FY 2006 budget: Recommendation to Bonneville

Related link: Budget Tracking and Adjustment Process (60k PDF)

August 22, 2005

Mr. Bill Maslen
Director, Fish and Wildlife
Bonneville Power Administration
P.O. Box 3621
Portland, Oregon 97208

Dear Mr. Maslen,

RE: Recommendations for project funding in Fiscal Year 2006 to implement the Fish and Wildlife Program

At its August 2005 meeting in Missoula, the Council decided on its start-of-year project and budget recommendations to Bonneville to implement the Council's Columbia River Basin Fish and Wildlife Program in Fiscal Year 2006. Attached to this letter are a set of tables (100k PDF) listing the projects recommended for both expense and capital funding, with recommended budgets and, where appropriate, specific guidance through brief comments.

Budget total. The projects recommended for expense funding by Bonneville total $157,168,092 million, along with $55,827,548 million in capital funding. The Council acknowledges Bonneville's accrual target for the rate period ending with FY06 has been to spend an average of $139 million per year in expense funds on the fish and wildlife program. Based on our past experiences with the differences between the planning budget and actual spending, the Council concluded that a start-of-year planning budget for expense funding of that amount for FY06 is appropriate and will not result in Bonneville spending more in FY06 than is consistent with meeting this accrual target. If anything, it seems more likely Bonneville will not spend as much in this rate period as originally targeted. Bonneville representatives informed the Council that any amounts not spent up to the target in this rate period will be carried over and added to the amounts available for spending on fish and wildlife in the next rate period. The Council asked for your written confirmation of this understanding.

Principles governing these project recommendations. The central principle the Council has used to arrive at this set of projects has been to remain consistent with the multi-year project recommendations that the Council developed during the provincial review a few years ago. It was in this provincial review process that the projects proposed for Bonneville funding received the review by the Independent Scientific Review Panel, the public and the Council required by Section 4(h)(10)(D) of the Northwest Power Act. These reviews and the basic set of resulting project recommendations were intended to remain valid for the next few years as the Council, the ISRP and others involved in project review focused on subbasin planning and on adopting the subbasin plans into the program. The Council, working with Bonneville and CBFWA staffs, project sponsors and others, have worked hard over the last months to identify an appropriate set of projects for FY06 to reflect the provincial review recommendations as evolved to this year, as well as reasonable cost estimates for performing the scopes of work recommended by the Council in the provincial review.

Two related governing principles have been to hold most projects at level funding and not to recommend any new projects or for an expansion of the scope of existing projects into new work. The Council did make exceptions in the application of these two principles, for reasons and under certain conditions explained below.

Finally, the Council has been adopting the subbasin plans into its program at precisely the same time as it was reviewing the on-going projects for these FY06 recommendations. For this reason, the Council also requested a threshold explanation from the project sponsors as to how projects are consistent with subbasin plans and plan priorities, as well as a clear and relatively detailed explanation of past and expected accomplishments. The Council has been encouraged with the responses. With the subbasin plan adoption now completed, the new project review process for FY07 and beyond will include a new solicitation, in-depth scientific and public review, and new multi-year Council recommendations, all aimed at implementing the objectives, strategies and priorities in the subbasin plans and a comprehensive review of project consistency with the plans.

Overarching issues. As in every year, the Council's review of projects proposed for funding in FY06 raised a small number of overarching policy issues. These issues included whether and how to address concerns raised by the continuation of level funding for another year; whether and how to incorporate the new projects proposed by Bonneville to implement the federal action agencies? recently adopted final Updated Proposed Action (UPA); how to respond to requests for additional operation and maintenance funding for land acquisition projects and to requests to fund certain recommended habitat acquisitions out of the expense budget rather than the capital budget; whether and how to close out a discrete set of assessment, monitoring and evaluation projects; how to handle projects that, from a review of the project responses, may need a specifically focused Step or similar review before proceeding or that raise an issue about a possible scope expansion; and so forth. For more detail on these, what these issues were and how the Council worked through them, see the memoranda prepared by the staff for the June, July and August Council meetings (see 2006 budget page for links) and the minutes of these meetings.

How the Council resolved these issues is reflected in the projects and budgets recommended and, where appropriate, in the comments in the table associated with specific projects. In most cases, this is sufficient. For example, the comments in the budget tables identify those projects for which the project response for FY06 raised the possibility of a scope expansion that, if true, would not be allowed, or that appear to require a review of some type before proceeding. Working with the Council staff, Bonneville should inquire further into these projects before contracting to determine if the project is truly within one or the other of these categories and, if so, to take or allow for the appropriate action.

For a few of these issues, the Council offers the following further guidance:

UPA projects. The action agencies committed to what is called the final Updated Proposed Action (UPA) as part of the most recent Section 7 consultation under the Endangered Species Act on the proposed operation of the Federal Columbia River Power System. Bonneville proposed that to start a number of activities to implement the UPA in FY06. The Council worked with Bonneville to develop an appropriate list of UPA-related projects and budgets, reflected in the attached tables. Some of these are new projects, and some represent an expanded scope for an existing project. These project recommendations are the only exception in the Council's FY06 start-of-year planning to the basic premise of not beginning new work in FY06. For that reason, the Council included these projects in the planning budget only under the condition that any new work derived from the UPA (whether in a new project or an expanded scope for an existing project) first undergo review by the ISRP and, subsequently, by the Council for a specific recommendation before implementation. Also, some of the projects are mere placeholders, such as the Columbia Cascade habitat placeholder, and these will require much further definition before they are ready for review.
O&M funding for wildlife land acquisitions. Budgets for those projects that maintain and protect land acquired for wildlife habitat are based on the following principles: Level funding applied to land acquisition O&M budgets (as to all other projects), except in the case of new land acquisitions or where there has been the adoption of a management plan since the last budget recommendation. When new acquisitions have occurred since the last budget recommendations, but no management plan for the land exists, Bonneville should provide a consistent base amount of operation and maintenance funding only, largely for management planning and the most necessary maintenance. With the adoption of a management plan, Bonneville should work with the project sponsor to set O&M budgets that are relevant to the tasks scheduled for implementation in the management plan, with reference to the ?Guidelines for Enhancement, Operation, and Maintenance Activities for Wildlife Mitigation Projects? adopted by the wildlife managers in 1998. The amounts shown in the budget table (largely derived from the sponsors? requests and preliminary input from Bonneville) should be considered ceilings; it may be possible to fund O&M for these projects consistent with the principles expressed above for less than the proposed amount.
Funding projects to acquire habitat for fish out of the expense budget. During the last provincial review process, the Council recommended that Bonneville fund a set of project proposed to acquire land to protect important habitat for anadromous and resident fish. Bonneville recognizes the importance of the projects, but has been unable to use its capital funds for this purpose. The projects sponsors, with the encouragement of Bonneville representatives, now propose to fund acquisitions under these projects out of the expense budget in FY06. The Council is willing to consider the concept of using available funds in the expense budget to implement these projects in FY06 but has requested defined, project specific budgets for consideration. The project tables identify the five projects involved, in the comments. But Bonneville and Council staff and the project sponsors are still working to define precisely which parcels may indeed be available in FY06 and at what specific budgets. The Council staff will bring back to the Council for review and possible recommendation specific proposed actions and expense budgets for these projects. Bonneville should not use its expense budget to acquire land under these projects if and until the Council makes a recommendation to do so.
Projects coming to an end. The Council identified a set of projects, mostly involving discrete assessment, monitoring or evaluation activities, which should come to a conclusion during FY05 or FY06. The Council staff worked with Bonneville representatives to identify appropriate close-out budgets in FY06 where necessary.
Recommended projects Bonneville has not funded after labeling them low priority. The Council identified a small set of projects in the area above Hells Canyon that the Council recommended for funding during the provincial review, but which Bonneville subsequently placed on a low-priority list and has declined to fund, but which have not been closed out for other reasons. The Council does not agree with Bonneville's action and continues to recommend that these projects be funded. The projects are included in the tables, along with recommended budgets for those projects for which the project sponsors requested funding during FY06.

Revised within-year process. The Council and Bonneville staff proposed revised procedures for tracking what is being spent during the fiscal year and making adjustments where necessary. The Council rejected one aspect of the proposal ? the staff proposal to establish a monetary threshold for within-year requests by project sponsors before these requests would require Council scrutiny. Otherwise, the Council approved the proposed revisions to the within-year process, which is attached as revised under the title ?FY 2006 Budget Tracking and Adjustment Process.?

Project performance audit pilot program. Finally, the Council approved in concept the idea of recommending that Bonneville initiate in FY06 a pilot program that subjects a certain number of projects to a performance audit. The Council directed the staff to develop the concept into a proposal for the Council to consider at its September meeting, the proposal to include a set of alternatives for how to implement such a pilot program. The Council will be forwarding to Bonneville a specific recommendation on this subject.

Please contact or of my staff if you have questions or seek further information on these recommendations. Please express our appreciation and thanks to your staff for the congenial and productive way they worked with the Council's staff to develop the project and budget information and proposals for Council review.

Sincerely,
Doug Marker, Fish and Wildlife Division Director

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Fish & wildlife Budgets FY 2006 budget
	FY 2006 Council Recommended F&W Start-of-year Budgets Related link: Budget Tracking and Adjustment Process (60k PDF) August 22, 2005 Mr. Bill Maslen Director, Fish and Wildlife Bonneville Power Administration P.O. Box 3621 Portland, Oregon 97208 Dear Mr. Maslen, RE: Recommendations for project funding in Fiscal Year 2006 to implement the Fish and Wildlife Program At its August 2005 meeting in Missoula, the Council decided on its start-of-year project and budget recommendations to Bonneville to implement the Council's Columbia River Basin Fish and Wildlife Program in Fiscal Year 2006. Attached to this letter are a set of tables (100k PDF) listing the projects recommended for both expense and capital funding, with recommended budgets and, where appropriate, specific guidance through brief comments. Budget total. The projects recommended for expense funding by Bonneville total $157,168,092 million, along with $55,827,548 million in capital funding. The Council acknowledges Bonneville's accrual target for the rate period ending with FY06 has been to spend an average of $139 million per year in expense funds on the fish and wildlife program. Based on our past experiences with the differences between the planning budget and actual spending, the Council concluded that a start-of-year planning budget for expense funding of that amount for FY06 is appropriate and will not result in Bonneville spending more in FY06 than is consistent with meeting this accrual target. If anything, it seems more likely Bonneville will not spend as much in this rate period as originally targeted. Bonneville representatives informed the Council that any amounts not spent up to the target in this rate period will be carried over and added to the amounts available for spending on fish and wildlife in the next rate period. The Council asked for your written confirmation of this understanding. Principles governing these project recommendations. The central principle the Council has used to arrive at this set of projects has been to remain consistent with the multi-year project recommendations that the Council developed during the provincial review a few years ago. It was in this provincial review process that the projects proposed for Bonneville funding received the review by the Independent Scientific Review Panel, the public and the Council required by Section 4(h)(10)(D) of the Northwest Power Act. These reviews and the basic set of resulting project recommendations were intended to remain valid for the next few years as the Council, the ISRP and others involved in project review focused on subbasin planning and on adopting the subbasin plans into the program. The Council, working with Bonneville and CBFWA staffs, project sponsors and others, have worked hard over the last months to identify an appropriate set of projects for FY06 to reflect the provincial review recommendations as evolved to this year, as well as reasonable cost estimates for performing the scopes of work recommended by the Council in the provincial review. Two related governing principles have been to hold most projects at level funding and not to recommend any new projects or for an expansion of the scope of existing projects into new work. The Council did make exceptions in the application of these two principles, for reasons and under certain conditions explained below. Finally, the Council has been adopting the subbasin plans into its program at precisely the same time as it was reviewing the on-going projects for these FY06 recommendations. For this reason, the Council also requested a threshold explanation from the project sponsors as to how projects are consistent with subbasin plans and plan priorities, as well as a clear and relatively detailed explanation of past and expected accomplishments. The Council has been encouraged with the responses. With the subbasin plan adoption now completed, the new project review process for FY07 and beyond will include a new solicitation, in-depth scientific and public review, and new multi-year Council recommendations, all aimed at implementing the objectives, strategies and priorities in the subbasin plans and a comprehensive review of project consistency with the plans. Overarching issues. As in every year, the Council's review of projects proposed for funding in FY06 raised a small number of overarching policy issues. These issues included whether and how to address concerns raised by the continuation of level funding for another year; whether and how to incorporate the new projects proposed by Bonneville to implement the federal action agencies? recently adopted final Updated Proposed Action (UPA); how to respond to requests for additional operation and maintenance funding for land acquisition projects and to requests to fund certain recommended habitat acquisitions out of the expense budget rather than the capital budget; whether and how to close out a discrete set of assessment, monitoring and evaluation projects; how to handle projects that, from a review of the project responses, may need a specifically focused Step or similar review before proceeding or that raise an issue about a possible scope expansion; and so forth. For more detail on these, what these issues were and how the Council worked through them, see the memoranda prepared by the staff for the June, July and August Council meetings (see 2006 budget page for links) and the minutes of these meetings. How the Council resolved these issues is reflected in the projects and budgets recommended and, where appropriate, in the comments in the table associated with specific projects. In most cases, this is sufficient. For example, the comments in the budget tables identify those projects for which the project response for FY06 raised the possibility of a scope expansion that, if true, would not be allowed, or that appear to require a review of some type before proceeding. Working with the Council staff, Bonneville should inquire further into these projects before contracting to determine if the project is truly within one or the other of these categories and, if so, to take or allow for the appropriate action. For a few of these issues, the Council offers the following further guidance: UPA projects. The action agencies committed to what is called the final Updated Proposed Action (UPA) as part of the most recent Section 7 consultation under the Endangered Species Act on the proposed operation of the Federal Columbia River Power System. Bonneville proposed that to start a number of activities to implement the UPA in FY06. The Council worked with Bonneville to develop an appropriate list of UPA-related projects and budgets, reflected in the attached tables. Some of these are new projects, and some represent an expanded scope for an existing project. These project recommendations are the only exception in the Council's FY06 start-of-year planning to the basic premise of not beginning new work in FY06. For that reason, the Council included these projects in the planning budget only under the condition that any new work derived from the UPA (whether in a new project or an expanded scope for an existing project) first undergo review by the ISRP and, subsequently, by the Council for a specific recommendation before implementation. Also, some of the projects are mere placeholders, such as the Columbia Cascade habitat placeholder, and these will require much further definition before they are ready for review. O&M funding for wildlife land acquisitions. Budgets for those projects that maintain and protect land acquired for wildlife habitat are based on the following principles: Level funding applied to land acquisition O&M budgets (as to all other projects), except in the case of new land acquisitions or where there has been the adoption of a management plan since the last budget recommendation. When new acquisitions have occurred since the last budget recommendations, but no management plan for the land exists, Bonneville should provide a consistent base amount of operation and maintenance funding only, largely for management planning and the most necessary maintenance. With the adoption of a management plan, Bonneville should work with the project sponsor to set O&M budgets that are relevant to the tasks scheduled for implementation in the management plan, with reference to the ?Guidelines for Enhancement, Operation, and Maintenance Activities for Wildlife Mitigation Projects? adopted by the wildlife managers in 1998. The amounts shown in the budget table (largely derived from the sponsors? requests and preliminary input from Bonneville) should be considered ceilings; it may be possible to fund O&M for these projects consistent with the principles expressed above for less than the proposed amount. Funding projects to acquire habitat for fish out of the expense budget. During the last provincial review process, the Council recommended that Bonneville fund a set of project proposed to acquire land to protect important habitat for anadromous and resident fish. Bonneville recognizes the importance of the projects, but has been unable to use its capital funds for this purpose. The projects sponsors, with the encouragement of Bonneville representatives, now propose to fund acquisitions under these projects out of the expense budget in FY06. The Council is willing to consider the concept of using available funds in the expense budget to implement these projects in FY06 but has requested defined, project specific budgets for consideration. The project tables identify the five projects involved, in the comments. But Bonneville and Council staff and the project sponsors are still working to define precisely which parcels may indeed be available in FY06 and at what specific budgets. The Council staff will bring back to the Council for review and possible recommendation specific proposed actions and expense budgets for these projects. Bonneville should not use its expense budget to acquire land under these projects if and until the Council makes a recommendation to do so. Projects coming to an end. The Council identified a set of projects, mostly involving discrete assessment, monitoring or evaluation activities, which should come to a conclusion during FY05 or FY06. The Council staff worked with Bonneville representatives to identify appropriate close-out budgets in FY06 where necessary. Recommended projects Bonneville has not funded after labeling them low priority. The Council identified a small set of projects in the area above Hells Canyon that the Council recommended for funding during the provincial review, but which Bonneville subsequently placed on a low-priority list and has declined to fund, but which have not been closed out for other reasons. The Council does not agree with Bonneville's action and continues to recommend that these projects be funded. The projects are included in the tables, along with recommended budgets for those projects for which the project sponsors requested funding during FY06. Revised within-year process. The Council and Bonneville staff proposed revised procedures for tracking what is being spent during the fiscal year and making adjustments where necessary. The Council rejected one aspect of the proposal ? the staff proposal to establish a monetary threshold for within-year requests by project sponsors before these requests would require Council scrutiny. Otherwise, the Council approved the proposed revisions to the within-year process, which is attached as revised under the title ?FY 2006 Budget Tracking and Adjustment Process.? Project performance audit pilot program. Finally, the Council approved in concept the idea of recommending that Bonneville initiate in FY06 a pilot program that subjects a certain number of projects to a performance audit. The Council directed the staff to develop the concept into a proposal for the Council to consider at its September meeting, the proposal to include a set of alternatives for how to implement such a pilot program. The Council will be forwarding to Bonneville a specific recommendation on this subject. Please contact or of my staff if you have questions or seek further information on these recommendations. Please express our appreciation and thanks to your staff for the congenial and productive way they worked with the Council's staff to develop the project and budget information and proposals for Council review. Sincerely, Doug Marker, Fish and Wildlife Division Director ^ top

FY 2006 Council Recommended F&W Start-of-year Budgets