(5) Transmission.-The Project Act did not authorize the construction of transmission lines by the United States. The provisions of the act relating to transmission all had reference to the transmission lines of the customers; i. e., a provision in section 5 (d) that a holder of a contract for more than 100,000 horsepower might be required to transmit power for a purchaser of less than 25,000 horsepower (sec. 5 (d)), a grant of rights-of-way for transmission lines (sec. 5 (d)), compensation to a contractor for property used for transmission in the event his contract should not be renewed (sec. 5 (b)); etc.

(6) Summary of provisions controlling power contracts.-The provisions of the Boulder Canyon Project Act governing power contracts, outlined above, were much more rigid than those of the large Federal projects which followed later. Among the distinctive features of the act in this respect were

(a) The requirement that power contracts be executed in advance of appropriations and construction;

(b) The requirement that these contracts produce revenues adequate to amortize the entire investment;

(c) The absence of any write-offs whatsoever, the flood-control allocation offering relief only to the extent of possible deferment if revenues were inadequate to retire this allocation within 50

years;

(d) Provision for added payments, in lieu of taxes, to Arizona and Nevada;

(e) Provision for the retention of revenues, after amortization, in a fund for the development of the basin;

Specific accounting procedure between the project and the Treasury, through a separate fund, to assure repayment to the Treasury of principal plus interest;

(g) The requirement that the customers build their own transmission lines;

(h) Provision for the operation of the power plant by the customers at their own expense;

(i) General provisions for preferences to public bodies, and particular provisions for preferences to States, as customers;

(j) After determination of preferences and allocation of energy, general and uniform treatment of all customers as to rates, duration of their contracts, and renewals.

E. Provisions Controlling Water Contracts

(1) Basic authority.-The basic authority of the Secretary of the Interior to contract for the storage and delivery of water for irrigation and domestic uses is contained in section 5 of the act, although important provisions appear elsewhere. Section 5, with respect to water contracts, reads:

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That the Secretary of the Interior is hereby authorized, under such general regulations as he may prescribe, to contract for the storage of water in said reservoir and for the delivery thereof at such points on the river and on said canal as may be agreed upon, for irrigation and domestic uses tracts respecting water for irrigation and domestic uses shall be for permanent service and shall conform to paragraph (a) of section 4 of this Act. No person shall have or be entitled to have the use for any purpose of the water stored as aforesaid except by contract made as herein stated.

(2) Subjection to Colorado River Compact.-All water contracts were subjected to the Colorado River Compact. These provisions are discussed in chapter IV (G).

(3) Subjection to lower basin compact.-The lower-division States were authorized to enter into a compact, and the Government's contracts were to be subject thereto, under certain circumstances. provisions are developed in chapter IV (H).

These

F. Provisions Relating Specifically to the All-American Canal

(1) Construction.-Section 1 of the Project Act authorized the Secretary of the Interior to construct a main canal and appurtenant structures, to be located entirely within the United States, connecting Laguna Dam, or other diversion dam to be constructed, with the Imperial and Coachella Valleys. The investment was to be reimbursable as provided in the reclamation law, i. e., without interest. No charge was to be made for the storage and delivery of water, i. e. on account of Hoover Dam, but the All-American Canal debt was not to be paid out of Hoover Dam power or water revenues. Section 4 (b), discussed supra, required that, before money was appropriated or construction commenced, the Secretary should make provisions for revenues adequate in his judgment to insure payment of all expenses of construction, operation, and maintenance, under the reclamation law (which at that time required payment within 40 years, without interest).

(2) Authorization for contract with Imperial Irrigation District.— Section 10, while preserving the existing contract of October 23, 1918 (appendix 1103), between the United States and Imperial Irrigation District, which obligated the district to pay $1,600,000 of the cost of Laguna Dam, authorized the Secretary to contract with the district for the construction of the canal and appurtenant structures and for the operation and maintenance thereof.

(3) Status of contracts as water storage and repayment contracts.-Section 5 authorized the Secretary to contract for the storage of water behind Hoover Dam, and for the delivery thereof "at such points on the river and on said canal as may be agreed upon." Such contracts, like the other storage contracts, were to be for "permanent service." No charge was to be made for such storage (sec. 1), as this area already

had a recognized right to natural flow, which was to be satisfied out of storage.' Section 6 of the act directed that the dam and reservoir be used, among other purposes, for "satisfaction of present perfected rights in pursuance of Article VIII of said Colorado River Compact," an article which provided that present perfected rights should "attach to and be satisfied" from water stored "not in conflict with Article III."

The All-American Canal contracts thus were to be dual in character: (1) Water-storage contracts under section 5, and (2) repayment contracts under section 4 (b) and related sections. With respect to the latter function, the contracts were governed by several special provisions, infra.

(4) Title.-Section 7 authorized the Secretary, in his discretion, after repayment "of all money advanced, with interest" (i. e., after repayment of the advances for Hoover Dam), to transfer the title of the canal and appurtenant structures (except Laguna Dam) down to and including Syphon Drop, to the districts or agencies having "a beneficial interest therein," under some form of organization satisfactory to the Secretary, in proportion to their capital investments. (5) Power utilization.-Section 7 of the act provided that—

The said districts or other agencies shall have the privilege at any time of utilizing by contract or otherwise such power possibilities as may exist upon said canal, in proportion to their respective contributions or obligations toward the capital cost of said canal and appurtenant structures from and including the diversion works to the point where each respective power plant may be located."

(6) Application of power revenues.-Section 7 of the act provided that

* The net proceeds from any power development on said canal shall be paid into the fund (Colorado River Dam fund) and credited to said districts or other agencies on their said contracts, in proportion to their rights to develop power, until the districts or other agencies using said canal shall have paid thereby and under any contract or otherwise an amount of money equivalent to the operation and maintenance expense and cost of construction thereof."

(7) Withdrawal of public lands.-Section 9 directed the withdrawal from public entry of all public lands of the United States found by the Secretary to be practicable of irrigation. The Secretary was thereafter authorized to open them for entry in tracts not exceeding 160 acres, giving preference to persons who had served in the Army, Navy, or Marine Corps.

1 See ch. I (D).

2 Eight power plants are planned on the All-American Canal: Syphon Drop (constructed), Pilot Knob (proposed; see ch. XIV), and two constructed and four proposed on the car al west of Pilot Knob.

3 Cf. art. 14 (b) of the Mexican water treaty, appendix 1405, and correspondence of Imperial Irrigation District and the State Department (appendixes 1410, 1411, 1412).

G. Provisions Relating to the Colorado River Compact (1) Status at the time of enactment of the Project Act.-As of the date of passage of the Boulder Canyon Project Act, December 21, 1928, the record on action by the States stood as follows:

The compact had been ratified as a seven-State document by California, Colorado, Nevada, New Mexico, Utah, and Wyoming. The compact had been ratified as a six-State compact by Colorado," Nevada, New Mexico,' and Wyoming.

Utah's ratification as a six-State agreement had been repealed.10 California's ratification" as a six-State document was conditional upon authorization by Congress of a 20,000,000 acre-foot reservoir. Thus at the time of consideration of the Project Act only four of the seven States had firmly committed themselves to approval of the compact as a six-State agreement.

(2) Approval of the Colorado River compact as a six- or sevenState agreement.-Section 13 (a) of the act stated that the Colorado River Compact signed at Santa Fe on November 24, 1922

is hereby approved by the Congress of the United States, and the provisions of the first paragraph of Article 11 of the said Colorado River compact, making said compact binding and obligatory when it shall have been approved by the legislature of each of the signatory States, are hereby waived, and this approval shall become effective when the State of California and at least five of the other States mentioned, shall have approved or may hereafter approve said compact as aforesaid and shall consent to such waiver, as herein provided. Section 4 (a) stipulated that the Project Act should not take effect and no authority be exercised thereunder unless and until

(1) the States of Arizona, California, Colorado, Nevada, New Mexico. Utah, and Wyoming shall have ratified the Colorado River compact, mentioned in section 13 hereof, and the President by public proclamation shall have so declared,

or, in the alternative

(2) if said States fail to ratify the said compact within six months from the date of the passage of this act then, until six of said States, including the State of California, shall ratify said compact and shall consent to waive the provisions of the first paragraph of Article XI of said compact, which makes the same binding and obligatory only when approved by each of the seven States signatory thereto, and shall have approved said compact without conditions, save that of such six-State approval, and the President by public proclamation shall have so declared, and, further, until the State of California, by act of its legislature, shall

4 Appendixes 215 to 220, inclusive.

Appendix 222.

Appendix 223.

7 Appendix 224.

Appendix 226.

Appendix 225.

10 Utah Laws 1927, p. 1.

11 Appendix 221.

agree irrevocably and unconditionally with the United States and for the benefit of the States of Arizona, Colorado, Nevada, New Mexico, Utah, and Wyoming, as an express covenant and in consideration of the passage of this act, that the aggregate annual consumptive use (diversions less returns to the river) of water of and from the Colorado River for use in the State of California, including all uses under contracts made under the provisions of this act and all water necessary for the supply of any right which may now exist, shall not exceed four million four hundred thousand acre-feet of the waters apportioned to the lower basin States by paragraph (a) of Article III of the Colorado River compact, plus not more than one-half of any excess or surplus waters unapportioned by said compact, such uses always to be subject to the terms of said compact.

The proclamation of June 25, 1929 (appendix 503), announced completion of the second of these alternatives, and the failure of the first.

(3) Subjection of operations to the compact.-The act repeatedly subjected all operations thereunder to the Colorado River Compact; thus, as to construction of works (sec. 1), as to the effective date of the act (sec. 4 (a)), as to operation of reservoirs, canals, and other works (sec. 8 (a)), as to the rights of the United States and those claiming under it to the waters of the river (sec. 13 (b)), and as to rights-of-way, etc., for water or power (sec. 13 (c)). Section 13 (d) subjected all uses to the Colorado River Compact, stipulating that the "conditions and covenants" referred to in the act

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shall be deemed to run with the land and the right, interest, or privilege therein and water right, and shall attach as a matter of law, whether set out or referred to in the instrument or not and shall be deemed to be for the benefit of and available to [each of the seven named States of the basin] and the users of water therein or thereunder, by way of suit, defense, or otherwise in any litigation respecting the waters of the Colorado River or its tributaries.1

H. Provisions Relating to a Lower Basin Compact

(1) Authorization.—Section 4 (a) of the act authorized the States of Arizona, California, and Nevada to enter into an agreement with respect to the waters available to the lower basin. The agreement so authorized, if ratified by the three States in the prescribed terms, would not require further action by Congress, differing in this respect from the usual authorization for negotiation of a compact subject to approval by the Congress after ratification by the States. 13 The compact authorized by section 4 (a) was spelled out in some detail, as follows:

12 This provision originated with L. Ward Bannister, Special Counsel, City of Denver.

13 Credit for the initial suggestion of a compromise along similar lines was given by Senator Pittman to Francis C. Wilson, Colorado River Commissioner for New Mexico (Congressional Record, 70th Cong., 1st sess., p. 10259, May 28, 1928). As to the character of the consent given here, see remarks of Senator Pittman, Congressional Record, December 12, 1928, p. 471. Cf. discussion of congressional consent to interstate compacts in Ely, "Oil Conservation Through Interstate Agreement" (1933), ch. VII, p. 166 et seq.