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ersus Ohio case the Court held that the Federal Government had the ower to control in an exclusive fashion these interstate shipments. ut the Congress exercised its authority under the Constitution and tid that the States might adopt such laws as they saw fit with refrence to prison-made goods coming into a State, such as Ohio did in le Whitfield case, Whitfield v. Ohio, 297 U. S. 431, and as done in ne liquor cases and that inasmuch as Congress had acted and passed he necessary legislation the situation was entirely different and conquently they upheld the rights of the States. Am I right about lat?

Mr. RANKIN. No; I don't think so, Senator. The Chief Justice ealt with the whole list of those cases in the Kentucky Whip and 'ollar case.

Senator BARRETT. Do you mean to say that there was not a statute hat permitted the State of Ohio and other States to legislate in the eld of the shipment of prison-made goods in interstate commerce ?

Mr. RANKIN. No. But the Court said that the basis for the support nd the validity of the act was the fact that the interstate commerce nded—and I will quote to you what Chief Justice Hughes said: ut the statute did not apply until the transportation was completed by actual elivery to the consignor as the right to receive was not affected by the Wilson ct. Such receipt and the possession following from it and the resulting right o use remain protected by the commerce clause.

It was only the period after the consignee got it in the original package that the States had any control over it He said that part of he shipment was not interstate commerce.

Then he went on to say that: ior has the Congress sought to delegate its authority to the States. He examined each one of those cases in that opinion.

Senator BARRETT. There is no question about that. But the Congress did act and say that the States might use, if they so desired, their own police powers over these prison-made goods coming into the States. Mr. RANKIN. Within the intrastate area of activity. Senator BARRETT. Within the confines of the State.

Mr. RANKIN. Within the intrastate part of the movement. That was the distinction he made in this case.

Senator BARRETT. Of course, they would not have any authority to do it except that the goods stopped in the State. They could not go into another State. There is no question about that. I won't argue that point with you any longer. I think that other attorneys will dispute your position and they will say as a result of the act of Congress giving the authority to the States was the basis on which the Court made the decision.

Mr. RANKIN. I also want to call attention to the problem that the bill presents in regard to the claimed over appropriation of many of the streams of the West.

Senator BARRETT. You had some difficulty with that, as I understand, in the case down in New Mexico; did you not?

Mr. RANKIN. That is right. Senator BARRETT. What are the facts in that case? Mr. RANKIN. In that case, the Congress provided for the establishment of a game and wildlife preserve and authorized and there was

spent over a million dollars. In 1906 a predecessor in title to the United States filed with the State to obtain water rights. Through continuation the United States acquired the lands and the appurtenant water rights. They used water in developing this project. The United States and its predecessors in interest requested and were granted extensions from time to time to make their proof.

Senator BARRETT. How did they file?
Mr. RANKIN. They made a filing under the State law.
Senator BARRETT. They purchased some rights; did they not?

Mr. RANKIN. Through condemnation proceedings the United States acquired the lands involved as well as the water rights appurtenant to several thousand acres thereof. In development of the project the United States was also making uses of water on the refuge for which there was no provision under State law.

Senator BARRETT. The river was overappropriated ?

Mr. RANKIN. That was the final claim, and that other persons had made their claims which intervened between the time the United States sought to prove up and the time that they had filed.

Senator BARRETT. It was my understanding, as I remember on that case, that the State granted permits and the anplications and permits granted overappropriated the stream and the Fish and Wildlife Service went in and bought some rights but the rights that they acquired were inadequate. That is the basis of the contention, no that somebody intervened. It is a question of the fact that the rights in the beginning were inadequate.

Of course, you have to comply with State law. There is not any question about that. Nobody makes any contrary contention, as I understand it, except the Attorney General.

Mr. RANKIN. The facts as we found them in the lawsuit were that they were claiming intervening rights, that the extensions that the Department of Interior and its predecessors in title obtained to make their proof were claimed to be invalid and the rights that came in during the interval before the time of their effort to prove up were claimed to be valid vested rights superior to those of the Government. Therefore, the United States had no water to use on this game refuge.

Senator BARRETT. That is because you did not comply with State law. Is that not the sum and substance of it?

Mr. RANKIN. That is what they claimed. They claimed that the Department of Interior did not comply with State law.

Senator BARRETT. What does that prove? Does that not just prove that somebody was a little inefficient in the employ of the United States? That is all that proves; is it not?

Mr. RANKIN. The lower court held that the United States got no water rights. The supreme court of the State held that the action could not be maintained against the United States; that if it had taken water rights that belonged to somebody else and had not complied with State law, they had a right to be compensated under the Tucker Act

, and that was the only right they had.

Senator BARRETT. That runs through all my reasoning on this, Mr. Rankin. Your position is sound in the absence of congressional action. I think you will find that in many of these cases. The courts would make one ruling without congressional action and after the Congress acts under its constitutional powers, the situation is entirely different. It is reversed.

Mr. RANKIN. The problem is to apply this to specific cases. What would be the situation about the Colorado River? Do we have to try to comply with State law there?

Senator BARRETT. No; you do not have to comply with State law there, and you know that just as well as I do, Mr. Rankin, because there is an interstate compact and there has been one since 1922. The States have agreed and the Congress has ratified that compact. Consequently, you have the compact. When you go in there and operate under that compact you are operating then because of the States themselves.

Mr. RANKIN. There is nothing in the compact that provides as to how the water shall be allocated to individuals or how the contracts that we have outstanding with various States and governmental subdivisions shall authorize the distribution of this water. Which law do we comply with in order to make those contracts valid? That is the problem.

Senator BARRETT. You comply, first, with the compact. As I understand, the Boulder Canyon Project Act related back to the compact also; did it not?

Mr. RANKIN. Yes. But it does not say a word about who, within the State of Arizona, or the State of California, or the State of Nevada, or the State of Utah is going to get the water.

Senator BARRETT. Of course not, because the Congress, by the act of 1902, acted and said: Here, as to that property right, the States shall have the authority to administer that water.

Mr. RANKIN. We have not complied with that. What do we do under this law about those projects? How are we going to get those water rights to protect those projects?

Senator BARRETT. How are you going to get the water rights?
Mr. RANKIN. Yes.

Senator BARRETT. The upper basin States have another compact. We divided that and agreed between ourselves. That has been cleared. There is not any dispute between the States as to the water which each State is entitled to.

Mr. RANKIN. I would like to know what Arizona against California

means.

Senator BARRETT. There is a question there. But the State of California passed an act and said, our rights are so and so, and that is what you are litigating, as I understand it.

Mr. RANKIN. There is a contention by the State of Arizona that the United States has sold water to the State of California under contract out of these dams that is a million acre-feet more than they are entitled to.

Senator BARRETT. I understand that. The State of California passed a statute and said that under the compact they were entitled to 4,470,000 acre-feet of water or something like that and there is an argument about that. We in the upper basin States have not made it a part of our business to inquire into that matter. When I said "we settled all our rights," I was referring to the upper basin States. I know you have that litigation. I am not going to try to settle that here. I think the Supreme Court will settle that between the States. When it is settled it will relate back to the compact, will it not?

Mr. RANKIN. Yes. But there is nothing that gives us any provision about this appropriation, use, or control under State law in the compact.

Senator BARRETT. The States have the right under the act of 1902, at the time they entered into the compact, and when they entered into the compact they agreed, taking into consideration the terms of the acts of Congress of 1902 and so on and so forth, that gave them the right to administer this water.

Mr. RANKIN. Without that act in force, the Supreme Court said the United States did not have to comply with State law. So they didn't

. Senator BARRETT. You say the United States Supreme Court said they do not have to comply with provisions of section 8 of the Reclamation Act?

Mr. RANKIN. They said they didn't have to comply with State law. They didn't have to get any license from the State of Arizona to build those dams although the law of Arizona required it. We have not complied with State law in that regard.

Senator BARRETT. I want to call your attention to this again. I thought I had.

Section 13 of the Boulder Canyon Project Act of 1928 specified that any rights acquired by the United States would be subject to the compact as well as rights obtained by contract with the United States. I thought I indicated that a moment ago. By this act of Congress it approved and consented to a compact which apportioned the waters of the Colorado system to the States and not to the United States. "Thus, Congress recognized that each State will administer its own water. The Congress stressed this thought in section 18 of the act, which reads that nothing herein shall be construed as interfering with the rights as the States now have either to the waters within their borders or to adopt such policies or enact such laws as they may deem necessary with reference to the appropriation, control, and use of waters within their borders, except as modified by the Colorado River compact or other interstate agreement.

Every interstate compact relating to the apportionment of waters of 17 Western States will go wholly or in part west of the 98th meridian and is predicated on the laws of those States. As I have said, the ownership and control of surface waters in the States is claimed by all of them, and ground waters in some of them.

That is a statement that I made myself, and I think that clearly shows that the Congress intended, when it ratified the compact, that the States should control the water under the terms of section 8 of the Reclamation Act of 1902. It so states in plain language in the Boulder Canyon Act.

Mr. RANKIN. If we have not complied with those State laws, then what does this do to it?

Senator BARRETT. If you have not complied with the State laws, that would be a matter for individuals that have property rights or interests there.

Mr. RANKIN. And the United States would not have to worry about it.

Senator BARRETT. Under this bill we are protecting legitimate interests of the United States, and we so intend to do. We do not intend to interfere with them. So, to that extent, I would not say that there was any interference with the rights of the United States.

Mr. RANKIN. What about the Indian reservations?

Senator BARRETT. I think that there is some question raised. We had that up the other day. It may be that we ought to make some change. Do you have the bill in front of you?

Mr. RANKIN. Yes.

Senator BARRETT. Section 6, on page 4.

Mr. RANKIN. Yes.

Senator BARRETT. That matter was brought to our attention the other day. In order to protect the rights of the Indians on any of those we decided the other day that line 22 would be changed by striking out the words "under State law," and that has been agreed to. So that language reads:

Subject to existing rights, all navigable and nonnavigable waters are hereby reserved for appropriation, use—

and so forth. We think that would protect any rights that the Indians might have.

Mr. RANKIN. I think it would, Senator, but I think it might destroy the effect of your bill.

Senator BARRETT. Why do you say that?

Mr. RANKIN. Because I think, under the concept of the Pelton case, that would mean that the United States had all of the rights it has in reserve lands and the right to the use of the water and you put yourself right back where you don't accomplish what you appear to be trying to accomplish otherwise.

Senator BARRETT. I cannot quite agree with you because I think that the bill makes eminently clear that we are not recognizing any distinction between reserved lands and public-domain lands. We are saying as far as this bill is concerned that the same rule applies to both.

Mr. RANKIN. I want to call your attention to the legislative history. You are striking out the words "under State law."

Senator BARRETT. As to future acquisition of water rights.
Mr. RANKIN. You are going to add that.

Senator BARRETT. That is in line 21. We do not have any intention here and I do not think that the Department of Justice would raise any serious question about the advisability of negating the rights of the States on the reserved lands of the United States, would they?

Mr. RANKIN. That is not our province. That is for Congress. Senator BARRETT. I know that is not. That is exclusively the province of the Congress. There is not any question about that. I do not think you would raise any point on that.

Mr. RANKIN. We wouldn't.

Senator BARRETT. We certainly are doing that and intend to do it. Mr. RANKIN. It would be easy for me, Senator, to just say that fixes everything. But I do want to call your attention carefully to that because I don't want to mislead you or be any part of anything like that.

Senator BARRETT. I wish you would point it out.

Mr. RANKIN. When you have a heading "Future Acquisition of Water Rights," that is not basically a part of the language of the bill that would govern. It could be interpreted that that applies to how you would acquire them. But then when you say "subject to existing rights" that means that you can acquire future rights but subject to that protection you are putting in. That is the way it would look to me. I do want to call your attention to it.

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