TOLEDO BEND PROJECT FERC NO FINAL LICENSE APPLICATION INITIAL STATEMENT

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TOLEDO BEND PROJECT FERC NO. 2305 FINAL LICENSE APPLICATION INITIAL STATEMENT September 2011 Copyright 2011. Sabine River Authority of Texas and Sabine River Authority, State of Louisiana. All Rights Reserved.

Table of Contents INITIAL STATEMENT... 1 VERIFICATION, LOUISIANA... 9 VERIFICATION, TEXAS... 10 Page i Toledo Bend Project No. 2305

INITIAL STATEMENT BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION Application for License for Major Water Power Project-Existing Dam (18 C.F.R. 4.50, 4.51, and 5.18). (1) Sabine River Authority, State of Louisiana (SRA-LA) and Sabine River Authority of Texas (SRA-TX; collectively, the Authorities), apply to the Federal Energy Regulatory Commission (FERC or Commission) for a license for the Toledo Bend Project (Project), FERC No. 2305, as described in the attached Exhibits. The Project s current license, for which the Authorities are co-licensees, expires on September 30, 2013. (2) The location of the Project is: State(s): County(s) or Parish(es): Louisiana and Texas Panola, Sabine, Shelby, and Newton, Texas De Soto, Sabine, and Vernon, Louisiana Nearby towns: Hornbeck, Florien, Zwolle, Converse, Many, Leesville, and Logansport, Louisiana; Hemphill, Pineland, Center, Joaquin, Teneha, Timpson, Newton, Carthage, and San Augustine, Texas Stream or other body of water: Sabine River (3) The exact name and address of the applicant(s) are: Sabine River Authority of Texas Sabine River Authority, State of Louisiana P.O. Box 579 15091 Texas Highway Orange, TX 77631-0759 Many, LA 71449-5718 The exact name and business address of each person authorized to act as agent for the applicant in this application, are: (1) Mr. James W. Pratt (2) Mr. Jerry L. Clark Executive Director General Manager Sabine River Authority, Sabine River Authority of Texas State of Louisiana P.O. Box 579 15091 Texas Highway Orange, TX 77631-0759 Many, LA 71449-5718 Phone: 407-746-2192 Phone: 318-256-4112 (3) Mr. Melvin T. Swoboda (4) Charles R. Sensiba Licensing Manager Van Ness Feldman, P.C. Toledo Bend Project Joint Operation 1050 Thomas Jefferson Street, NW P.O. Box 579 Washington, D.C. 20007 Orange, TX 77631-0579 Phone: 202-298-1800 Phone: 409-746-2192 Page 1 Toledo Bend Project No. 2305

(4) The Authorities are both governmental entities organized and existing under the laws of their respective states. In 1949, the Sabine River Authority of Texas was established by the Texas State Legislature. A copy of the enabling legislation for the Sabine River Authority of Texas appears at Attachment 1. The Louisiana State Legislature created the Sabine River Authority, State of Louisiana the following year. A copy of the enabling legislation for the Sabine River Authority, State of Louisiana, appears at Attachment 2. As such, the Authorities are municipalities within the meaning of Section 3(7) of the Federal Power Act (FPA) and are claiming the status of an existing licensee under Section 15 of the FPA. (5)(i) The statutory or regulatory requirements of the state(s) in which the project would be located that affect the Project, as proposed, with respect to bed and banks, and to the appropriation, diversion, and use of water for power purposes, and with respect to the right to engage in the business of developing, transmitting, and distributing power, and any other business necessary to accomplish the purposes of the license under the FPA, are: State Texas Louisiana Agency Texas Commission on Environmental Quality Texas Commission on Environmental Quality Texas General Land Office Louisiana Department of Environmental Quality N/A Louisiana Department of Natural Resources, Office of Coastal Management (LOCM) Statute or Regulation TAC 30-307; TAC 30-279 TWC 2(B)11; TAC 30-295; TAC 30-297 TAC 31 Part 16 LAC Title 33, Part IX, Subpart I, Chapter 15 La. Rev. Stat. 38:2325. La. Rev. Stat. 49:214:21 to 49:214.39 Statutory or Regulatory Requirement Water Quality Certification (Section 401 of the Clean Water Act) Water Rights (Permits to Public Waters) Texas Coastal Zone Management Program (CMP) Water Quality Certification (Section 401 of the Clean Water Act) Right to conserve, store, control, preserve, utilize, and distribute waters of the Sabine River Louisiana Coastal Zone Status Request will be submitted following the filing of the final license application with FERC. Existing water rights are sufficient to operate the Project as proposed in this application. No federal consistency certification or determination is required, as the Project is outside of, and does not affect resources within, the CMP boundary. Request will be submitted following the filing of the final license application with FERC. Existing statutory rights are sufficient to operate the Project as proposed in this application. No federal consistency certification or determination is required, as the Project is outside of, and does not affect, Louisiana s coastal zone. A coastal zone permit is not required. In addition to the state laws referenced above, the Project also is subject to the Sabine River Compact, Pub. L. No. 82-578, 68 Stat. 690 (1954), an interstate compact between Page 2 Toledo Bend Project No. 2305

Texas and Louisiana, approved by Congress, regarding the allocation of the waters of the Sabine River Basin between the two states. The Compact equitably apportions the waters of the Sabine River between Louisiana and Texas. A copy of the Sabine River Compact appears at Attachment 3. (5)(ii)The steps which the applicant has taken or plans to take to comply with each of the laws cited above. Sabine River Compact The operation of the Toledo Bend Project for water supply purposes provides a dependable yield of 1,868,000 gallons per day, equally shared by SRA-TX and SRA-LA pursuant to and in compliance with the Sabine River Compact. Similarly, the yield of the Toledo Bend Reservoir (2,086,600 ac-ft/yr) is equally divided between Texas and Louisiana (Freese and Nichols 1999 1 ), as envisioned by the Compact. Water Quality Pursuant to 18 C.F.R 5.23, the Authorities are subject to water quality certification from the Louisiana Department of Environmental Quality (LDEQ) and Texas Commission on Environmental Quality (TCEQ) pursuant to Section 401(a)(1) of the federal Clean Water Act (CWA). The Authorities will apply for the water quality certifications no later than 60 days after FERC issues the notice of acceptance and ready for environmental analysis. Coastal Zone Management Act Consistency Certification The Toledo Bend Project is outside the designated coastal zone in both Texas and Louisiana, and the operation of the Project does not affect resources within the designated coastal zone in either state. The relicensing of the Project, therefore, is not subject to consistency certification under the Coastal Zone Management Act. By letter dated August 9, 2011, the Louisiana Office of Coastal Management stated: based on the location of the Project and the information described in the draft license application, the LOCM has concluded that the Commission's issuance of a new license for the continued operation and maintenance of the Project will not adversely affect coastal resources. The Project is not in and will not affect the coastal zone. Provided the operations remain unchanged, this action is not subject to a consistency review under La. Rev. Stat. 214.32 and no consistency certification is required. By letter dated September 16, 2011, the Texas Coastal Coordination Council stated: it has been determined that the project referenced above [the Toledo Bend Project] is outside the Texas Coastal Management Program (CMP) boundary. Therefore, it is not subject to consistency review under the Texas CMP. Copies of these letters appear at Attachment 4. 1 Freese and Nichols, Inc. 1999. Comprehensive Sabine Watershed Management Plan. Prepared for the Sabine River Authority of Texas in conjunction with the Texas Water Development Board. Contract #97-483-214. Page 3 Toledo Bend Project No. 2305

Water Rights The Authorities possess all of the necessary water rights to operate the Project as proposed in this application as discussed below. State Water Rights (Texas) On September 23, 1961, Permit No. 1994 was issued to the SRA-TX that grants the right to create Toledo Bend Reservoir with a gross storage capacity of 4,477,000 ac-ft (TCEQ 1961 2 ). The permit also states that SRA-TX can divert a total of 750,000 ac-ft of water per year for the following uses: 100,000 ac-ft for municipal uses; 600,000 ac-ft for industrial uses; and 50,000 ac-ft for irrigation uses. By the 1961 permit, SRA-TX also was permitted to make non-consumptive use of water for the purpose of hydroelectric power generation not to exceed 16,000 cubic feet per second (cfs) and to use the bed and banks of the Sabine River to convey water. As part of the permit, the SRA-TX was required to construct a 100-square-foot sluiceway in the dam to insure water for delivery of downstream senior water rights. On October 30, 1974, the SRA-TX was authorized under Permit No. 1994A to transfer 80,000 ac-ft of water per year to the Neches River basin (TCEQ 1974 3 ). On April 29, 1986, Permit No. 1994B was issued stating that SRA-TX was authorized to construct an additional hydroelectric generating unit which was never implemented (TCEQ 1986a 4 ). This permit also authorized SRA-TX to change the release rate from 16,000 to 21,000 cfs for combined generating units. On December 16, 1986, Certificate of Adjudication No. 05-4658 was issued to SRA-TX, which consolidated the previously issued water rights permits and set forth the following conditions (TCEQ 1986b 5 ): SRA-TX can impound 4,477,000 ac-ft of water; SRA-TX can divert water for the following uses: 100,000 ac-ft for municipal uses; 600,000 ac-ft for industrial uses; and 50,000 ac-ft for irrigation uses. A total of 80,000 ac-ft of the water uses described above can be diverted to the Neches Basin for municipal/industrial use; SRA-TX can divert water for hydroelectric generation not to exceed 21,000 cfs; SRA-TX can use impounded waters for recreation purposes; 2 Texas Commission on Environmental Quality. 1961. Permit #1994. Water Rights Permitting Section. 3 Texas Commission on Environmental Quality. 1974. Permit #1994A. Water Rights Permitting Section. 4 Texas Commission on Environmental Quality. 1986a. Permit #1994B. Water Rights Permitting Section. 5 Texas Commission on Environmental Quality. 1986b. Certificate of Adjudication No. 05-4658. Water Rights Permitting Section. Page 4 Toledo Bend Project No. 2305

SRA-TX can use bed and banks for downstream delivery of water; and The impoundment of water in the reservoir for hydroelectric purposes is subordinate to the impoundment of water for municipal, industrial, and irrigation purposes. State Water Rights (Louisiana) Louisiana s system of water law is set forth in the Louisiana civil code and is similar to a riparian system. Free flowing waters (i.e., surface waters) are considered state owned except where riparian claims have been made. With regard to the Sabine River basin, the Louisiana State Legislature, in creating the SRA-LA, authorized SRA-LA, among other things, to conserve, store, control, preserve, utilize, and distribute the waters of the rivers and streams of the Sabine watershed. To maintain downstream flow and improve lake access surrounding the Toledo Bend Reservoir, the Louisiana State Legislature amended existing statutes to restrict the use of hydroelectric power to water levels in the reservoir above 168 feet, subject to certain exceptions. (6) Name and address of the owner of existing Project Facilities: Sabine River Authority of Texas Sabine River Authority, State of Louisiana P.O. Box 579 15091 Texas Highway Orange TX, 77631-0579 Many, LA 71449-5718 The dam associated with the Project is not federally owned or operated. Page 5 Toledo Bend Project No. 2305

Additional Information Required by 18 C.F.R. 5.18(a) (1) Identify every person, citizen, association of citizens, domestic corporation, municipality, or state that has or intends to obtain and will maintain any proprietary right necessary to construct, operate, or maintain the project: The Authorities presently hold and will continue to hold the proprietary rights necessary to operate and maintain the Project. (2) Identify (providing names and mailing addresses): (i) Every county and/or parish in which any part of the project, and any Federal facilities that would be used by the project would be located: Panola County 110 S. Sycamore, Room 216A Carthage, Texas 75633 De Soto Parish P.O. Box 898 Mansfield, Louisiana 71052 Sabine County P.O. Box 176 Hemphill, Texas 75948 Sabine Parish 400 S. Capital Street Many, Louisiana 71449 Shelby County 200 San Augustine, Box 6 Center, Texas 75935 Vernon Parish P.O. Box 1548 Leesville, Louisiana 71446 Newton County 110 Court Street P.O. Drawer J Newton, Texas 75966 (ii) (A) Every city, town, or similar local subdivision: In which any part of the project, and any Federal facilities that would be used by the project, would be located: The Project facilities are not located within the boundary of any city or town but are located on lands within the counties referenced above in item (2) (i). (B) That has a population of 5,000 or more people and is located within 15 miles of the project dam: There are no towns of 5,000 or more people located within 15 miles of the Project dam. (iii) (A) Every irrigation district, drainage district, or similar special purpose political subdivision: In which any part of the project, and any Federal facilities that would be used by the project, would be located: Panola County Groundwater District P.O. Box 826 Carthage, Texas 75633 Page 6 Toledo Bend Project No. 2305

(B) That owns, operates, maintains, or uses any project facilities or any federal facilities that would be used by the project: There are no irrigation districts, drainage districts, or similar special purpose political subdivisions that own, operate, maintain, or use any project facilities or any federal facilities that would be used by the Project. (iv) Every other political subdivision in the general area of the project that there is reason to believe would likely be interested in, or affected by, the application: City of Hemphill 211 Starr Street Hemphill, Texas 79548 City of Center 617 Tenaha Street Center, Texas 75935 City of Tenaha P.O Box 70 Tenaha, Texas 75974 City of Newton 101 West North Street Newton, Texas 75966 City of San Augustine 301 South Harrison Street San Augustine, Texas 75972 City of Many 965 San Antonio Avenue Many, Louisiana 71449 Town of Zwolle P.O. Box 1038 Zwolle, Louisiana 71486 Town of Mansfield P.O. Box 773 Mansfield, Louisiana 71052 City of Pineland 101 Dogwood Street Pineland, Texas 79568 City of Joaquin P.O Box 237 Joaquin, Texas 75954-0237 City of Timpson P.O Box 369 Timpson, Texas 75975-0369 City of Carthage 812 West Panola Street Carthage, Texas 75633 City of Converse 209 W. Port Author Converse, Louisiana 71419 City of Leesville 101 West Lee Street Leesville, Louisiana 71446 Town of Logansport P.O. Box 400 Logansport, Louisiana 71048 (v) All Indian tribes that may be affected by the project: There are no Indian reservation lands within the Project Boundary or immediate Project vicinity. The ancestral lands of the Alabama-Coushatta Tribe of Texas, the Caddo Indian Tribe of Oklahoma, the Choctaw-Apache Tribe of Ebarb, and the Coushatta Tribe of Louisiana encompass the Toledo Bend Project area. The Alabama Coushatta Tribe of Texas, the Caddo Indian Tribe of Louisiana, and the Coushatta Tribe of Louisiana are listed on the Federal Register (FR 68:68180-68184) as Indian Entities Recognized and Eligible to Receive Services From the U.S. Bureau of Indian Affairs. The Choctaw- Apache Tribe of Ebarb is recognized by the State of Louisiana. The following Indian tribes have been contacted by the Authorities informing them of the relicensing: Page 7 Toledo Bend Project No. 2305

Alabama-Coushatta Tribe of Texas Mr. Carlos Bullock, Chairman 571 State Park Rd. 56 Livingston, TX 77351 Caddo Nation of Oklahoma Ms. Brenda Edwards, Chairperson P.O. Box 487 Binger, OK 73009 Coushatta Tribe of Louisiana Mr. Kevin Sickey, Chairman P. O. Box 818 1940 CC Bell Road Elton, LA 70532 Choctaw-Apache Tribe of Ebarb John W. Procell, Chairperson P.O. Box 1428 35 Lonnie Rd. Zwolle, LA 71486 Page 8 Toledo Bend Project No. 2305