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CED-81-95 1 (1981-04-21)

handle is hein.gao/gaobabbvi0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20548 RELEASED COMMUNITY AND ECONOMIC W LOPMENT OIVISION APRIL 21, 1981 B-202886 The Honorable George Miller House of Representatives 115011 Dear Mr. Miller: Subject: f- ormation on the Resale of Water Provided nder Contract by the Federal Government in California (CED-81-95) On April 8, 1981, we met with you to discuss our findings on your requests of April 30, 1980, and January 8, 1981, concerning the resale of Federal water supplied under contract to State and local districts. We agreed to provide information on the following questions: --Do Department of the Interior's Water and Power Resources Service policies and procedures address water resales? --Are California's five largest Resources Service customers (districts) profiting from the resale of federally supplied water outside their service areas? --Do provisions in new water service contracts require periodic recalculation of water rates? The Resources Service's current policy and contract provisions provide that water resales outside a service area must meet specific Resources Service requirements and be approved by the Resources Service. None of the five districts have resold federally supplied water outside their service areas. However, we found that one of the districts purchased water from other districts at rates equal to applicable Resources Service and district costs. Since the Resources Service adopted a Service-wide policy in December 1978 to periodically recalculate water rates, only two long-term contracts have been negotiated for federally supplied water in California. Both contracts include a 5-year rate adjust- ment provision. (085620)

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