stand further investigation. I am not charging that there is anything wrong with these, but I do think we ought to know what we are including and we ought to include the same factors in all of these projects. That is the only point I have against area redevelopment. That is the only thing I have against this type of project. I do not believe in setting up one set of rules for part of our people and then setting up a different set of rules for other people who are exactly similarly situated.

༡ ི་ ན་ ་ ་ མི

Mr. SWIGART. On that particular point, too, Mr. Poage, this redevelopment benefit has not been set up on the basis of discriminating against one group for another group, but the economists-I am not an economist, but they are the ones who have brought this to the forefront. In other words, they say if you have an affluent area, then these redevelopment benefits do not really accrue because you are not adding any more employment where there is full employment and affluence. You are not adding benefits that the particular area needs because they do not need additional employment and expansion.

Mr. POAGE. I want to know where in the United States full employment exists. In my county we are only 4 percent under. You would not give us credit for it. If you then go to another district in Texas and find a county that is 7 percent under, you would give them credit for it.

Mr. SWIGART. That is because of the law. The ARA Act prescribes a formula for determining when a county is in bad shape and when it is not.

Mr. POAGE. I know the law prescribes the formula under which certain counties can get certain benefits that are not given to the rest of us, and I think it is wrong, but the majority passed it and it is the law. But this law, Public Law 566, was not amended and there is no law that says that in these watershed projects you shall give special consideration to and special privileges to people of any certain area. Mr. SWIGART. Except the orders we get from the executive branch of the Government. That is the reason we do that.

Mr. POAGE. I am not suggesting that you gentlemen are in any wise responsible for it. I know you get these things handed down. But I do say there is no law to that effect. You may get instructions from the executive branch of the Government to burn your maps and to produce some false maps and bring them up here, but that still would not be the way the committee wants to carry it out.

I think I speak for the committee that we want the facts and we want the same treatment all over the United States. Mr. Teague represents a rich district, and I think he is entitled to the same kind of treatment and under the same standards that my people are entitled to. Mr. TEAGUE. I agree with you, Mr. Chairman. It is true my district is prosperous, but nevertheless, with the increase in population out there, we have an unemployment problem.

Mr. POAGE. Of course you have.

Mr. TEAGUE. I have a project which I shall present, hopefully, before the year is over, and I would not expect to get any calculation. of redevelopment nature in that project unless that would be the policy to be applied everywhere.

Mr. SWIGART. I would like to point out one other thing, too, that we could not do, I do not think, Mr. Chairman, what I understand you would like. We could not send up a project through the Bureau of

the Budget that had redevelopment benefits in it for counties which were not designated by the ARA or some other specific designation. The Bureau of the Budget will accept redevelopment benefits in these kinds of projects. So we could never get it out of the executive branch on a nationwide basis.

Mr. POAGE. Unless there is objection from some member of the committee, I will ask you to take word back to the Bureau of the Budget that we do not want any calculations brought up here that include redevelopment or any other figure that is not applicable across the country. Has anybody any objection to that?

(No response.)

Mr. POAGE. Is there anything further on this?
Mr. LANE. I have nothing further.

MUDDY FORK OF SILVER CREEK WATERSHED, INDIANA

Mr. POAGE. We will pass to the Muddy Fork of Silver Creek watershed project. Mr. Denton was here on that project but he has stepped out at the moment. We will now hear the Department on this project.

MUDDY FORK OF SILVER CREEK WATERSHED WORKPLAN

Size and location: 42,642 acres in Clark, Floyd, and Washington Counties. Tributary to: Ohio River-Mississippi River.

Sponsors: Clark County, Floyd County, and Washington County Soil and Water Conservation Districts; and town of New Providence, Inc.

Purposes: Watershed protection, flood prevention, municipal water supply and recreation.

Principal measures: Soil conservation practices on farms; and structural measures consisting of three floodwater retarding structures, one multiple-purpose structure for flood prevention and municipal water, three multiple-purpose structures for flood prevention and recreation with recreational facilities, and 12.5 miles of channel improvement. Combined storage capacity of the structures totals 4,659 acre-feet.

Number of beneficiaries: Owners and operators of 96 farms, more than 50 residences, transportation facilities and commercial properties benefited by flood protection; 300 families served by water supply; and the population provided about 17,000 visitor-days of recreational use per year.

1 This is primarily the cost of applying land treatment measures by landowners. Cost sharing from Federal funds appropriated for the agricultural conservation program may be available if included in the county program developed each year in consideration of approved State and National programs and the annual authorization by the Congress.

2 Consisting of—

Construction and installation services cost for recreation and municipal water.
Land, easements, and rights-of-way.

Administration of contracts and legal costs.

The value of measures already applied ($846,350) increases this to 46 percent.

Benefit-cost ratio: 1.3 to 1.

Prorated Public Law 566 cost per acre: $172.

Carrying out the project: The town of New Providence, also known as Borden, assumes all local responsibilities for installation, operation and maintenance of structure No. 1. A conservancy district, now being organized under the Indiana Conservancy Act, will assume these responsibilities for all other structural measThe estimated annual cost of operation and maintenance is $24,703.

ures.

Mr. LANE. The Muddy Fork of Silver Creek Watershed is located in Clark, Floyd and Washington Counties, Indiana, and contains 42,600 acres. This watershed is located about 15 miles north and west of Louisville, Ky. It is tributary to the Ohio River.

The watershed is about 15 miles long and 411⁄2 miles wide on the average. The elevation ranges from about 980 feet at the upper end to 437 feet at the lower end. The precipitation is about 43 inches a

year.

Most of the upland is wooded, having steep slopes and shallow soils. These upland soils have little moisture-holding capacity, and runoff rates are high. Most of the water for domestic use and livestock is derived from low-yielding wells. There is a great need for a more dependable supply, particularly in the town of Borden. Only 19 percent of the watershed is cropland, with about 70 percent wooded. The principal crops are corn, soybeans, and small grain and hay. Some vegetables are grown for canning.

There are 322 farms in the watershed, averaging about 177 acres. Many of the farmers work at a cabinet factory in Borden or a cement plant at Pekin at the lower end of the watershed.

Frequent flooding damages farms and crops, houses, business, and industrial property, and also roads and bridges. The flood of June

1960 resulted in over $70,000 of damage to the town of Borden. More than 50 homes were flooded. The cabinet factory had to be closed and Highway 60 was closed. The domestic wells which are used as a source of water supply in Borden were contaminated. In addition, over 4,700 acres of cropland were flooded, with crop losses ranging from partial to complete. Flood damages are estimated to amount to $91,850 annually. Almost 60 percent of this is damage to crops and pasture.

Lack of adequate municipal and industrial water supply has tended to stagnate economic development. A recent test by the Clark County Board of Health found that 31 of the 35 wells used in Borden were contaminated and unsafe for human consumption.

The plan provides for the installation of land treatment measures on about 31,500 acres of crop, pasture, and woodland to reduce erosion and retard runoff. These measures will be supplemented by seven floodwater retarding structures and reservoirs and 121⁄2 miles of channel improvement. One of the reservoirs will provide 81 million gallons of municipal water capacity for the town of Borden. Three of the reservoirs will provide recreational lakes ranging from 21 to 28 acres in size. These measures have been planned to complement Dean Lake, the lake shown here, which recently has been completed by the Indiana Flood Control and Water Resources Commission. The lake has a surface area of 192 acres and provides also about 2,800 acre-feet of flood prevention capacity. The State is acquiring 600 acres that will be intensively developed and will serve the recreational needs of nearly half a million nearby residents.

The project will provide a high degree of protection to more than 4,700 acres of agricultural flood plains, small floods will be completely controlled and larger floods will be substantially reduced. Average annual agricultural damage will be reduced from $58,000 to $9,400 annually, a reduction of about 84 percent. The reduction in flood hazard will make possible a fivefold increase in truck crops to supply the fresh produce market of Louisville and the cannery at Austin.

The town of Borden north of Highway 60 will be fully protected from a repetition of the 1960 flood. The project will also make it possible for the town of Borden to install a community water system to serve the present needs of 300 families and the expanding needs that an assured water supply will generate.

The project will also provide about 17,000 visitor-days of use for recreation. We estimate total annual benefits are $148,585.

The estimated benefit-cost ratio is 1.3 to 1. The prorated 566 cost per acre is $172.

If I may, Mr. Chairman, I would like again to call to your attention that we have redevelopment benefits here amounting to 7 percent of the total. If that figure were taken from the total of the benefits, the project would still be adequately justified.

Mr. POAGE. Again indirect and secondary benefits are lumped together. Taking out the secondary, what are the claimed benefits?

Mr. LANE. Without those benefits in there, Mr. Chairman, the total benefits would amount to $123,700 annually as against the average

annual cost of $114,000. So there is an excess of benefit over cost even on that basis.

Mr. POAGE. I am interested that this project has four multiplepurpose dams, one of which is for flood prevention and municipal water. What are the other three?

Mr. LANE. The other three are recreation, but there will be no Federal funds going into recreation for these three other structures. The public recreation needs would be supplied or would be met by the Dean Lake development which has just been completed by the Štate. These are lakes which local groups wish to add capacity to for their own use for such use as they wish to make of it. They pay for the additional cost.

In addition to that, I might point out that by adding this capacity, generally that will reduce the cost of the flood prevention storage in that structure by making it multipurpose.

Mr. POAGE. Gentlemen, I hope that it does not seem that I am raising many objections that should not be raised, but I just have not fully understood. On recreation projects you pay for the recreation features, like one out of every 75,000 acres; but on these you do not. The Government has some investment in it, but it seems to me that you take credit for the benefit of the private expenditure here.

Mr. LANE. No. Mr. Chairman, we evaluate the benefit of the entire project. The entire project consists of Federal investment and nonFederal investment. In these particular structures there is a combination of Federal investment and non-Federal investment, and the only way that we know how to determine whether these particular reservoirs are justified is to compare the total benefit with the total cost. To that extent we do take credit for it.

Mr. PoAGE. I think I understand.

Mr. TEAGUE. I do not have any questions, Mr. Poage, but in case you need my encouragement, I compliment you for looking into these matters. I think we are entirely justified in asking these questions. Mr. POAGE. Let the record show

Mr. DAVID MCFALL (special assistant to Representative Hamilton). I am from Congressman Hamilton's office. Mr. Denton also asked me to extend his apologies. He had to leave.

Mr. POAGE. I was just going to ask the record to show that Mr. Denton had been here for some time. If Mr. Hamilton is represented, we will be glad to hear from you.

Mr. McFALL. Thank you, sir. The Congressman had an executive session and was unable to appear in person because of the time conflict. He has a statement, which I have with me, which I would appreciate your having placed in the record.

Mr. POAGE. Without objection, we will include the statement in the record.

(The statement follows:)

STATEMENT OF HON. LEE H. HAMILTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF INDIANA

Mr. Chairman and members of the subcommittee, I appreciate the opportunity to appear before you to testify in support of the proposed Muddy Fork of Silver Creek watershed. This project is a vital link in the long-needed chain of conservation projects to attain full utilization of southern Indiana's water and tourist potential.

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