BOULDER CANYON PROJECT ACT-SEC. 6

15. -Rights-of-way

The Secretary may make a reasonable charge (a) for rights-of-way for oil pipe lines over the public land granted pursuant to section 28 of the act of Feb. 25, 1920 (41

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Stat. 437, 449), as amended, but not (b) for right-of-way for transmission line under section 5 (d) of the Boulder Canyon Project Act (45 Stat. 1057). Solicitor's Opinion, 57 ID 31 (1939).

Sec. 6. [River regulation, improvement of navigation, flood control—Irrigation and domestic use-Power-Title of dam to remain in United StatesContracts of lease of a unit or units of Government-built plant with right to generate electrical energy-Rules and regulations regarding maintenance of works to be in conformity with Federal water power act-Issuance of power permits or licenses.]—The dam and reservoir provided for by section 1 hereof shall be used: First, for river regulation, improvement of navigation, and flood control; second, for irrigation and domestic uses and satisfaction of present perfected rights in pursuance of Article VIII of said Colorado River compact; and third, for power. The title to said dam, reservoir, plant, and incidental works shall forever remain in the United States, and the United States shall, until otherwise provided by Congress, control, manage, and operate the same, except as herein otherwise provided: Provided, however, That the Secretary of the Interior may, in his discretion, enter into contracts of lease of a unit or units of any Government-built plant, with right to generate electrical energy, or, alternatively, to enter into contracts of lease for the use of water for the generation of electrical energy as herein provided, in either of which events the provisions of section 5 of this act relating to revenue, term, renewals, determination of conflicting applications, and joint use of transmission lines under contracts for the sale of electrical energy, shall apply.

The Secretary of the Interior shall prescribe and enforce rules and regulations conforming with the requirements of the Federal water power act, so far as applicable, respecting maintenance of works in condition of repair adequate for their efficient operation, maintenance of a system of accounting, control of rates and service in the absence of State regulation or interstate agreement, valuation for rate-making purposes, transfers of contracts, contracts extending beyond the lease period, expropriation of excessive profits, recapture and/or emergency use by the United States of property of lessees, and penalties for enforcing regulations made under this act or penalizing failure to comply with such regulations or with the provisions of this act. He shall also conform with other provisions of the Federal water power act and of the rules and regulations of the Federal Power Commission, which have been devised or which may be hereafter devised, for the protection of the investor and consumer.

The Federal Power Commission is hereby directed not to issue or approve any permits or licenses under said Federal water power act upon or affecting the Colorado River or any of its tributaries, except the Gila River, in the States of Colorado, Wyoming, Utah, New Mexico, Nevada, Arizona, and California until this act shall become effective as provided in section 4 herein. (45 Stat. 1061; 43 U.S.C. § 617e)

EXPLANATORY NOTE

Reference in the Text. The Federal Water Power Act, referred to in the text, is the

Act of June 10, 1920, 41 Stat. 1063. The
Act appears herein in chronological order.

BOULDER CANYON PROJECT ACT-SEC. 7

NOTES OF OPINIONS

Sec. 7. [Title to main canal-Utilization of power possibilities by participating agencies-Revenues.]-The Secretary of the Interior may, in his discretion, when repayments to the United States of all money advanced, with interest, reimbursable hereunder, shall have been made, transfer the title to said canal and appurtenant structures, except the Laguna Dam and the main canal and appurtenant structures down to and including Syphon Drop, to the districts or other agencies of the United States having a beneficial interest therein in proportion to their respective capital investments under such form of organization as may

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be acceptable to him. The said districts or other agencies shall have the privilege. at any time of utilizing by contract or otherwise such power possibilities as may exist upon said canal, in proportion to their respective contributions or obligations toward the capital cost of said canal and appurtenant structures from and including the diversion works to the point where each respective power plant may be located. The net proceeds from any power development on said canal shall be paid into the fund and credited to said districts or other agencies on their said contracts, in proportion to their rights to develop power, until the districts or other agencies using said canal shall have paid thereby and under any contract or otherwise an amount of money equivalent to the operation and maintenance expense and cost of construction thereof. (45 Stat. 1062; 43 U.S.C. § 617f)

1. "Net proceeds"

NOTES OF OPINIONS

The Public Works Administration and the Rural Electrification Administration proposed to make loans aggregating $3,460,000 to the Imperial Irrigation District for financing the construction of an electric power production, transmission and distribution system in the Imperial Valley, Calif., and in construing the nature and extent of the security of the United States for repayment of the construction cost of the AllAmerican canal under its contract of Dec. 1, 1932, as amended, with the Imperial Irrigation District, the Acting Solicitor held that the payments of principal and interest on the PWA and REA bonds and the oneyear reserves for such payments may be deducted in determining the amount of "net proceeds" payable into the Colorado River dam fund except that the so-called "second lien" of the REA bonds on the PWA revenues would be ineffective as against the prior right of the United States under Sec. 17 of the Boulder Canyon project act and Article 35 of the All-American canal contract, in the event that the right of the United States to net proceeds should

be held to be limited to those from generation of energy alone. Acting Solicitor Kirgis Opinion, 56 I.D. 116 (1937).

It is clear that under section 7 of the Boulder Canyon Project Act, the "net proceeds" from any power development on the All-American Canal are required to be paid into the Colorado River Dam Fund and credited to the various districts until the construction, operation and maintenance costs have been paid. However, section 7 does not specify when this payment is to be made. With respect to Coachella Valley County Water District's share of the net proceeds from power facilities on the canal operated by the Imperial Irrigation District, the requirements of the law will be met if:

(1) the net proceeds for 1954 and subsequent years are paid directly by Imperial into the Colorado River Dam Fund; and

(2) the $490,366.02 in net proceeds paid by Imperial directly to Coachella for the years 1945 through 1953, which Coachella used to purchase U.S. Government bonds, is paid to the Fund as the bonds mature. Dec. Comp. Gen. B-124783 (September 2, 1955).

Sec. 8. [(a) Colorado River compact to control in use of water. (b) Use of water also governed by compact among States of the lower division.]—(a) The United States, its permittees, licensees, and contractees, and all users and appropriators of water stored, diverted, carried and/or distributed by the reservoir, canals, and other works herein authorized, shall observe and be subject to and controlled by said Colorado River compact in the construction, management, and operation of said reservoir, canals, and other works and the storage, diversion, delivery, and use of water for the generation of power, irrigation, and other purposes, anything in this act to the contrary notwithstanding, and all permits, licenses, and contracts shall so provide.

(b) Also the United States, in constructing, managing, and operating the dam, reservoir, canals, and other works herein authorized, including the appro

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BOULDER CANYON PROJECT ACT-SEC. 9

priation, delivery, and use of water for the generation of power, irrigation, or other uses, and all users of water thus delivered and all users and appropriators of waters stored by said reservoir and/or carried by said canal, including all permittees and licensees of the United States or any of its agencies, shall observe and be subject to and controlled, anything to the contrary herein notwithstanding, by the terms of such compact, if any, between the States of Arizona, California, and Nevada, or any two thereof, for the equitable division of the benefits, including power, arising from the use of water accruing to said States, subsidiary to and consistent with said Colorado River compact, which may be negotiated and approved by said States and to which Congress shall give its consent and approval on or before January 1, 1929; and the terms of any such compact concluded between said States and approved and consented to by Congress after said date: Provided, That in the latter case such compact shall be subject to all contracts, if any, made by the Secretary of the Interior under section 5 hereof prior to the date of such approval and consent by Congress. (45 Stat. 1062; 43 U.S.C. § 617g)

1. Colorado River Compact

NOTES OF OPINIONS

The declarations in sections 1, 8(a), 13 (b), and 13(c) of the Boulder Canyon Project Act that the Secretary of the Interior and the United States shall be subject to and controlled by the Colorado River Compact, were made only to show that the Act and its provisions were in no way to upset, alter, or affect the Compact's congressionally approved division of water between the Upper and Lower Basins. They were not intended to make the compact and its provisions control or affect the Act's allocation among and distribution of water within the States of the Lower Basin. Arizona v. California, 373 U.S. 546, 567 (1963).

the dam and reservoir; (3) the § 4(b) requirement for revenue provisions in the contracts adequate to ensure the recovery of the expenses of construction, operation and maintenance of the dam and other works within 50 years after their construction; (4) the directive in § 5 that water contracts for irrigation and domestic use shall be only for "permanent service"; (5) the recognition given in § 8(a) to the Colorado River Compact, which means that the Secretary and his permittees, licensees and contractees can do nothing to upset or encroach on the Compact's allocation of water between the Upper and Lower Basins; (6) the application by § 14 of general reclamation law except as the Act otherwise provides; and (7) the protection given in § 6 to "present perfected rights." Arizona v. California, 373 U.S. 546, 583-85 (1963).

Apportionment of the Lower Basin waters of the Colorado River is not controlled by doctrine of equitable apportionment or by the Colorado River Compact. Arizona v. California, 373 U.S. 546 (1963).

The power of the Secretary of the Interior to apportion and distribute Colorado River water among and within the Lower Basin States through the execution of contracts for its use is subject to a number of standards and limits in the Boulder Canyon Project Act. These include (1) the limitation in § 4(a) of 4,400,000 acre-feet on California's consumptive uses out of the first 7,500,000 acre-feet of mainstream water, leaving 3,100,000 acre-feet which the Secretary properly has apportioned by contract in the quantities of 300,000 acre-feet to Nevada and 2,800.000 to Arizon: (2) the provision in § 6 setting out in order the purposes for which the Secretary must use Sec. 9. [Withdrawal of all irrigable lands-Entry under reclamation lawPreference in entry to soldiers.]-All lands of the United States found by the Secretary of the Interior to be practicable of irrigation and reclamation by the

As Congress intended to apportion only the Colorado River mainstream, the Secretary of Interior cannot reduce water deliveries thereunder to Arizona and Nevada by the amount of their uses from tributaries above Lake Mead, though the Secretary may charge them for their diversions from the mainstream above the lower basin. Arizona v. California, 373 U.S. 546 (1963).

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irrigation works authorized herein shall be withdrawn from public entry. Thereafter, at the direction of the Secretary of the Interior, such lands shall be opened for entry, in tracts varying in size but not exceeding one hundred and sixty acres, as may be determined by the Secretary of the Interior, in accordance with the provisions of the reclamation law, and any such entryman shall pay an equitable share in accordance with the benefits received, as determined by the said Secretary, of the construction cost of said canal and appurtenant structures; said payments to be made in such installments and at such times as may be specified by the Secretary of the Interior, in accordance with the provisions of the said reclamation law, and shall constitute revenue from said project and be covered into the fund herein provided for: Provided, That all persons who served in the United States Army, Navy, Marine Corps, or Coast Guard during World War II, the War with Germany, the War with Spain, or in the suppression of the insurrection in the Philippines, and who have been honorably separated or discharged therefrom or placed in the Regular Army or Naval Reserve, shall have the exclusive preference right for a period of three months to enter said lands, subject, however, to the provisions of subsection (c) of section 4 of the Act of December 5, 1924 (43 Stat. 672, 702; 43 U.S.C., sec. 433); and also, so far as practicable, preference shall be given to said persons in all construction work authorized by this act: Provided further, That the above exclusive preference rights shall apply to veteran settlers on lands watered from the Gila canal in Arizona the same as to veteran settlers on lands watered from the All-American canal in California: Provided further, That in the event such an entry shall be relinquished at any time prior to actual residence upon the land by the entryman for not less than one year, lands so relinquished shall not be subject to entry for a period of sixty days after the filing and notation of the relinquishment in the local land office, and after the expiration of said sixty-day period such lands shall be open to entry, subject to the preference in this section provided. (45 Stat. 1063; Act of March 6, 1946, 60 Stat. 36; 43 U.S.C. § 617h)