There is one other question, and that is the question of land limitation. There was no land-limitation reference in the bill last year, and it is my understanding that that meant that there would be no land limitation applied in the bill as it then passed. I understand that there is some inclination now to have a land-limitation clause inserted in the bill. I would merely say this in that regard: That a great many, probably the majority of these small projects, are going to be rehabilitation and betterment of existing projects, and that the size of the farms in those projects has been established by long experience; and we would hope that any limitation which might be implied would do as little violence to that setup as possible. I think that concludes my remarks. Mr. ASPINALL. Thank you, Mr. Bliss. The Chair will now ask Mr. Whitacre, from Nevada, manager of the Walker River Irrigation District and member of the small projects committee of the National Reclamation Association, to give his statement. STATEMENT OF ROY WHITACRE, MANAGER, WALKER RIVER IRRIGATION DISTRICT; AND MEMBER, SMALL PROJECTS COMMITTEE, NATIONAL RECLAMATION ASSOCIATION Mr. WHITACRE. Mr. Chairman, I would be very happy to submit this statement, and have already to the clerk, but there are 1 or 2 paragraphs I would like tocomment on. Mr. ASPINALL. Is there any objection to the witness submitting his statement at this time and then speaking extemporaneously? Hearing none, it is so ordered. (The prepared statement of Mr. Whitacre follows:) STATEMENT BY ROY M. WHITACRE, SECRETARY-MANAGER OF WALKER RIVER IRRIGATION DISTRICT, SECRETARY OF THE SMALL PROJECTS COMMITTEE OF THE National RECLAMATION ASSOCIATION AND Dire tor of THE NEVADA STATE RECLAMATION ASSOCIATION For over 5 years the small projects committee of the National Reclamation Association has proposed le vislation to the Congress to provide for a partnership arrangement between small irrigation districts and the Federal Government, whereby the development of the western water resources could be had at the least cost and at the lowest possible governmental level. The present bill, H. R. 384, the result of months of study and review by the respective committees of Congress, the Department of Interior and the National Reclamation Association can accomplish that desired result. Following the failure of passage of similar legislation at the last session of Congress, however, it was thought advisable to secure additional information on certain questions that had been raised as to the extent and advisability of the program. These questione meres 1. The mumber of projects interested in the legislation. 2. The number of acres of 'and involved. 3 The cost of the pro"TS”L 4. The purpose for which the funds wou'd be used In an attempt to amive at fants rather than conjecture, we have circularized many of the small »o» Föderal irrigation districts in the West, asking for the above information In addition to the results of the survey. I have had available the results of a study conducted in 195 by the Bureau of Reclamation entitled "Small Projects Iv Anfor interim stroman report on ems" projects. Although both surveys were admittedly moomplete the conclusions reached for the 17 Western States were Dere are over 430 erall ¿series ove 300.000 seres of land who could and probably wonnd apply for lows under the act, over a period of years The estimate of the costs by the Bureau was $176 millions. However, if the estimate is correct and we feel that it is, the provisions of the bill that require a 25 percent contribution on the part of the applicant would reduce the total loan capital required to about $132 million. Although determination was made by the Bureau that one-half of the works would be rehabilitation and betterment and one-half for new lands, samples of returns made to the small projects committee, indicate that in only few instances would the money be used for new development and in only two States was it indicated that new lands would be brought into production as a result of loans from this source. Basically, the purpose it would accomplish would be to cnserve and protect the districts and waters, established over the past many years and not to add materially to the acres already in cultivation. Apparently from the record of the action had last year, the matters considered under the measure, have with a few exceptions, been agreed upon by both the committee of the Senate and House as being proper and desirable legislation. It is on these controversial provisions I would like to comment. 1. Shall the loans be authorized by the Congress or by the Secretary of the Interior? At the last session of Congress, the House passed and delivered to the Senate H. R. 5301, which among other things provided for loans to non-Federal districts, of not more than $5 million on the authority of the Secretary of the Interior. This section was amended by the Senate committee to limit secretarial authorization to $200,000 and to require congressional authorization for any application for a loan in excess of that amount. In the study made by the Bureau of Reclamation in 1950, as set out above, it was estimated, on an incomplete basis, that there were in excess of 439 projects in the West who would come within the "small projects" category and who would, if legislation of this type prevailed, eventually apply for a loan. The committee felt that the consideration of this great number of requests for separate legislation would unduly burden the Members and committees of Congress, particularly in view of the fact that the bill provides that before any loan could be authorized, the Secretary must submit the matter to the respective Interior Committees for comments. Obviously, if the comment was negative the Secretary would deny the application. Further, before any moneys were made available to the local districts, the Appropriations Committee must decide on the validity of the request before funds would be granted. Actually a double check on the project. We feel that such review would be ample to protect the Government against any possible loss and also assure the success of the projects. 2. Shall review by the States in the river basin in which the project is located under subsection c, section 1, of the Flood Control Act of 1944 be required? This provision is not included in the present bill, but review is limited to the State or States in which the project is located. So far as we are able to determine from our own surveys and investigations, nearly all the contemplated applications for loans will be for rehabilitation, betterment, and enlargement of existing irrigation projects and most of this work will be to improve, and enlarge, distribution systems. The water and water rights have been established through court decree or compacts and no new rights are contemplated. The primary purpose being to make the most complete use of the water available on land already under irrigation. To require a small project in Wyoming or Montana which desired to improve its distribution system to first secure the comments of all the States in the Missouri Basin would nullify in most instances the intent of the act: To provide assistance with a minimum of red tape and delay. The same condition prevails on any project located on the Colorado River drainage system. Obviously no structure or works costing less than $5 million can impair the rights of other States on these interstate systems. 3. Shall the acreage limitation provisions of the Federal Reclamation Act apply? Were there any indication that large new areas of reclamation, containing new lands or new sources of water, we would have no complaint against the application of the acreage limitation provisions. However, most of these applicants will be from areas on which an agricultural economy already exists. Many of these districts have historys of from 50 to 100 years. Actually in my own district, the water rights date back as far as 1859, and any water to be developed or works planned to be constructed under the present proposal would be supplementary in nature and designed to firm up and make more stable a supply that has existed for many years. A large portion of the land is already held in ownership falling within the limitation requirements. Of the 491 landowners in the Walker River Irrigation Of the District, 450 of them have holdings of less than 320 acres per family. 80,000 acres of water right land, 68,000 acres or 85 percent fall within this category. To bar the project from the benefits of the act unless and until the 15 percent agree to break up their hol'ings would hardly be a justifiable procedure. I would ike to add that the principles as set out in H. R. 384 have received the endorsement of all the States in the West as copies of resolutions addressed to the Members of the Congress from your respective States testify. The National Reclamation Association at its 1954 meeting in Portland by resolution again endorsed the bill as here written and I am sure that many members of this committee have been urged by their constituents to support the bill. As a representative of the Nevada Reclamation Association, the small projects committee of the National Reclamation Association, and the Walker River Irrigation District I would like to add my endorsement of the principles set out in H. R. 384 and urge serious and favorable consideration for its passage in the form and in the manner it is now before you. Mr. WHITACRE. Last year our small projects committee, in an estimate to determine actually how many projects, the number of acres, and the cost of the projects developed a survey in an attempt to determine these matters. Although admittedly the results of the survey were incomplete, we took the results of that particular survey and one which the Bureau of Reclamation had conducted in 1950, which was entitled "Small Projects Inventory," an interim summary report on small projects. The conclusion reached for the 17 Western States were as follows: That there were over 450 small districts covering better than 1,300,000 acres of land who could and probably would apply for loans under the act over a period of years. The estimate of the cost by the Bureau was about $176 million. The determination by the Bureau was that about one-half of these works would be rehabilitation and betterment and the other half, of course, would bring in new lands. But samples of returns made to the small projects committee indicated that only in few instances would the money be used for new development, and that in only two States. was it indicated that new lands would be brought into production as a result of the loans. We also made an examination as to the maximum amount that the districts anticipated borrowing and only in two instances was the amount in excess of the $5 million figure that had been included in the Miller bill last year. Now, we do not know whether or not that figure was below the $5 million because that was the amount set in the bill or because that was the amount that the respective districts hoped to borrow. I would like, too, to cite a paragraph in reference to the discussion that was had in relation to the land-limitation provision and its effect on the respective districts, particularly as it affects our own district. in Nevada. Our own district, the history of it dates back to 1859. It is an established water economy, an agricultural economy that is based upon a complete agricultural unit for each individual ranch owner. A large portion of the land is already held in units that would come within the acreage limitation requirements of the Federal Reclamation Act. Of the 491 landowners in the district, 450 of them have holdings of less than 320 acres per family and of the 80,000 acres of water-right land, 68,000 acres, or 85 percent, fall within this category. That would leave about 15 percent of the total land and a number of families who would either be barred from participation if the act carried and we were eligible for a loan, or they would have to have some arrangement for penalty or interest provisions to be paid on those excess lands. I think that will complete my statement, Mr. Chairman. The Chair will now call Mr. Boen, manager and chief engineer of the Eastern Municipal Water District, California, also a member of the small projects committee of the National Reclamation Association. STATEMENT OF DOYLE BOEN, GENERAL MANAGER AND CHIEF ENGINEER, EASTERN MUNICIPAL WATER DISTRICT, HEMET, CALIF.; AND MEMBER, SMALL PROJECTS COMMITTEE, NATIONAL RECLAMATION ASSOCIATION Mr. BOEN. Mr. Chairman, I have a prepared statement I would like to submit. Mr. ASPINALL. Is there objection to the submission of the statement and it being placed in the record? Hearing none, it is so ordered. (The prepared statement of Mr. Boen follows:) STATEMENT BY DOYLE F. BOEN, GENERAL MANAGER-CHIEF ENGINEER, EASTERN MUNICIPAL WATER DISTRICT (RIVERSIDE COUNTY, CALIF.), HEMET, CALIF. My name is Doyle F. Boen. I am a registered civil engineer in the State of California. I reside in the city of Hemet, Calif. I am now and have been for 311⁄2 years the chief engineer and general manager of the Eastern Municipal Water District (Riverside County, Calif.). I make this statement on behalf of said district in my official capacity and as a member of the small projects committee of the National Reclamation Association. It The Eastern Municipal Water District comprises 125,000 acres, of which 110,000 acres is farmland graded from good to excellent. This area is divided geographically into four valleys lying within the San Jacinto River Basin. contains three incorporated cities and several unincorporated communities and has a total population of about 30,000 people, supported almost wholly by agriculture with a total annual crop income of $30 million including livestock and poultry. Approximately two-thirds of this land is under irrigation or has a recent rotation irrigation history and is now suffering severely from a prolonged overdraft on the local ground water which accounts for 80 percent of the local water production. Like many western agricultural areas, the depletion of ground water supply is restricting the acreage of irrigated agriculture and rapidly threatening severe economic losses. The Eastern District, being a member of the Metropolitan Water District of Southern California, in March 1952 voted general obligation bonds in the amount of $4,300,000 for the purpose of constructing main supply lines and pumping facilities which would make supplemental water supply from the Metropolitan Water District aqueduct available to all areas of the district to the nearest 4 or 5 miles. As of this date this major supply system is more than 80 percent complete and in operation. The second major phase in making possible the beneficial use of this supplemental water is the construction of distribution lines from the major supply system to the various portions of the district and finally to the individual farms. Some areas, over the years, have been developed and irrigated by means of surface distribution systems. Other areas were developed by farmer-owned wells without community-service distribution systems. It was originally planned, when our district was organized in 1950, that some small existing distribution agencies could be expanded to perform a large part of the ultimate water distribution and in areas where this was not possible the Eastern Municipal Water District would form improvement districts to finance the installation of distribution systems through the sale of bonds. Four such small areas have partially solved their problems by the formation of improvement districts and the sale of over $1 million in bonds. However, experience has now shown that the assessed valuation of farmlands does not permit the sale of bonds in such amounts as are required for these undertakings. We have also found that small existing water companies are not able to secure credit for any substantial expansion. However, it can be readily shown that the undertakings are economically feasible and can easily repay the investments under favorable financing. Although our district has now obligated all of its reasonable bonding capacity for these purposes, our resources by these means cannot complete the job of getting a supplemental supply of water to all of the individual farms. To distribute supplemental water where needed, and to avoid severe economic losses to existing developments, the district must immediately look to Federal assistance for financing the remaining portions of the distribution systems. In view of the specific requirements of our district we strongly urge that Congress pass a small-projects legislation in the form and language as set forth in H. R. 384 or H. R. 104 with a change in language of the first paragraph of section 5 so that it would conform in principle with H. R. 5301 which passed the House during last Congress. We believe that in our district, being composed of several valleys with partial distribution facilities of varying degrees with investments in waterworks systems amounting to far in excess of $15 million, the enforcement of the land-limitation provisions of the Reclamation Act presents hardships not experienced in projects where raw land is developed into irrigated farms. The amount of small-projects loans sought by this district represents only a small figure compared to the total investment already previously made. In our district 97 percent of the farmowners own 160 acres or less, such that family farms of man and wife are under 320 acres and these farmers farm 79 percent of the land. By necessity a rotation plan is widely practiced whereby one heavy high-value crop is planted every second or third year with grain in the interim years, lending itself very favorably to a family-farm unit of from 300 to 500 acres. We strongly urge that applications for loans under the proposed act be adequately processed to determine the financial feasibility of the project and the risk involved, but that redtape and time-consuming detail be kept to a minimum to bring early relief to applicants at the least possible expense to all concerned. The maximum cost of $5 million for a project or undertaking is comfortably adequate to finance the largest improvement district of the Eastern Municipal Water District. Having completed several million dollars' worth of waterworks systems of highquality design and rigid construction specifications, wherewith all engineering costs, from preliminary planning to and including supervision of construction, amounted to less than 621⁄2 percent of the total construction costs, we feel that we have demonstrated that design and construction can be competently and adequately done at the local level, provided assistance in financing is available. I am submitting for the record a summary of the district's construction costs, prepared by independent auditors, substantiating my previous statement. Through intimate acquaintance with water districts in our general area, and discussions with officials of these districts, I can authoritatively state that their requirements for assistance in financing waterworks facilities, especially distribution lines, are closely related to our needs. Officials of the Palo Verde Irrigation District, the Coachella Valley County Water District, the Western Municipal Water District, and the Elsinore Valley Municipal Water District, have authorized me to say to you at this hearing that this small-projects legislation, if enacted into law, would be important in assisting them to build seriously needed additions to their waterworks systems which they cannot otherwise finance. In discussing these matters at small-projects meetings of irrigation association conferences and national reclamation association meetings, the story is always the same, as evidenced by repeated resolutions from these organizations the most recent of which have asked the enactment into law of legislation essentially the same in principle as H. R. 5301 as passed by the House at the 83d Congress. Mr. BOEN. If it meets with your pleasure, I would like to comment on some of it since a part of it is repetitious. Mr. Chairman, my observations and viewpoints I have chosen more as a manager of a water district and some of the detail problems and the application of the provisions of the proposed bill toward meeting those problems. Our district is very similar to many districts in the West, and my acquaintenance, especially with those in my immediate vicinity, prompt me to go into a little detail. I would like to say that I have been authorized to speak on behalf of several districts at this particular hearing, the Palo Verde Irrigation District, the Coachella Valley County Water Distiret, the Western Municipal Water District of California, and the Elsinore Valley |