124 



funds and authorities would be flow/spill aeasurea thAt mr« 

 consistent vlth flo^'/spill aeasures developed by KPPC under 

 839Ch)(6HBHii). 



o The HorthKest Power Act directs KPPC to "consider" specific 

 "principles" when it develops its fish program. 16 O.S.C. 

 839b(h)(8). One principle addresses sonstary costs 

 839b(h)(8)(D) (eKphasis added): 



Monetary costs' and electric power losses 

 resulting frox inpleaentation of the proqrea 

 shall be allocated by [BPA] consistent with 

 individual project inpacts and systeawide 

 objectives of [16 U.S.C. a39b(h)]. 



o BP^ nay allocate aaourrts expended for "each activity" under 

 the XPPC plan "to the various project purposes.** 16 U.S.C. 



839b(h)llO)(C). 



o BPA treats costs it incurs when the flow seasures of 

 the NPPC fish program are inpleaented as the purchase 

 power costs incurred whan water is spilled instead of 

 put through turbines at dans in the salaon's aigratory 

 patlway. 



o Under the "principle" enunciated under 839bCh) (8) (O) , 

 the cost for power purchase is a "Bonetary cost ... 

 resulting froa lepleaentation of the progras" that 

 "shall be allocated" by BPA, as would be costs for 

 hatcheries. 



o Put in ter»B of 839b(h) (10) (C) , purchase power costs 

 for flow/spill nitlgation aeasxires are an "anount 

 expended" for an "activity" under the NPPC prograa, 

 wtiich in this Instance would be the flow/spill 

 aitigation aeasures. It ie Loportant to clarify here 

 that, as discussed belcTW, the only category of purchese 

 pcJtfer costs allocable by BPA are those incurred for 

 fiab and wildlife aitigation aeasures. 



With this understanding of BPA's position in "aind,^ and with 

 particular note that the natter of controversy raised in Chairsan 

 Miller's letter relates only to allocation by BPA of power 

 purchase costs incurred under the fish eltigation provisions 

 (section 4(h)) of the Horthwest Power Act, we agree BPA has 

 stated a reasonable interpretation of its authority to allocate 

 some power purchase costs. We also believe, however, that BPA's 

 interpretation should not, end will not, eerve as a precedent on 

 how power purchase costs generally are allocated at federal water 

 resource facilities. 



First, tl\B authority to allocate does not rest upon an 

 interpretation that BPA is exercising BPA authority oyer flow 

 decisions. Chairman Killer's main concern appears to be that 

 decisions concerning flows froa federal daas m the Colunbia 

 River Basin are nsi nade by BPA, but by the corps of Erngineera 



^ He have shared our understanding of BPA's legal reasoning 

 with staff of -the BP.\ general counsel's office, who have 

 indicated our understanding cocports with that office's position. 



