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CENTRAL VALLEY PROJECT OF CALIFORNIA

THURSDAY, FEBRUARY 7, 1935

HOUSE OF REPRESENTATIVES,
COMMITTEE ON FLOOD CONTROL

Washington, D. C. The committee this day met at 10:40 a. m., Hon. Riley J. Wilson, chairman, presiding, to consider H. R. 4122 and H. R. 4128, identical bills, as follows:

[H. R. 4122 and +128]

A BILL To improve navigation and to control destructive flood waters on the Sacramento

and San Joaquin Rivers in the State of California ; to aid and improve agriculture and industrial development within said river basins; and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That for the purpose of improvement of navigation on the Sacramento and San Joaquin Rivers in the State of California ; to control destructive flood waters in said Sacramento and San Joaquin River Basin; to aid and improve agriculture and industry within said basins; to provide for the generation of electrical energy as a means of making the project hereinafter referred to a self-supporting and financially solvent undertaking; to provide for the economic and social well-being of the people of the State of California, and for other beneficial purposes, there is hereby authorized to be appropriated from time to time, out of any money in the Treasury not otherwise appropriated, such sums of money as may be necessary to carry out the purposes of this Act, not exceeding in the aggregate the sum of $170,000,000.

SEC. 2. All moneys authorized to be appropriated by this Act shall be made available as herein provided for expenditure by the Water Project Authority, a body politic and corporate, created in and by an Act of the Legislature of the State of California passed and adopted at the legislative session of 1933, and designated the “ Central Valley Project Act of 1933" (ch. 1042, Statutes of 1933), and thereafter approved by the people of the State of California at a special election held in said State on December 19, 1933; said moneys to be expended, subject to the provisions of this Act, for the purpose of the acquisition of the necessary rights and properties and the construction by said Water Project Authority of the Central Valley project, as said project and the construction thereof is authorized, set forth, and provided for in said Central Valley Project Act of 1933, and hereinafter referred to as project.”

SEC. 3. The Secretary of the Interior and the Secretary of War shall have and exercise joint power and authority in administering this Act.

SEC. 4. The said Secretary of the Interior and the said Secretary of War shall authorize and approve all expenditures to be made under this Act; shall approve any and all plans and specifications for the construction of said Central Valley project; shall exercise general supervision and control over the construction of said project to the extent necessary to insure substantial compliance with the approved plans and specifications; shall approve all contracts entered into by said Water Project Authority for the sale, use, or disposal of water and electric energy or other facilities to be made available by the operation of said project as to their suffiency in matters of both form and substance, and shall have and exercise such incidental powers as may be necessary, or appropriate to insure the proper application of the funds made

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available hereunder and to properly protect the interests of the United States in the premises. Upon the completion of construction of said project and the repayment to the fund hereinafter created of all moneys loaned to said Water Project Authority, for the repayment of which provision is made in this Act, together with interest thereon as herein provided, and the transfer of said moneys so loaned, together with interest, into the Treasury, all powers, duties, and functions created and established by this Act shall cease and terminate.

SEO. 5. (a) There is hereby established a special fund, to be known as “ Central Valley project fund" (hereinafter referred to as the "fund "), and to be available, as hereinafter provided, only for carrying out the provisions of this Act. All payments or advances to said Water Project Authority, and all moneys received therefrom, in carrying out the provisions of this Act, shall be made from or received into said fund, under the direction of the Secretary of Interior and the Secretary of War.

(b) The Secretary of the Treasury is authorized to advance to the fund for the use of and expenditure by said Water Project Authority, from time to time and within the appropriations therefor, such amounts as the Secretary of the Interior and the Secretary of War shall certify to be necessary to meet the requirements for funds of the construction program of the said Water Project Authority, except that the aggregate amount of such advances shall not exceed the said sum of $170,000,000, the appropriation whereof is herein authorized.

Of the total amount herein authorized to be appropriated, $38,000,000 thereof is hereby allocated as a direct grant to said Water Project Authority and shall be used and applied toward defraying the cost of the necessary labor and materials entering into the cost of the construction of said project; $12,000,000 thereof is hereby allocated as a special and direct contribution to and participation in the cost of construction of the Kennett Dam of said project, on account of the general and Federal benefits from the construction of said dam to navigation, flood control, and salinity control, in accordance with the report of the Chief of Engineers of the War Department, dated April 6, 1934, and contained in House of Representatives Document Numbered 35, Seventythird Congress, second session, and shall be used and applied toward defraying the cost of construction of said Kennett Dam; both of which sums, constituting in the aggregate $50,000,000, shall be made available to said Water Project Authority for the uses and purposes of this Act, and in the manner herein provided, and subject to the provisions of this Act, without necessity of or provision for repayment or reimbursement to said fund or to the Treasury of the United States; the remaining sum of not to exceed $120,000,000 shall be allocated and made available to said Water Project Authority as a loan to be repaid to said fund over a period of forty years commencing with the tenth year after beginning of construction of said project, and to bear interest at the rate of four per centum per annum. As security for such repayment, the Secretary of the Interior and the Secretary of War are authorized and empowered to accept and receive the revenue bonds of said Water Project Authority, or may purchase such revenue bonds, and may execute such contract or contracts with said Water Project Authority as may be necessary, expedient, or advisable in order to protect the interests of the United States, and may supervise and approve the operation and maintenance of said Central Valley project so long as said loan, or any part thereof shall remain unpaid. The Secretary of the Interior and the Secretary of War may dispose of any such bonds so received to public or private agencies or entities on such terms as they may deem and find advantageous.

(c) Moneys in the fund advanced under subdivision (b) shall be available only for expenditures for construction, and for the payment of interest during construction and for one year thereafter, on any amounts loaned as herein provided : Provided, That any amount loaned as herein authorized may be expended by said Water Project Authority for any purpose authorized by said Central Valley Project Act.

(d) The Secretary of the Treasury shall charge the fund as of June 30 in each year with such amount as may be necessary for the payment of interest on any loan, or portion thereof, made under subdivision (b) at the rate of 4 per centum per annum accrued during the year upon the amounts so advanced and remaining unpaid, except that if the fund is insufficient to meet such payment of interest the Secretary of the Treasury may, in his discretion, defer any part of such payment, and the amount so deferred shall bear interest at the rate of 4 per centum per annum until paid.

(e) The Secretary of the Interior and the Secretary of War shall certify to the Secretary of the Treasury, at the close of each fiscal year, the amount of money in the fund in excess of the amount necessary to meet the requirements for funds of the construction program for said project. Upon receipt of each such certificate the Secretary of the Treasury is authorized and directed to charge the fund with the amount so certified as repayment of or credit on any of the advances made under subdivision (b), which amount shall be covered into the Treasury to the credit of miscellaneous receipts.

SEC. 6. Before any money is appropriated for the purpose of this Act, the Secretary of the Interior and the Secretary of War shall require the submission by the Water Project Authority of contracts for the furnishing, disposal, or use of water and electric energy or other facilities to be made available by the operation of said project, establishing revenues in such amounts as they shall deem sufficient to demonstrate the ability of said Water Project Authority to pay any and all expense of operation and maintenance of said project and to repay to said fund any and all amounts loaned, together with interest thereon, as herein provided, having and giving due consideration to any showing which may be made or presented by said Water Project Authority indicating future growth of population in said Sacramento and San Joaquin River Basins, industrial expansion therein, and consequent future increased demand for such facilities to be made available by the operation of said project, which may be reasonably anticipated.

The CHAIRMAN. The committee will please come to order.

We have several representatives from the various departments of the Government present, and I should like to have their names.

Charles ELLIOTT. I represent the National Resources Board. C. W. LOWDERMILK. I represent the Soil Erosion Board. I am vice-director.

Lt. Col. Glenn EDGERTON, Corps of Engineers, United States Army. I represent the office of the Chief of Engineers of the United States Army.

The CHAIRMAN. The purpose of the numerous bills now pending before the Committee on Flood Control is to secure legislation by the Congress approving projects for controlling floods, improvements for navigation, the development and use of hydroelectric power, protection against the erosion of soils, the preservation and use of natural resources, and for the protection of human life and property on streams and watersheds in all parts of the United States.

The depletion of natural resources such as forests, extensive clearing and cultivation without preventative methods against erosion, has progressively increased flood heights in all streams to such an extent that annual losses run into hundreds of millions of dollars and consequent danger to the homes and lives of citizens is constantly increasing

Therefore, the purpose of the hearing now beginning will be to make up a list of projects and secure the allotment of funds to undertake the work thereon according to merit, economic value, and conditions of emergency for the protection of life and property. Also, to secure authorization for ample funds for the completion of adopted projects for the major portion of the streams and watersheds affected. Surveys have been made and data collected that will provide an opportunity to begin the works immediately and especially on the emergency phases of the projects that will coordinate with the plans for final completion. So in a national program for public works to relieve unemployment, and at the same time to make permanent investments to increase and maintain the assets of the Nation, and to insure future security to agriculture and industry, a comprehensive plan as outlined in the measures before this committee offers the best opportunity.

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