THE OMNIBUS ADJUSTMENT ACT-SEC. 41 371 (d) The water rights formerly appurtenant to the permanently unproductive lands shall be available to the remaining land on said project without added cost to the water users, because of the Gunnison Tunnel not yet being completed and there being an inadequate water supply. All as shown by classification heretofore made under the supervision of the Board of Survey and Adjustments and shown in the table on page 55 of said Document 201, checked and modified as outlined in "General recommendations" numbered 2 and 4, page 60 of said document. (44 Stat. 646) YAKIMA PROJECT, WASHINGTON Sec. 39. [Deductions from total cost.]-There shall be deducted from the total cost of said project the following sum: $3,068, or such an amount as represents the actual construction charges as found by the Secretary of the Interior against the following lands: Fifty-nine acres, Sunnyside division, permanently unproductive because of shallow soil overyling rock. (44 Stat. 646) Sec. 40. [Construction charges suspended.]—All payments upon construction charges shall be suspended against the following lands: (a) One thousand eight hundred and forty-nine acres, Sunnyside division, temporarily unproductive, being either water-logged, alkalied, rough, steep, shallow soil overlying hardpan, or difficult to subdue. (b) Three thousand and thirty-two acres, Tieton division, temporarily unproductive because of shallow, poor soil with rough topography. All as shown by classification heretofore made under the supervision of the Board of Survey and Adjustments and shown on page 57 of said Document 201, checked and modified as outlined in “General recommendations" numbered 2 and 4, page 60 of said document. (44 Stat. 647) ADMINISTRATIVE PROVISIONS Sec. 41. [Permanently unproductive land excluded from project-Disposition of water rights.]—All lands found by the classification to be permanently unproductive shall be excluded from the project, and no water shall be delivered to them after the date of such exclusion unless and until they are restored to the project. Except as herein otherwise provided, the water right formerly appurtenant to such permanently unproductive lands shall be disposed of by the United States under the reclamation law: Provided, That the water users on the projects shall have a preference right to the use of the water: And provided further, That any surplus water temporarily available may be furnished upon a rental basis for use on lands excluded from the project under this section, on terms and conditions to be approved by the Secretary of the Interior. (44 Stat. 647; 43 U.S.C. § 423) 1. Notice NOTE OF OPINION Where the United States is under contract to furnish water for land now found, in accordance with the act, to be permanently unproductive, not only the owner of the land but also any interested mortgagees 372 THE OMNIBUS ADJUSTMENT ACT-SEC. 42 severance of the water right. Interpretation, 51 L.D. 525, 526 (1926). or other lienors are entitled to a notice and an opportunity to consent or object to the Sec. 42. [Disposition of construction charges already paid on permanently unproductive lands-Cash refunded if all lands excluded.]—The construction charges heretofore paid on permanently unproductive lands excluded from the project shall be applied as a credit on charges due or to become due on any remaining irrigable land covered by the same water-right contract or land taken in exchange as provided in section 44 of this act. If the charges so paid exceed the amount of all water-right charges due and unpaid, plus the construction charges not yet due, the balance shall be paid in cash to the holder of the waterright contract covering the land so excluded or to the irrigation district affected; which in turn shall be charged with the responsibility of making suitable adjustments with the landowners involved. Should all the irrigable lands of a water-right applicant be excluded from the project as permanently unproductive, and no exchange be made as provided in section 44 hereof, the total construction charges heretofore paid, less any accrued charges on account of operation and maintenance, shall be refunded in cash, the water-right contract shall be canceled, and all liens on account of water-right charges shall be released. (44 Stat. 647; 43 U.S.C. § 423a) Construction charges 2 NOTES OF OPINIONS Where a perpetual vested water right has been granted by the United States, the Government is obligated to furnish water to lands owned by applicants, or, if the lands are found to be permanently unproductive and the water right is to be abrogated pursuant to the act of May 25, 1926, the applicants are entitled to adequate compensation therefor in an amount equivalent to a paidup water right, even though no money was actually paid to the Government for the water rights. The compensation payable to the applicants may be on the same basis as the refund of construction charges. Comp. Gen. Dec. A-20551 (December 12, 1927), In re P. L. Duncan and John Nelson, Umatilla project. At the initiation of a project, a tract of land had a partial water right and the Government adjusted the water right by considering that the value of the water right then held was $35 and by agreeing to furnish a complete water right for $25 per irrigable acre to be paid by the landowner. Upon the enactment of the adjustment act, the tract of land was found to be permanently unproductive. The owner applied, under section 42, for credits on other land on account of the construction charge on this tract. The Comptroller General held that credit may be allowed for refund of the recognized value of the old water right Except where the vested right feature is involved, it is necessary in a refund of construction charges paid on permanently unproductive land under section 42, act of May 25, 1926, to show that the owner of the property or his predecessors in title have actually paid to the Government as construction charges the amount proposed to be refunded. Vouchers for refund of construction charges should be stated in sufficient detail to enable the General Accounting Office to verify the fact that the amount proposed to be refunded has been collected. Such vouchers are not such as should be paid by a disbursing officer; they should be forwarded to the General Accounting Office for settlement as claims. Comp. Gen. Dec. A-21979 (March 17, 1928), In re Herman Seseman, Shoshone project. THE OMNIBUS ADJUSTMENT ACT-SEC. 43 373 Sec. 43. [Suspension of construction charges against areas temporarily unproductive-Payments made credited to construction charge-CreditsDelivery of water-Permanently unproductive lands.]-The payment of all construction charges against said areas temporarily unproductive shall remain suspended until the Secretary of the Interior shall declare them to be possessed of sufficient productive power properly to be placed in a paying class, whereupon payment of construction charges against such areas shall be resumed or shall begin, as the case may be. Any payments made on such areas shall be credited to the unpaid balance of the construction charge on the productive area of each unit. Such credit shall be applied on and after the passage and approval of this act, which shall not be construed to require revision of accounts heretofore adjusted under the provisions of this section as originally enacted. While said lands so classified as temporarily unproductive and the construction charges against them are suspended, water for irrigation purposes may be furnished upon payment of the usual operation and maintenance charges, or such other charges as may be fixed by the Secretary of the Interior the advance payment of which may be required, in the discretion of the said Secretary. Should said lands temporarily classed as unproductive, or any of them, in the future be found by the Secretary of the Interior to be permanently unproductive, the charges against them shall be charged off as a permanent loss to the reclamation fund and they shall thereupon be treated in the same manner as other permanently unproductive lands as provided in this act except that no refund shall be made of the construction charges paid on such unproductive areas and applied as a credit on productive areas as herein authorized. (44 Stat. 647; Act of April 23, 1930, 46 Stat. 249; 43 U.S.C. § 423b) EXPLANATORY NOTE 1930 Amendment. The Act of April 23, 1930, 46 Stat. 249, amended section 43 by (1) adding to its present second and third sentences, and (2) by adding to its last sentence the words "except that no refund shall be made of the construction charges paid on such unproductive areas and applied as a credit on productive areas as herein authorized." The 1930 Act appears herein in chronological order. NOTES OF OPINIONS The Secretary of the Interior has the authority at the present time, pursuant to section 43 of the Act of May 25, 1926 (44 Stat. 636), as amended by the Act of April 23, 1930 (46 Stat. 249), to reclassify lands classed as temporarily unproductive under such act, as amended, either as lands in a paying class or as lands permanently unproductive, and to effect the necessary adjustments of the repayment obligations to reflect such changes in classification. Memorandum of Acting Chief Counsel Fix, August 21, 1944. 2. Effect of determination The contract of August 19, 1948, with the Northport Irrigation District, made pursuant to the Act of May 25, 1948, fixed the construction charge obligation of the district at $952,045.57, thus superseding earlier contracts which reduced the obligation by the amount of the construction charge applicable to temporarily unproductive or suspended lands, Consequently, the Secretary is without authority to declare 2,555 acres of land (construction charges against these lands were suspended by section 26 of the Omnibus Adjustment Act) permanently unproductive and to write off as a loss to the reclamation fund the amount of the construction charge allocated to such lands, as provided in section 43 of the 374 THE OMNIBUS ADJUSTMENT ACT-SEC. 44 Omnibus Adjustment Act. Solicitor Davis 3. Supplemental charges There is no foundation for an interpretation of section 43 of the Omnibus Adjustment Act as amended by the Act of April 23, 1930, which would authorize a deferment of the beginning of payment of supplemental construction charges of the Huntley project for a term of years after the completion of the payment of the primary construction charges. Solicitor Finney Opinion, 53 I.D. 323 (1931). Sec. 44. [Exchanges, if lands eliminated or insufficient to support familyFinal proof on original entry accepted-Entry of contiguous land-Selection of equal area on relinquishing eliminated, by private owner-Credit for amounts paid-Rights not assignable-Rights of lien holders to be considered-Preference to ex-service men.]-Settlers who have unpatented entries under any of the public land laws embracing lands which have been eliminated from the project, or whose entries under water rights have been so reduced that the remaining area is insufficient to support a family, shall be entitled to exchange their entries for other public lands within the same project or any other existing Federal reclamation project, with credit under the homestead laws for residence, improvement, and cultivation made or performed by them upon their original entries and with credit upon the new entry for any construction charges paid upon or in connection with the original entry: Provided, That when satisfactory final proof has been made on the original entry it shall not be necessary to submit final proof upon the lieu entry. Any entryman whose entry or farm unit is reduced by the elimination of permanently unproductive land shall be entitled to enter an equal amount of available public land on the same project contiguous to or in the vicinity of the farm unit reduced by elimination, with all credits in this section hereinbefore specified in lieu of the lands eliminated. Owners of private lands so eliminated from the project may, subject to the approval of the Secretary of the Interior, and free from all encumbrances, relinquish and convey to the United States lands so owned and held by them, not exceeding an area of one hundred and sixty acres, and select an equal area of vacant public land within the irrigable area of the same or any other Federal reclamation project, with credit upon the construction costs of the lands selected to the extent and in the amount paid upon or in connection with their relinquished lands, and the Secretary of the Interior is hereby authorized to revise and consolidate farm units, so far as this may be made necessary or advisable, with a view to carrying out the provisions of this section: Provided further, That the rights extended under this section shall not be assignable: And provided further, That in administering the provisions of this section and section 42, the Secretary of the Interior shall take into consideration the rights and interests of lien holders, as to him may seem just and equitable: Provided further, That where two entrymen apply for the same farm unit under the exchange provisions of this section, only one of whom is an ex-service man, as defined by the joint resolution of January 21, 1922 (Forty-second Statutes, page 358), the ex-service man shall have a preference in making such exchange. (44 Stat. 648; 43 U.S.C. § 423c) Sec. 45. [Amendment of water-right contracts-Water users to contract to pay charges on remaining productive lands-Extension of time on construction charges discretionary with Secretary-Limitation of 40 years-Relief provided for in Fact Finders' Act authorized-Secretary's decision on amending contracts conclusive-Discretionary execution of contracts made in good faith to. operate January 1, 1927-Paying charges for 1926, 1927, and 1928-Completion of supplemental contract with Belle Fourche District.]-The Secretary of the Interior is hereby authorized, in his discretion, to amend any existing water-right contract to the extent necessary to carry out the provision of this. act, upon request of the holder of such contract. The Secretary of the Interior, as a condition precedent to the amendment of any existing water-right contract, shall require the execution of a contract by a water-users' association or irrigation district whereby such association or irrigation district shall be required to pay to the United States, without regard to default in the payment of charges against any individual farm unit or tract of irrigable land, the entire charges against all productive lands remaining in the project after the permanently. unproductive lands shall have been eliminated and the charges against temporarily unproductive areas shall have been suspended in the manner and to the extent authorized and directed by this act. The Secretary is authorized, in his discretion, upon the request of individual water users or district, and upon performance of the condition precedent above set forth, to amend any existing water-right contract to provide for increase in the time for payment of construction charges, which have not then accrued, to the extent that may be necessary under the conditions in each case, subject to the limitation that there shall be allowed for repayment not more than forty years from the date the first payment matured under the original contract, and also to extend the time for payment of operation and maintenance or water rental charges due and unpaid for such period as in his judgment may be necessary not exceeding five years, the charges so extended to bear interest payable annually at the rate of 6 per centum per annum until paid, and to contract for the payment of the construction charges then due and unpaid within such terms of years as the Secretary may find to be necessary, with interest payable annually at the rate of 6 per centum per annum until paid. The Secretary is further authorized, in his discretion, to grant the relief provided for in section 4, act of December 5, 1924 (Forty-third Statutes at Large, page 701), to any of the projects mentioned in this act, without requiring such project to take over the care, operation, and maintenance of the project works.. |