eets were found feasible and approved. The finding of feasibility was based on the reports of the Bureau of Reclamation. These rerts are based on a very careful and complete study of the physical at economic conditions in the localities of the proposed projects.

Mr. RICH. Then the point that I want to make is this, that the Fident and the Secretary of the Interior were the ones who author-the construction of these projects that were started by P. W. A. gh emergency relief funds?

Mr. LEAVY. If you will qualify your question a little further, in mes to the witness, by adding that it was after they had been found feasible projects and economically sound projects

Mr RICH. I am trying to find out from where the authority came the construction of these projects.

Mr PAGE. The basic law set up that machinery. When Congress anger appropriated money for us, the money was obtained through e allotments, following the same type of procedure as in the past. Mr. FITZPATRICK. Like other relief projects throughout the counthat are taken to aid the unemployment situation.

Mr. LEAVY. But the difference is that these projects were underen after a more thorough and complete study, based upon knowle acquired after some 30 years in reclamation engineering. Mr. PAGE. Very complete engineering reports are available on all f the projects that were undertaken.

Mr. LEAVY. I want to clear up a point that Mr. Rich has raised.

IIPATMENTS MADE FOR CONSTRUCTION, OPERATION, AND MAINTENANCE AND WATER-RENTAL CHARGES

Mr. Page, in your justification you deal rather extensively with subject, do you not?

Mr. PAGE. Yes, sir.

Mr. LEAVY. You set forth a table that shows the various completed amation projects since 1902, when the act first became effective, ther with the charges that were made against them for construcand the amount that has been paid on account of such charges. table discloses that 98.9 percent of every dollar that went into Se projects has been returned.

M. LEAVY. Then you deal with the question of operation and attenance of the project after it was initiated and completed and, of these reclamation States, your figure discloses that 99.1 Sent of those charges have been repaid to the Federal Treasury? M. PAGE. Yes.

Mr. LEAVY. You deal with the water-rental charges up to June 30, that carries it through the period of the depression-and your a discloses that out of $9,700,000 of rental charges all but $65,865 en repaid.

Mr PAGE. Yes, sir.

Mr LEAVY. I ask that these tables be incorporated into the

three tables referred to appear as a part of the justification,

ted near the beginning of this general statement.)

V. RICH. May I ask a question there?

LEAVY. Of course, I am not here to answer these questions, ' irh.

Mr. RICH. Do you say that the total amount of uncollected water charges for all of the Federal projects is only $65,865?

Mr. LEAVY. For completely developed projects.

Mr. PAGE. The total of all of the water-rental charges.

Mr. RICH. That are being owed to the Government at this time? Mr. PAGE. Yes, sir. Of $9,700,000 of water rental charges, all has been paid but $65,865.

Perhaps I should explain that this is a charge for the use of water. It is not a part of the repayment of the investment but it is a rental for water which is furnished to irrigated lands, and that is on somewhat the same basis as the table which just precedes it, which shows 99.1 percent of all of the operation and maintenance paid.

Mr. RICH. The amount that is being paid into this reclamation fund has practically all been appropriated out by Congress from the time it was started and, while the orignal investments might have been paid on those particular projects, yet that same money is paid out by the Secretary of the Interior on appropriations made by Congress, so that it has never really come back into the Treasury?

Mr. PAGE. It has come in and gone out again. The act of June 17, 1902 set up the Reclamation Fund as a revolving fund, and this condition was anticipated and expected. The money originally came from

western sources.

Mr. RICH. It has come in and gone out again in practically every one of those cases.

Mr. LEAVY. Gone out on new developments.

Mr. RICH. Yes; so that the original cost has never been returned.

STATUS OF RECLAMATION FUND

Mr. SCRUGHAM. Mr. Page, what is the status of the so-called reclamation fund at this time?

Mr. PAGE. I have inserted in the record a table on that subject, Mr. Chairman.

Mr. SCRUGHAM. Will you read the substance of it?

Mr. PAGE. The income to reclamation fund, composed of accretions from the sale of public lands, oil royalties from public lands, and repayments from settlers, has decreased, due to a number of things. First the sale of public lands has almost been discontinued under the operations of the Taylor Grazing Act. The oil royalties have decreased, because of the control of production of oil to conserve this resource, and the Congress has given water users a moratorium on their charges for the last 4 years. The appropriation for the fiscal year 1937, plus the proposed appropriation for the fiscal year 1938, will take all of the money which has accumulated in the reclamation fund.

Mr. SCRUGHAM. This is rather important. Let us discuss this a little more in detail. I think that this is the every essential part of the hearing. Continue with your statement, and then I will ask you some questions with regard to it.

Mr. PAGE. The construction program for 1937 and 1938 calls for a total expenditure from the reclamation fund of $20,525,000. That is for the 2 years.

Mr. SCRUGHAM. And that was approved by the Bureau of the Budget?

Mr. PAGE. That is the program as approved by the Bureau of the Budget. In addition, there is approximately $4,000,000 required

"for operation and maintenance, which is repaid from year to year. In all, the total obligations on the reclamation fund for these 2 years would be $24,525,000.

The income of the fund from the sale of public lands has dropped from $9,400,000 in 1908 to $154,000 in 1936.

Mr. SCRUGHAM. That is the new income?
Mr. PAGE. Yes; the accretions to the fund.

Mr. SCRUGHAM. That came in during the past year?
Mr. PAGE. That is right.

Mr. SCRUGHAM. Let me see if I understand you correctly. That reduction has been due to three factors. One is the withdrawal of the public domain from entry, due to the establishment of the so-called Taylor Grazing Act system; the second one is due to the fact that the moratorium has been allowed in certain instances; and the third has I been due to the regulation of the production of oil, and the royalties from the production of oil have consequently decreased?

Mr. PAGE. That is right.

Mr. SCRUGHAM. Those are the three principal factors.

Now, where is it proposed to obtain the money to finance these new operations in case the so-called reclamation fund is depleted?

Mr. PAGE. That has been given considerable study, and it has caused us considerable concern. The theory of the reclamation fund. was that it should be derived from the assets of the Western States in which the money was to be spent. Therefore, in keeping with that theory, a study has been made to determine if there are other revenues which might be covered into that fund.

There is one possibility that I would like to suggest to the committee, and that is that in lieu of turning the repayments of the emergency-fund projects into the General Treasury they might be diverted to the reclamation fund.

Mr. SCRUGHAM. That would require special legislation?

Mr. PAGE. Yes, sir.

Mr. SCRUGHAM. Has any such legislation been proposed through the Committees on Irrigation and Reclamation of the House or Senate, - or either of them?

Mr. PAGE. Not that I know of.

Mr. SCRUGHAM. That is the function of the legislative committee rather than of the Appropriations Committee.

Mr. PAGE. Special legislation would be required to provide for that diversion of the returns from the emergency-fund projects.

Another alternative might be a loan from the General Treasury, similar to the one that we had some years ago. At that time there was $20,000,000 that was loaned to the reclamation fund from the General Treasury, of which half has been repaid. In addition, a second loan was made of $5,000,000, so that actually the reclamation fund now owes the General Treasury $15,000,000. This is payable, under the present law, on the basis of $2,000,000 a year from the reclamation fund, beginning, I think, in 1939.

Mr. SCRUGHAM. Is the law governing this a specific legislative act of Congress?

Mr. PAGE. Originally it was. In last year's appropriation bill, an amendment set the beginning of the repayment of that loan over for 2 years, so that it was handled in the appropriation bill last year.

Mr. SCRUGHAM. Are there any legislative provisions I should recall, but I do not-in the reclamation bill.

Mr. PAGE. There is not now; no. If the committee desires we could submit language to accomplish it.

Mr. SCRUGHAM. I would like to have you submit that language for consideration.

Mr. PAGE. I will be glad to do that. It could be as follows [reading]:

Provided further, That the last line of section 10 of the Act of April 1, 19 (47 Stat. 75), as amended by the Act of March 3, 1933 (47 Stat. 1427), is hereby further amended by substituting "1943" for "1936": Provided further, That s moneys payable to the United States in connection with Federal reclamation projects financed with funds heretofore or hereafter appropriated or allocated therefor shall be deposited to the credit of the reclamation revolving fund created by the Act of June 17, 1902 (32 Stat. 388).

EMERGENCY RELIEF FUNDS

Mr. FITZPATRICK. Was any of the money that you received from the emergency relief fund an absolute grant, or was it loaned to you? Mr. PAGE. It all must be repaid.

Mr. FITZPATRICK. There was not any absolute grant?

Mr. PAGE. No, sir. There will be no interest charged, but the law requires that all this be repaid to the General Treasury.

Mr. RICH. You mean that these funds that were expended by the Public Works Administration and by the Federal Emergency Relief, all of that money that went into these projects, will be repaid? Mr. SCRUGHAM. On reclamation projects only.

Mr. FITZPATRICK. I was referring to the reclamation projects. So that was just loaned to you and will have to be returned to the Treasury?

Mr. PAGE. That is right. No Federal reclamation project is constructed unless there is a contract for repayment from the beneficiaries of that project. This requirement was not relaxed in the expenditure of emergency funds in our program. It was established in the Reclamation law and it always has been and is operative.

Mr. RICH. What is the total amount which has been expended on these projects from Emergency Relief funds?

Mr. PAGE. We would have to make current deductions from these allotments, but the allotments from the Public Works Administration amounted to $94,664,000, and from the Emergency Relief allotments $61,922,000. That has not all been expended, which brings up another matter of considerable concern to us. Some of this money cannot be expended by June 30, 1937. There are works in progress which cannot be completed by that date, and it is therefore of great interest to us that the unexpended balances of these funds be carried over until completion of the particular projects on which the work is now in progress.

Mr. O'NEAL. Have you any unexpended balances on projects that have been completed?

Mr. PAGE. No, sir. Those have been returned.

Mr. O'NEAL. When there are unexpended balances on projects that have been completed from emergency funds, what is done with that money?

Mr. BURLEW. It is returned to the source. It is not deposited in the Treasury, but it is returned or put on some other project.

Mr. O'NEAL. It automatically goes into that reclamation fund, and there is available for other projects?

Mr. BURLEW. No. If there is a balance left on a reclamation project, the allotment is returned to the Public Works Administration and is used over again.

Mr. O'NEAL. They reallocate it over again?

Mr. BURLEW. Yes, sir.

Mr. SCRUGHAM. To meet the situation just described, would language somewhat as follows in the Interior Department appropriation bill cover the situation:

The Public Works Administration allotments made available to the Department of the Interior, Bureau of Reclamation, pursuant to the National Industrial Recovery Act of June 16, 1933, either by direct allotment or by transfer of allotment originally made to another department or agency, and the allocations made to the Department of Interior, Bureau of Reclamation, from the appropriation contained in the Emergency Relief Appropriation Act of April 8, 1935, shall remain available for the purposes for which allotted during the fiscal year 1938. Would that cover that situation?

Mr. PAGE. I think so, yes; that would cover it.

Mr. O'NEAL. May I ask about that. Would that refer directly to a distinct project, or not?

Mr. SCRUGHAM. No; it would not. I just wish to have that paragraph considered at the proper time, and I want to make it a matter of record so that we can call attention to it when we reach it.

Mr. PAGE. There is a list of projects on page 4 of the justification. which are in the class that I mentioned, that cannot be finished unless these balances are carried over.

AMOUNT OF ESTIMATE REQUESTED FOR 1938

Mr. LEAVY. Mr. Page, what in the aggregate are you asking in the way of appropriations for your bureau this year?

Mr. PAGE. The total of the Budget for 1938 is $34,665,000.

Mr. LEAVY. And that includes how many projects? Could you put that in the record?

Mr. PAGE. Yes; that statement has gone into the record as a part of the general statement.

Mr. FITZPATRICK. What part of the total of $34,665,000 would be spent here in the District of Columbia?

Mr. PAGE. Well, there is very little.

Mr. FITZPATRICK. You say very little. Have you ever figured out the percentage?

Mr. PAGE. Yes.

Mr. LEAVY. You mean for the office?

Mr. FITZPATRICK. For everything in the District of Columbia. I find that some of the departments here spend 45 percent of their total appropriation here.

Mr. KUBACH. We do not spend over $300,000.

Mr. PAGE. We have only 99 employees in the District.

Mr. LEAVY. Now, Mr. Page, I want to follow this up. Is this $34,665,000 that you have in your estimate the amount that the Budget allowed you after your hearings before the Director of the Budget?

Mr. PAGE. Yes, sir. That is what is listed in the Budget.