In any event, the State of New Hampshire does not need to apologize for its water pollution control program. The same holds true for the State of Maine, but its officials are fully capable of stating their own case without benefit of any support from me. Since 1947, when the control statute was enacted-a short time indeed in measuring progress in a field where concepts and practices long since established and publicly accepted must be completely reversed-somewhat better than 65 percent of the surface waters of the State have been classified and control programs thereby instituted. Some 23 pollution control projects have been built and placed in operation or renovated during this period and there are 17 others in the process of construction. As of the present time we have 37 other communities actively planning similar projects which will be placed under construction in the immediate future. In the course of these operations all funds available to the State under the construction grants section of the Federal act have been fully utilized. As a matter of fact, the water pollution commission has found it necessary to exercise discretion and judgment in the allocation of such moneys in order that they might be expended in those areas and in those communities of the State where the greatest good in terms of critical pollution problems solved, would be obtained. Another way of saying the same thing is that there is not sufficient money for all communities to act at the one given time and the commission, therefore, has to schedule its control efforts in accordance with the amounts of funds available. Thus it can be fairly stated that the Federal Government has established the pace of the "cleanup" program, for experience conclusively demonstrates that communities will not proceed without the benefit of financial assistance, nor do we believe that they can be reasonably expected to do otherwise.

Accordingly, it would not be any exaggeration to state, in view of the finan cial resources available, that the scheduling of an emergency pollution control program for the Androscoggin River within the immediate future could only result in an extremely serious dislocation and disruption of the plan for pollution control within the State of New Hampshire.

Returning to the matter of assistance, I would point out that New Hampshire has not been unmindful of its obligations in the area of financial help to communities and industries faced with the burden of installing pollution control facilities. At the present time we have a 20-percent grant system in effect as a form of encouragement to local governments engaged in essential activity. As a further inducement, a State guarantee of municipal bonds issued for pollution control projects is available to municipalities affected by the program—and industries by legislative act are allowed tax exemptions for a period of 25 years on facilities designed to control air or water pollution. As recently as 1961 the legislature approved statutory changes whereby municipalities may finance the construction of treatment works for industry which, of course, has the important effect of freeing industry from making heavy capital investments in such nonproductive facilities.

At this juncture we would call to your attention that the matter of overall program scheduling by the pollution control agencies of the two States has been agreed upon insofar as the Androscoggin River watershed is concerned. In so doing, it was understood that this watershed should receive a "lower action" priority for the simple but very compelling reason that suitable controls have existed here since 1947, when the supreme court of equity for Androscoggin County in the State of Maine established jurisdiction over the stream. To us it was and still is apparent that the court examined the question of damages and concluded that elimination of nuisance effects resulting from pollution in the river offered a reasonable solution to the problem then existing.

Under the guidance of the court-appointed river master, notable improvement in river conditions has been achieved and further progress is being made. all of which has been accomplished as a result of sushtantial investments in pollution control facilities by industry.

With specific reference to the reduction of industrial wastes being discharged to the Adroscoggin River in the Berlin area, we can point to several important changes which have taken place since 1947. In that year the Brown Co. in cooperation with the International and Oxford Paper Cos. installed a lagoon in Jay, Maine, at a cost of $150,000. In 1951 and 1953, the Brown Co. installed two lagoons at Berlin which have operated successfully and these involved a total cost of $328.000. In 1958 the company placed its new magnesium base sulfite recovery plant in operation, which resulted in a very substantial reduc tion in sulfite waste liquor being discharged to the stream. This installation was designed to evaporate and burn approximately 90 percent of the waste liquors

and as such constituted a pioneer process of involving the disposal of wastes from hardwoods. The investment required for these facilities amounted to $5,445,007.

We are not proposing that the task of pollution control in the Androscoggin River is complete. As a matter of fact, communities in New Hampshire, within this watershed, are now preparing to sponsor engineering investigations as to their pollution control needs. This, coupled with similar plans by industries for future work (such as the additional Kraft evaporators to be installed by Brown Co. at a cost in excess of $300,000, the same to be place in operation on or about Mar. 1, 1963), should be allowed to take place under State and interstate jurisdiction.

The State of New Hampshire, through its water pollution commission has all of the necessary competence in terms of professional personnel and the other resources required, to complete any and all investigations essential to the development of appropriate stream classification recommendations for the legislature. In our conversations with counterpart authorities in the State of Maine, it is evident that the same degree of skills and competence is available to do the job for that State.

As stated before, this entire matter is on the agenda of the New England Interstate Water Pollution Control Commission, and we much prefer to proceed in an orderly fashion at these local levels of government. We are not of the opinion that any discussion of technicalities is desirable or indicated but rather the decision to be made here concerns the vital issue as to whether the State and interstate agencies operating under adequate statutory authority are to be allowed an opportunity to resolve the problem in an orderly manner without Federal encroachment. Accordingly, at this time we would ask that the Department of Health, Education, and Welfare recognize the primary jurisdiction of the States by withdrawing its enforcement action, and meanwhile we would assure you of our sincere interest to cooperate by keeping the Federal agency informed at all times as to progress being made.

Finally, in order that there may be no misunderstanding whatever concerning our plans with regard to the Androscoggin River Basin, and to eliminate any uncertainty as to the correctness of the position being maintained by the State and interstate agencies involved here today, I will state that the commissions of New Hampshire and Maine have agreed under the cooperative provisions of the New England Interstate Water Pollution Control Compact to submit classification recommendations to the 1967 biennial sessions of their respective State legislatures.

One further matter deserves comment. It is the position of the Governor of the State of New Hampshire. So there may be no misunderstanding of what his position in this matter is, let me quote to you, first of all, from the Congressional Record of January 31, 1963, where Congressman James C. Cleveland of the State of New Hampshire made the following statement, authorized by the Governor of the State of New Hampshire:

"Mr. Speaker"-I quote from page 512, in the third column-"Mr. Speaker, I talked with Governor King on the telephone this morning and he authorized me to quote him as follows, and I quote:

"At this time we would ask that the Department of Health, Education, and Welfare recognize the primary jurisdiction of the State by withdrawing its enforcement action and, meanwhile, we would assure you of our sincere interest to cooperate by keeping the Federal agency informed at all times as to progress being made.""

I am authorized by Governor King to submit a letter to the chairman of this conferece which further expresses his position in this matter. The letter is dated February 4, 1963. and it is addressed to Mr. Murray Stein, Chief, Enforcement Branch, Division of Water Supply and Pollution Control, U.S. Public Health Service, Washington, D.C.

"DEAR MR. STEIN: I have been notified that you will serve as chairman of the conference called by Mr. Anthony J. Celebreeze, Secretary, Department of Health, Education, and Welfare, for Tuesday, February 5, 1963, at Portland, Maine, with reference to the Androscoggin River.

"Since this proceeding constitutes the initial step in the enforcement measures provided for under section 8 of the Federal Water Pollution Control Act *** I felt it incumbent upon me to go into this matter in great detail with the water pollution commission and the office of the attorney general of the State of New Hampshire in order to gain a full and complete understanding of all of the various aspects involved in this situation.

"After a careful review of all information available on the subject, I am convinced that the State and interstate agencies are entitled to a reasonable opportunity to resolve the pollution control needs for the Androscoggin River over and above those measures already in effect as a result of decisions made by the Honorable Supreme Judicial Court of Equity for Androscoggin County in the State of Maine.

"Obviously, orderly and equitable procedure for both States requires legislative review and the enactment of appropriate stream classifications in this watershed by both States so that, upon this basis, adequate enforcement efforts may be assured.

"Accordingly, I take this means of advising you of my complete and unqualified support of the statement to be presented at the conference by Assistant Attorney General Alexander J. Kalinski, on behalf of the State of New Hampshire. For purposes of the record, I would also bring to your attention my concurrence in the policy expressions contained in the resolution adopted recently by the 1963 session of the General Court, a copy of which was forwarded to Secretary Celebrezze under date of January 24, 1963.

"In conclusion, I would assure you of our sincere intention to continue to cooperate in all areas of mutual interest and responsibility; however, in the current instance, it is my belief that a harmonious settlement can best be achieved by primary action at State and interstate levels of government."

Thank you, Mr. Stein.

May I offer you the copy of the matters I have read into the record?

Mr. CANNON. Well, sir, I do not want to characterize what I said. My feeling is that Mr. Kalinsky indicated that he felt he had not been cooperated with in the first instance.

Senator MUSKIE. He did not even give anybody a chance.

Mr. CANNON. He did not even get an adequate notice of the conference.

Senator MUSKIE. He was there. How did he get there without notice?

Mr. CANNON. Well, I think that he felt that the policy being carried out by the States of Maine and New Hampshire, and the policy being carried out by the New England Interstate Water Pollution and Control Commission was achieving progress on the Androscoggin River.

Senator MUSKIE. Why didn't he come there and content himself with saying that?

Mr. CANNON. I think he said it.

Senator MUSKIE. His words will speak for themselves.

Mr. CANNON. He also said that he felt the Federal Government should not go into its formal conference enforcement procedures without first having an informal discussion with the State officials because every time the Federal Government intervenes where you have a State or interstate regulatory agency this necessarily casts some doubt on their competency in their official

Senator MUSKIE. This is not so at all if you have read the law. The conference is a step preceding the institution of formal enforcement activities by the Federal Government under present law, and you know that.

The conference was put in the law, as I understand it, at the insistence of industry and for the purpose of creating an informal proceeding as a prelude to formal enforcement activity. How many informalities do you want before you get to a serious discussion about your problem?

Mr. CANNON. Well, this may get into a debate about the definition of the word "formal" but I would say that a procedure that is spelled out in a statute seems to me to be a pretty formal procedure.

Senator MUSKIE. Well, you wrote it in the statute to insure that that procedure would be used.

Mr. CANNON. I did not have a thing to do with it.

Senator MUSKIE. Would you like to strike that section of the law out?

Mr. CANNON. No. I think if you are going to go into enforcement procedures that is an appropriate first step, certainly, but I agree with Mr. Kalinsky that even before you go into that step that there be some sort of consultation as to what is it that the Federal people are worried about that they do not think these State people are doing. Senator MUSKIE. Will you get the section of the law relating to conferences? As I understand it, you do not want the Federal agency to look over your shoulder while you are reading your guide.

Mr. CANNON. Well, Senator, I did not say that, and certainly that is not my attitude.

Senator MUSKIE. The purpose of the whole conference procedure is to make it possible, and this has been made clear by every witness who has touched upon the point in this hearing yesterday and today, representatives of industry, representatives of the Department, they all understand the conference procedure to be an informal consultation between representatives of the States and the Federal Government for the purpose of considering whether or not there ought to be any enforcement activity.

Mr. CANNON. Well, Senator, I am reading the language here and it says:

You shall give formal notification of any such pollution to the State water pollution control agency and interstate agency, if any, of the State or States, and shall call promptly a conference.

So it looks pretty formal to me.

Senator MUSKIE. May I refer you to the last sentence of that paragraph:

The Secretary shall also call such a conference whenever, on the basis of reports, surveys or studies, he has reason to believe that any pollution referred to in subsection (a) and endangering the health or welfare of persons in the State other than that in which the discharge or discharges originated, is occurring.

If it is your proposal to strike out that provision of the law and to leave the Secretary only with the alternative of instituting formal enforcement proceedings, why, we would be glad to have that position made clear in the record.

Mr. CANNON. Senator, we certainly are not advocating that.

Senator MUSKIE. You still would like Mr. Kalinski's remarks made a part of the record?

Mr. CANNON. Yes, sir.

Senator MUSKIE. I am anxious to read them in full. They have been made a part of the record.

Mr. CANNON. All right. We agree on something.

Senator MUSKIE. I think we agree on more than you would allow us to. That is the interesting point. You may proceed.

Mr. JOHNSON. On page 20 we talk about the standards. I won't

read the text here. On page 20 we mention grants and aid.

Basically, we say that the various bills over the years have increased these grants, and that there seems to be no limit into the future. Senator MUSKIE. May I ask a question here?

Mr. JOHNSON. Yes, sir.

Senator MUSKIE. Does industry ever increase its appropriations for problems and discovers that the problems are bigger than it originally expected they would be?

Mr. JOHNSON. I think frequently.

Senator MUSKIE. But this is not permissible for the Federal Government?

Mr. JOHNSON. I think it is less desirable.

Senator MUSKIE. But you would grant that it, perhaps, may be necessary?

Mr. JOHNSON. I think that is the world we are living in, yes.
Senator MUSKIE. All right.

Senator NELSON. Excuse me, are you at the bottom of page 20?
Mr. JOHNSON. We are at the top of page 21.

Senator NELSON. Excuse me.

Mr. JOHNSON. I won't read that except to say that someone estimated that to separate the storm and sanitary sewers would cost something in the nature of $8 billion, indicating where these appropriations might possibly go.

Senator MUSKIE. Would you argue that this is a problem that does not need to be dealt with?

Mr. JOHNSON. It does need to be dealt with. Did you say that it does not need to be dealt with?

Senator MUSKIE. That it does not need to be dealt with.

Mr. JOHNSON. Is that what you say? We are just indicating the extreme to which grants conceivably could skyrocket.

Senator MUSKIE. But you are indicating now for the purpose of arguing that they should not be increased. So I am asking whether with respect to the storm-sewer problem you consider that is not a problem.

Mr. JOHNSON. I do consider that it is a problem. We go on to say here that we favor the communities and the subdivisions to build and finance their own operations wherever they might be. Senator MUSKIE. Do you think they are able to?

Mr. JOHNSON. I think they are. We have two or three good examples here, one in St. Louis and one in Cincinnati, and Allegheny County in Pennsylvania. Here these particular communities have spent $66 million and the other $100 million. They have those bonded, and someone is paying the interest.

Senator MUSKIE. Is that for storm sewage?

Mr. JOHNSON. This is for sewage treatment, sewerage treatment. Senator MUSKIE. Yes: but you do not know whether it applies to the storm sewage problem?

Mr. JOHNSON. No: I do not.

Senator MUSKIE. On what basis have you reached the conclusion that you think the communities in the country are in position to handle the storm sewage problem on their own?

Mr. JOHNSON. I think the whole Federal grant is a wrong concept.

Senator MUSKIE. Well now, they amount to something like $10 to $12 billion at the present time. Do you think that the local communities of this country could absorb that $10 to $12 billion now if the Federal Government were to step out of all grants in aid?