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got non-Federal debt service, which is 23 percent. I understand 

 that; residential exchange; Federal interest. Where do you put 

 WPPSS operating costs? Is that on other entities, 18 percent? Is 

 that in there? I am just curious. What is that 18 percent block? 



Mr. Hardy. I believe WPPSS operating costs are part of that, 

 along with the Corps and the Bureau, and those are the three prin- 

 cipal factors associated with that. 



Mr. DeFazio. Okay. Then I would just like to have a brief discus- 

 sion of that. First off, have you thought about, considered, entered 

 into discussions with the Corps or the Bureau regarding their 

 share of that and seen whether or not there are any potential re- 

 ductions there given the extraordinary circumstances that confront 

 you? 



Mr. Hardy. Yes, we have. We have both done that at the assist- 

 ant administrator level and at my level, and I am anticipating we 

 will get some reductions from both of those agencies. I don't expect 

 it to be a huge amount, but they are trying their best. The Bureau 

 in particular has been quite forthcoming in trying to present us 

 with some savings. We have deferred at least one capital project 

 that we otherwise would have directly funded at Hungry Horse. 

 That I think will provide us with some savings, and we are looking 

 for other savings as well. 



Mr. DeFazio. Yes, I would urge you to be aggressive in dealing 

 with your fellow agencies, and maybe I will get a look at some of 

 their costs in more detail. 



My imderstanding is that the Administrator does have a right of 

 review of the WPPSS expenses. Do you agree with that statement? 



Mr. Hardy. Yes. 



Mr. DeFazio. You have a right of review and 



Mr. Hardy. We have a right of review of the Supply System ex- 

 penses. We have made the same request of the Supply System, and 

 we are actively working with them to try to identify those savings. 

 They are in the process of doing that, and at least the figures I saw 

 at the Supply System executive board meeting last week would in- 

 dicate that there are several million dollars of savings in the cur- 

 rent operating budget that are available. We are aggressively pur- 

 suing those with their cooperation. 



Mr. DeFazio. In your formal responses you did note that WPPSS 

 was at the high end in terms of single plant operating utilities in 

 terms of their per-unit costs. 



Mr. Hardy. That is correct. 



Mr. DeFazio. What sort of scrutiny do you give to their budget? 

 Do you have a detail of staff that goes over their budget, or how 

 do you review their budget, their submission, their costs? 



Mr. Hardy. We have about a 10- or 12-person staff that is per- 

 manently on site in Richland that not only reviews their budgets 

 but basically is into all aspects of their operations. So we are work- 

 ing with them on a continuous, day-to-day basis. One of those Bon- 

 neville staff people is an auditor who participates with Supply Sys- 

 tem staff and with their independent commercial auditor to audit 

 those expenses. We track and monitor that quite closely. 



The Supply System has just hired a new managing director, and 

 I am optimistic that he is the kind of turnaround manager that will 

 help us produce even greater savings. I can tell you that in the few 



