projects to be given over to public agencies in the area where the project is located?

Mr. RANKIN. Yes.

Senator KUCHEL. To that extent, could it not be contended that that constituted a delegation of Federal authority?

Mr. RANKIN. I think they are acting on behalf of the Federal Governemnt in doing that and carrying out directions of the Secretary of the Interior and his various subordinates.

Senator KUCHEL. By way of agency?

Mr. RANKIN. That is right.

Senator KUCHEL. You do not quarrel with the sections which provide for delegation of operation and maintenance, but your theory of upholding the constitutionality of it is that they are acting as agents of the Federal Government?

Mr. RANKIN. That is right.

Senator KUCHEL. Senator Barrett suggested that there would be other witnesses-lawyers like yourself who would testify somewhat differently than you with respect to the rights and liabilities of the Federal Government. We are going to be in this committee with expert opinions that are not going to match up. Then we are going to be faced with the problem of trying to decide the policy that we want in any legislation that will be carried and, having decided that policy, what expert witnesses we are going to follow to tailor the language of the legislation.

Again I do believe that the people here and the people who are interested in the Barrett bill look with great concern over those instances where Federal installations have refused to comply with State law and which, as a result, have created some unfortunate situations in the Nevada Navy Department. That is an unfortunate example of that.

Is it possible in line with your opinion on the constitutional responsibility of the Government to provide legislation that would indicate that it is the intention of Congress that the Government shall, when it acquires property, comply with the water laws of the State where the acquisition is made?

Mr. RANKIN. I think that can be done in some areas. I think that in regard to the navigational servitude, the way is clear in the decisions of the Supreme Court for the Congress to decide that it will not exercise its full power to take the rights regardless of what rights there might be under State law, and therefore in that area they could require compensation.

The area of where you have the water right reserved by the United States and it already owns it, to say that it has to be compensated for is another problem.

Senator KUCHEL. Assume that the Federal Government acquires property by purchase, are its rights to water for that property, in your opinion, any greater than those of a private landowner who owns property in that same area?

Mr. RANKIN. The only difficulty in that to say "yes" or "no" is tha the United States under the Constitution has greater rights than the private owner by cession from the States. Oftentimes Congress has provided for the acquisition by condemnation of military lands or other reservations and then the Government has asked, through the various departments involved, whether or not the State would

cede jurisdiction over those lands. In many instances, every right of jurisdiction has been ceded except the right of taxation. There have been some rights of taxation that have been reserved in some

cases.

The courts have held that in view of the Constitution in those cases the United States has complete jurisdiction to make the laws for that area and that takes it out of a class just like the State is out of a class of the ordinary property owner who is a citizen.

Senator KUCHEL. So your answer would be that it is impossible to say that the Federal Government, when it hereafter acquires a piece of property, can have its water rights measured in exactly the same fashion that a private landowner would have them measured.

Mr. RANKIN. That is true.

Senator KUCHEL. If the Congress desired to adopt the policy that the Federal Government hereafter would, when it acquired property in a State, submit to the jurisdiction of the State with respect to rights of water in the same fashion as a private landowner, would there be any constitutional objection to that, in your opinion?

Mr. RANKIN. Yes. Because you are saying as to Federal property the Federal Government shall be subordinate to a State. The Constitution says the Federal Government, when it is exercising its proper powers, cannot be subordinate to the State. It seems to me that Congress could resolve this problem so far as that particular part is concerned. I don't mean that is the solution for the whole problem. It could resolve that by saying it is desirable as a policy in order to have a proper record that the Government file in the States its claims in regard to a particular matter, but to say that the State could deny the Federal Government the power to have a well or some other proper activity under the Constitution would be subordinating the Federal Government again to State control.

Senator KUCHEL. So that in your opinion this Congress is powerless to require Federal properties hereafter acquired to be subject to the laws of States with respect to water.

Mr. RANKIN. I think that is true. There is no constitutional power in the Congress to subordinate the United States in any area of its proper activity, including the management of its own property, to the States. I don't say that this question is insoluble because of that. It seems to me that the policy of the President is for the States and the Federal Government in this area to work together. I think that the Congress could pass legislation where no project would be undertaken until the proper authorities of the State were consulted with and they worked out their water problems and the whole program together in the same family the way it should be done.

Senator KUCHEL. Do you draw an analogy between this whole question and the question of the proposed in-lieu tax legislation? Mr. RANKIN. It seems to me you come to the impasse between the constitutional provision of who is going to be supreme. It was decided by the Founding Fathers that after the confederation did not work that they had to have the Federal Government supreme in a proper area. So they made such a provision.

What you are trying to deal with is the proposition that the Federal authorities shake their fists and say, "We will run the show."

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Of course, that makes a bad reaction. Whenever you have one of these projects or programs, there is not anybody that wants it any more than the West and it goes into the State. It enriches the State at the same time that it helps the Federal Government to have development and more taxable income and property, so they ought to work together.

There is plenty of ground and area for them to work together. If that was the kind of legislation, where they could not start on a project until they tried to work that out in reasonable balance, I think many of these problems would be resolved. That does not solve the problem of your question of vested rights and what people might be worried at the present time about. I am disturbed about that concept.

I just say this for your thoughtful consideration because I say you have complete power to transfer by proper grant. The courts approved the tidelands grant. You could do the same with the right to the use of water and transfer it to the States if you so see fit.

I am interested in the West, too, and these projects. I don't want anything to be done that is going to hurt them. It seems to me that the West receives benefit of tax money that comes out of a good part of the rest of the country, more than, at least until a very recent time, they originated. I would hate to see that dried up.

If you had the water belonging to the States you might reach the place where a good two-thirds of the country would say, "You have the water now. It is your project. Go out and fix it yourself."

Senator KUCHEL. I have a hazy recollection of a lawsuit that I think was called the Alpine Water case. I have not thought about it for a long time. It seemed to me that there was a contention a number of years ago by the Federal Government that all the unappropriated waters in some stream that ran from Nevada to Arizona were vested in the Federal Government. I think that lawsuit is still pending. I do not know who the parties are. I have forgotten. But so far as the Department of Justice is concerned, what is the position of the Department of Justice with respect to unappropriated waters in navigable streams and in nonnavigable streams where the Federal Government has reservations or by reason of authority of Congress has constructed any type of public work?

Senator BARRETT. Before he answers that question, will the Senator yield to me so I could add this quotation from the decision in the case of Ickes v. Fox that we discussed before. I will start on page 631 of volume 323, United States:

All of these steps make plain that these projects were designed, constructed and completed according to the pattern of State law as provided in the Reclamation Act. We can see here what was said in Ickes v. Fox supra

this is from the case of Nebraska v. Wyoming, which cited Ickes v. Fox

although the Government diverted, stored, and distributed the water, the contention of petitioner

and this is the United States

that thereby ownership of the water or water rights become vested in the United States is not well founded. Appropriation was not made for the use of the Government but under the Reclamation Act for the use of the landowners and by the terms of the law and of the contract already referred to the water rights

being the property of the landowners, wholly distinct from the property right of the Government in the irrigation works. Compare Murphy v. Kerr (296 Fed. 536). The Government was and remained simply a carrier and distributor of the water with the right to receive the sums stipulated in the contracts as reimbursement for the cost of construction and annual charges for operation and maintenance of the works. The property right and the water right is separate and distinct from the property right in the reservoirs, ditches, and canals. The water right is appurtenant to the land the owner of which is the appropriator. The water right is permitted by appropriation, that is, by an actual diversion followed by an application within a reasonable time of the water to a beneficial use.

I think it is pretty clear in the Nebraska v. Wyoming case and the Ickes v. Fox case and the Denver case mentioned a while ago that the Federal Government, through the Attorney General's Office has repeatedly made the contention-not alone in this administration but heretofore-that the United States does own the water.

I call attention again to the fact that since my colleague is under the rule in the Pelton Dam case if a portion of the public domain is reserved for power purposes, then it would be on all fours with the Pelton case and in that manner you are then subjecting the whole of our public domain to possible inclusion under the rule established under the Pelton case.

There is nothing to prohibit the executive arm of the Government from doing that with any part of the public domain.

The question that Senator Kuchel asked you is precisely the same as pointed out in those cases I quoted from. Your contention heretofore in all these cases was that the United States is the owner of the water.

Mr. RANKIN. The answer to the question is in this regard: That the United States owned the right to use the waters when the land was ceded to it-the rights to the use of the water as distinct from the water itself. It continued to own them. But it provided in recognition of the principle of appropriation of water that anyone who complied with that principle and applied the water to beneficial use got the right and it got it from the United States and it was a valid right.

Senator BARRETT. That was not the contention you made in the Ickes v. Fox case.

Mr. RANKIN. I was not in that case.

Senator BARRETT. I am not talking about you. I mean the Department of Justice.

Mr. RANKIN. If you will notice in the quotation you read, Senator, it said the petitioner contended or claimed. That is the allegation of the petitioner.

Senator BARRETT. That is right.

Mr. RANKIN. There was a motion to dismiss which admitted all of the well-pleaded matters under the rules. So there was never any issue as to whether that was a fact or not.

Senator BARRETT. It was a contention; that is all.

Mr. RANKIN. You see what I mean?

Senator BARRETT. That is what we are talking about here, contentions.

Senator KUCHEL. How would the Department answer that question?

Mr. RANKIN. I think it would answer that the title to unappropriated waters never passed from the United States except to the various individuals who appropriated to beneficial use.

Senator KUCHEL. And who may tomorrow or the next day do the same thing.

Mr. RANKIN. That is right. The only thing that is withheld from that is in the places of reservation. As to that, many of them have been made under direction of Congress or the authority of it. It takes the whole bundle of real-estate rights or real property rights and holds them back.

Senator KUCHEL. And holds them back, Mr. Rankin, in your opinion, to the extent of the potential beneficial consumptive use of the land in the reservation.

Mr. RANKIN. Except, I think, it would have to be reasonable. I think the Court will say that it has to be reasonable. But the Winters case is an example of that in which the Court said the United States made a treaty with the Indians and by that treaty it was contemplated that the Indians would have such reasonable amount of water reserved as a part of their reservation as they would need for their proper life and growth and development.

I don't see any reason why in other reservations the Court would not apply a similar doctrine."

Senator KUCHEL. Mr. Chairman, I have to run. I am 45 minutes late to a meeting in the State Department.

Senator BARRETT. How much more time will you need, Mr. Rankin? Mr. RANKIN. Whatever you say.

Senator BARRETT (presiding). You may proceed.

We want to give you all the time you desire to present your position in this matter. We would like to complete these hearings before the end of the week if we possibly can.

Mr. RANKIN. I would like to discuss how I distinguish the cases, the Louisville and Nashville Railroad Companies v. Cook Brewing Com pany (223 U. S. 70), and the Kentucky Whip and Collar Company v. ICR Co. (229 U. S. 334), which I think have been called to your at tention here in previous testimony. You recall that those cases deal either with intoxicating liquors and the right of the States to regulate the traffic in intoxicating liquors or prison goods. Chief Justice Hughes dealt with that problem.

You will also recall the Knickerbocker case (Knickerbocker Ice Co. v. Stewart (253 U. S. 149), the Court saying that there could not be a delegation to the States of the power to apply compensation laws, and treated several of these cases

Senator BARRETT. That is under article 3.

Mr. RANKIN. Yes.

Senator BARRETT. That is because of the exclusive jurisdiction of the United States in admiralty cases.

Mr. RANKIN. Yes.

Senator BARRETT. I think that distinguishes that case from the others. There is not any question about that.

Mr. RANKIN. Chief Justice Hughes said in those cases the principle that was involved was that the interstate commerce ceased at the time it came into the hands of the consignees in the original package.

Senator BARRETT. Is that exactly right? That was not my under standing. I thought in the case you mentioned and the Whitfield