Hon. CARL HAYDEN, HOUSE OF REPRESENTATIVES, Chairman, Senate Committee on Appropriations, DEAR SENATOR HAYDEN: In the fiscal year 1959 public works appropriations bill, under "general investigations," $65,000 was approved for a study of streams within the East Side Levee and Sanitary District (Illinois). The estimated cost of this study, according to the Corps of Engineers, is $150,000. A balance of $85,000 is necessary to complete the study. Unfortunately, during consideration of H.R. 7509, the House committee was not currently informed by the Corps of Engineers, and the committee did not know that the survey was underway and that the fiscal 1959 funds would be expended by the end of the fiscal year. In order to prevent an interruption in the survey, the additional $85,000 is needed. I will be deeply appreciative if your committee can include this necessary amount in the public works appropriations bill when it reaches you for action. Thank you for your courtesy and consideration. Sincerely yours, MELVIN PRICE, Member of Congress. U.S. SENATE, COMMITTEE ON PUBLIC WORKS, June 12, 1959. Hon. ALLEN J. ELLENDER, Chairman, Subcommittee on Civil Works, Senate Appropriations Committee, (Attention of Mr. Kenneth Bousquet.) DEAR MR. CHAIRMAN: I am advised by the Corps of Engineers that a recent review of the status of the Kentucky River survey indicates that further engineering studies must be made which will require additional appropriations in the amount of $12,000. I am writing to request that the subcommittee approve this amount for inculsion in the fiscal year 1960 program. As you know, this survey is of great importance in connection with Kentucky River development, and I am hopeful that it will be completed within 90 days if the requested amount is approved. With kind regards, I am Sincerely yours, JOHN SHERMAN COOPER. U.S. SENATE, Hon. ALLEN J. ELLENDER, COMMITTEE ON PUBLIC WORKS, June 12, 1959. Chairman, Appropriations Committee, Subcommittee on Public Works, DEAR MR. CHAIRMAN: A much needed improvement in Ohio is the Black Fork channel improvement project. It is my hope that your committee will give serious consideration to the inclusion of this project in the Senate public works appropriation bill now under consideration. It is my understanding that the House Committee on Appropriations will look with favor upon this project when it comes over to them. Sincerely yours, STEPHEN M. YOUNG. - PUBLIC WORKS APPROPRIATIONS FOR 1960 FRIDAY, JUNE 12, 1959 U.S. SENATE, SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS, Washington, D.C. The subcommittee met at 1:45 p.m., pursuant to call, in room F-82, the Capitol, Hon. Allen J. Ellender, chairman of the subcommittee, presiding. Present: Senators Ellender, Robertson, Holland, Dworshak, Smith and Hruska. CIVIL FUNCTIONS-DEPARTMENT OF THE ARMY CORPS OF ENGINEERS STATEMENT OF BRIG. GEN. J. L. PERSON, ASSISTANT CHIEF OF ENGINEERS FOR CIVIL WORKS; ACCOMPANIED BY COL. ARTHUR C. NAUMAN, CORPS OF ENGINEERS, ASSISTANT CHIEF OF CIVIL WORKS; COL. STEPHEN E. SMITH, CORPS OF ENGINEERS, ASSISTANT CHIEF OF CIVIL WORKS; LT. COL. JAMES A. VIVIAN, CORPS OF ENGINEERS, ASSISTANT CHIEF OF CIVIL WORKS; HARRY COHEN, ASSISTANT CHIEF, PROGRAMS BRANCH, CIVIL WORKS; B. JOSEPH TOFANI, CHIEF PROGRAMS BRANCH, CIVIL WORKS; AND A. H. MCRAE, ASSISTANT CHIEF OF CIVIL WORKS GENERAL STATEMENT Senator ELLENDER. The committee will please come to order. (Off the record.) Senator ELLENDER. On the record. General Person, I am sure that you are familiar with what the House has done to the bill before us, and I am wondering if you would be good enough to tell us your views as to the cuts made and whether or not you desire to make a reclama for any of the cuts that have been made by the House. General PERSON. Sir, as we go through the individual projects in detail we will be prepared to comment on the elements in the House bill which we feel were cut too deeply. Senator ELLENDER. Very well. Are there any questions before we discuss the individual projects? Senator ROBERTSON. I would like to ask the general what he is asking to be restored, what it would amount to in money. HOUSE REDUCTION General PERSON. The major thing, sir, is the line item reduction which the House made in the budget, where we had a $30 million line item reduction which would be taken care of by savings and slippages. The House increased that reduction to $43 million. We feel that that increase will make it very difficult to administer the program efficiently. Senator ROBERTSON. Now, just explain what you mean by a line item reduction? General PERSON. Well, sir, the total amounts allocated to each project were reduced by a flat sum of $30 million in the budget submission and $43 million by the House bill with the thought that that $43 million would be absorbed by slippages of one sort or another. In other words, when you add up the amounts allocated to each project, they total $43 million more than the amount actually appropriated. Senator ROBERTSON. Now, what was the House total with respect to the budget estimate? General PERSON. The total was about the same. Senator ELLENDER. As I understand the action of the House, they made cuts in some budgeted items beyond the amounts suggested by the corps, and then increased the reduction in the amount for savings and slippages in order to effectuate the figures reported, to make it appear that the amount appropriated was within the budget estimate. What the House has actually done is to require the Senate committee to exceed the budget to provide funds for the work programed in the budget, and to provide the funds for the new projects inserted by the House. General PERSON. Yes, sir. Senator ELLENDER. In other words, we have a certain amount, as the Senator from Virginia knows, that is allowed for savings and slippages. What the House did was simply to reduce that from a reasonable amount and it is not really a savings by any means. If anything, it is going to retard many projects for which funds are included in the program. Senator ROBERTSON. Well, I am just trying to analyze this program. The House has some worthy projects and we have some worthy projects. The House put their projects in by cutting projects they figured we would have to restore. I was just wondering where our projects are going to stand with respect to the budget and how much of this cut we will have to restore. Senator ELLENDER. Well, I wonder, in order to clarify that point, General Person, if you would give us actual figures. If this committee should restore the cuts made by the House, how much would the House be over the budget with the new projects that they have placed in the bill, just in round figures? General PERSON. Approximately $18 million. I can correct that for the record, but it is roughly in the neighborhood of $18 million. Senator ROBERTSON. All right. Now, they put in some projects which I think are very good. I think we would have had to put them in if they hadn't. Senator ELLENDER. That is right. AMOUNTS NECESSARY TO BE RESTORED Senator ROBERTSON. I was just wondering now, as long as we have got you here for this hearing, how much of the line cut and how much of the cut on other budgeted items do you feel would be absolutely necessary to be restored. Then we can see what leeway you would have left. General PERSON. We feel the whole $18 million should be restored. Senator ROBERTSON. Everything that is in the budget has got to stay there, is that it? General PERSON. That is our recommendation, yes, sir. Senator ROBERTSON. I know that is your recommendation, butGeneral PERSON. Of course, during the hearings, sir, we offered or volunteered to make reductions in certain projects where slippages and savings had occurred between the time we submitted our initial budget and the time the hearings took place. Senator ROBERTSON. Well, that is money you couldn't profitably use. But suppose the budget has an item of $5 million and the House said, let us cut a half-million out of that and give you $42 million, and you said, "No. We want the whole thing. That is on a big project." If you could tell us where you could take a cut then we can put in a little $50,000 and $75,000 item here and there, and not exceed the budget. General PERSON. No, sir. We wouldn't recommend any cuts below the budget figure as amended during our testimony. SAVINGS AND SLIPPAGES Senator ROBERTSON. All right. Now, how about your savings and slippages? That $18 million, you want all of that to go back? General PERSON. Yes, sir and that includes $13 million additional reduction for savings and slippages. Senator ROBERTSON. That is one of your musts. General PERSON. Yes, sir. Senator ROBERTSON. All right. What is your other "must"? General PERSON. The additional $5 million represents a composite of several project cuts, which we will testify to for the record. We could give a list of those. Senator ELLENDER. General, will you furnish for the record the amount which you are asking for reclama and give the list of projects in which the House actually cut back on those projects that had a budget estimate. General PERSON. Yes. We will be glad to. (The statement referred to follows:) Items on which restoration of House reductions is recommended In a separate statement filed with your committee recently, port officials have documented additional Federal costs amounting to over $2 million which will result from appropriating $11.5 million this year and scheduling the project for completion in 3 instead of 4 years. B. Other considerations.—I feel sure we can all agree on the sound proposition that a project, once started, should be prosecuted to completion at an economic rate of construction so that the benefits may accrue at the earliest possible moment. I do not believe that statistics are necessary to prove that this project for which the Corps of Engineers years ago established a 4-year construction period as a reasonable minimum, is not being economically developed when on the 10th anniversary of the initiation of actual work that project is only about 40 percent complete. LOCAL INTERESTS IN PROMPT COMPLETION The Sacramento-Yolo Port District will likewise suffer a financial detriment if completion is delayed another year. The district contemplates expending approximately $8 million in additional funds for construction of the terminal facilities. These expenditures will be made during the last year of construction of the project itself in order to achieve simultaneous completion. Deferring these costs will also increase the district's costs as follows: $8 million at 5 percent equals $400,000. In addition to the $400,000 cost to the port district resulting from 1-year delay in competion of the project, port officials have calculated an additional loss of nearly $75,000 for interest on expended funds. In addition, a delay of 1 year in completion of the project will mean the loss of its benefits to shippers for that time. Corps of Engineers officials have estimated that it now costs shippers $2 million per year to reach shipside at ports beyond Sacramento. Thus, a delay of 1 year will cost the local interests alone nearly $2.5 million when we consider the increased construction costs, interest paid by the port district and freight costs to shippers. The price of 1 year's delay is not all covered into the figures I have cited. In addition, there are items which cannot be measured such as the loss of tax revenues at all levels from increased business activity if completion is delayed. CONCLUSION The record clearly establishes that an appropriation of $11.5 million for the new fiscal year will enable the Corps of Engineers to schedule the project for completion in June 1962 and thereby bring about substantial savings to the United States and the port district over the next 3 years, to say nothing of the increased benefits to local industry, importers, exporters, etc., and to both the United States and local public agencies in taxes and general business activity that will begin to accrue the day this splendid project is placed in full operation. |