1151 Valley Mall Parkway, East Wenatchee, WA 98802

509-884-7191 / 1-800-503-7990

Meaghan Vibbert
Public Information Officer
(509) 881-2221
News Release - 11/1/2004

Colville Settlement Press Release

November 1, 2004

Negotiations produce equitable settlement

East Wenatchee, WA; Nespelem, WA - After nearly two years of negotiation, the Confederated Tribes of the Colville Indian Reservation and Douglas County Public Utility District have reached a reasonable settlement regarding annual charges owed to the tribes.

Joe Pakootas, Chairman of the Colville Tribal Business Council said, “I’m feeling pretty happy about the outcome. The Tribe is finally going to receive some significant compensation for its past damages. A lot of our members may not feel complete with it, but at least compensation is started. The settlement is far better than years of litigation.”

“We are fortunate that conditions allowed us to work out a solution with the Colville Tribe,” said Douglas PUD Manager Bill Dobbins. “This settlement fulfills a license requirement that has been outstanding since the Project was originally licensed in 1962.”

A provision in the Federal Power Act and also in the Wells Project license requires the licensee to pay a reasonable charge for the use of tribal lands embraced within the Colville Indian Reservation. Over the years compensation has been paid for some, but not all of the land in question, and the amount of that compensation has been disputed by the Tribe. Agreements have now been negotiated to resolve this long-outstanding issue.

The Tribe will release all past and present claims regarding annual payments against the Douglas County PUD for use of lands within the Project, affirm all land rights previously conveyed to Douglas PUD, including the right to impound water over the beds of the Okanogan and Columbia rivers within the Project Boundary. The Tribe also agrees to support Douglas PUD’s efforts to obtain a new fifty-year license for the Wells Project.

The Wells Project will pay a lump sum of $13.5 million to the Colville Tribe within six months of the date the Federal Energy Regulatory Commission (FERC) approves the settlement. Douglas PUD will sell Wells Project revenue bonds to finance the obligation. Current Wells Project participants will bear the cost of debt service through August 31, 2018. Douglas PUD will transfer approximately 466 acres of Wells Project land to the Colville Tribe within thirty days of FERC approval. The properties are owned by the PUD but are above the Project boundary and are surplus to the operational needs of the Wells Project.

The Colville Power Allocation shall be four and one-half percent (4.5%) of Wells Project output through August 31, 2018, increasing to five and one-half percent (5.5%) thereafter. The Colville Tribe will pay Wells Power Cost for this allocation. Douglas PUD will initially sell the Colville Power Allocation for the Colville Tribe.

Douglas PUD does not anticipate an immediate change to its retail electric prices, but the settlement will likely be a contributing factor at some point in the future when it is necessary for the District to adjust electric prices.