Pa Real Estate Sales Agreement by rmf12915

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									Water Supply
Reallocation
   John Grothaus
 (CENWK-PM-PF)
 FY 06 PA Program
     July 2006
                     Outline
•   1.   Introduction / Overview
•   2.   Cost Sharing Policies
•   3.   Eligible Users
•   4.   Rights acquired by User
•   5.   Basic Policy
•   6.   Reallocations

                                   2
                   Water Supply in a
                  Multipurpose Project



Flood Control
   Storage



   Conservation
     Storage
                  Water
                  Supply   Sediment
                                         3
“The Secretary . . . Has the discretion to
market water . . .even if this results in a
   decrease of the project’s actual or
 potential power production. . .Section 6
was included in the Flood Control Act to
 empower the Secretary of the Army to
make reasonable reallocations between
     the different project purposes.”

   Army General Counsel, 13 March 1986
          Cost Sharing Policies
            for M&I Storage
   Reallocations and Project Modifications
- Non-Federal sponsor pays 100% of new
  construction costs during construction
- If storage reallocated, sponsor repays over 30-
  years with interest
- Interest rate as established in Section 932 of
  WRDA ’86
- Pro-rata share of OMRR&R costs
- All conveyance, treatment, and distribution; Non-
  Federal
                                                      6
              Water Supply
          Reallocation of Storage
• Water Supply Act of 1958 allows for reallocation
  without Congressional approval as long as it does not
  have a serious impact on original project purposes or
  involve major structural or operational changes
• Reallocation permitted for M&I water supply only
• Corps policy limits reallocations to 50,000 ac-ft or 15%
  of the total usable storage, whichever is less
• Non-Federal pays highest of 4 analysis methods
   – Revenues Forgone, Benefits Forgone, Updated Cost of Storage,
   Replacement Costs

                                                                    11
       Price of Reallocation
Highest of:
 1. Benefits Foregone
 2. Revenues Foregone
 3. Replacement Costs
 4. Updated Cost of Storage



                               12
Competing Interests...




                         13
 Existing Water Supply users
Public Law 88-140 entitled to
permanent use of storage space.
Current Corps policy requires new
users to purchase additional storage
to preserve yields of existing water
supply users (“dependable yield
mitigation storage”)
                         EC 1105-2-216
                                     14
       REALLOCATION
          Hydropower Credit
Where Federal Hydropower is affected:

  -if hydropower revenues are reduced, the Power
  Marketing Agency (PMA) will be credited for the
  amount of revenues foregone to the Treasury

  - where existing PMA contracts require acquisition
  of replacement power, additional credit covering
  cost can be made to PMA for duration of contracts

                                                       16
              Reallocation Report
                Requirements
1.   Purpose of report
2.   Background, project data, and map
3.   Water supply needs analysis
4.   Test of financial feasibility
5.   Cost of storage analysis
6.   Analysis of alternatives to meeting water supply needs
7.   Appropriate NEPA documentation
8.   Recommendation of district commander
9.   Public participation and public interest review
     documentation

                                                              17
        DELEGATIONS &
         PROCESSING
 Model Agreements
 Delegations
 Processing
 Common Issues – Problems
 Unique Situations / Future Attractions



                                           18
     WATER SUPPLY
 APPROVAL AUTHORITIES

Originally Authorized

Reallocations/Modifications


                               21
APPROVAL of ORIGINALLY
 AUTHORIZED STORAGE

 Delegated to HQUSACE
 - If follows model agreement & policies
HQUSACE may further
 delegate to Divisions/District
 Commanders
                                           22
      Approval of Reallocation
• CONGRESS - if severe effect on other authorized
  purposes or would involve major structural or
  operational changes
• SECRETARY OF THE ARMY - if > 15% of total
  storage or > 50,000 ac. ft. and not requiring
  Congressional approval
• COMMANDER, USACE - if < 15% or < 50,000 ac. ft.
  and not requiring Congressional approval
• DIVISION COMMANDER - if < 499 ac. ft. -- delegated
  from Commander, USACE

                                                  23
          APPROVAL of
        REALLOCATIONS
          EXCEPTIONS
 All reallocation reports are submitted to the
 ASA (CW) with the draft water supply
 agreement
When the cumulative amounts or storage
 exceed the lesser of 4,000 acre-feet or 10%
 of available storage, reports will be
 submitted to HQ for review by the ASA
 (CW)
                                              24
 APPROVAL of AGREEMENTS
for REALLOCATED STORAGE
                     Draft
       From – To             *Approval by
       (acre-feet)
         0 – 99                  District
       100 – 499                Division
        500 & up               ASA CW)
 * For reallocations that do not require Congressional
 Approval and that follow the model format or the model
 With approved changes
                                                     25
 APPROVAL of AGREEMENTS
for REALLOCATED STORAGE
                  Final
    From – To             Approval by
    (acre-feet)
      0 – 499              District
    500 – 999             HQUSACE
    1000 & up             ASA CW)


                                        26
          PROCESSING at HQ
 Send documents (10 copies in draft form to HQ-
 RIT )
  - model contract/agreement with red line changes
  - list of deviations with explanation for changes
  - clean copies revised model
 RIT will “manage” review and processing
 Team assigned will include attorney, Real Estate
 Specialist, Environmental Compliance expert,
 Policy Reviewer, others as necessary

                                                      27
       PROCESS of DRAFTS
                 (10 Copies)
 If significant revisions needed, documents
 returned to Div/Dist with comments and
 resubmittal
 If no or minimal changes, HQ will send to
 ASA with recommendations, or return to
 field to finalize as appropriate
 Target Time – 30 Days

                                               28
     PROCESSING of FINALS
  (4 Copies Ready for Signature/Approval)
 Most delegated to district or division
 Those that require ASA approval, will be
 sent after district/sponsor sign
 Those requiring HQ approval, will be sent
 to DCW after district/sponsor sign
 Ensure Review Record is included in
 packages

                                              29
       POST PROCESSING


Furnish “copy” of signed/approved to HQ-
 MSC-RIT (includes those approved at
           district/division level)




                                            30
COMMON ISSUES-PROBLEMS
   Storage – Yield Relationships
   HP Losses and Compensation
   Consideration of FC storage
   DYMS
   Total Useable Storage
   Updating Storage Costs
   Return Flows
   NED vs. Financial Analysis
   Section 322/WRDA 88 qualifications
   Unsupported Deviations
   Extraordinary WS Demands
                                         31
      UNIQUE SITUATIONS /
     FUTURE ATTRACTIONS
 Renewals
 Credits for Prior Payments
 Interstate Disputes
 30-year payment limits
 Increased Delegations
 Pricing for Un-Reliable Water Supply
 WS as a Business Program
 Centers of Expertise
                                         32
        Current Projects



Howard Hansen, WA
                                Lake Lanier, GA




               Seven Oaks, CA                     11
                                                  33
     Questions???

John Grothaus – 816-389-3110


								
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