John T. Doolittle Grain from the John Day Pool and above accounts for 80 to 90% of barged grain shipments received in Portland. Of wheat and barley received in Portland, 40% is shipped by barge. The Lower Snake River shipments of wheat are very significant. Hard Red Winter and Hard Red Spring combines with Soft White in combination cargoes. It originates in Montana and is shipped by truck to Lewiston and barged to Portland. Assuming only an April, May, and June drawdown, the grain industry would have to truck grain in winter months to arrive in Lewiston prior to a drawdown in April. Winter trucking is more costly as load limits are often imposed and adverse weather causes dangerous road conditions. Furthermore, rural roads are not all-weather roads, and are often not usable during inclement weather, The window of time for shipping to Lewiston would be prior to December and in March. This would prevent growers and their co-ops from meeting down river delivery contracts in Portland. The grower, in any event, must pay the increased shipping costs. If the market price is not strong enough to make economic sense to sell, sales from country elevator origins will not occur. If barge traffic is concentrated on fewer loading points, the volume serviced might be less than normal. If more than the usual number of rail cars are needed in the Pacific Northwest during the April-July period, the region will be in competition for grain hopper cars during the wheat harvest in the Midwest, from the Gulf States up to the Northern Tier. Reducing the marketing year by two to three months will have an adverse impact on the price of wheat, even if markets were not lost as they most certainly would be. There is no alternative to truck barge shipment of wheat. For example, in 1991 at the Mission unit train facility east of Pendleton, rail cars were not available to ship more than half of the wheat they had contracted for in Portland. This added cost for shipment by truck, and penalties were charged for failure to deliver on time. If the John Day Pool were to go to spill way level, 90% of the grain barged on the river to Portland would have to move by truck to The Dalles Pool. The cost to growers in the Pendleton area who would transport their grain by truck to Biggs to off load onto barge would be an estimated 20 cents. An additional handling charge of 10 cents at Biggs would bring total additional costs per bushel for transportation to 30 cents. With margins John T. Doolittle October 2, 1995 periods of drawdown. The capability of downriver storage is limited so it is unlikely that it will be stored in Portland awaiting vessels coming upriver. The more likely scenario might be that grain would be stored upriver, even stored on the ground if necessary, awaiting the return to minimum pool. If that timing is during July and August when there is no supply in storage and we are just beginning to harvest, our customers needs will not be met. This would be the worst possible scenario because our customer would go elsewhere. Vessels have regular ports of call. If that regularity is lost it may cost us our customer. Lost income for farmers means a greater trade deficit for our nation. Service on rail is less than ideal, with hopper car shortages occurring frequently during time of high demand. Placing a heavier burden on the system during a drawdown will cause even greater problems. Other impediments to grower service are the railroad company abandonment of short haul feeder lines, and the emphasis on servicing stations that are capable of loading unit-trains. These are multiple grain car loadings of 25 or more in a specified restricted period of hours. Not all country such stations are charged higher freight rates. Trucking is absolutely not an option. One barge load of wheat is 3500 tons. This would equate to 35 rail cars, or about 117 truckloads. This is absolutely contrary to the efficiencies and economies of scale offered by either rail or barge. American Waterways Operators published comparative rates for shipping grain from Clarkston, WA to the Portland District: By barge 20 cents per bushel; by rail 35 cents per bushel, by track 94 cents per bushel. Only when a distance of 700 miles from the export terminal is reached does rail have comparative rates. There is no summary or conclusion to the report. It is obvious that there will be increased costs and these costs will be passed on to farmers who can ill afford them. Barge operators have told us they must meet their fixed costs even though the river is down. This means barge rates would increase. Sincerely, Kenneth R. Hart Chairman, Oregon Grains Commission HEARING ON FEDERAL ACTIVITIES INVOLVING OREGON WATERS OCTOBER 4, 1995 Good afternoon, Mr. Chairman and members of the committee. WaterWatch is very pleased to be invited to speak on Umatilla Basin water issues. We first testified before Congress on these matters in July 1994. Our statement in that hearing focused on water spreading, the unauthorized use of federal project water, which has been a major issue in the Umatilla Basin since we exposed the practice here in 1990. Our written testimony from last year's hearing provides background information on water spreading and states some of WaterWatch's views on the issue. A copy is attached. Since we wrote that earlier testimony, much has been said about water spreading, but little has been done. Our statement today first summarizes the events of the past fifteen months regarding the water spreading issue in. the Northwest. We then discuss some recent progress in addressing water spreading here in the Umatilla Basin. Water spreading, July '94-'95: New light on an old issue Since July 1994, the long-ignored issue of water spreading has gained greater attention than ever before. The Interior Department Inspector General issued a report on the subject. A House committee conducted an oversight hearing. And recovery plans for Northwest salmon called for an end to water spreading in the Northwest. The Inspector General's Report. [L]ands the Bureau identified as ineligible to receive Federal water were being irrigated from at .... The Inspector General's July 1994 report found that Reclamation had failed to ensure that federal project water was used only on lands eligible to receive it under federal law. As a result, irrigators throughout the West were delivering federal water to unauthorized lands. The report summarized Reclamation's own figures on water spreading on 24 projects, but it did not estimate how much water spreading was occurring westwide. The IG's review of these 24 projects showed that as many as 154,000 ineligible acres were receiving up to 429,000 acre-feet of water annually. About 75 percent of this unauthorized water spreading was occurring in the Columbia-Snake Basin. Six Oregon projects were listed: Baker, Crescent Lake Dam, Deschutes, Owhyee, Umatilla and Vale. The IG estimated that irrigators on these six projects were spreading about 122,700 acre-feet of water annually to over 49,000 acres, and had failed to reimburse taxpayers for over $4.5 million over nine years. WaterWatch of Oregon 213 Southwest Ash, Suite 208 Portland, OR 97204 The IG report also found that, according to Bureau officials and records, "about 75 percent of the water delivered to ineligible lands associated with the 24 projects could have been used to provide additional stream flows for protected species or to reduce potentially toxic irrigation drainage flows as allowed under state law." Of the 122,700 acre-feet being spread at Oregon projects, the IG found that all of it could have been used to provide streamflows to support protected species or tribal fisheries, or to reduce potentially toxic irrigation drainage. The IG recommended that Reclamation take three specific steps to resolve water spreading, including developing a schedule and action plan for addressing the problem westwide. Reclamation concurred in the recommendations and promised to implement them. The 1994 Congressional Hearing. My feeling is that unless we act now to enforce the law and the contracts and address this Well, I am very encouraged by your statement. You obviously understand this is a very involved situation and stability is a question of survival in the Northwest. And I understand you to say that one shoe cannot fit all feet, but there are some encouraging signs in the Pacific Northwest.... So I want to thank you for what I think is a very judgmental position in this whole area of conflict. You didn't think I would say that, did you? oformer Congressman Bob Smith, responding to a later comment from Beard, July 1994 On July 19, 1994, the Oversight & Investigations Subcommittee of the House Committee on Natural Resources held a hearing on "Water Use Practices on Bureau of Reclamation Projects." It focused heavily on the IG's report and Reclamation's response to it. Except for the Commissioner and the IG, every witness at the hearing was from the Pacific Northwest. There was a particular focus on Oregon and the Umatilla Basin. The State of Oregon, the Oregon Water Resources Congress, the Confederated Tribes of the Umatilla, and WaterWatch all testified. All four of us expressed a strong interest in resolving water spreading cases in a way that is both timely and cooperative. The 1994 hearing involved many differing points of view, but it was not acrimonious. Everyone seemed to agree that Reclamation must go forward to resolve water spreading, that it must act soon, that it must proceed on a case-by-case basis, and that it must work with all interested parties in addressing the issues. Even Bob Smith--who started out suggesting that the response to water spreading was part of a Clinton Administration "war on the West"--ended up agreeing that Reclamation's plans made sense. The salmon plans. Water spreading is the use of water for purposes (or in areas) other than those authorized by the BOR. In some areas there may be substantial amounts of water being diverted for unauthorized uses. This water should be made available for instream uses. By April 1996, the BOR and state water resources departments should identify and halt all instances of water spreading on Reclamation projects. •NMFS Proposed Recovery Plan for Snake River Salmon, March 1995 One month after the water spreading hearing, the National Marine Fisheries Service took emergency action to list Snake River Chinook salmon as endangered. While the Snake River salmon stocks have received the greatest attention, many other anadromous and resident fish throughout the Northwest--from lampreys to coho, suckers to steelhead--are also in serious peril. A major factor in their decline has been the degradation of freshwater habitat, including a lack of adequate streamflows. The National Marine Fisheries Service produced its Proposed Recovery Plan for Snake River Salmon in March, 1995. Environmentalists throughout the Northwest slammed the plan as too weak to save the salmon. But as to water spreading, NMFS called for quick and serious action: it directed Reclamation and the states to end unauthorized water uses within one year and make spread water available for instream uses. The plan designated this action as "priority one." The NMFS statement followed a 1993 recommendation of Donald Bevan's salmon recovery team that Reclamation should investigate water spreading as part of an effort to end illegal water diversions in the Snake River Basin. The Northwest Power Planning Council's 1994 Fish & Wildlife Program directed Reclamation to "[i]dentify all cases of water spreading on reclamation projects in the Columbia River Basin. Determine quantities and market values of water that has been spread by water users. Propose alternative approaches for addressing this issue, including alternatives that provide incentives for water conservation, that would make water available for instream uses and that recognize whether instream needs are satisfied." The Columbia Basin Fish & Wildlife Authority and the Pacific Fishery Management Council also called for an end to water spreading. In addition, both the National Congress of American Indians and the Interior Department's Assistant Secretary for Indian Affairs asked Reclamation to correct water spreading so as to benefit affected Tribes. Reclamation on water spreading: lots of talk, little action Reclamation is actively seeking to eliminate the unauthorized use of water, sometimes referred to as water spreading. We are currently developing regulations for resolving any use of Reclamation project water not in compliance with federal law or Reclamation water contracts. These regulations will be published in the Federal Register for public comment in the spring, to be followed by public hearings.... At a time when demands on water resources in the West are multiplying, your readers can be confident that I am committed to ensuring the legal use of federal water. oformer Commissioner Dan Beard, January 1995 We understand that the Interior Department has suspended its efforts to write westwide rules on "water spreading".. The Bureau of Reclamation has known for over a decade that water spreading is a major problem, but has done little to stop it. Your recent decision will effectively allow this illegal activity to continue. The Clinton Administration is taking the same approach to water spreading that the Reagan Administration did ten years ago: ignore it and hope it goes away. •American Rivers, Idaho Rivers United, NRDC and WaterWatch, July 1995 Reclamation first examined the issue of water spreading in the early- to mid-1980s. It formed an informal "Ineligible Lands Task Force" led by the Pacific Northwest Region. This group issued a brief report in 1985, primarily emphasizing the need to collect more and better information on water spreading before proceeding to solve the problem. The report also identified "incentives for taking positive action to address the 'water spreading' issues," options for solving the problem, and constraints to implementing these options. Later that year, Reclamation opted to dissolve the task force and delegate the water spreading problem to the regional offices. "Because of the complexity and magnitude of the problem," wrote Acting Commissioner Robert Olson, "we are taking a long-range approach to resolution." Long range, indeed. Reclamation simply ignored the problem until 1993, when controversy in the Pacific Northwest forced it to deal with water spreading. The Boise regional office established a 21-090 - 96 - 4 3 |