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parte comniuilcation by a Member of the Task Force at the hearing 

 is that BPA will notify the Administrative Law Judge of the 

 communication and he will give the parties to the rate case an 

 opportunity to respond on the record to the communication. 



If you have any questions about the ex parte rules please 

 contact the Majority Staff. 



BPA Budget Cuts 



On April 9, 1993 Administrator Hardy announced a series of 

 actions to improve BPA's near-term financial status and reduce 

 the euBOunt of the proposed rate increase. Hardy announced that 

 BPA would "move to terminate" two uncompleted nuclear plants, 

 WNP-1 and WNP-3 that were built by the Washington Public Power 

 Supply System (HPPSS) . For the past ten years these plants have 

 been preserved and maintained so that the option of completing 

 construction was available. The current cost of this 

 "mothballing" is about $10 million per year. BPA expects that 

 termination of these plants will bring significant savings by the 

 mid-1990s. 



Hardy also plans to cut BPA administrative costs by 50 

 percent by reducing expenditures for travel, training, office 

 supplies, overtime, and reducing temporary and on-site contractor 

 employment. BPA also will continue a "limited" hiring freeze and 

 is considering closing one or more field offices. 



Finally, BPA has reopened their budget process for FY 1994 

 to consider reductions of up to twenty-five percent. 



Overview of BPA's Proposed FY 1994 Budget 



The proposed FY 1994 Budget that BPA has submitted to 

 Congress is based upon assumptions made in January 1993. These 

 assumptions are no longer valid and BPA has reopened its budget 

 process as part of its effort to limit the rate increase. 

 Consequently, the numbers in FY 1994 Budget are now only 

 reference points for BPA's ongoing review of its budget and do 

 not even include the budget cuts recently announced by 

 Administrator Hardy. 



The following table summarizes BPA's proposed FY 1994 

 Budget. 



