Manager's Report

9 August. 2011

The comment period has officially closed for the National Oceanographic and Atmospheric Administration (NOAA) draft 10(j) rule proposing designation of the reintroduced Steelhead to be experimental and non-essential.  NOAA has proposed that the 10(j) designation be in place for four generations of returning steelhead placed above the Pelton – Round Butte Complex which translates into 12-14 years.  After the fourth returning generation the 10(j) designation expires.  Surprisingly, there were very few comments (6) for such a precedent setting federal rule. The one critical comment was from Earth Justice that filed on behalf of American Rivers, Trout Unlimited and WaterWatch and it argued for less time before the sunset and that utilizing revised 4(d) rules were more appropriate. Overall impression was that there were no compelling comments to notably drive NOAA to revise their proposed rule. It is anticipated that the final rule will be published in the federal register before the end of the year.

Congressman Greg Walden’s bill on the Crooked River (HR 2060) passed its first hurdle with a unanimous vote out of a House sub-committee and will be in front of two House committees in early September after the August recess. The DBBC continues to be very involved with the efforts in support of the bill.

The official kick-off to the US Department of Energy, Bureau of Reclamation and the Army Corps of Engineers “Basin Scale Hydroelectric Assessment” was held over a two days on August 2-3 with over 20 stakeholders in attendance. The Deschutes Basin was the only basin in the western U.S. selected for this study and represents a considerable opportunity for additional funding and recognition for potential additional development of hydroelectric generation. Next steps include further refining specific studies to be conducted by the federal entitity staffs and buy-off by the basin stakeholders involved. Stakeholders included irrigation districts, municipalities, environmental interests, elected officials and several state and federal agency personnel. The study will be conducted through 2011 and 2012 with final reports anticipated year end 2012.

The Business Energy Tax Credit (BETC) for Juniper Ridge is being actively promoted to the investment and business community in Oregon. The amount of funds that will be realized to COID from the BETC is $4,198,000. These amounts will be used to buy-down the existing obligation to ODOE under the terms of our Small Energy Loan agreement.

The Siphon Power Project and the Juniper Ridge Hydro are close to certification by the California Energy Commission. Once certified COID will be eligible to sell the Renewable Energy Credits (RECs) generated by our renewable energy plants into the State of California. Final rules for the sale of out-of-state generated RECs into California are expected to occur possibly by year end 2011. Selling RECs into California is notable because the utilities in Oregon are fully satisfying their Oregon Renewable Portfolio Standard (RPS) requirements through 2015 and provides some opportunity to COID to generate some additional revenue from REC sales.

Juniper Ridge and SPP hydroelectric generation is slightly ahead of expectations to date. Reservoir levels are above average for this time of year and foretell the distinct possibility of SPP generation even if there is a below average winter of precipitation. The weather a year after a strong La Nina is usually below average.

COID has filed the necessary paperwork with the Oregon Department of Energy to officially register SPP and Juniper Ridge as officially generating RECs for the Oregon RPS.

There is increasing focus in Central Oregon for identifying available lands of large acreage ready for development by relocating companies. The tri-county area is mobilizing the packaging and marketing for relocation opportunities in the area and the COID property of 200 acres east of Redmond is in the mix. The tri-county area has barriers to entry with available electricity supply and a few other infrastructure related issues but is actively addressing these in mutual cooperation. A recent study was completed discussing these issues in detail and is available on the web. COID intends to be an active participant in this process.

Opportunities

  • Approved Oregon Watershed Enhancement Board (OWEB) funding is now available to proceed with the design on the fish ladder for the North Canal Dam. COID, NUID, Swalley and ODFW along with the Upper Deschutes Watershed Council (OWEB agent) will be preparing an agreement to formalize the grant and work product likely by September.
  • The COID and BLM land exchange in the Badlands area east of Bend is still working its way toward finalization. It is anticipated that completion will be in 2012.
  • COID is engaging in discussion with PacifiCorp with the Cline Falls facility on next steps to clarify the conditions for the lease termination on that site for March 2013. COID is evaluating the costs for retrofitting and upgrading the facility to potentially pursue FERC licensing for a hydro project at this location.
  • The DBBC has been a member of a group of stakeholders formed to evaluate options for dealing with the building sedimentation in Mirror Pond located in Bend. A smaller group of these stakeholders including Bend Parks, City of Bend and PacifiCorp has hired a project manager to assist in the effort of developing a community based plan to develop options and gather funding for this Mirror Pond issue. This effort will take place during 2011 and likely beyond. The DBBC is active and regularly participates in these discussions.

Challenges

  • Issues continue to arise with patrons and the delivery of water to parcels past the District’s Point of Delivery.  The District is evaluating its existing statutory authorities and reviewing policies to assist in resolving these issues.
  • Persistence of patrons failing to beneficially use their water either due to economics, absentee ownership, or mismanagement resulting in potential confiscation by the District as the only viable option to prevent forfeiture.

STATUS REPORT

State of Oregon Legislation

The session is now concluded and a number of bills supported by COID and the DBBC were passed and several did not. Below is a final update on status of a few bills of importance.

  • HB 2873 - Relating to fish supportive measures for hydroelectric projects located within artificial delivery systems; declaring an emergency. Proposed by OWRC and passed the House but did not get out of committee in the Senate.

Governor’s Office pledged after session workgroup

  • HB 3623 - Relating to the Deschutes Basin ground water study area; declaring an emergency.  Bill was amended late in session and passed both House and Senate and received the Governor’s signature. Summary result of the bill is that the existing mitigation program stays more or less in its present shape and extended for 15 years.
  • HB 3571 – Relating to ownership of Renewable Energy Certificates for hydroelectric facilities built prior to 2005. Passed both chambers of the Oregon Legislature and was signed by Governor Kitzhaber on June 8th.  This bill now clearly establishes ownership of the RECs from qualified renewable energy facilities built prior to 2005 to the owners of the facilities. 

Real Estate

  • One 20 acre parcel near Deschutes Market Road and Hwy 97 was listed for sale through Steve Scott Realtors.  Listing, as per District policies, was at the recently updated appraised value.  No offers have been received to date.  The remaining 20 acre parcel was not listed.

Status – No Change

  • COID and the Redmond School District filed and received approval of a partition plat to the City of Redmond.  Traffic issues in Redmond are affecting the timing of the zoning change possibility and therefore any potential sale to an interested buyer. 

Status – Paused.  ODOT and the City of Bend have executed an agreement this past month that may facilitate movement of a similar agreement for Redmond. Legislation has been filed in Salem that may further produce positive effects for potential development. [See discussion above]

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    • Occasional inquiries on various District owned parcels are directed to Real Estate Agent of Record – Steve Scott Realtors.

Development 

  • COID, Arnold, Swalley and Tumalo are in active discussions with the City of Bend to implement the recently executed MOU and pursue an Inter-Governmental Agreement by the end of 2011.  NUID has joined the efforts already underway.

Status – Ongoing. 

 

ON THE RADAR SCREEN

  • Federal legislation and regulation of renewable energy projects
  • Federal regulation of wetlands and jurisdiction of irrigation canals