Iowa, in the amount of $8,500,000, (4) enter into an assumption of liability and a loan agreement for the payment of $4,500,000 of Industrial Development Revenue Bonds in connection with the acquisition of coal cars for a unit train or enter into a conditional sales agreement or other financing arrangement, and (5) issuance of up to 300,000 shares of Preferred Stock, par value $50 per share, in the amount of $15 million, via private placement.

By amendment No. 1, filed March 5, 1979, Company amended its original application by withdrawing its request to issue the 300,000 shares of Preferred Stock, via private placement.

A separate Commission order will be issued regarding the proposed assumption of liability for the financing of coal cars for the unit train.

The Applicant is proposing to enter into loan agreements with the City of Clinton, Iowa, for payment of Pollution Control Revenue Bonds of $7,500,000 and an unsecured loan of $1,000,000, to finance the construction of pollution abatement equipment on Unit 2 at Applicant's Milton L. Kapp Power Station. The net proceeds will be loaned by the City of Clinton to the Applicant pursuant to the loan agreement. Payments by the Applicant under the loan agreement will be sufficient to pay principal, premium, if any, and interest due on the bonds and note.

Written notice of the Application has been given to the Iowa State Commerce Commission, the Illinois Commerce Commission and the Minnesota Public Service Commission and to the Governor of each of the States. Notice has also been given by publication in the Federal Register stating any person desiring to be heard or to make any protest with reference to the Application shall file petitions or protests on or before March 27, 1979, with the Federal Energy Regulatory Commission, Washington, D.C. 20426. No petition, protest or request to be heard in opposition to the granting of the application has been received.

The Office of Chief Accountant finds:

(1) Interstate Power Company, a corporation, is a public utility within the meaning of Section 204 of the Federal Power Act, subject to the jurisdiction of the Commission.

(2) The proposed guaranty by the Company of the Pollution Control Revenue Bonds to be issued by the City of Clinton, Iowa, will constitute an

assumption of liability within the purview of Section 204 of the Federal Power Act.

(3) The proposed issuance of Common Stock as described above, will constitute an issuance of securities within the purview of Section 204 of the Federal Power Act.

(4) Applicant is not organized and operating in a State under the laws of which the security issue here involved is regulated by a state commission within the meaning of Section 204(f) of the Act, and the proposed issuance is, therefore, not exempt by virtue of that Section from the requirements of Section 204 of the Act.

(5) The proposed issuance of Common Stock and assumption of liability will be exempt from the competitive bidding requirements of Section 34.la of the Commission's Regulations under the Federal Power Act by reason of paragraph 34.1a(a)(2) thereof.

(6) The proposed issuance of securities is consistent with the provisions of Section 204(a) of the Federal Power Act.

Pursuant to the Authority Delegated in Docket No. RM78-19, August 14, 1978, FERC Statutes and Regulations, ¶30,016, the Office of Chief Accountant Authorizes:

The proposed issuance of Common Stock and assumption of liability as guarantor for the Pollution Control Bonds upon the Terms and conditions and for the purpose set forth in the application, subject to the provision set forth below.

(A) The proposed issuance of Common Stock and Assumption of Liability shall be exempted from compliance with the competitive bidding requirements of Section 34.1a(a), (b) and (c) of the Regulations under the Federal Power Act.

(B) The foregoing authorization is without prejudice of the authority of the Commission or any other regulatory body with respect to rates, service, accounts, valuation, estimates or determinations or cost or any other matter whatsoever now pending or which may come before the Commission.

(C) Nothing in this letter shall be construed to imply any guarantee or obligation on the part of the United States in respect to any security to which this order relates.

L. H. DRENNAN, JR.
Chief Accountant.

[162,157

On May 6, 1974, the Pacific Power & Light Company (PPLC), Licensee for Project No. 658, led an application' under Section 62 of the Federal Power Act (Act) for surrender of its minor-part cense' for Project No. 658, a 66-kV transmission ne with a right-of-way 100 feet wide extending bout 90 miles in a general southeastwardly direcon from PPLC's hydroelectric power station at Taches, Washington. The 100-foot right-of-way -averses lands of the Yakima Indian Reservation in akima County, Washington (approximately 1.02 iles), and United States lands administered by the ureau of Land Management (BLM) in Benton ounty, Washington (approximately 5.70 miles).

On October 19, 1973, PPLC had filed an pplication for amendment of license seeking Comission approval of the sale of that portion of the ansmission line located in Benton County, includg related structures and privately owned lands, to e Benton County Public Utility District No. 1. On pril 4, 1974, PPLC was notified by a Commission rected letter that Commission staff studies had termined the transmission line to not be a priry line within the meaning of Section 3(11)3 of e Act, but rather an operating part of an interconcted transmission system not within the licensing thority of the Commission. Accordingly, the mmission's letter dismissed PPLC's application amendment of license, directed PPLC to file

within 30 days an application for surrender of license in accordance with Part 66 of the Commission's Regulations, and further directed PPLC to make application to the U.S. Department of the Interior (Interior) for permission to continue the occupancy by the transmission line of United States lands. PPLC filed the instant application in response to the Commission's letter."

By letter filed December 6, 1974, Interior noted that while it had no objection to the action proposed in the application, it could find no evidence that PPLC had filed for permission to occupy the Indian lands or those lands administered by Interior's Bureau of Land Management (BLM). PPLC responded shortly afterwards that on December 20, 1974, permission was requested of the Bureau of Indian Affairs, Yakima Agency. On May 21, 1976, PPLC filed with the Commission copies of two right-of-way permits over Yakima Indian lands issued by the Yakima Tribal Council for the continued use of those tribal lands occupied by the transmission line.

The public lands of the United States occupied by the transmission line-and administered by BLM-are located in Benton County, Washington. As mentioned above, the Benton County PUD No. 1 has purchased the Benton County portion of the transmission line from PPLC. Benton County PUD [162,1601

No. 1, by letter dated November 16, 1976, requested BLM's permission to occupy those Federal lands affected by the transmission line in Benton County. No permit has yet been issued. Accordingly, surrender of the license for Project No. 658 shall not be effective until all of the permits necessary for the continued occupancy of United States lands have been granted by the responsible agencies.

Approval of the surrender of the transmission line license would not involve any construction or change in project operation. Consequently, this action would not constitute a major Federal action significantly affecting the quality of the human environment.

It is ordered that:

(A) Surrender of the License for transmission line Project No. 658 is accepted, subject to the condition below, and shall be effective as of the date all permits necessary for the continued occupancy of United States lands by the works of Project No. 658 have been granted.

(B) The Pacific Power & Light Company shall continue to pay annual charges for Project No. 658 until the surrender of license has been made effective as described above.

(C) The Pacific Power & Light Company shall file copies with the Commission of all permits necessary for the continued occupancy of United States lands by the project works of Project No. 658.

(D) Until all necessary permits are secured and copies filed with the Commission, Pacific Power & Light Company shall report to the Commission, at

six month intervals, the steps it has taken and the progress made in obtaining the necessary permits.

(E) This order shall become final 15 days from the date of its issuance unless a petition apealing it to the Commission is filed under Section 1.7(d) of the Commission's Regulations, 18 CFR 1.7(d) (as amended, August 14, 1978). Failure of the Licensee to file such a petition shall constitute acceptance of this order.

-Footnotes

'This proceeding was commenced before the Federal Power Commission. By joint regulation of October 1, 1977 (10 CFR 1000.1), it was transferred to the Federal Energy Regulatory Commission. The term "Commission" when used in the context of action taken prior to October 1, 1977, refers to the FPC; when used otherwise, the reference is to the FERC.

216 U.S.C. § 799.

'The license was issued on July 9, 1926, for a period of 50 years, and amended on May 26, 1942. Its minor-part designation indicates that it licenses only those facilities located on United States lands. On July 7, 1976, 56 FPC 105, PPLC was issued an annual license authorizing PPLC to continue operation and maintenance of the project until the application for surrender is approved.

'Authority to act on this matter is delegated to the Director, Office of Electric Power Regulation, under Section 3.5(g) of the Commission's Regulations, 18 CFR 3.5(g) (as amended August 14, 1978, FERC Statutes and Regulations 30,016).

16 U.S.C. 796(11).

18 CFR §§ 6.1 - 6.5 (1977).

'Public notice of the application for surrender was issued on June 20, 1974, with July 29, 1974, was the last date for filing protests or petitions to intervene. None were received.

The Consumers Power Company, Licensee for the Hodenpyl Project FERC No. 2599, filed for Commission approval a Revised Exhibit R for the Project on March 31, 1978, and supplemented it on April 20, and May 1, 1978, pursuant to Article 40' of the license2.

Discussion

The Exhibit R indicates that Licensee leases 229 acres of project lands for recreational purposes, and provides 3 private boat docks, 5 park areas and camping areas, 2 Boy Scout Camps, a roadside park, a picnic area, and a canoe portage. A U.S. Department of Agriculture (Forest Service), campground is located adjacent to the project. Licensee also proposes to: (1) develop a public fishing site at Woodpecker Creek downstream of the dam, im

prove road access to the fishing site, and provide a gravel parking area for 10 to 15 cars by mid-1980, (2) improve boat launching facilities by the summer of 1979 and gradually withdraw trailer sites from the water's edge within the existing Mesick Trailer Park by 1985; (3) construct a new boat launching ramp at Village Park in the future; and (4) reserve certain project lands for future recreational uses. Improvement of the existing canoe portage, as proposed in the Exhibit R, was completed in August, 1978. Additional recreational facilities will be developed as the needs occur. Sanitation facilities that are presently provided at the project are described in the Exhibit R. Estimated recreational usage, as shown in the Exhibit R and on Form 80, indicates that the present annual visitation is 100,000 day and 76,000 overnight visitors, while

projected ultimate visitation is estimated to be 120,00 day and 92,000 overnight visitors.

The Exhibit R was prepared in consultation with the Heritage Conservation and Recreation Service, Forest Service, Michigan Department of Natural Resources, and local entities. Their recommendations have been incorporated into the recreation plan.

The Revised Exhibit R complies with the requirements of Article 40 of the license, and it is being approved.

Public notice of the application was given on January 9, 1979 with February 20, 1979, as the last date for filing protests or petitions to intervene. No protests or petitions to intervene have been received. ENVIRONMENTAL IMPACTS

Adverse environmental impacts associated with construction of the proposed recreation facilities could include disturbance of wildlife and removal of vegetative cover, but these effects would be short-term and minor in nature. Following construction, the project area would be landscaped to complement and enhance the appearance of the immediate area.

There are no threatened or endangered plant or wildlife species in the area.

Staff consulted the National Register of Historic Places and found that no listed historic sites will be affected by the recreational development. In addition, there are no sites in the project area eligible for inclusion in the Register. Ordering Paragraph (B) requires licensee to consult with the Michigan State Historic Preservation Office prior to the commencement of any construction or development.

For the reasons discussed above, approval of the Revised Exhibit R for the Hodenpyl Project would not constitute a major Federal action significantly affecting the quality of the human environment; therefore, preparation of an environmental Impact statement is not necessary.

It is ordered that:

(A) The Exhibit R, filed on March 31, 1978, and suplemented on April 20 and May 1, 1978, consisting of (1) 7 pages of text, and (2) Exhibit R drawing Revision #1, titled “Project Recreational Use Map," FERC No. 2599-14, is approved.

(B) Prior to commencement of any construction of recreational facilities at the project, Licensee shall consult with the State Historic Preservation Officer (SHPO) to determine the need for, and extent of, any archeological or historic resource surveys and any mitigative measures that may be necesssary. In addition, should any previously unrecorded archeological or historic sites be discovered during construction, the Licensee shall halt construction and report its findings to the Commission and the SHPO, consult with the SHPO as to necessary procedures for assessing the significance of the sites, and develop a mitigation plan for the protection of significant archeological or historic

resources.

(C) This order shall become final 15 days from the date of its issuance, unless a petition appealing it to the Commission is filed under Section 1.7(d) of the Commission's Regulations, 18 CFR 1.7(d) (as amended August 14, 1978). Failure of the Licensee to file such a petition shall constitute acceptance of this order.

-Footnotes

1 Article 40. The Licensee shall consult and cooperate with the appropriate Federal, State and local agencies in the development of the project recreation resources to provide for optimum public utilization of the area and shall within one year from the date of issuance of this license file for Commission approval a revised Exhibit R conforming to Section 4.41 Exhibit R of the Regulations under the Federal Power Act. The revised Exhibit R shall give consideration to: (1) identification of project lands having recreation potential and their reservation for future public recreational use; (2) recreation facilities needed for future development to meet anticipated demands; (3) provisions for any needed sanitation and waste disposal facilities at existing recreational facilities; (4) estimated present of initial recreational use, and projected ultimate recreational use; and (5) the nature and extent of consultation and cooperation with appropriate Federal, State, and local agencies.

2 Authority to act on this matter is delegated to the Director, Office of Electric Power Regulation, under Section 3.5(g) of the Commission's Regulations; 18 CFR 3.5(g) as amended August 14, 1978, FERC Statutes and Regulations 30,016. In this order, the "Commission," when used in the context of an action taken or statement made prior to October 1, 1977, refers to the Federal Power Commission; when used otherwise, the reference is to the Federal Energy Regulatory Commission.

etter-Order Approving Settlement

[162,162)