H.R. 3981 would authorize the Bureau of Reclamation (BOR) to convert some water service contracts in 17 western states to repayment contracts. Water users that choose to convert their contracts would be required to accelerate repayment of their share of the capital costs of constructing the affected projects. The bill also would authorize the BOR to spend receipts attributable to accelerated payments to construct new water projects.
Based on information from the BOR, CBO estimates that enacting the bill would have no net effect on direct spending over the next 10 years because increases in offsetting receipts from accelerated repayments (net of annual payments that would otherwise occur under current law) would be offset by increases in direct spending for constructing new projects over the 2015-2024 period. Additionally, because we expect nonfederal contractors would finance accelerated payments with bonds exempt from federal taxation, the staff of the Joint Committee on Taxation (JCT) estimate that enacting the legislation would lead to a decrease in revenues of $43 million over the 2015-2024 period. In total, CBO estimates that those changes would increase budget deficits over that 10-year period by $43 million. Because the legislation would affect direct spending and revenues, pay-as-you-go procedures apply.
H.R. 3981 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and would impose no costs on state, local, or tribal governments.