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![handle is hein.gao/gaobabehc0001 and id is 1 raw text is:
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BY T1H US GENLRAL ACCOUNTING OFFICE
Report To The Secretary Of Energy
Policies Governing Bonneville Power
Administration's Repayment Of Federal
Investment Still Need Revision
The federal government, through the Bonneville Power
Administration, has invested over $7 billion in hydro-
electric facilities in the Federal Columbia River Power
System. Through 1964, Bonneville repaid the federal
investment using fixed annual repayments. However, in
1965, Bonneville dropped fixed annual repayments and
adopted the repayment study method for determining
revenue requirements. The repayment study is designed to
produce revenues to pay costs, including repayment of the
federal investment. The only requirement is that the
projects be repaid within their scheduled life. The federal
investment, however, is the lowest category of expense;
therefore, if revenues are insufficient to cover all ex-
penses, the federal investment is deferred. In the past 6
years Bonneville has experienced operating losses, result-
ing in nonpayment of the federal investment.
In 1981, GAO reported that Bonneville's repayment study
method was inadequate and should be changed to a
fixed/mortgage basis with required annual repayments.
Since GAO's earlier report, Bonneville has not made any
repayment because operating losses occurred in each
year. GAO again recommends that Bonneville adopt a fixed
mortgage-type repayment system in order to assure timely
and equitable repayment of the federal investment.
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'> OCT-GAO/RCED84-25
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