TO AMEND THE RECLAMATION PROJECT ACT OF 1939 MONDAY, MARCH 17, 1947 HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON IRRIGATION AND RECLAMATION OF THE COMMITTEE ON PUBLIC LANDS, Washington, D. C. The subcommittee met, pursuant to call, at 10 a. m., in the committee room of the House Committee on Public Lands, the Honorable Robert F. Rockwell (chairman of the subcommittee) presiding. Mr. ROCKWELL. The committee will please come to order. Gentlemen of the committee, we have, after some little discussion, got this week set aside for the consideration of our reclamation bills. As those of you remember who were on this committee last year, the bill on the amendment to the fundamental reclamation law was discussed for one or two years and we never did get it out of the committee. This week we are going to try the Herculean task of agreeing on some bill that can be reported out to the House. Now, we have three bills that I should like to have this committee consider. One of them is by Congressman Jones, who is chairman of the Interior Appropriations Subcommittee, and a man we should have a great deal of consideration for. I believe his bill does not tie in to the bills that Mr. Lemke and I have introduced, and therefore I think this morning it would be wise to take up H. R. 1772, Mr. Jones' bill, and see if we can dispose of that. The bill, H. R. 1772, is to provide for the flow of revenues from Federal reclamation projects into miscellaneous receipts of the Treasury and to provide that revenues from Federal reclamation projects hereafter financed wholly from general funds of the Treasury shall be covered into miscellaneous receipts of the Treasury. The bill will be inserted in the record at this point. (The bill is as follows:) [H. R. 1772, 80th Cong., 1st sess.] A BILL To provide for the flow of revenues from Federal reclamation projects into miscellaneous receipts of the Treasury and to provide that revenues from Federal reclamation projects hereafter financed wholly from general funds of the Treasury shall be covered into miscellaneous receipts of the Treasury Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Act of May 9, 1938 (52 Stat. 291), is hereby amended by striking out the first proviso in the provision of such Act relating to the disposition of moneys received by the United States in connection with any irrigation projects, including the incidental power features thereof, constructed by the Secretary of the Interior through the Bureau of Reclamation, and inserting in lieu thereof the following: "Provided, That, after the close of each fiscal year, there shall be covered into the General Treasury as 'miscellaneous receipts' that proportion of the net revenues not required to meet contractural 1 2 AMEND RECLAMATION PROJECT ACT OF 1939 obligations of the United States received from each such project during such fiscal year which the sum of general-fund appropriations made after the effective date of this proviso for each such project bears to the aggregate of all appropriations and allotments made for such project: Provided further, That when the sum of transfers from the reclamation fund to miscellaneous receipts of the Treasury with respect to a project equals the sum of all general-fund appropriations made for such project subsequent to the effective date of this proviso then the amount to be transferred to miscellaneous receipts of the Treasury with respect to each such project, after the close of each fiscal year, shall be that proportion of the net revenues received from each such project during such fiscal year which the sum of all general-fund appropriations and allotments bear to the aggregate of all appropriations and allotments made for such project." SEC. 2. This Act shall become effective upon the first day of the fiscal year following the fiscal year in which it shall become law. Mr. ROCKWELL. We have a favorable report on H. R. 1772, but Mr. Jones tells me that he wishes to change the bill and that he has the copies of the changes coming in here in a few minutes. They will be here by the time he finishes with his testimony, and I think probably we might have this report read to the committee. Mr. GRANT (the clerk). (Reads:) THE SECRETARY OF THE INTERIOR, MY DEAR MR. WELCH: I am glad to comply with your request for an expression of my views on H. R. 1772, a bill to provide for the flow of revenues from Federal reclamation projects into miscellaneous receipts of the Treasury and to provide that revenues from Federal reclamation projects hereafter financed wholly from general funds of the Treasury shall be covered into miscellaneous receipts of the Treasury. revenues * I have no objection to the enactment of the bill. H. R. 1772 would start a flow of funds into miscellaneous receipts of the Treasury from existing Federal reclamation projects upon the expiration of one fiscal year following the fiscal year in which the bill had been enacted into law. The amount that would thus be covered into miscellaneous receipts would be "that proportion of the net * * * received from each such project * which the sum of general-fund appropriations made after the effective date of this proviso bears to the aggregate of all appropriations and allotments made for such project." Under existing law (the present Hayden-O'Mahoney amendment), no provision is made for the flow of revenues into miscellaneous receipts of the Treasury until "after the net revenues derived from the sale of power shall have repaid those constructions costs allocated to power to be repaid by power revenues therefrom * * Under the terms of the bill, when following the procedure described in the preceding paragraph, the aggregate of the revenues covered into miscellaneous receipts of the Treasury with respect to a project had equaled the sum of all general-fund appropriations made for that project subsequent to the effective date of the bill, then the amount to be transferred to miscellaneous receipts of the Treasury would be "that proportion of the net revenues received from * such project * which the sum of all general fund appropriations and allotments (for such project) bears to the aggregate of all appropriations and allotments made for such project." Finally, under the terms of the bill, where a project had been wholly financed from general funds of the Treasury appropriated subsequent to the effective date of the bill, then all net revenues from such project would be covered into miscellaneous receipts of the Treasury. To correct an apparent typographical error, I suggest that at page 2, line 19, the word "bears" be substituted for the word "bear." In addition, I believe that more ready understanding of the background of this bill would be facilitated by the incorporation in it of a statement, in the nature of a preamble, reading along the following lines: "Whereas for many years it has been recognized that the creation, operation, and maintenance of reservoirs and other works on navigable streams, or tributaries thereof, incident to the construction, operation, and maintenance of projects for the reclamation by irrigation of arid or semiarid lands, and for purposes related thereto, reduces the incidence and extent of destructive floods which, among other things, upset orderly processes, cause loss of life and property, AMEND RECLAMATION PROJECT ACT OF 1939 3 including the erosion of lands, and the impairment and obstruction of navigation, highways, railroads, and other channels of commerce between the States, and constitute a menace to the general welfare; and "Whereas for many years it has been recognized that the construction, operation, and maintenance of projects for the reclamation by irrigation of arid or semiarid lands and for purposes incidental thereto is a proper activity of the Federal Government in cooperation with States, their political subdivisions, and localities thereof, and is in the interest of the general welfare; and "Whereas to the ends aforesaid the Congress has, from time to time, made appropriations from general funds of the Treasury which, in addition to funds appropriated from the reclamation fund, have been used to finance the construction, operation, and maintenance of works authorized under the Federal reclamation laws (Act of June 17, 1902, 32 Stat. 388, and acts amendatory thereof or supplementary thereto); and "Whereas it is the sense of the Congress that the revenues from Federal reclamation projects should be distributed appropriately between the reclamation fund and the 'miscellaneous receipts' of the Treasury: Now, therefore," In view of my understanding that you desire an immediate report on H. R. 1772, this letter has not been submitted to the Bureau of the Budget for consideration, therefore, no commitment can be made concerning the relationship of the foregoing views to the program of the President. Sincerely yours, OSCAR L. CHAPMAN, Under Secretary of the Interior. Mr. ROCKWELL. All right, Mr. Jones. Will you make your statement regarding the bill. STATEMENT OF HON. ROBERT F. JONES, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF OHIO be Mr. JONES. The reason the bill H. R. 1772 was introduced may stated as follows: On an appropriation bill passed and approved by the President on May 9, 1938, there was legislation codified under title 43, section 392 (a), which attempted to dispose of moneys, the income from reclamation projects, which had been financed from the general fund. That codified section was legislation on an appropriation bill at the same time appropriations were made from the general fund directly for the first time. Up until that time there had been allocations of money, $192,000,000, from the relief funds or emergency funds in connection therewith to provide work for unemployed. The legislation which is codified reads as follows: All moneys received by the United States in connection with any irrigation projects, including the incidental power features thereof, constructed by the Secretary of the Interior through the Bureau of Reclamation, and financed in whole or in part with moneys heretofore or hereafter appropriated or allocated therefor by the Federal Government, shall be covered into the reclamation fund, except in cases where the provision has been made by law or contract for the use of such revenues for the benefit of users of water from such project: Provided, That after the net revenues derived from the sale of power developed in connection with any of said projects shall have repaid those constructions costs of such project allocated to power to be repaid by power revenues therefrom and shall no longer be required to meet the contractual obligations of the United States, then said net revenues derived from the sale of power developed in connection with such project shall, after the close of each fiscal year, be transferred to and covered into the General Treasury as "miscellaneous receipts": Provided, further, That nothing in this section shall be construed to amend sections 617-617t of this title, or to apply to irrigation projects of the Office of Indian Affairs. My criticism of this legislation is that the general fund moneys which are raised by revenues from the entire United States are used 4 AMEND RECLAMATION PROJECT ACT OF 1939 to build reclamation projects and then the income from these projects in toto are returned to the reclamation fund. Then subsequently, after the total amount that has been expended from the general fund has been returned to the reclamation fund, the general treasury, the general fund of the Treasury, shall start receiving income from the project. Now, it seems to me that the legislation put the cart before the horse, and that the general fund should be reimbursed for the amount of the appropriations in these various projects constructed in whole or in part from the general fund and thereafter the logical place for the moneys to go would be to the reclamation fund. The bill, H. R. 1772, attempts to return moneys which are apropriated both from the general fund and from the reclamation fund to build various and sundry projects, in proportion that each bears to the whole apropriation expended for construction of such projects, and a certain amount would be returned depending upon such proportions each year to each fund. On line 3 of the bill H. R. 1772 is a reference to a statute in parentheses "52 Stat. 291"-and it is an incorrect reference. The statute number should be "52 Stat. 322." This bill is the same bill that was introduced in the last Congress by Senator O'Mahoney and Senator Hayden, and I rewrote the bill and did not examine the statute number before introducing it. Upon further study, I have found this discrepancy in the proper reference to the statute. Mr. MURDOCK. Mr. Chairman, may I ask a question? Mr. JONES. Yes, sir. Mr. MURDOCK. Which Senators introduced the bill? Mr. JONES. Senator O'Mahoney and Senator Hayden, I believe. Mr.MURDOCK. In the last session? Mr. JONES. That is right. Mr. MURDOCK. And this is identical, with the exception? Mr. JONES. Yes, sir; it is identical, exactly; and I am quoting the correction that should be made. The proper statute reference should be "52 Stat. 322". Now, I think in order to get at the problem and the basis of the consideration for H. R. 1772, or a corrected approach to the problem, which I will submit to the committee, and copies should be here shortly, I ought to emphasize the points of view by giving a brief history of the development of the reclamation of arid and semiarid lands and the first conception of the reclamation fund. Mr. MURDOCK. Mr. Chairman, before he goes into that, may I ask one more question? Mr. JONES. Yes, sir. Mr. MURDOCK. As I understand this bill, it will change the effect of the so-called Hayden-O'Mahoney amendment of 1938? Mr. JONES. Yes, sir. Mr. MURDOCK. And this evidently was the intent of the authors of the legislation in the first place, by the introduction of the bill last session, do you think? Mr. JONES. You mean the intent that I have expressed in describing H. R. 1772 when they introduced the exact copy of the bill in the last session? Mr. MURDOCK. Yes, sir. |