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Protecting and enhancing fish and wildlife in the Columbia River Basin no longer is a 

 discretionary budget item; it is a firm obligation, a cost of doing business in the modem 

 Northwest. Protecting and enhancing fish and wildlife is a legitimate and necessary cost of 

 operating the hydropower system. 



In this regard, the region expressed a strong preference for clear goals and cost- 

 effective measures to increase salmon survival. The Council tried hard — and succeeded, I 

 think ~ to comply with these demands in crafting the Strategy for Saltnon. Yet Bonneville 

 apparently is willing to curtail fish and wildlife measures when revenues decline. 



Savings and efficiencies are important. Bonneville should pursue savings in 

 consultation with the region, and we committed to work with Bonneville to ensure that 

 programs are delivered as efficiently as possible. At the same time, however, program levels 

 must be adequate to meet Bonneville's obligations under the Northwest Power Act. These 

 obhgations include a requirement to acquire least-cost resources and to protect, mitigate and 

 enhance fish and wildlife, including related spawning grounds and habitat, of the Columbia 

 River and its tributaries. 



While we agree with Bonneville that agency costs should be reduced by introducing 

 efficiencies and cutting programs no longer needed, we cannot agree to selective 

 implementation of the Council's program. The drought should not be an occasion for 

 Bonneville to carve away Council policies and mandated programs simply because some 

 customers disagree with them. In particular, we caution against the impulse to respond to 

 short-term, drought-induced, cash flow constraints by cutting investments in our future, cuts 

 that will result in higher costs for future customers and for the people of this region. 

 Injudicious cuts in the fish and wildlife program will cost the region more in the long run if 

 we have to accelerate our efforts in order to "catch up" with fish populations that may be 

 slipping toward extinction. 



We understand that Bonneville's short-term cash flow needs are real. We believe 

 they can and should be addressed by cash-flow budget toob such as program deferrals (for 

 expenditures that are not time-critical) rather than program elimination. We have committed 

 to work with Bonneville to identify such deferrals in the conservation and fish and wildlife 

 budgets. In addition, we advocated that Bonneville also consider employing a one-year 

 drought surcharge to bridge the drought-induced cash flow gap. Both deferrals and 

 siurharge can be revisited next year depending on water conditions. Bonneville also should 

 investigate approaches to financial management that would provide the budget flexibility to 

 ensure full funding of the fish and wildlife program. The program should not be used as a 

 shock absorber when income from power sales is down as the resuh of poor water conditions 

 or poor markets for power. 



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