Mr. HAYDEN. I understand that under the Federal water-power act three things must be shown: That your plan is feasible from an engineering point of view; that you have a proper authorization from the States wherein the power plant or dam is to be located; and that you can finance the project. As it stands to-day, you could not make the required financial showing? Mr. CRISWELL. No; we could not make that financial showing. Mr. HAYDEN. So that, until your charter limit of indebtedness is raised, there would be no prospect of your obtaining this permit from the Federal Power Commission? Mr. CRISWELL. Not only that, Mr. Hayden; but I think we would have to do some arguing with the financial interests in Wall Street as to the amount of our bonds. Because there is some law in some of these Eastern States-some of the Eastern States have laws which limit the purchase of these securities by savings banks, etc., to cases where they do not exceed a certain percentage. Mr. HAYDEN. Of the valuation of the city? Mr. CRISWELL. Yes; of the valuation of the city. Our assessed valuation at the last assessment, in March of last year, was $974.000,000 plus. And that was an increase of about 12 per cent over the previous year. I presume that that same increase will keep up, if it will not be exceeded a little bit this year. Mr. HAYDEN. I am asking you these questions because there was a feeling in Arizona that there was grave danger that the city of Los Angeles might be granted this permit, under the preference given to municipalities by the Federal water power act, and that the city would seize upon this valuable power site and transmit the power away from Arizona to our detriment. I wanted to find out whether that danger was real or not. Mr. CRISWELL. No; there is no intention on the part of anyone in Los Angeles to do that sort of thing. The prosperity of Los Angeles depends to a certain extent upon the prosperity of all that section; well I will go as far as to say it does to the full extent. Mr. HAYDEN. Are you willing to share that prosperity at its source, by the payment of a reasonable royalty to Arizona upon the power? Mr. CRISWELL. Well, that is what is proposed in this bill: if the Government builds a dam, that we shall pay a royalty on that power. Mr. LEATHERWOOD. To Arizona? Mr. CRISWELL. And as to the other, if the city of Los Angeles should build a dam-I might say that on our aqueduct, which at the present time extends out into other counties than Los Angeles County, the city of Los Angeles pays taxes upon all of that property, just the same as a private corporation would pay them. Mr. HAYDEN. The people of Arizona feel that they are entitled to at least a fair tax upon the value of the property within the State. They would obtain that under the Federal water power act. If you made your application under that act and it was granted, the State of Arizona would get a part of the rental that the city of Los Angeles would pay to the United States for the use of the site. That would be in a lieu of taxes. Before Los Angeles could get a permit from the Federal Power Commission, you would have to come to a proper understanding with the State authorities of Ari zona; because the Federal water power act provides that until your application has been approved by the State, wherein the dam site is located, it shall not even be considered by the Federal Power Commission. The difference between that situation and the Swing bill is that this bill provides that the dam shall be built by the Federal Government, and there is no provision for any payment in lieu of taxes of any royalty, or the payment of any consideration to the State of Arizona whatsoever. Mr. CRISWELL. Well, I suppose that this bill follows the lines of previous legislation of this character; and I feel quite sure that we in Los Angeles would not interpose any objection to the State of Arizona attempting to secure a reversal of that policy; and we would. of course, like for this project to be treated the same as any other Government project. Mr. HAYDEN. All the other legislation enacted by Congress relating to reclamation, contains a provision that nothing shall be done. that interferes with the laws of the States, relating to the appropriation, use, or distribution of water, thereby recognizing that, to obtain the right to the use of water, you must obtain it from the State wherein the project is located. That same provision is contained in the Federal water power act, in substance. The Federal water power act prohibits the Federal Power Commission from issuing any license until the laws of the States are first complied with. This bill does not do that. Mr. CRISWELL. Well, I would say that that is a matter that the lawyers would have to settle. And, thank God! I am not a lawyer. Mr. HAYDEN. I will also have to give thanks for neither am I a lawyer. [Laughter.] Mr. CRISWELL. But I am sorry that I am not an engineer. Mr. RAKER. Just along that same line, of course, I suppose you are thinking about the royalty that would have to be paid by reason of the good people in the upper basin allowing the water to run down hill? Mr. CRISWELL. Well, there is plenty of water. Mr. SWING. Well, the question has been answered; and I wonder if when Mr. Criswell is through we can have Mr. Taylor make a statement for five minutes, Mr. Chairman? Mr. HUDSPETH. I want to ask this gentleman one question before he leaves. When did this apparent shortage of water appear in Los Angeles? Mr. CRISWELL. It commenced to develop last year. Mr. HUDSPETH. At what time, Mr. Criswell? Mr. CRISWELL. A year ago now, this winter, there was a rainfall that was far below normal. Mr. HUDSPETH. The reason I asked the question is that I do not recall any of your witnesses who testified for Los Angeles before this committee at its hearing a year ago mentioned the fact that there was a shortage of water. My recollection is that it was confined solely to the power proposition, the need for more power, in the city of Los Angeles; and that no witness at that time mentioned anything regarding water. Mr. CRISWELL. This water situation has developed within-well approximately, the last year. Mr. HUDSPETH. Since the hearing on this bill a year ago? Mr. CRISWELL. Since the hearing on this bill a year ago last June. Thank you, gentlemen. Mr. SWING. Mr. Chairman and gentlemen: You do not need to have introduced to you Mr. John Taylor, vice chairman of the American Legion legislative committee; and I should like to have Mr. Taylor talk to you for five minutes before you adjourn. TESTIMONY OF MR. JOHN THOMAS TAYLOR, VICE CHAIRMAN LEGISLATIVE COMMITTEE OF THE AMERICAN LEGION (The witness was sworn by the chairman.) Mr. TAYLOR. The reason that we are interested in this legislation is because it opens up lands for development for the ex-service men. We have been interested in opening up lands ever since the exservice men got back. In fact, one of the first things that was done while the ex-service men were still returning was the preparation of a couple of bills. The first one, as I remember it, was the LaneMondell bill, which attempted to develop lands for ex-service men. And since then, there have been a number of pieces of legislation pending before both the House and the Senate for that purpose. As you know, in the adjusted compensation bill, there was a specific provision for land settlement. And in the present adjusted compensation bill there is a provision, which I will not read because it is so well known Mr. RICHARDS (interposing). Which bill do you have reference to? Mr. TAYLOR. The bill as it is before the Senate and the House, it is S. 2309. Mr. RICHARDS. The McKenzie bill? Mr. TAYLOR. The McKenzie bill and the Curtis bill. Mr. RICHARDS. There is also the Thomas bill? Mr. TAYLOR. There are half a dozen bills in the House. But in all of them the land development feature was taken out, and only that portion left in, which provides for preference rights in land. which was newly developed. Mr. HUDSPETH. Preference rights to the soldiers? Mr. TAYLOR. Preference rights to the soldiers, yes. And I will just submit that bill to the committee without reading it-S. 2309. In effect, it gives a preference right to the soldiers for a certain. time. Mr. HAYDEN. The American Legion has not in any manner changed its position with respect to the land development? Mr. TAYLOR. No, sir. I want to read the resolution adopted at the last convention with respect to this matter. It is as follows: Whereas the undeveloped resources of the Colorado River constitute one of our Nation's greatest assets; and Whereas the life-giving waters and potential energy of said river, equivalent in value to millions of dollars, is annually running to waste in the flood waters of the river and constituting a menace to life and property while it runs to waste; and 92265-24-PT 2- -7 Whereas the Department of the Interior of the United States has recommended to Congress the construction of a project for the protection and development of the Lower Colorado River, commonly known as the "Boulder Dam and All-American Canal project," as the first unit of the ultimate complete development of the resources of said river: and Whereas this project is vitally necessary to safeguard the lives and property of many ex-service men and thousands of others living in the Lower Colorado River Basin, now constantly threatened with devastation and destruction from annual floods of that river: and Whereas under said project thousands of ex-service men and women will be given the preferred right to acquire homes and farms by entry upon several hundred thousand acres of public lands in Arizona, Nevada, and California now arid and worthless, but which by this project will be made intensely productive and valuable: Now, therefore, be it Resolved, That the American Legion, in national convention assembled, does hereby favor the adoption by Congress of a program for the ultimate complete development of the Colorado River, and favors as the first unit of that program the passage of legislation that will carry out the recommendations heretofore made by the Interior Department providing for the construction of said Boulder Dam and All-American Canal, and that the national legislative committee of the American Legion be directed to use all legitimate means to secure the passage of such legislation. Mr. HUDSPETH. Mr. Taylor, the Legion would go on record and pass a resolution of similar character in regard to any other new project that might be opened up, or might be in course of construetion or anticipation, would it not? Mr. TAYLOR. For the development of arid lands by irrigation, or of cut-over lands? Mr. HUDSPETH. Yes. Mr. TAYLOR. Certainly. Mr. HUDSPETH. Any that would give an avenue for the soldier to get a home? Mr. TAYLOR. Certainly. Mr. HAYDEN. Was any resolutions passed on the subject of soldier settlement at the last national convention of the American Legion? Mr. TAYLOR. Yes. Mr. HAYDEN. On the broad policy? Mr. TAYLOR. Certainly. Mr. HAYDEN. Have you a copy of that resolution with you? Mr. HAYDEN. If you please. Mr. TAYLOR. It says: Resolved, That the American Legion in fifth annual convention assembled, indorses and approves the plans submitted to Congress for the lending of Federal aid to the reclamation of arid lands and the drainage of swamps and other similar projects, and urges that Congress speedily enact legislation whereby the vast amount of land included therein may soon be made productive; be it further Resolved, That such legislation provide, as has been the policy in the past, that the ex-service men and women of this country be given preferential rights in the settlement of such lands when they have been reclaimed; be it further Resolved, That this convention especially indorses what is commonly known as the Columbia River Basin reclamation project and the Colorado River Basin reclamation project, and as incidental thereto, the construction of the Boulder Dam and All-American Canal. And it being necessary, in order to carry out the Colorado River project, that a compact be entered into by the seven States whose territory is involved in that project, known as the Colorado River compact, and all of the States having approved the same except the State of Arizona; be it Resolved, That this convention memorializes the governor and legislators of the State of Arizona speedily to ratify that compact. That is a general land resolution. Mr. HAYDEN. I had in mind that reference to the Colorado River compact. The American Legion in the State of Arizona has very strongly indorsed the compact and urged upon the legislature its approval. The difficulty under which we labor here is that the States of the Upper Basin feel that pending the approval of the Colorado River compact, they are forced to oppose the enactment of any legislation at this time. Mr. TAYLOR. Well, of course, what the Legion is interested in is land development, is it not? And Mr. Heald from the West, and Doctor Hartman, from the West, have come on here to Washington to appear before this committee and give such technical testimony as you gentlemen think is necessary. Mr. RAKER. They will be on hand, will they? Mr. TAYLOR. Yes; they are sitting behind you now. Mr. RAKER. I take it from those resolutions and the purport of them, that you strongly indorse the Government's development of the Colorado River rather than private development. Am I correct in that? Mr. SWING. It says a development according to the Interior Department recommendation, which means by the Government. Mr. TAYLOR. It says a development according to the recommendations of the Department of the Interior. That is, frankly, a question which was not brought up at the convention. Mr. SWING. Oh, yes; the resolution speaks for itself. And here is the report right here [indicating] to which it refers. Mr. TAYLOR. It says the report of the Department of the Interior. But what I mean is that the boys out there are interested in land development-- Mr. SWING (interposing). The resolution says Mr. HAYDEN (interposing). Let him answer. Mr. SWING. I know; but he can only speak as far as the resolution goes; and that speaks absolutely and unequivocally for the development of this project by the United States Government, as set forth in the Fall-Davis report. Mr. TAYLOR. There is no question about that. I thought Judge Raker meant to ask if we were generally in favor of the private development of land, or of Government development. Is that what you meant? Mr. RAKER. No. Mr. TAYLOR. You meant as to this specific project? Mr. TAYLOR. In this specific project, they went into it very thoroughly and recommended the Interior Department report. In fact, we had Mr. Swing out there to give us some light on it, as we had a number of other men that knew about it; and the resolutions committee was very specific about this particular Boulder Dam project. Mr. RAKER. By the Government? Mr. TAYLOR. According to the report of the Department of the Interior. Mr. RAKER. Do they still stand that way, so far as you know? |