills to authorize storage projects on the Colorado River were introduced in the House by representatives from the upper basin states of Utah and Colorado. 36 These bills each provided a type of geographic preference for marketing power. Arizona Power places great emphasis on the fact that these mandatory geographic preferences were deleted by the House Committee on Interior and Insular Affairs. Because this is the most crucial aspect of Arizona Power's argument, we examine this episode in detail. 49 The bills were similarly worded in their directions for marketing hydroelectric power. Each required the Secretary to include in contracts with customers outside the upper basin states a provision for termination or modification to the extent deemed necessary by the Secretary to meet power demands in the upper basin states. 37 The implication of these provisions for the financial success of the projects were hotly debated. Bureau of Reclamation Regional Director Larson testified that preference customers in the upper basin states would initially use only ten per cent of the electric power. He estimated that it would take 20 years after the construction of the two largest proposed dams before the upper basin would develop a demand for all CRSP power. Representative Hosmer of Southern California feared that the difficulty in finding purchasers willing to invest in expensive transmission lines for withdrawable power threatened the economic feasibility of the project. Hearings on H.R. 4449 et al. Before the Subcom. on Irrigation and Reclamation of the House Comm. on Interior and Insular Affairs, 83d Cong., 2d Sess. 167-70 (1954). 38 50 Moffat, a representative of ten upper basin private utilities, proposed one solution. He expressed a desire that CRSP power be marketed to private utilities in the upper basin states rather than preference customers outside of the area. He also proposed that long-term contracts be entered into so that the private utilities could afford to invest in transmission facilities. Id. at 570-71. 51 Preference customers vigorously attacked these proposals. The National Rural Electric Cooperative Association prepared a statement charging that the mandatory geographic preference might lead 52 to modification and perhaps abrogation of the preference provision of the reclamation laws . . . . In other words, were the rural electic (sic) systems and other preference agencies in the upper Colorado River Basin States unable to initially or ultimately utilize all of the firm energy available from the projects, the remaining portion of the energy would be sold to nonpreference customers within these States, if they desired it, rather than to preference customers lying (even slightly) outside of the upper Colorado River Basin area, even though the power could be made available to the preference customers over the existing or proposed facilities of the Federal Government that were electrically integrated with the upper Colorado River Basin project. In general, neither State lines nor the peripheries of river basins bear any relation in distance from a project to economical transmission distances from a project. 53 Id. at 897 (emphasis added). The rural electric cooperatives also criticized the private utilities for advocating that any marketing plan be incorporated in the text of legislation. They argued that the Secretary's broad discretion in contracting with power customers should be bounded only by the traditional limitations imposed by the reclamation law preferences of Section 485h(c) and the requirement of economic stability. The cooperatives feared that participation by private utilities might deprive them of the full benefits of the project. Id. at 898. 39 54 In light of these points of contention the House Committee on Interior and Insular Affairs made two successive amendments. The Committee first substituted for the three proposed bills the language of a draft bill from the Interior Department. H.R.Rep. No. 1774, supra, at 19. In place of the mandatory withdrawal clauses of the original bills, Section 6 of the new version placed a ten-year limit on contracts to customers outside of the upper basin states unless the Secretary determined that the power sold was in excess of the probable needs in the upper basin states. 40 The Committee then amended Section 6 by deleting the time limitation on contracts with lower basin customers. It explained the purpose of its amendment as follows: 55 By this amendment all States of the Colorado River Basin would be placed on the same basis with respect to acquiring electric power from the project. In discussing section 6, the committee considered writing into this legislation a power preference provision similar to those in existing reclamation law. Such a provision was not specifically written in because the provisions in general reclamation law, including the Reclamation Project Act of 1939 (Section 485h(c)) and the Flood Control Act of 1944, would be applicable to this project under section 3. The committee wishes to make it clearly understood that, although a power preference provision is not specifically written into this legislation, the committee fully supports the application of existing power preference provisions to this project. 56 Id. at 22 (emphasis added). 57 This is the first point in the legislative history where the phrase same basis is used by a committee. Arizona Power interprets this statement as prohibiting geographic preferences. But reading the statement in the context of the hearings on the mandatory geographic preferences in the original bills, we cannot agree. No one at the hearings objected to the original preferences on the ground that the lower division states would be deprived of their fair share of CRSP power. 41 Instead the critics of the provisions were concerned solely with generating maximum power revenues while adhering to the reclamation law preference for public utilities. The Committee report expressed similar concerns. 42 We believe that when the Committee stated that all states would be on the same basis, it meant that the Secretary should have discretion to market CRSP power wherever he thinks best to maximize revenues consistent with reclamation law preferences. The Committee deleted mandatory preferences because it feared that they might unduly fetter the Secretary's discretion and hamper his efforts to achieve CRSP's underlying objectives. But the Committee did not prohibit the Secretary from adopting a geographic preference if at some time in the future he determined that such a preference was consistent with the policies of maximizing revenue and adhering to reclamation law preferences. 58 Significantly, Arizona Power does not argue that the Marketing Criteria will lead to a loss of potentially recognizable power revenues or a decrease in the firm power rates. Nor does it argue that the Marketing Criteria are inconsistent with reclamation law preferences. Arizona Power argues only that it was the congressional understanding that maximum revenues could be achieved under the reclamation law preferences only if CRSP power were sold to Arizona preference customers on a permanent basis. 59 This argument would have some substance if Arizona Power could point to clear evidence that the Committee desired a certain portion of CRSP power allocated to the lower division states and to Arizona in particular. It does not, nor could it. The Committee states that a major purpose of the bill was to provide hydroelectric power for the expanding economy of the area, referring to the upper basin. H.R.Rep. No. 1774, supra, at 11. 43 The Committee did note that there was an increasing need for electric energy (w)ithin and adjacent to the Upper Basin. Id. at 13. But it does not appear that any significant portion of Arizona was encompassed under this latter description. 44 60 We therefore conclude that it was not the House Committee's understanding that CRSP success depended on any given geographic allocation of power. The understanding was that success required only that the Secretary have discretion to market CRSP power in the best interests of the government. 61
62 Proceedings in the Senate closely paralleled those in the House. A bill was introduced there similar to those introduced in the House, S.1555, 83d Cong., 1st Sess. (1953), and hearings were held on the measure. Hearings on S.1555 Before the Subcomm. on Irrigation and Reclamation of the Senate Comm. on Interior and Insular Affairs, 83d Cong., 2d Sess. (1954). Many of the same witnesses presented similar testimony. See, e. g., id. at 575 (statement of private utilities), 687 (National Rural Electric Cooperative Association). Southern California interests again opposed the proposed legislation. See S.Rep. No. 1983, 83d Cong., 2d Sess. 25-30 (1954) (minority views of Sen. Kuchel). The House Committee's amended bill and report were before the full Senate Committee. See id. at 20-24. 63 Section 4 of the Senate bill contained a mandatory geographic preference in favor of the upper basin states identical to that contained in the House bills. There was little discussion of the marketing problem. The Committee deleted the mandatory preference but did not detail its reasons in its report. Arizona Power points to broad language in the report that there is a ready market (for hydroelectric power) throughout all the Colorado River Basin States. S.Rep. No. 1983, at 2-3. This statement, however, is ambiguous at best. The preceding paragraph specifically noted that the upper basin states anticipated rapid growth with a resulting urgent need for water and power, particularly in the Albuquerque, Denver and Salt Lake City metropolitan areas. Id. at 2. 45 The legislative history, therefore, presents no clear evidence that the Senate Committee in the 83rd Congress intended to prohibit all types of geographic preferences.