DRAFT

November 14, 2007

Stephen J. Wright
Administrator & CEO
Bonneville Power Administration
MG
905 NE 11th Ave. / P.O. Box 3621
Portland, OR 97208-3621

Chairman Tom Karier
Northwest Power and Conservation Council
Spokane Office
705 West First Avenue, MS-1
Spokane, WA 99201

Dear Sirs,

It is our understanding that the Bonneville Power Administration (BPA) is preparing to reopen the WP-07 Rate Proceeding pursuant to the May 3, 2007 Golden Northwest vs. BPA case. As you know, the costs associated with implementing the Columbia River Basin Fish and Wildlife Program (Program) were addressed in this legal opinion. In a recent meeting with the fish and wildlife agencies and tribes of the Columbia Basin Fish and Wildlife Authority (CBFWA), the BPA legal staff assured the fish and wildlife managers that if BPA is provided with new information regarding costs for implementing the Fish and Wildlife Program for FY08 and FY09, BPA is obligated to consider those costs in the upcoming rate proceedings. It is in this spirit that we submit this letter.

The members of CBFWA have recently participated in an analysis of unmet critical needs for various fish and wildlife projects across the region that were submitted and reviewed during the FY07-09 project selection process. Please find this analysis in the attached memo. As you conduct the rate case proceeding, please take this analysis into account as it indicates additional funding may be needed to meet critical needs. The fish and wildlife managers are concerned that BPA and the Northwest Power and Conservation Council (Council) funding recommendations and decisions to this point have compromised the implementation of these critical and essential projects as part of the Program to protect, mitigate and enhance the fish and wildlife resources of Columbia River. We request that BPA and the Council collaborate with the agencies and tribes, through CBFWA, to assure adequate funding is provided to meet these critical needs.

As your process for reviewing the WP-07 Rate Proceeding moves forward, we see this as an opportunity for collaboration on this important aspect of the Program. Our analysis recognizes that the list of projects currently approved by BPA for funding under the Expense category of the Integrated Program budget is significantly less than the available funding. So, it appears there are existing funds that could be budgeted to address some of these needs. However, an additional $28 million over the two year period may be required to fully implement these most critical and essential projects.

This analysis is consistent with the correspondence we sent on August 30, 2006 to Council requesting assistance in establishing funding levels that would support adequate implementation of BPA’s portion of the Fish and Wildlife Program and Subbasin Plans. At that time, the fish and wildlife agencies and tribes suggested an additional $30 million may be required to fund essential projects and tasks identified by the fish and wildlife managers and local recovery groups. Our current list of critical and essential projects is consistent with that letter which was copied to BPA prior to their FY07-09 funding decision. This list also includes several projects that will be included in any long term agreements. In the original rate proceeding for FY07-09, several fish and wildlife managers advocated levels of funding significantly higher than BPA established for the rate period. Our current analysis is not inconsistent with their submission. However, we are only focusing on critical and essential unmet needs for the remainder of this rate period.

With the reopening of the rate proceeding imminent, the fish and wildlife managers urge BPA to include adequate funding to implement the Program in any proposal BPA may submit for review in the WP-07 Rate Proceeding. We understand the current rate case allows the use of a NOAA Fisheries Biological Opinion rate adjustment mechanism; however, this should be an action of last resort. With our current analysis, it seems appropriate that collectively we should all use existing opportunities to assure costs are appropriately identified to assure proper rates from the onset.

The U.S. Fish and Wildlife Service abstain to this letter.

Thank you for consideration of this request. Please contact Brian Lipscomb to arrange a meeting at your earliest convenience.

Sincerely,

Larry Peterman,Vice Chair,

Montana Fish, Wildlife & Parks

Cc:	NPCC Members

Tony Grover, NPCC

Greg Delwiche, BPA

CBFWA Members

H:\WORK\MBRS\2007_1114\CBFWA_WP07letter_Nov9_2007DraftVer2.doc