In 1962, the Federal Power Commission granted the Douglas County Public Utility District a 50-year license to build and operate Wells Dam about 8 miles downstream of Pateros. Construction of the dam would flood much of the original city. The Pateros City Council accepted an offer to relocate the town, and the PUD spent about on moving or demolishing buildings and improving the town's infrastructure. Wells Dam went into operation in 1967. Despite relocation of the city, the population dropped by almost a third from 1960 to 1970.