§838k — Title 16 Conservation | U.S. Code

Summary

The BPA Administrator can sell bonds to the U.S. Treasury to pay for building, buying, or replacing the power transmission system and to support conservation, renewable energy, and fish and wildlife programs under the Pacific Northwest Electric Power Planning and Conservation Act (but not to buy power from plants over 50 average megawatts under section 6). Bonds can also be issued to refinance older bonds. The Treasury Secretary sets the bond terms and interest by looking at market rates, the life of the projects, and utility financing practices. Interest is based on similar U.S. government securities plus an amount to match government corporation rates. Starting in fiscal year 1982, if the Administrator does not make the repayments that were projected for a year (unless the shortfall is caused by lower power sales from changing streamflows or other things beyond the Administrator’s control), the Treasury Secretary may raise the interest rate on outstanding bonds by up to 1% for each year the repayments fall short. The Secretary must consider any early repayments and, after talking with the Administrator and FERC, be sure the Administrator can afford the higher rate. The increase stops once repayments meet the Secretary of Energy’s repayment criteria. The total principal outstanding could not exceed $1,250,000,000 before October 1, 1981, and may be increased by another $1,250,000,000 after that date if provided in annual appropriation laws; the extra amount is reserved for conservation and renewable loans and grants in a special revolving account and is not state or local money. Payments of principal, premiums, and interest on these bonds must come only from the Administrator’s “net proceeds.” Net proceeds means the money left from BPA’s total receipts after first taking out trust funds and certain listed costs (see section 838i(b)), and it includes any reserve funds created from those receipts. The Treasury Secretary must buy these bonds when issued and may use proceeds from public debt securities to do so. The Treasury may later sell, buy back, or redeem the bonds, and those actions are treated as U.S. public debt transactions.

Title 16, §838k

Conservation — Source: USLM XML via OLRC

(a)The Administrator is authorized to issue and sell to the Secretary of the Treasury from time to time in the name and for and on behalf of the Bonneville Power Administration bonds, notes, and other evidences of indebtedness (in this chapter collectively referred to as “bonds”) to assist in financing the construction, acquisition, and replacement of the transmission system, to implement the Administrator’s authority pursuant to the Pacific Northwest Electric Power Planning and Conservation Act [16 U.S.C. 839 et seq.] (including his authority to provide financial assistance for conservation measures, renewable resources, and fish and wildlife, but not including the authority to acquire under section 6 of that Act [16 U.S.C. 839d] electric power from a generating facility having a planned capability greater than 50 average megawatts), and to issue and sell bonds to refund such bonds. Such bonds shall be in such forms and denominations, bear such maturities, and be subject to such terms and conditions as may be prescribed by the Secretary of the Treasury taking into account terms and conditions prevailing in the market for similar bonds, the useful life of the facilities for which the bonds are issued, and financing practices of the utility industry. Refunding provisions may be prescribed by the Administrator. Such bonds shall bear interest at a rate determined by the Secretary of the Treasury taking into consideration the current average market yield on outstanding marketable obligations of the United States of comparable maturities, plus an amount in the judgment of the Secretary of the Treasury to provide for a rate comparable to the rates prevailing in the market for similar bonds issued by Government corporations. Beginning in fiscal year 1982, if the Administrator fails to repay by the end of any fiscal year all of the amounts projected immediately prior to such year to be repaid to the Treasury by the end of such year under the repayment criteria of the Secretary of Energy and if such failure is due to reasons other than (A) a decrease in power sale revenues due to fluctuating streamflows or (B) other reasons beyond the control of the Administrator, the Secretary of the Treasury may increase the interest rate applicable to the outstanding bonds issued by the Administrator during such fiscal year. Such increase shall be effective commencing with the fiscal year immediately following the fiscal year during which such failure occurred and shall not exceed 1 per centum for each such fiscal year during which such repayments are not in accord with such criteria. The Secretary of the Treasury shall take into account amounts that the Administrator has repaid in advance of any repayment criteria in determining whether to increase such rate. Before such rate is increased, the Secretary of the Treasury, in consultation with the Administrator and the Federal Energy Regulatory Commission, must be satisfied that the Administrator will have the ability to pay such increased rate, taking into account the Administrator’s obligations. Such increase shall terminate with the fiscal year in which repayments (including repayments of the increased rate) are in accordance with the repayment criteria of the Secretary of Energy. The aggregate principal amount of any such bonds outstanding at any one time shall not exceed $1,250,000,000 prior to October 1, 1981. Such aggregate principal limitation shall be increased by an additional $1,250,000,000 after October 1, 1981, as provided in advance in annual appropriation Acts, and such increased amount shall be reserved for the purpose of providing funds for conservation and renewable resource loans and grants in a special revolving account created therefor in the Fund. The funds from such revolving account shall not be deemed State or local funds.

(b)The principal of, premiums, if any, and interest on such bonds shall be payable solely from the Administrator’s net proceeds as hereinafter defined. “Net proceeds” shall mean for the purposes of this section the remainder of the Administrator’s gross receipts from all sources after first deducting trust funds and the costs listed in section 838i(b)(2) through (b)(7), (b)(11), and (b)(12) of this title, and shall include reserve or other funds created from such receipts.

(c)The Secretary of the Treasury shall purchase forthwith any bonds issued by the Administrator under this chapter and for that purpose is authorized to use as a public debt transaction the proceeds from the sale of any securities issued under chapter 31 of title 31, as now or hereafter in force, and the purposes for which securities may be issued under chapter 31 of title 31, as now or hereafter in force, are extended to include any purchases of the bonds issued by the Administrator under this chapter. The Secretary of the Treasury may, at any time, sell any of the bonds acquired by him under this chapter. All redemptions, purchases, and sales by the Secretary of the Treasury of such bonds shall be treated as public debt transactions of the United States.

Notes & Related Subsidiaries

Editorial Notes

References in Text

The Pacific Northwest Electric Power Planning and Conservation Act, referred to in subsec. (a), is Pub. L. 96–501, Dec. 5, 1980, 94 Stat. 2697, which is classified principally to chapter 12H (§ 839 et seq.) of this title. For complete classification of this Act to the Code, see

Short Title

note set out under section 839 of this title and Tables. Codification In subsec. (c), “chapter 31 of title 31” substituted for “the Second Liberty Bond Act” on authority of Pub. L. 97–258, § 4(b), Sept. 13, 1982, 96 Stat. 1067, the first section of which enacted Title 31, Money and Finance.

Amendments

1980—Subsec. (a). Pub. L. 96–501, § 8(d), inserted provision relating to the implementation of the Administrator’s authority pursuant to the Pacific Northwest Electric Power Planning and Conservation Act, inserted “issued by Government corporations” after “rates prevailing in the market for similar bonds”, increased the existing $1,250,000,000 aggregate principal limitation by an additional $1,250,000,000 after Oct. 1, 1981, to be used to provide funds for conservation and renewable resource loans and grants in a special revolving account created for that purpose, and inserted provision that, beginning in fiscal year 1982, if the Administrator fails to repay by the end of any fiscal year all of the amounts projected immediately prior to that year to be repaid to the Treasury by the end of that year under the repayment criteria of the Secretary of Energy and if that failure is due to reasons other than a decrease in power sale revenues due to fluctuating streamflows or other reasons beyond the control of the Administrator, the Secretary of the Treasury may increase the interest rate applicable to the outstanding bonds issued by the Administrator during that fiscal year. Subsec. (b). Pub. L. 96–501, § 8(c), substituted “, (b)(11), and (b)(12) of this title,” for “and (b)(11) of this title,”.

Statutory Notes and Related Subsidiaries

Effective Date

of 1980 AmendmentAmendment by Pub. L. 96–501 effective Dec. 5, 1980, see section 11 of Pub. L. 96–501, set out as an

Effective Date

note under section 839 of this title.

Transfer of Functions

Functions of Secretary of the Interior with respect to Bonneville Power Administration transferred to Secretary of Energy by section 7152(a)(1)(D), (2) of Title 42, The Public Health and Welfare, with Bonneville Power Administration to be preserved as a distinct organizational entity within Department of Energy and headed by an Administrator.

§838k Bonneville Power Administration Bonds

Summary

Title 16, §838k

Notes & Related Subsidiaries

Editorial Notes

References in Text

Short Title

Amendments

Statutory Notes and Related Subsidiaries

Effective Date

Effective Date

Transfer of Functions

Citations & Metadata