The following excerpts from a pamphlet produced by the Army Corps of Engineers, circa 1955 provide an overview of the justifications, funding, federal-local partnerships, and statistics regarding the John Day Dam. The pamphlet is available at the Oregon Historical Society
The John Day Proposal is Sound
The proposed legislation offers a sensible and practical method of getting the John Day project built quickly in conformance with the comprehensive Columbia River development plan of the Corps of Engineers to help meet urgent power needs of the Pacific Northwest and improve navigation.
We are very much interested in seeing the John Day project built promptly because It means more power for the region and will help meet the needs of the 600,000 customers who look to us for their electric service requirements.
There is every reason to believe that the $273,000,000 needed for construction of the power facilities at John Day can be supplied to the government by power distributors of the area if Congress will act to make this possible. Since the power investment represents nearly 90 per cent of the total estimated cost of the project, the proposed plan of financing would assure a rapid and efficient construction program.
If necessary, we are willing to undertake to put up the full $273,000,000 needed for the power development. It should he made clear, however, that the amount of power we may obtain would depend entirely upon the volume of applications made to the Federal Power Commission by other responsible utilities seeking to participate in the program.
Power from John Day will be needed in the Northwest as fast as it can be made available. The project is a good one, and the cost of power from this source should be comparable with the rate levels forecast for the Bonneville Power Administration.
The feasibility of the financing plan has been discussed with responsible investment sources, and assurances have been given that utilities interested in participating in the project can get the money for construction of the power facilities on a reasonable basis.
Local interests will advance cash for construction
Total cost of the project is estimated at $3l0,000,000. Of this amount about $273,000,000 will be for power facilities. All of the power costs-88 per cent of the total cost of construction-will be advanced by the local interests contracting to market the power output.
In effect, the John Day proposal simply provides for an advance sale of power. In the case of other federal projects the government has appropriated taxpayers' money, built a dam, and then has sold the power for money enough to get back over a long period of years-usually 50-the amount invested in power facilities.
In the case of the John Day project the government would do its selling of the power output first, collecting sufficient payments in advance to meet all costs of the dam's power facilities, and then proceeding to build the project.
The Bill defines "local interests" as: "States or agencies thereof; people's utility districts, public utility districts, and municipalities operating electric distribution systems; rural electric cooperatives; and private electric utility companies."
The Bill further provides: "Any local interest . . . may within six months from the date of enactment of this Act, make application in writing to the Federal Power Commission. . . for participation in the project."
PHYSICAL FEATURES OF THE JOHN DAY PROJECT
217.3 miles from mouth of Columbia
Lock 86' x 675' with 14 feet over sills
Energy (annual) Prime
Total 7,540,000,000 kwh
A QUICK LOOK AT THE JOHN DAY PROJECT
Its total cost is an estimated $3l0,000,000.
About $273,000,000 would be advanced by local interests, as prepayment for power.
Navigation facilities - about $37,000,000 - will be paid for with Federal funds.
This financing plan for John Day will speed procurement of an essential power supply, vital to the continued economic growth of the Northwest.
In addition to advancing funds for construction of the power facilities, local interests will pay for operation, maintenance and replacement of power and related parts of the project.
Every cost allocated or charged for power operations will be repaid just as on other Columbia river dams owned by the Federal government. For example, the local participants will pay most of the first cost of fishways as well as of operation and maintenance.
Local interests will pay for transmission of power over government-owned lines if used.
Cost of power will be attractive to the prospective project participants, whether electric companies or public agencies, in comparison with BPA rates at the time John Day dam is completed, and increasingly so thereafter during the 50-year contract period.
The project will be Federally owned.
It will be designed, constructed, operated and maintained by the Army Engineers.
It will be a part of, and operated in accord with the comprehensive plan for the Columbia river.
It will be integrated with the Northwest Power Pool.
It will complete slack water navigation from the Pacific ocean to the Pasco-Kennewick area in eastern Washington.
It will produce 1,105,000 kilowatts of power, initially.
The equity portion of any financial participation by electric companies will be subject to State excise and Federal income taxes. These tax payments could amount to far more than the government's investment in non-reimbursables over the 50-year contract period - depending upon the degree of electric company participation.
Plan will speed construction
Federally-financed projects are dependent upon
annual appropriations for continuity of construction, and as a consequence
are subject to delays. Under the John Day proposal the money will
be available when it is needed, with a resulting economy of time
Area needs will be considered in allocating John Day power
The John Day Bill provides that if the applications for power exceed the total estimated power to be generated by the project, the Federal Power Commission will determine the allocation of power contracts, taking into consideration
"(l) the present and future availability to the applicant of power and energy from other comparable sources;
(2) the intent of Congress that the power and energy from the project shall have the widest distribution to domestic and rural customers, with proper regard for the needs and requirements of the applicants in the area to accomplish such purpose;
(3) that the allocation of power and energy shall be proportionate to the financial participation in the cost of the project by the respective applicants; and
(4) that there be an equitable division of the power and energy from the project, giving consideration to existing resources and the use thereof by each applicant."
Local participants will pay for upkeep, maintenance and operation
Under terms of the contracts to be entered into between the Federal government and the participating local interests, the local interests not only will pay the construction cost of power facilities in advance, but also will pay annually the operation and maintenance costs. The Bill provides:
"That the local interests shall pay (I) their proportionate share of the cost of operation and maintenance of and normal replacements to the power facilities and to the portion of the project allocated to power, both during construction and for such fifty year period after completion of the initial installation of the power facilities of the project; (2) any costs of transmission of such power as may by mutual agreement be transmitted over Federal transmission facilities (3) any lawful net charge for upstream and downstream power benefits as determined by the Federal Power Commission."
Thus, while ownership, operation and control of the project remain in the hands of the Federal government, local interests will assume for the duration of their contracts the full financial responsibility for operation and maintenance of power facilities; as well as their proportionate share for joint facilities.
Power cost will be low
John Day is generally recognized to be the largest, low-cost site remaining undeveloped on the Columbia's main stem that is close to major load centers. Early studies have indicated that cost of power from the John Day project will compare favorably with that of other major projects now being built or planned. The indication of low power cost was an important factor in obtaining assurance of the financial feasibility of the John Day proposal.
More power will be needed by 1960 the time to start construction is now
The homes, farms, businesses and industries of the Pacific Northwest are the greatest users of electricity in the world. The region is growing, and will continue to grow at a rate considerably greater than the national average.
Hydroelectric projects now being built will bring into being sufficient electricity to meet requirements until 1960 or 1961. But 500,000 to 600,000 kilowatts of new generation is needed every year, and it takes a long time to bring a major hydroelectric project into production. New starts must be made without delay.
Construction of the John Day project will take 8 to 10 years, from the time engineering studies are begun. It is probable that construction time will be reduced to some degree by the availability of funds when needed, rather than having to wait for Congressional appropriations; but even so, there should be no delay in beginning the job.
Power development in the Pacific Northwest is an "all hands" job
All power authorities agree that very soon expenditures for new power projects needed to keep pace with the region's growth must be at the rate of nearly 51,000,000 a day.
So great is the need, that every project now being planned must be pushed to completion as rapidly as possible. The resources of every segment of the Pacific Northwest's power industry must be utilized to the fullest. We must continue to seek every penny of Federal appropriations which can be secured to help with the job.
However- in ten years from 1946 to 1955 the Federal government appropriated a total of 51,485,000,000 for Pacific Northwest power construction.
During the next ten years close to $3,000,000,000 twice as much will be needed for construction of new power facilities, based on moderate estimates.
In view of the needs of other parts of the country, of the national debt, and of defense expenditures, it is not realistic to expect that any single agency even the U.S government will provide all the dollars for all the projects which the region needs NOW.
Local agencies, public and private, must join in partnership with the Federal government in comprehensively developing our water resources.
The John Day Bill proposes a way to get a Federal project speedily built, but with local participants supplying most of the capital requirements.
The "partnership" principle, as spelled out by the National Administration, is not new to the Pacific Northwest. As early as 1917, the utilities of the region began establishing interconnections between their systems for the exchange of power. These interconnections were developed as needed, and by 1942 a comprehensive system had been established which provides complete interconnection of all transmission systems - Federal, municipal, and investor-owned-and the integrated operation of all generation facilities. The resulting Northwest Power Pool is an outstanding example of efficient operation on a voluntary basis by diverse interests, an outstanding example of partnership. It is time now to put these principles of cooperation into motion for the development of new generation in the vast quantities needed in the years ahead.
John. Day will be an integral part of the comprehensive basin development plan
John Day dam was authorized for Federal construction in 1950. Under HR 5789 its construction will be in accordance with the comprehensive plan of basin development as outlined in the Army Engineers' Review Report on the Columbia river and its tributaries. The dam will be a multi-purpose project with important navigation, flood control, irrigation and power benefits.
John Day will be built, owned and operated by the Federal Government
The project will be built by the Chief of Engineers under the direction of the Secretary of the Army. At all times it will be owned by the United States government, and after completion will be operated by the United States government.
The Federal government will have full control over the design and construction of the project, and will have sole authority for the integration of its operation with other hydroelectric, navigation, irrigation and flood control projects on the Columbia river and its tributaries.
John Day will provide slack water
John Day will be the last link in the series of dams and channel improvements providing 328 miles of slack water navigation all the way from the mouth of the Columbia river to Pasco, Washington, in the heart of the Inland Empire. The dam, plus navigation locks, will enable barges to pass the rapids at this point and continue on up the river under slack water conditions. Further, the benefits of navigation can be secured for only a small outlay of Federal funds about 12 per cent of the dam's total estimated cost, for non-reimbursable features.
John Day will be a major,