[ITEM 43] BOULDER CANYON PROJECT PERMIT AND LICENSE TO USE MACHINERY (1) THIS PERMIT and LICENSE, made as of the 22nd day of October, nineteen hundred thirty-four pursuant to the Act of Congress approved June 17, 1902, (32 Stat., 388), and acts amendatory thereof or supplementary thereto, all of which acts are commonly known and referred to as the reclamation law, and particularly pursuant to the Act of Congress approved December 21, 1928, (45 Stat., 1057), designated the Boulder Canyon Project Act, between THE UNITED STATES OF AMERICA, hereinafter referred to as the United States, acting for this purpose by Harold L. Ickes, Secretary of the Interior, hereinafter styled the Secretary, and THE CITY OF LOS ANGELES, a municipal corporation, and its Department of Water and Power (said Department acting herein in the name of the City, but as principal in its own behalf as well as in behalf of the City, the term City as used in this permit and license being deemed to be both the City of Los Angeles and its Department of Water and Power): WITNESSETH: EXPLANATORY RECITALS (2) WHEREAS, for the purpose of controlling the floods, improving navigation and regulating the flow of the Colorado River, providing for storage and for the delivery of the stored waters for reclamation of public lands and other beneficial uses exclusively within the United States, and for the generation of electrical energy, the Secretary, subject to the terms of the Colorado River Compact, is authorized to construct, operate and maintain a dam and incidental works in the main stream of the Colorado River at Black Canyon or Boulder Canyon, adequate to create a storage reservoir of a capacity of not less than twenty million acre-feet of water; also to construct, equip, operate and maintain at or near said dam, or cause to be constructed, a complete plant and incidental structures suitable for the fullest economic development of electrical energy from the water discharged from said reservoir; and (3) WHEREAS, after full consideration of the advantages of both the Black Canyon and Boulder Canyon dam sites, the Secretary has determined upon Black Canyon as the site of the aforesaid dam, hereinafter styled the Boulder Dam, and is now causing said dam to be constructed so as to create at the date of completion thereof a storage reservoir of a capacity of approximately thirty million five hundred thousand acre-feet of water, and is also causing to be constructed and equipped at or near said dam, a complete plant and incidental structures for the development of electrical energy from the water discharged from the aforementioned reservoir; and (4) WHEREAS, the United States has entered into a several contract with The City of Los Angeles (and its Department of Water and Power) and Southern California Edison Company Ltd., of date April 26, 1930, for the lease, and for the operation and maintenance of the power plant to be constructed at Boulder Dam as aforesaid, together with the right to generate electrical energy as therein stated, which said contract was amended by supplemental contracts of dates May 28, 1930, and September 23, 1931; and (5) WHEREAS, it appears that at least two of the generating units to be leased to the City under the aforesaid contract of April 26, 1930, as amended, will be ready for operation, and that it is probable that water sufficient for the operation thereof will also be available, in advance of the time when, under conditions now existing and having regard to the extreme low flow of the Colorado River during the present year, the Secretary will be able to make the declaration contemplated by Article (11) (a) of said contract of April 26, 1930, as amended; and (6) WHEREAS, it is to the interest of both parties hereto that if practicable such of said units as are ready for operation should be placed in operation as soon as water is available therefor and in advance of the time when under such present conditions such declaration can be made; and (7) WHEREAS, to that end, it is the desire of the parties to arrange the terms and conditions upon which the City may, in advance of the time when said lease to it shall take effect according to its terms, operate such generating units and incidental works as may be ready for operation in advance of the time when under such existing conditions such declaration can be made; (8) Now, THEREFORE, in consideration of the mutual covenants herein contained, the parties hereto agree as follows, to wit: INSTALLATION OF MACHINERY (9) In connection with the construction of Boulder Dam, power plant and appurtenant structures, the United States will place in readiness for service, as soon as in the exclusive determination of the Secretary shall be proper, such units as practicable of the generating machinery and incidental works now being installed, or under contract for installation, in said power plant building, pursuant to said lease to the City, consisting of (a) four (4) vertical shaft 115,000 horsepower, 180 r.p.m. hydraulic turbines, complete with governors, pressure regulators and butterfly type shut-off valves, (b) four (4) 82,500 kv-a., 60 cycle generating units, and (c) power transformers and switching equipment together with necessary auxiliary equipment and necessary spare parts for all such equipment. PERMIT AND LICENSE TO USE MACHINERY AND POWER PLANT FACILITIES (10) The United States hereby permits and licenses the City to use appropri ate plant facilities and such units of the machinery and equipment specified in Article nine (9) hereof as are ready for operation, at any time during the term of this permit and license for the period from the time when water for the generation of electrical energy is first available and the said machinery and equipment are installed, as conclusively determined by the Secretary, to the time when, as conclusively determined by the Secretary, electrical energy may be generated under conditions contemplated by the aforesaid contract of April 26, 1930, as amended, and particularly under the provisions of Article eleven (11) (a) thereof. OPERATION AND MAINTENANCE OF POWER PLANT (11) Upon written notification from the Secretary that generating equipment is ready for operation by it, under this permit and license, and that water is available for generating energy therefrom, the City shall assume operation and maintenance of that portion of the generating machinery and incidental works and structures which is ready for operation, and if from time to time, within the period of this permit and license, additional generating equipment shall be ready for operation, then upon written notification from the Secretary that such additional generating equipment is ready for operation by it under this permit and license, the City shall assume operation and maintenance of such additional generating equipment, and thereafter the City shall save the United States, its officers, agents and employees harmless as to injury and damage to persons and property which may in any manner arise out of the operation and maintenance of the portion of such generating machinery and incidental works and structures, the operation of which has been so assumed by the City. Machinery and equipment, the operation of which is assumed by the City hereunder, shall be maintained in first class operating condition at the sole cost and expense of the City, under the supervision of a Director appointed by the Secretary. The Director, among other powers, shall have authority to enforce rules and regulations promulgated by the Secretary in accordance with the Boulder Canyon Project Act, respecting operation and maintenance of the power plant and appurtenant works and structures, pursuant to Article twenty-four (24) hereof. OPERATION AND MAINTENANCE OF DAM (12) The United States will for the period of this permit and license operate and maintain the dam, reservoir, pressure tunnels, penstocks to but not inclusive of the shut-off valves at the inlets to the turbine casings, and outlet works, and shall have full control of all water passing the dam for any and all purposes. The City shall not during the period hereof have the right to demand the release of any quantities of water for the generation of electrical energy, or otherwise, but shall have the right to the use of waters released from the reservoir created by the construction of Boulder Dam for the generation of electrical energy only as, if and when, as conclusively determined by the Secretary, water is available for the use of the City for such purposes. It is also understood and agreed by the City that this permit and license shall be without prejudice to the right of the United States to make a contract with The Southern Sierras Power Company and The Nevada-California Power Company for the sale of electrical energy and the lease of power privileges during the period from the time water is first available for the generation of electrical energy at Boulder Dam to the time when Southern California Edison Company, Ltd. is entitled or obligated to take electrical energy under the provisions of the aforesaid contract of April 26, 1930, as amended; provided, however, that any such contract shall provide that the Companies shall not have the right to demand the release of any quantities of water for the generation of electrical energy or otherwise, but shall have the right to the use of waters released from the Boulder Dam, only if, as and when, as conclusively determined by the Secretary, water is available for the use of the Companies for the generation of electrical energy over and above quantities of water required and used by the City (either before or after the date on which one billion two hundred fifty million (1,250,000,000) kw. h. of electrical energy per year is ready for delivery as declared by the Secretary pursuant to Article (11) of the aforesaid contract dated April 26, 1930, as amended) for the operation, at any capacity up to the maximum, of electrical generating equipment furnished and installed by the United States for the use and benefit of the City and others that have heretofore contracted with the United States for the purchase of electrical energy to be generated at Boulder Dam power plant and are entitled or obligated to take electrical energy prior to the time Southern California Edison Company, Ltd., is entitled or obligated to take electrical energy to be thus generated. It is also understood and agreed by the City that this permit and license shall be without prejudice to the right of the United States to make a contract, or contracts, with the State of Nevada and/ or the State of Arizona for electrical energy for use within such states, respectively, during the period of this permit and license, in any amount not exceeding eighteen per centum (18%), to each of said states, of the electrical energy to be generated by the City under the terms of this permit and license. If any such contract, or contracts, shall be so made the City covenants to generate and furnish to the state, or states, so contracting, at transmission voltage, the electrical energy to which such state, or states, may be entitled under such contract, or contracts. Such contract, or contracts, and such generation and furnishing, shall be upon the same terms and conditions with respect to notice, payment and all other matters, as the terms and conditions relating to the generation for and delivery to the States of Nevada and Arizona, of firm energy, as set forth and contained in the aforesaid contract of April 26, 1930, as amended, excepting only that the basis of cost to said states, or either of them, for falling water, shall be the same as is applicable to the City under the terms of this permit and license. It is also understood by the City that the dam and reservoir will be operated and used: First, for river regulation, improvement of navigation, and flood control; second, for irrigation and domestic uses and satisfaction of perfected rights in pursuance of Article VIII of the Colorado River Compact; and, third, for power, and this permit and license is given upon the express condition, and with the express covenant, that the rights of the City to waters of the Colorado River, or its tributaries, shall be subject to, and controlled by the Colorado River Compact. 833942-50-33 |