[Federal Register Volume 62, Number 166 (Wednesday, August 27, 1997)]
[Pages 45440-45445]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-22747]



Bureau of Reclamation

Review of Existing Coordinated Long-Range Operating Criteria for 
Colorado River Reservoirs (Operating Criteria)

AGENCY: Bureau of Reclamation, Interior.

ACTION: Notice of proposed decision regarding the Operating Criteria.


SUMMARY: The purpose of this action is to provide public notice that 
the Secretary of the Interior proposes no change to the existing 
Operating Criteria as a result of the current review process. The 
current review has been conducted as an open public process, including 
formal consultation with the seven Colorado River Basin States (Basin 
States). The results of the review indicate that modification of the 
Operating Criteria is not justified at the present time.

DATES: All written comments relevant to this proposed decision received 
on or before September 10, 1997.

ADDRESSES: Interested parties should send comments or questions to 
Bruce Moore, Bureau of Reclamation, 125 South State Street, Room 6107, 
Salt Lake City, Utah 84138-1102, telephone (801) 524-3702, or Jayne 
Harkins, Bureau of Reclamation, P.O. Box 61470, Boulder City, Nevada 
89005, telephone (702) 293-8190.

SUPPLEMENTARY INFORMATION: The public review process began with a 
Federal Register notice published on August 20, 1996, announcing the 
review of the Operating Criteria and inviting comments during the 60 
days following the notice. On October 31, 1996, another Federal 
Register notice was published announcing two public consultation 
meetings and extending the comment period an additional 30 days. On 
November 4, 1996, a Fact Sheet containing information about the 
Operating Criteria review and an invitation to the public consultation 
meetings was sent to known and anticipated interested parties and 
agencies, and governor-designated representatives of the Basin States, 
inviting their participation. Public consultation meetings were held on 
November 18, 1996, and December 2, 1996, to receive comments on issues 
and questions from all interested parties.
    Comments from the two Federal Register notices were received from 
18 respondents. The comments were reviewed by the Bureau of Reclamation 
for identification and analysis of the issues. A set of all comment 
letters received was provided to any interested party requesting a 
copy. A synopsis of the issues raised during the public review process 
was sent to all interested parties and participants in a March 1997 
newsletter entitled the River Review.
    In response to requests, another public consultation meeting and an 
additional 45-day comment period were announced in the Federal Register 
on March 28, 1997. On April 4, 1997, a letter from the Team Leader 
containing the preliminary results of Reclamation's analysis on each 
major issue area and an invitation to attend a public consultation 
meeting on the preliminary results and analysis was sent to all 18 
respondents, Governor-designated representatives of the Basin States, 
and any others who had attended meetings or expressed an interest in 
the review of the Operating Criteria. On April 22, 1997, a final public 

[[Page 45441]]

meeting was conducted to discuss the preliminary analyses.
    As required by Pub. L. 90-537, formal consultation with the 
representatives of the seven Basin States, and other parties and 
agencies as the Secretary may deem appropriate, was conducted in the 
context of public consultation meetings on three separate occasions: 
November 18, 1996; December 2, 1996; and April 22, 1997.
    Following analysis of comments received as a result of this notice, 
any proposed Federal action will be evaluated by Reclamation to 
determine the applicability of National Environmental Policy Act (NEPA) 
compliance. After that process has been completed, the final 
Secretarial decision will be published in the Federal Register.


    The Operating Criteria, promulgated pursuant to Section 602 of 
Public Law 90-537 (U.S.C. 1552), were published in the Federal Register 
on June 10, 1970. The Operating Criteria provide for the coordinated 
long-range operation of the reservoirs constructed and operated under 
the authority of the Colorado River Storage Project Act, the Boulder 
Canyon Project Act, and the Boulder Canyon Project Adjustment Act for 
the purposes of complying with and carrying out the provisions of the 
Colorado River Compact, the Upper Colorado River Basin Compact, and the 
Mexican Water Treaty.
    Previous reviews of the Operating Criteria were initiated in 1975, 
1980, 1985, and 1990. They resulted in no changes to the Operating 
Criteria. Prior to 1990, reviews were conducted primarily through 
meetings with and correspondence among representatives of the seven 
Basin States and Reclamation. Because the long-range operation of the 
Colorado River reservoirs is important to many agencies and 
individuals, in 1990, through an active public involvement process, 
Reclamation expanded the review of the Operating Criteria to include 
all interested stakeholders. A team consisting of Reclamation staff 
from Denver, Colorado; Salt Lake City, Utah; and Boulder City, Nevada, 
was organized to conduct the 1990 review. For the 1995 review, 
Reclamation staff from Salt Lake City, Utah, and Boulder City, Nevada, 
followed the same public process.
    The scope of the review has been consistent with the statutory 
purposes of the Operating Criteria which are ``to comply with and carry 
out the provisions of the Colorado River Compact, the Upper Colorado 
River Basin Compact, and the Mexican Water Treaty.'' Long-range 
operations generally refer to the planning of reservoir operations over 
several decades, as opposed to the Annual Operating Plan (AOP) which 
details specific reservoir operations for the next operating year.

Synopsis of Review Results

    Many of the issues raised during the review are more properly dealt 
with during the development of the AOP. These include annual surplus 
determinations in the Lower Basin; the probability of spills from Lake 
Powell, including the release of beach/habitat building flows from Glen 
Canyon Dam; storage equalization between Lakes Powell and Mead; and 
factors for determining 602(a) storage.
    The Operating Criteria were purposely designed to be flexible so 
that during the development of the AOP, variations in hydrologic 
conditions and changing demands for water use, including environmental 
demands and possible mitigation measures, could be accommodated. The 
process for developing the AOP is open to the public and all interested 
    Reclamation regularly applies the NEPA process to activities 
constituting a major Federal action significantly affecting the quality 
of the human environment. The appropriate level of NEPA compliance for 
the review of the Operating Criteria will be determined by Reclamation 
based on the final decision resulting from the review.
    With respect to other environmental issues, Reclamation is in 
various stages of consultation with the Fish and Wildlife Service under 
Section 7 of the Endangered Species Act on most Colorado River mainstem 
facilities. When a Section 7 consultation results in the Service 
providing Reclamation with specific flow recommendations to remove or 
prevent jeopardy to listed species or their critical habitat, they are 
incorporated into Reclamation's operations, and if appropriate, 
included in the AOP.
    Reclamation has programmed and expended funds for fish and wildlife 
mitigation and enhancement for impacts associated with previous 
activities where appropriate. Reclamation will continue to use this 
approach. Any changes associated with the long-range Operating Criteria 
will also be evaluated to determine if there are any mitigation 
requirements or enhancement opportunities.
    Regarding the issue of water marketing and banking, Reclamation has 
initiated a rule-making process focused on water banking in groundwater 
aquifers or off-mainstem storage reservoirs in the Lower Basin. This 
administrative rule is considered a responsibility of the Secretary of 
the Interior and focuses only on the three Lower Basin states. 
Reclamation believes that water marketing and banking would not change 
the current Operating Criteria, as this issue lends itself to the AOP 
    Throughout the course of the review of the Operating Criteria, 
Reclamation has encouraged public participation and developed a 
thorough administrative record. Based on the results of the review and 
the analysis of public comments, it is proposed that the Operating 
Criteria not be modified at this time.

Analysis of Issues

Issue #1

    [Application of the Administrative Procedures Act (APA)]

    Background: The APA was signed into law in 1946 by President 
Truman. The purposes of the Act are: (1) To require agencies to keep 
the public informed on organization, procedures and rules, (2) to 
provide for public participation in the rule-making process, (3) to 
prescribe uniform standards of conduct for rule-making and adjudicatory 
proceedings, and (4) to restate the law of judicial review. The law 
primarily deals with rule-making. The definition in the law of a rule 
in part is as follows: ``* * * the whole or part of an agency statement 
of general or particular applicability and future effect designed to 
implement, interpret, or prescribe law or policy or describing the 
organization, procedure, or practice requirements of an agency * * *'' 
Rule-making has two parts, formal and informal.
    Analysis and Response: The Coordinated Long-Range Operating 
Criteria is a document generated from a requirement in the 1968 
Colorado River Basin Project Act. It describes how the Secretary of the 
Interior will meet some of the commitments under the Act. The APA 
applies to rule-making exercises only and focuses on the requirements 
for the public to comply with the statutes.
    The Bureau of Reclamation is encouraging public participation and 
developing a thorough administrative record. The review of the 
Coordinated Long-Range Operating Criteria is not a rule-making exercise 
and is therefore not subject to the APA.

Issue #2

    [Surplus declarations are referenced in the 1964 Supreme Court 
decree (Arizona v. California) and are a part of the 1970 Criteria

[[Page 45442]]

for Coordinated Long-Range Operation of Colorado River Reservoirs. 
The decree apportions surpluses (50 percent to California, 46 
percent to Arizona, and 4 percent to Nevada), while the Operating 
Criteria define surpluses as existing when there is sufficient 
storage in Lake Mead to supply greater than 7.5 million acre-feet 
(MAF) for Lower Basin consumptive uses. Guidelines for determining 
when surplus conditions exist have never been formally adopted.]

    Background: In the past, Reclamation has performed computer 
modeling studies of alternative surplus guidelines to determine the 
effects of various levels of surplus use. Because the shortage risks of 
surplus use (Arizona) fall on other than the benefactor (California), 
impacts and differences in risks of future shortages and reservoir 
drawdown have been keenly debated. All modeling strategies have as 
their foundation the principle of reducing system spills by allowing 
greater use in the Lower Basin, thus drawing down the reservoirs. This 
greater drawdown then allows the high flows of flood years to be 
captured by the reservoir system. While the amount of system spills is 
thus reduced, the degree of drawdown affects the risk of shortages to 
users during possible future drought conditions. Resolving the balance 
between risk of shortages and spills is the heart of the surplus issue.
    Until 1996, Lower Basin consumptive uses were less than their 
allocation of 7.5 MAF, and California uses were met through unused 
apportionments of Arizona and Nevada rather than surplus declarations. 
However, with the implementation of the Arizona groundwater banking 
program, total Lower Basin use now exceeds 7.5 MAF and water above this 
amount can only be delivered through surplus declarations.
    The 1996 Annual Operating Plan (AOP) committed to meet all 
reasonable beneficial consumptive uses, and later in the year when the 
annual Lower Basin use was greater than 7.5 MAF, a surplus was 
declared. The 1997 AOP contains an explicit determination of surplus, 
based on the current hydrologic situation and a lack of impacts from 
this single decision. As a result of 1997 system flood control 
operations, the 1998 AOP will almost certainly contain an explicit 
surplus determination.
    However, these determinations have relied solely on an annual 
examination of reservoir conditions in the Colorado River Basin rather 
than specific, long-term strategies which examine the potential for 
problems in the future. Drought periods in the basin can extend for 
many years and with the large volume of reservoir storage, many years 
could be required before negative impacts of surplus determinations are 
observed. Much of the current debate is focused on the risk of certain 
things happening in the future.
    Analysis and Response: The comments received addressed three key 
topics relating to surplus determinations: (1) The establishment of 
guidelines, (2) the forum for establishing these guidelines, and (3) 
how surpluses will affect the probability of spills from Lake Powell.
    Establishment of Guidelines.--The comments all agreed that surplus 
and shortage guidelines should be established, but varied in how firm 
or detailed these guidelines should be. The most flexible approach 
would be the annual determination of surplus/normal/shortage conditions 
through the AOP process, deciding on the condition of the reservoir 
system on a year-by-year basis. The most rigid approach would be the 
revision of the Operating Criteria to include specific guidelines which 
then would be applied each year to produce a determination.
    Flexible guidelines have the advantage of being easily modified as 
consumptive use demands and hydrologic conditions change throughout the 
basin. For some parties, near-term surpluses could be more liberal than 
when Upper Basin uses increase and the likelihood of surplus deliveries 
are reduced. Flexible guidelines could be adopted without the more 
formal process of incorporating guidelines into the Operating Criteria.
    Modifying the Operating Criteria to include surplus guidelines 
offers the advantage of clearly specifying under what conditions 
surpluses would be declared. All interests would then understand 
exactly what impacts could be expected under ranges of hydrologic 
conditions. Contingency plans could be implemented to mitigate adverse 
impacts and agreements could be formed to help meet consumptive use 
demands during non-surplus periods.
    Forum for Establishing Guidelines.--Most commentors felt that the 
AOP would be the most appropriate mechanism for preparing surplus/
shortage guidelines. The less formal nature of the AOP meetings was 
viewed as positive for attempting to resolve this difficult issue. 
However, the issue has been addressed for the last five years in the 
AOP meetings, and no definite guidelines have been produced.
    Probability of Spills from Lake Powell.--The release of beach/
habitat building flows from Glen Canyon Dam was a contentious topic 
during the completion of the Glen Canyon Dam Environmental Impact 
Statement. The 1968 Colorado River Basin Project Act directed the 
Secretary of the Interior to avoid anticipated spills while the 1992 
Grand Canyon Protection Act directed the Secretary to operate the dam 
to improve the environmental conditions in the Grand Canyon. In 1995, 
an agreement was reached between interested parties which attempts to 
meet the intents of both the 1968 and 1992 Acts by providing these high 
flows during high reservoir storage conditions when required for dam 
safety purposes.
    Surplus determinations which explicitly drop the level of Lake Mead 
and through equalization drop the level of Lake Powell would likely 
reduce the probability of these powerplant bypasses. Commentors 
responded with concern for this possibility recommending that if 
surpluses were declared, measures should be taken to keep the 
probability of bypasses the same as at the present. The impacts of high 
spring flows are currently believed to be very important and this 
potential effect should be addressed as surplus guidelines are 
    The Bureau of Reclamation believes that surplus/shortage criteria 
should: (1) Be specific guidelines that can be used to predict 
measurable effects in the future, (2) be developed through the AOP 
process, and (3) include a discussion of the potential effects on Lake 
Powell spills along with possible mitigation measures.

Issue #3

    [Section 602(a)(3) of the 1968 Colorado River Basin Project Act 
discusses the quantification of a reservoir storage volume in the 
Upper Basin. This storage is intended to supplement the unregulated 
flow of the Colorado River at Lees Ferry during drought periods as 
part of the 1922 Colorado River Compact deliveries to the Lower 
Basin. The intent of this provision is to avoid impairment of Upper 
Basin consumptive uses.]

    Background: The 1968 Act contains several provisions which can be 
viewed as accomplishing the intent of the Article III(e) provision of 
the Colorado River Compact, that of the Upper Basin not withholding 
water that the Lower Basin requires for consumptive use demands. 
Through a combination of avoiding spills, equalizing storage between 
Lakes Powell and Mead, and the 602(a) storage volume, Upper Basin water 
was to be transferred to Lake Mead for use in the Lower Basin. When 
Upper Basin storage falls below this 602(a) storage level, storage 
equalization provisions of the 1968 Act are disregarded.
    By statute, the 602(a) storage volume was to be quantified taking 
into account

[[Page 45443]]

historic stream flows, the most critical period of record, and 
probabilities of water supply. Since the purpose of this storage is to 
help provide Lower Basin deliveries, it is quantified as the difference 
between depleted flow at Lees Ferry and the Lower Basin delivery 
requirements over some period of drought. Upper Basin depletion levels 
significantly affect the storage calculation. Using the most critical 
period of natural flow, the 602(a) volume is currently estimated to be 
about 10 million acre-feet, which includes preservation of the 5.2 
million acre-feet minimum power pool in Lake Powell. In the future, 
when Upper Basin consumptive uses increase, it has been assumed that 
Lake Powell could be completely drained to provide Lower Basin 
    Controversy exists regarding the probability attached to the 
depleted flow assumptions with respect to both the rarity of the 
critical flow period and the projected depletion increases in the Upper 
Basin. These are the principle reasons that 602(a) storage has never 
been formally determined and agreed to by the Basin States. However, in 
the computer modeling of long-range operations of the reservoir system, 
some estimate or procedure must be used to model this portion of the 
applicable statutes. Currently, the Bureau of Reclamation uses the 
observed critical 12-year period (1953-1964) as the basis for the 
storage calculation. Reflecting the lack of a formal determination, 
each year's Annual Operating Plan has contained language stating that 
current reservoir storage in Upper Basin reservoirs exceeds the storage 
required under Section 602 under any reasonable range of assumptions 
which may be applied. The current Upper Basin depletion level is the 
prime reason that this statement is true.
    Analysis and Response: The relationship between the 602(a) volume 
and surplus/shortage criteria has been raised in previous Annual 
Operating Plan discussions. Some parties have argued that both less or 
more severe drought periods should be used in the modeling, thus 
changing the Upper Basin risk of shortages.
    Formally specifying or changing the risks associated with the 
602(a) storage level will likely require a legal opinion on the issue 
of avoiding impairment of Upper Basin consumptive uses. Since these 
uses presently do not significantly restrict Lower Basin surpluses and 
require much less than full Lake Powell storage to meet Lower Basin 
deliveries, this issue perhaps is not ripe for resolution. Reclamation 
recommends delaying implementing guidelines or changing the current 
602(a) modeling assumptions until current assumptions or practices 
create unacceptable impacts.

Issue #4a

    The Bureau of Reclamation should conduct an environmental 
analysis under the National Environmental Policy Act (NEPA) of any 
changes to the Operating Criteria.

    ]Background: Letters of comment to the Operating Criteria review 
expressed concern over the long-term effects of the Operating Criteria 
on downstream resources as it relates to cumulative effects and spill 
frequency. Several letters indicated that the current Operating 
Criteria do not give equal consideration to environmental and 
recreational resources, and instead focus only on traditional water and 
power uses. To incorporate consideration of all resources and impacts 
of the Operating Criteria, the commentors recommended that the 
Operating Criteria be evaluated through application of NEPA.
    Analysis and Response: Reclamation regularly applies the NEPA 
process to activities constituting a Federal action, and agrees that 
compliance with NEPA would be required for any proposed changes to the 
long-range Operating Criteria that are discretionary Federal Actions 
(Chapter 3.1 of the NEPA Handbook). The appropriate level of NEPA 
compliance will be determined by Reclamation if the results of the 
review include proposed changes to the Operating Criteria.
    The first step in the NEPA process is to reach a decision on 
whether or not the proposed changes are ``a major Federal action 
significantly affecting the quality of the human environment.'' If the 
answer is yes, an Environmental Impact Statement is prepared by 
Reclamation. If the answer is no, a Categorical Exclusion is prepared 
by Reclamation. If there is uncertainty as to the ``significance'' of 
the change, Reclamation prepares an Environmental Assessment to 
determine if a Finding of No Significant Impact (FONSI) is justified. 
If a FONSI is not justified, Reclamation continues the NEPA analysis 
and writes an Environmental Impact Statement.
    The key issue in whether NEPA documentation is needed is whether 
there is a Federal action or Federal discretion associated with this 
review. If no Federal action is being proposed or taken by Reclamation, 
no NEPA documentation is required. While no changes are being proposed 
as the result of this review, Reclamation is making a decision in 
proposing no change. Because of this, Reclamation recommends that a 
Categorical Exclusion be prepared pursuant to Departmental Instructions 
516 DM 2, appendix 1.7.

Issue #4b

    The Operating Criteria should recognize the need to preserve and 
recover endangered species dependent upon the quantity, quality, and 
pattern of release.

    ]Background: Construction and operation of water storage and 
delivery facilities on the Colorado River and its tributaries are 
recognized as factors contributing to the decline of certain fish and 
wildlife species which have been listed as threatened or endangered by 
the Fish and Wildlife Service (Service). Storing water during the 
spring runoff decreases the natural spring flow, and releasing water 
later in the year for human use raises the base flow. These types of 
changes in the hydrograph have removed spawning cues, effected water 
temperature, clarity, the food base, and fluvial geomorphology. 
Physical alteration from riverine to extensive reservoir environments 
has occurred causing further change to habitat for these species and 
resulted in the establishment of exotic species of fish, wildlife, and 
plants that directly compete with listed species and their habitat. The 
control of natural flood cycles and development of the floodplain for 
agriculture and other purposes has significantly changed or eliminated 
original habitats in and along extensive parts of the lower Colorado 
River. The success of efforts to recover endangered species are often 
thought to be dependant on restoring the natural hydrograph to the 
degree possible. Commentors are concerned that if provisions for 
releases designed to recover endangered species are not incorporated 
into the Operating Criteria, changes to operations will not be 
    Analysis and Response: Reclamation is in various stages of 
consultation with the Service under Section 7 of the Endangered Species 
Act on most mainstem facilities. Conservation plans and recovery 
programs are also a large part of Reclamation activities in operation 
of the Colorado River. Operation of these facilities for endangered 
species would remain consistent with the original intended purpose of 
the project in accordance with the implementing regulations of the 
Endangered Species Act. When a Section 7 consultation results in the 
Service providing Reclamation with specific flow recommendations or 
other alternatives to remove or prevent jeopardy to listed species or 
their critical habitat, they are incorporated

[[Page 45444]]

into Reclamation's operations, and if appropriate, are included in the 
Annual Operating Plan of the particular facility which was the subject 
of the consultation. Operations remain consistent with the ``Law of the 
River,'' water service contracts, and other legal obligations. Examples 
of facilities where consultation has been completed resulting in a flow 
recommendation are Flaming Gorge Dam on the Green River in Utah, Glen 
Canyon Dam on the Colorado River in Arizona, and several features of 
the Colorado River Front Work and Levee System Program on the last 270 
miles of the Colorado River in the United States.
    Reclamation and the Service recently completed formal Section 7 
consultation on lower Colorado River operations and maintenance (Lake 
Mead to the Southerly International Boundary with Mexico), and are 
engaged in ongoing consultation for Navajo Reservoir operations on the 
San Juan River in Colorado, and Aspinall Unit operations on the 
Gunnison River in Colorado. The Department of the Interior signed a 
Memorandum of Agreement in August 1995 that was further described in a 
Memorandum of Clarification and most recently a joint Participation 
Agreement to develop a long-term (50 year) Lower Colorado River Multi-
Species Conservation Program (MSCP) from Lees Ferry to the Southerly 
International Boundary with Mexico. The overall objective of the MSCP 
is to develop a plan which would conserve and protect more than 100 
listed and sensitive species within the Colorado River and its one 
hundred-year flood plain, and to the greatest extent possible, 
accommodate current and future water and power operations.
    Reclamation continues to undertake and pursue efforts for 
conservation and recovery of fish and wildlife and associated critical 
habitat under specific project authorities such as Section 8 of the 
Colorado River Storage Project Act and the Grand Canyon Protection Act. 
In addition, Reclamation has significant ongoing conservation and 
recovery efforts under the authority of Section 7(a)(1) of the 
Endangered Species Act. For example, the Lake Mohave Native Fish 
Rearing Program in the Lower Colorado River Basin continues to collect 
and rear wild larval razorback and bonytail chubs for release back into 
Lake Mohave to maintain the primary adult population and genetic pool 
for these species. Voluntary refinements to river operations have also 
been implemented when possible to benefit endangered species (i.e., 
management of reservoir levels in Lake Mohave for endangered fish). The 
Upper Colorado River Recovery Implementation Program, with an annual 
budget exceeding $7 million, and the San Juan River Basin Recovery 
Implementation Program are other examples.
    Reclamation will continue to plan and implement initiatives for 
protection of endangered species and associated critical habitat on a 
project-specific basis as described, with the goal of integrating these 
actions to the greatest degree possible to address ecosystem level 
needs. Where appropriate, initiatives such as the Glen Canyon Adaptive 
Management Program and the MSCP will be considered and incorporated 
into future Annual Operating Plans.

Issue #4c

    Funding for mitigation of negative impacts to fish and wildlife 
resources should be provided.

    Background: Modification of river flows due to the operation of 
projects authorized by the Colorado River Storage Project Act has 
impacted fish, wildlife, and their habitats through reduction or 
elimination of overbank flooding, channelization, water depletions, and 
changes in water quality. These projects produce revenue primarily 
through power production. Commentors are concerned that sufficient 
funds be made available for mitigation activities.
    Analysis and Response: Reclamation, like all Federal agencies, must 
have both authorization and appropriations to undertake actions and 
incur debt. In the Upper Colorado River Basin, Section 8 of the 
Colorado River Storage Project Act authorizes and directs the Secretary 
of the Interior to investigate, plan, construct, operate, and maintain 
facilities to improve conditions for and mitigate losses of fish and 
wildlife. Funds authorized by this section of the Act are 
nonreimbursable and nonreturnable, and therefore must be appropriated 
by the Congress. Section 5(a) specifies that the Basin Fund will not be 
applied to Section 8 (fish and wildlife mitigation). The Grand Canyon 
Protection Act states that power revenues may be used for activities 
designed to conserve the environment downstream from Glen Canyon Dam, 
but does not exclude the use of other funding mechanisms.
    Mitigation and enhancement activities are typically identified and 
proposed on a project-by-project basis through project planning and 
environmental compliance. Reclamation has programmed and expended funds 
for fish and wildlife mitigation and enhancement for impacts associated 
with previous activities where appropriate. Most often these activities 
are identified in Fish and Wildlife Coordination Act Reports and 
National Environmental Policy Act documents. Reclamation will continue 
to use this approach. Since no changes are being proposed, there is no 
specific mitigation or enhancement necessary for this action. 
Reclamation will continue to comply with NEPA and other appropriate 
environmental laws in identifying, planning, and carrying out 
mitigation and enhancement activities.

Issue #5

    Is there a need to change the Operating Criteria.

    Background: The Operating Criteria are to accomplish the objectives 
of Section 602(a) of the Colorado River Basin Project Act. Modification 
of the Operating Criteria can be done by the Secretary of the Interior 
``* * * as a result of actual operating experiences or unforeseen 
circumstances * * * to better achieve the purposes specified in 
[Section 602(a) of the Colorado River Basin Project Act].''
    Commentors stated that they believe ``* * * there are no conditions 
resulting from actual operating experiences or unforeseen 
circumstances, since the last review, that justify the need to modify 
the existing Criteria,'' and that the reservoirs have been operating 
satisfactorily under the present Operating Criteria. These comments 
support not changing the criteria at this time.
    Others stated that we are entering a new era and that the Operating 
Criteria should be changed to reflect different circumstances and 
concerns. The Lower Basin States have reached their annual 
apportionment of 7.5 million acre-feet for consumptive use. 
Environmental and recreational issues have increased in value in the 
eyes of the public. There were also those who stated that the Operating 
Criteria need to be changed to include specific guidelines that allow 
the Secretary of the Interior to make surplus, shortage, and normal 
determinations. These comments all support a need for change.
    Analysis and Response: The Operating Criteria provide guidelines 
for the operation of Upper Basin Reservoirs and Lake Mead. Specific 
operational needs are not detailed in the Operating Criteria. The 
specific needs have, in the past, been addressed in the Annual 
Operating Plan development process.
    The Operating Criteria may be modified from time to time as a 
result of actual operating experiences or unforeseen circumstances. 
With the issues of surplus and flood control in

[[Page 45445]]

our current operations and possibly emerging over the next several 
years, the operational experiences needed to determine if changes to 
the Operating Criteria are necessary will be acquired. Under the 
present Operating Criteria, all needs have been met.
    The evaluation of operational experiences over the next several 
years will determine whether or not to change the Operating Criteria. 
But for the purposes of this review, it appears that no change is 
needed to the Operating Criteria.

Issue #6

    Water marketing and banking.

    Background: Several years ago the Bureau of Reclamation advanced 
draft regulations for administering Colorado River water entitlements 
in the Lower Basin States of Arizona, California, and Nevada. The draft 
regulations contained provisions for water banking and water marketing 
in the Lower Basin. Because there was not consensus with the states 
regarding the draft regulations, they have been held in abeyance while 
the three states attempt to reach some agreement on numerous issues, 
including water marketing and banking. This negotiation process among 
the states is continuing. Many people believe that some form of water 
banking and marketing will be essential to meeting future water needs 
in the Lower Colorado River Basin.
    Analysis and Response: Reclamation has initiated a rule-making 
process focused on water banking in groundwater aquifers or off-
mainstream storage reservoirs in the Lower Basin. This administrative 
rule is considered a responsibility of the Secretary of the Interior 
under the Boulder Canyon Project Act, and focuses only on the three 
Lower Basin States. Reclamation continues to work with the States and 
to encourage them to cooperatively develop a proposal for water 
marketing and banking in the Lower Basin.
    Reclamation believes it is not appropriate that water marketing and 
banking would change the current Operating Criteria as this issue 
focuses on the Lower Basin.

Proposed Decision

    The Department has considered issues arising from the review of the 
Operating Criteria. After a careful review of the issues, solicitation 
of involved party's responses to Reclamation's analysis, and 
consultation with the Governor's representatives of the seven Basin 
States, the Department proposes no modifications to the Operating 
Criteria at this time.

    Dated: August 19, 1997.
Eluid L. Martinez,
Commissioner, Bureau of Reclamation.
[FR Doc. 97-22747 Filed 8-26-97; 8:45 am]