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Reclamation Water Storage Projects: Section 4007 of the Water
Infrastructure Improvements for the Nation Act
Section 4007 of the Water Infrastructure Improvements for
reclamation laws, may be no more than 25% federally
the Nation Act (WIIN Act; P.L. 114-322) created a new
funded.
authority for the Bureau of Reclamation (Reclamation, part
of the Department of the Interior) to build water storage
For federal participation in the construction of a project
projects in the western United States. From FY2017 to
under either designation, the Secretary of the Interior must
FY2020, Congress appropriated $469 million for these
find that the project is feasible and provides federal benefits
projects, and Reclamation has allocated a portion of these
proportionate to the federal government’s cost share (e.g., a
funds to progress on a number of water storage projects in
project providing 50% federal support appears to require
its service area.
that 50% of its benefits be federal in nature, whereas a
project providing 25% federal support must have 25%
Background
federal benefits). Project sponsors also must agree to pay
In the early and mid-20th century, Reclamation built
their portion of project costs up front (i.e., at the time of
hundreds of large dams and water diversion structures
construction). After the Secretary’s recommended projects
throughout the West. Traditionally, Reclamation’s role in
have been transmitted to Congress, the project must be
water project development has been limited to
designated by name in an enacted appropriations act.
geographically specific projects authorized in federal
statute. Typically the federal government, through
Differences from Traditional Reclamation Water
discretionary appropriations to Reclamation, has provided
Storage Project Construction
full, up-front funding for the construction costs of these
Instead of full, up-front federal financing to be repaid over
facilities. Project beneficiaries, which are irrigators,
time (i.e., the “traditional” model for Reclamation projects),
municipal water suppliers, and hydropower contractors,
Section 4007 essentially authorizes partial, up-front federal
repay their portion of project construction or development
funding, with the corresponding nonfederal share of
costs over a 40-50 year term. The amount recouped by the
funding also required up-front. Proponents of these changes
federal government typically depends on several factors,
argue that they stretch scarce federal funds and provide
including the portion of project benefits that are
increased incentive for local involvement in storage
nonreimbursable because they are considered federal in
projects. At the same time, in requiring a large initial cost
nature (e.g., fish and wildlife enhancements, flood control,
share from nonfederal users, the new authority may not be
recreation), as well as adjustments for irrigators’ ability to
attractive for sponsors who cannot afford large, up-front
pay. Additionally, irrigation beneficiaries are not charged
payments.
interest on their repayment obligations. As a result, the total
amount repaid to the federal government for these projects
Section 4007 also significantly altered the role of
is typically less than the full cos t of construction.
congressional authorizing and appropriations committees in
project development. It allows Reclamation to move
Section 4007 of the WIIN Act
forward with construction without direct legislative
Section 4007 of the WIIN Act authorized a new structure
approval from congressional authorizing committees. By
for Reclamation to support water storage infrastructure
requiring designation of Administration recommendations
projects, including both surface water and groundwater
by name in appropriations acts, Section 4007 effectively
storage projects. The act authorized $335 million in
shifted project approval (i.e., authorization) decisions to the
discretionary appropriations for new and improved federal
appropriations process.
and nonfederal water storage projects. Any appropriated
funds are to be made available for qualifying water storage
Recent Funding, Project Allocations
projects approved for construction prior to January 1, 2021.
Congress appropriated $469 million for Section 4007
projects as of mid-2020, including funding in enacted
Funding for water storage project construction under
Energy and Water Development appropriations acts for
Section 4007 is available for two primary project types.
FY2017 ($67 million), FY2018 ($134 million), FY2019
“Federally-owned storage projects,” defined to be any
($134 million), and FY2020 ($134 million). For its part,
project to which the United States holds title and which was
Reclamation has issued three rounds of funding allocations
authorized to be constructed pursuant to Reclamation’s
for Section 4007 that, once approved by Congress, release
laws and regulations, may be no more than 50% federally
portions of this funding to individual projects.
funded. “State-led” storage projects, defined to be
Reclamation’s recommendations in January 2018 and
groundwater or surface water storage projects constructed,
February 2019 have been approved by Congress, and the
operated, and maintained by s tates or political subdivisions
latest recommendations (from June 2020) are awaiting
that are found to have a federal benefit in accordance with
congressional action as of the date of this report (Table 1).
https://crsreports.congress.gov
Reclamation Water Storage Projects: Section 4007 of the Water Infrastructure Improvements for the Nation Act
Table 1. Approved and Proposed Allocations for Section 4007 Water Storage Projects
($ in millions)
Jan 2018
Feb 2019
June 2020
Project (State)
(approved)
(approved)
(proposed)
Shasta Dam and Reservoir Enlargement Project (CA)
$20.0
-*
$15.0
Sites Reservoir Storage Project (CA)
$4.35
$4.0
$4.0
Upper San Joaquin River Basin Storage Investigation (CA)
$1.5
-
-
Friant-Kern Canal Subsidence Chal enges Project (CA)
$2.2
$2.35
$71.0
Boise River Basin Feasibility Study (ID)
$0.75
$1.75
$2.88
Yakima River Basin Water Enhancement Project—Cle Elum
$2.0
$4.0
$1.0
Pool Raise (WA)
Upper Yakima System Storage Feasibility Study (WA)
$2.5
-
-
Del Puerto Water District Feasibility Study (CA)
-
$1.5
$1.5
Los Vaqueros Reservoir Phase 2 Expansion (CA)
-
$2.16
$7.85
Delta Mendota Canal Subsidence Correction (CA)
-
-
$3.0
San Luis Low Point Improvement Project (CA)
-
-
$1.7
Sacramento Regional Water Bank (CA)
-
-
$0.87
Total
$33.30
$15.76
$108.79
Sources: Bureau of Reclamation Reports to House and Senate Committees on Appropriations, January 2018, February 2019, and June 2020;
and enacted appropriations legislation for FY2018 (P.L. 115-141) and FY2020 (P.L. 116-94).
Notes: *In 2019, Reclamation proposed $57 mil ion for the Shasta Dam and Reservoir Enlargement Project, but Congress did not agree to this
al ocation.
In the first two allocations (finalized in FY2018 and
implications for water storage priorities throughout the
FY2020 appropriations, respectively), Congress approved
West. Demand for additional funds under this authority is
Reclamation recommendations for nine projects in three
likely to continue, thus Congress may also be asked to
states. In June 2020, Reclamation recommended an
consider additional appropriations, as well as increases to
additional $108.8 million for 10 projects. If this funding
and extension of Section 4007. S. 1932 would extend the
were approved, approximately $160 million of the $469
authority for these projects through FY2025 and authorize
million will have been allocated to individual projects.
$670 million in additional funding. H.R. 2 includes an
authorization for $750 million in additional funding for
The project which has been recommended for the most
these projects through FY2026, as well as alterations to
funding as of 2020, the Shasta Dam and Reservoir
eligibility requirements and the approval process for
Enlargement Project, is controversial and is opposed by the
Section 4007 projects.
State of California. California state law prohibits any
expansion of storage at Lake Shasta that would inundate
Supporters have advocated for continuing and increasing
state-protected portions of the McCloud River, a tributary
funding for Section 4007 projects. They argue that new
of the reservoir. The Shasta project would raise Shasta Dam
construction would increase water availability in the West
and expand the capacity of the largest storage reservoir in
and help to address the effects of climate change on
California—Lake Shasta—a linchpin for the federal Central
availability of water resources, thus it warrants federal
Valley Project (CVP). The project would create an
prioritization. They also note that more funding is required
estimated additional 634,000 acre-feet of storage and
to complete the projects that initially received these funds.
51,000 acre-feet of yield (i.e., additional water supplies ) for
Opponents of extending the Section 4007 authority believe
CVP contractors. To date, this project is the only project
there should be little or no federal role in projects that
that has been recommended for funding by the
otherwise would be the responsibility of nonfederal entities.
Administration (in 2019) but not approved by Congress in
Some would also prefer that Congress focus on promoting
enacted appropriations language.
alternatives seen as more environmentally friendly, such as
water conservation and water reuse.
Legislation and Issues for Congress
In the future, the Administration is likely to continue
Charles V. Stern, Specialist in Natural Resources Policy
proposing funding allocations for Section 4007 projects for
congressional approval. These decisions may have
IF10626
https://crsreports.congress.gov
Reclamation Water Storage Projects: Section 4007 of the Water Infrastructure Improvements for the Nation Act
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