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112th Congress                                            Rept. 112-221
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 1

======================================================================

 
  AMENDING THE WATER RESOURCES DEVELOPMENT ACT OF 1986 TO CLARIFY THE 
ROLE OF THE CHEROKEE NATION OF OKLAHOMA WITH REGARD TO THE MAINTENANCE 
               OF THE W.D. MAYO LOCK AND DAM IN OKLAHOMA

                                _______
                                

               September 23, 2011.--Ordered to be printed

                                _______
                                

 Mr. Hastings of Washington, from the Committee on Natural Resources, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 1421]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Natural Resources, to whom was referred 
the bill (H.R. 1421) to amend the Water Resources Development 
Act of 1986 to clarify the role of the Cherokee Nation of 
Oklahoma with regard to the maintenance of the W.D. Mayo Lock 
and Dam in Oklahoma, having considered the same, report 
favorably thereon without amendment and recommend that the bill 
do pass.

                          Purpose of the Bill

    The purpose of H.R. 1421 is to amend the Water Resources 
Development Act of 1986 to clarify the role of the Cherokee 
Nation of Oklahoma with regard to the maintenance of the W.D. 
Mayo Lock and Dam in Oklahoma.

                  Background and Need for Legislation

    In the 1950s, Congress approved and appropriated money to 
the Army Corps of Engineers to construct the McClellan-Kerr 
navigation system along the Arkansas River. However, in the 
1970s, the U.S. Supreme Court ruled that the Cherokee Nation, 
Chickasaw Nation, and Choctaw Nation owned parts of the bed and 
banks of the Arkansas River affected by this project.
    After several years of litigation against the State of 
Oklahoma and negotiations with the United States, a settlement 
was reached with all three tribes. In 1981, the Cherokee Nation 
asked Congress for the exclusive right to build a hydroelectric 
facility on its Arkansas River land. In 1986, Congress enacted 
the Water Resource Development Act of 1986 (Public Law 99-662), 
which gave the tribe this authority.
    While section 1117 of the Water Resource Development Act of 
1986 gave the tribe exclusive rights to develop the 
hydroelectric facility on their land, it also required that 
once the hydroelectric facility is built, the tribe must 
transfer its ownership to the Army Corps of Engineers. The 
Corps would then manage, operate, and maintain the facility. 
Once the facility becomes operational, the Southwestern Power 
Administration would then market the power, so that debt from 
the construction of the hydroelectric facility would be repaid 
and royalties would be given to the tribe.
    Today, the Cherokee Nation now has the capital to move 
forward with developing, operating, and maintaining a 
hydroelectric facility, and has plans to construct a 30 
megawatt hydroelectric facility that would employ between 150 
and 200 workers.
    This bill would amend Section 1117 of the 1986 Water 
Resources Development Act of 1986 so that the Cherokee Nation 
of Oklahoma may design and construct one or more hydroelectric 
generation facilities without transferring title to the federal 
government. Furthermore, the tribe may market the electricity 
generated from the facilities.

                            Committee Action

    H.R. 1421 was introduced on April 7, 2011, by Congressman 
Dan Boren (D-OK). The bill was referred primarily to the 
Committee on Transportation and Infrastructure, and 
additionally to the Committee on Natural Resources. Within the 
Committee on Natural Resources, the bill was referred to the 
Subcommittee on Indian and Alaska Native Affairs. The bill was 
also referred to the Committee on Transportation and 
Infrastructure. On July 12, 2011, the Subcommittee on Indian 
and Alaska Native Affairs held a hearing on the bill. On July 
20, 2011, the Natural Resources Committee met to consider the 
bill. The Subcommittee on Indian and Alaska Native Affairs was 
discharged by unanimous consent. No amendments were offered, 
and the bill was ordered favorably reported to the House of 
Representatives by unanimous consent.

            Committee Oversight Findings and Recommendations

    Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII of the Rules of the House of Representatives, the 
Committee on Natural Resources' oversight findings and 
recommendations are reflected in the body of this report.

                    Compliance With House Rule XIII

    1. Cost of Legislation. Clause 3(d)(1) of rule XIII of the 
Rules of the House of Representatives requires an estimate and 
a comparison by the Committee of the costs which would be 
incurred in carrying out this bill. However, clause 3(d)(2)(B) 
of that rule provides that this requirement does not apply when 
the Committee has included in its report a timely submitted 
cost estimate of the bill prepared by the Director of the 
Congressional Budget Office under section 402 of the 
Congressional Budget Act of 1974. Under clause 3(c)(3) of rule 
XIII of the Rules of the House of Representatives and section 
403 of the Congressional Budget Act of 1974, the Committee has 
received the following cost estimate for this bill from the 
Director of the Congressional Budget Office:

H.R. 1421--A bill to amend the Water Resources Development Act of 1986 
        to clarify the role of the Cherokee Nation of Oklahoma with 
        regard to the maintenance of the W.D. Mayo Lock and Dam in 
        Oklahoma

    H.R. 1421 would give the Cherokee Nation exclusive 
authority to construct hydroelectric generating facilities at 
the W.D. Mayo Lock and Dam on the Arkansas River in Oklahoma. 
The bill would also grant the Cherokee Nation sole 
responsibility to operate and maintain the facilities as well 
as to market the hydroelectric power. Based on information from 
the Army Corps of Engineers, the Southwestern Power 
Administration (SWPA), and the Cherokee Nation, CBO estimates 
that enacting the bill would have no significant net impact on 
the federal budget. Enacting H.R. 1421 would not affect direct 
spending or revenues; therefore, pay-as-you-go procedures do 
not apply.
    The Water Resources Development Act of 1986 authorized the 
Cherokee Nation--a nonfederal entity--to develop 
hydroelectricity at the federal dam but required that the title 
of the completed facilities be transferred to the Corps to 
operate and maintain the facilities. Under that act, the 
Southwestern Power Administration was required to market any 
electric power generated at the facility. Hydroelectric power 
has not been developed at the dam and, according to interested 
parties, is unlikely to be developed under current law. H.R. 
1421 would eliminate those requirements and allow the Cherokee 
Nation to retain the title to any hydroelectric improvements, 
operate and maintain the facilities, and market the power.
    H.R. 1421 would require the Cherokee Nation to pay all 
costs associated with the design and construction of the 
facilities. The bill would authorize the Corps to provide 
assistance for those activities subject to reimbursement of all 
costs. The Cherokee Nation would also be responsible for 
reimbursing SWPA for the cost to transmit power from the dam. 
Because federal agencies would be reimbursed for all costs, CBO 
estimates that implementing the legislation would have no 
significant net impact on the federal budget.
    H.R. 1421 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would impose no costs on state, local, or tribal governments.
    The CBO staff contact for this estimate is Aurora Swanson. 
The estimate was approved by Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.
    2. Section 308(a) of Congressional Budget Act. As required 
by clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives and section 308(a) of the Congressional Budget 
Act of 1974, this bill does not contain any new budget 
authority, spending authority, credit authority, or an increase 
or decrease in revenues or tax expenditures. Based on 
information from the Army Corps of Engineers, the Southwestern 
Power Administration (SWPA), and the Cherokee Nation, CBO 
estimates that enacting the bill would have no significant net 
impact on the federal budget. Enacting H.R. 1421 would not 
affect direct spending or revenues; therefore, pay-as-you-go 
procedures do not apply.
    3. General Performance Goals and Objectives. This bill does 
not authorize funding and therefore, clause 3(c)(4) of rule 
XIII of the Rules of the House of Representatives does not 
apply.

                           Earmark Statement

    This bill does not contain any Congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined 
under clause 9(e), 9(f), and 9(g) of rule XXI of the Rules of 
the House of Representatives.

                    Compliance With Public Law 104-4

    This bill contains no unfunded mandates.

                Preemption of State, Local or Tribal Law

    This bill is not intended to preempt any State, local or 
tribal law.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

      SECTION 1117 OF THE WATER RESOURCES DEVELOPMENT ACT OF 1986


[SEC. 1117. W.D. MAYO LOCK AND DAM.

  [(a) Notwithstanding any other provision of law, the Cherokee 
Nation of Oklahoma is authorized to design and construct 
hydroelectric generating facilities at the W.D. Mayo Lock and 
Dam on the Arkansas River in Oklahoma, as described in the 
report of the Chief of Engineers dated December 23, 1981: 
Provided, That, the agreement described in subsection (d) of 
this section is executed by all parties described in subsection 
(b) of this section.
  [(b)(1) Conditioned upon the parties agreeing to mutually 
acceptable terms and conditions, the Secretary and the 
Secretary of Energy, acting through the Southwestern Power 
Administration, may enter into a binding agreement with the 
Cherokee Nation of Oklahoma under which the Cherokee Nation of 
Oklahoma agrees--
          [(A) to design and initiate construction of the 
        generating facilities referred to in subsection (a) of 
        this section within three years after the date of such 
        agreement,
          [(B) to reimburse the Secretary for his costs in--
                  [(i) approving such design and inspecting 
                such construction, and
                  [(ii) providing any assistance authorized 
                under subsection (c)(2) of this section, and
          [(C) to release and indemnify the United States from 
        any claims, causes of action, or liabilities which may 
        arise from such design or construction.
  [(2) Such agreement shall also specify--
          [(A) the procedures and requirements for approval and 
        acceptance of such design and construction are set 
        forth,
          [(B) the rights, responsibilities, and liabilities of 
        each party to the agreement are set forth, and
          [(3) the amount of the payments under subsection (f) 
        of this section, and the procedures under which such 
        payments are to be made, are set forth.
  [(c)(1) No Federal funds may be expended for the design or 
construction of the generating facilities referred to in 
subsection (a) of this section prior to the date on which such 
facilities are accepted by the Secretary under subsection (d) 
of this section.
  [(2) Notwithstanding any other provision of law, the 
Secretary is authorized to provide, on a reimbursable basis, 
any assistance requested by the Cherokee Nation of Oklahoma in 
connection with the design or construction of the generating 
facilities referred to in subsection (a) of this section.
  [(d)(1) Notwithstanding any other provision of law, upon 
completion of the construction of the generating facilities 
referred to in subsection (a) of this section, and final 
approval of such facilities by the Secretary--
          [(A) the Cherokee Nation of Oklahoma shall transfer 
        title to such facilities to the United States, and
          [(B) the Secretary shall--
                  [(i) accept the transfer of title to such 
                generating facilities on behalf of the United 
                States, and
                  [(ii) operate and maintain such facilities.
  [(2) The Secretary is authorized to accept title to such 
facilities only after certifying that the quality of the 
construction meets all standards established for similar 
facilities constructed by the Secretary.
  [(e) Pursuant to any agreement under subsection (b) of this 
section, the Southwestern Power Administration shall market the 
excess power produced by the generating facilities referred to 
in subsection (a) of this section in accordance with section 5 
of the Act of December 22, 1944 (58 Stat. 890; 16 U.S.C. 825s).
  [(f) Notwithstanding any other provision of law, the 
Secretary of Energy, acting through the Southwestern Power 
Administration, is authorized to pay to the Cherokee Nation of 
Oklahoma, in accordance with the terms of the agreement entered 
into under subsection (b) of this section, out of the revenues 
from the sale of power produced by the generating facilities of 
the interconnected systems of reservoirs operated by the 
Secretary and marketed by the Southwestern Power 
Administration--
          [(1) all reasonable costs incurred by the Cherokee 
        Nation of Oklahoma in the design and construction of 
        the generating facilities referred to in subsection (a) 
        of this section, including the capital investment in 
        such facilities and a reasonable rate of return on such 
        capital investment, and
          [(2) for a period not to exceed fifty years, a 
        reasonable annual royalty for the design and 
        construction of the generating facilities referred to 
        in subsection (a) of this section.
  [(g) Notwithstanding any other provision of law, the 
Secretary of Energy, acting through the Southwestern Power 
Administration, is authorized--
          [(1) to construct such transmission facilities as 
        necessary to market the power produced at the 
        generating facilities referred to in subsection (a) of 
        this section with funds contributed by non-Federal 
        sources, and
          [(2) to repay those funds, including interest and any 
        administrative expenses, directly from the revenues 
        from the sale of power produced by the generating 
        facilities of the interconnected systems of reservoirs 
        operated by the Secretary and marketed by the 
        Southwestern Power Administration.
  [(h) There are authorized to be appropriated to the Secretary 
for the fiscal year in which title to the generating facilities 
is transferred and accepted under subsection (d) of this 
section, and for each succeeding fiscal year, such sums as may 
be necessary to operate and maintain such facilities.]

SEC. 1117. W.D. MAYO LOCK AND DAM.

  (a) In General.--Notwithstanding any other provision of law, 
the Cherokee Nation of Oklahoma may--
          (1) design and construct one or more hydroelectric 
        generating facilities at the W.D. Mayo Lock and Dam on 
        the Arkansas River in Oklahoma, subject to the 
        requirements specified in subsection (b) and in 
        accordance with the conditions specified in this 
        section; and
          (2) market the electricity generated from any such 
        facility.
  (b) Pre-Construction Requirements.--(1) The Cherokee Nation 
shall obtain any permit required by Federal or State law before 
the date on which construction begins on any hydroelectric 
generating facility at the location referred to in subsection 
(a), except that the Cherokee Nation shall be exempt from any 
licensing requirements under the Federal Power Act (16 U.S.C. 
791a et seq.) that may otherwise be required for the 
construction, operation, or maintenance of hydroelectric 
generating facilities.
  (2) The Cherokee Nation may initiate the design or 
construction of any such facility only after the Secretary 
reviews and approves the plans and specifications for such 
design and construction.
  (c) Payment of Design and Construction Costs.--(1) The 
Secretary of the Army may accept funds offered by the Cherokee 
Nation and use such funds to carry out the design and 
construction of any hydroelectric generating facility.
  (2) The Cherokee Nation shall--
          (A) bear all costs associated with the design and 
        construction of any such hydroelectric generating 
        facility; and
          (B) provide any funds necessary for such design and 
        construction to the Secretary of the Army prior to the 
        Secretary initiating any activities related to the 
        design and construction of a hydroelectric generating 
        facility under this section.
  (d) Assumption of Liability.--The Cherokee Nation shall--
          (1) hold all title to any hydroelectric generating 
        facility constructed under this section and may, 
        subject to the approval of the Secretary of the Army, 
        assign such title to a third party;
          (2) be solely responsible for--
                  (A) the operation, maintenance, repair, 
                replacement, and rehabilitation of any such 
                facility; and
                  (B) the marketing of the electricity 
                generated by any such facility; and
          (3) release and indemnify the United States from any 
        claims, causes of action, or liabilities that may arise 
        out of any activity undertaken to carry out this 
        section.
  (e) Assistance Available.--Notwithstanding any other 
provision of law, the Secretary of the Army may provide any 
technical and construction management assistance that is 
requested by the Cherokee Nation relating to the design and 
construction of any hydroelectric generating facility described 
in subsection (a).
  (f) Third Party Agreements.--The Cherokee Nation may enter 
into agreements with the Secretary of the Army or a third party 
that the Cherokee Nation or the Secretary determines are 
necessary to carry out this section.