02-31419. Change in Discount Rate for Water Resources Planning

AGENCY:

Bureau of Reclamation, Interior.

ACTION:

Notice of change.

SUMMARY:

The Water Resources Planning Act of 1965 and the Water Resources Development Act of 1974 require an annual determination of a discount rate for Federal water resources planning. The discount rate for Federal water resources planning for fiscal year 2003 is 5.875 percent. Discounting is to be used to convert future monetary values to present values.

DATES:

This discount rate is to be used for the period October 1, 2002, through and including September 30, 2003.

FOR FURTHER INFORMATION CONTACT:

James R. Handlon, Economist, Office of Policy, Washington DC 20240; telephone: [phone].

SUPPLEMENTARY INFORMATION:

Notice is hereby given that the interest rate to be used by Federal agencies in the formulation and evaluation of plans for water and related land resources is 5.875 percent for fiscal year 2003.

This rate has been computed in accordance with Section 80(a), Pub. L. 93-251 (88.Stat. 34) and 18 CFR 704.39, which: (1) Specify that the rate shall be based upon the average yield during the preceding fiscal year on interest-bearing marketable securities of the United States which, at the time the computation is made, have terms of 15 years or more remaining to maturity (average yield is rounded to nearest one-eighth percent); and (2) provide that the rate shall not be raised or lowered more than one-quarter of 1 percent for any year. The Treasury Department calculated the specified average to be 5.477 percent. Rounding this average yield to the nearest one-eighth percent is 5.500 percent, which exceeds the permissible one-quarter of 1 percent change from fiscal year 2002 to 2003. Therefore, the change is limited to one-quarter of 1 percent.

The rate of 5.875 percent shall be used by all Federal agencies in the formulation and evaluation of water and related land resources plans for the purpose of discounting future benefits and computing costs or otherwise converting benefits and costs to a common time basis.

Dated: November 8, 2002.

Elizabeth Cordova-Harrison,

Deputy Director, Office of Policy.