Mr. O'SULLIVAN. Yes, sir.

Mr. SCRUGHAM. I want the installation cost of a horsepower. I want the cost per horsepower. I am endeavoring to get the capital cost of installation per horsepower unit.

Mr. O'SULLIVAN. I do not have those figures fresh in mind.
Mr. SCRUGHAM. What would be the approximate cost?

Mr. O'SULLIVAN. The cost at Grand Coulee would be around $70 per horsepower.

Mr. SCRUGHAM. Without credit for the storage, what would be the cost?

Mr. O'SULLIVAN. Without contribution from the lower developments?

Mr. SCRUGHAM. What would be the cost without that contribution. Mr. O'SULLIVAN. I do not remember the figures, but I think it would be somewhere around $70 to $100.

Mr. SCRUGHAM. That was my impression.

DATA RE COST OF GRAND COULEE AND STEAM DEVELOPMENT FURNISHED BY MR. O'SULLIVAN

Without credit from down-stream developments and flood or navigation benefits, the capital cost, per installed horsepower, at Grand Coulee will be slightly less than $70. The capital cost of hydroplants usually runs from $95 to $190 per horse power. The capital cost of steam-electric plants, according to the authorities ranges from $56 to $95 per installed horsepower. The capital cost of the most efficient steam plant on the Pacific coast, which is located at Long Beach, Calif... is $58.65 per horsepower. The Shuffleton steam plant of the Puget Sound Power & Light Co. at Seattle is said to have cost about $105 per horsepower.

The Bureau of Reclamation says that Grand Coulee prime power can be gener ated at a cost of between 1.14 and 1.4 mills per kilowatt-hour, depending upon the load factor, and that the cost of secondary power will be 0.5 of a mill. The average cost of steam generation is given by the authorities at 5 mills per kilowatthour. The average life of a steam plant is but 16 years, while that of a hydroplant is at least from 40 to 50 years and the operating cost of a hydroplant is very much less than that of a steam plant. The Bureau of Reclamation states that the cost of generating power at Long Beach, with a load factor of 60 percent, with fuel oil costing $1 per barrel, and with interest on the investment figured at 6 percent, is 4.345 mills per kilowatt-hour. Grand Coulee will produce 8,100 million kilowatthours of commercial and 5,000 millions of secondary power annually. The annus saving in the cost of producing Grand Coulee commercial power over the cost of producing a similar amount of power at Long Beach, with fuel oil costing 55 cents a barrel, would amount to $19,440,000.

Mr. LEAVY. I may have already asked this question, but at the risk of repetition, I will ask it again: Is there ever any hope of the United States Government getting back any of the money put into this project unless it makes appropriations for developing the project? Mr. O'SULLIVAN. The investment will be a tremendous loss if the dam is not completed without interruption. Delay in completion spells interest charges of about $2,000,000 per year and increased cost of construction ranging from $2,000,000 to $5,000,000; the loss of a power market that is now knocking at the door of Grand Coulee: the construction of other plants to serve the market that could better be served by Grand Coulee; and the loss of the principal means of liquidating the cost of not only the dam but of the Reclamation project as well.

It may be said that the United States could salvage some of its investment by turning the Grand Coulee foundations over to the State of Washington or the private electric utilities. Even it the State could finance the completion of the dam it could not do so in

time to secure the power market now awaiting the completion of the project. It is unthinkable that the United States would turn the best power site in the United States, if not in the civilized world, over to the private electric utilities which, I am informed, are now looking at the project with covetous eyes. Such a step would deprive the Columbia Basin lands of any revenue from the sale of Grand Coulee power so necessary to make the project economic. The abandonment of the project would strike a deadly blow at the comprehensive plans for the maximum development of the Columbia River.

Mr. LEAVY. With the same population, the consumption of power increases, does it not?

Mr. O'SULLIVAN. Yes, sir.

Mr. LEAVY. With a drop in the rates, the consumption increases even with the same population?

Mr. O'SULLIVAN. Yes, sir.

Mr. LEAVY. Is not that the history of Tacoma when they had the lowest rate in the United States?

Mr. O'SULLIVAN. Yes, sir; with lowered rates it is possible to double and even treble the use of electricity within a short period. In 1930, the per-capita use of electricity in the United States was 1,025 kilowatt-hours while in Canada it was 2,124 and in Norway 3,560. In 1933, in Winnipeg, Canada, with an average cost of 7 mills per kilowatt-hour, the use per customer was nearly 5,000 kilowatthours. The Electrical World concludes that there is possible an annual domestic use of 40,000 kilowatt-hours per home for a large percentage of customers.

Mr. LEAVY. They are successfully using power at Tacoma for heating purposes?

Mr. O'SULLIVAN. Yes, sir; and at Grand Coulee, the contractors are heating their camps with electricity. The power, transmitted 100 miles by a power company, costs the contractors about 3 mills per kilowatt-hour. It is sold by the contractors to the 3,500 inhabitants of the camp at a price of 3 mills per kilowatt-hour plus a fixed monthly charge of about $4.50. The cost of current for heating, cooking, lighting, refrigeration, and every other purpose in the homes of the workers does not exceed $12.50 per month even during the coldest winter months with temperatures as low as 10 to 20 degrees below zero.

Mr. O'NEAL. What is the size of one of those homes?

Mr. O'SULLIVAN. They are small homes with three or four rooms. Our State college reports that electric heating, with electricity costing 5 mills per kilowatt-hour, can compete with any other type of heating, and that the heating of homes within 200 miles of Grand Coulee would consume all of its power. At Mason City, the contractors' camp, the State college is heating successfully with an electric furnace that costs no more than a hot-air furnace, being built of tile and filled with native cobble rock. The heat is stored in the furnace during off-peak hours and the heated air is drawn off during the day by means of conduits and electric fans.

Mr. LEAVY. I wish you would briefly discuss the mineral deposits that are undeveloped in that area.

Mr. O'SULLIVAN. The State of Washington has about 57 different minerals. Of course, Idaho is a great mineral State, and we reach its mines and smelters economically with Grand Coulee power. We have some aluminum clays.

Mr. SCRUGHAM. Is that in the form of bauxite?

Mr. O'SULLIVAN. No, sir.

Mr. SCRUGHAM. In what form does that aluminum clay occur? Unless it is practicable to work it, it is of no value. That information is essential.

Mr. O'SULLIVAN. They are working on that now to determine if it is feasible to develop.

Mr. SCRUGHAM. You do not have that information now?

Mr. O'SULLIVAN. No, except to say that our State college is conducting research into the feasibility of producing aluminum from these clays and is optimistic over the possibility. But bauxite could be shipped to Puget Sound by water, where Grand Coulee power can be delivered at a price of 1.2 mills for the secondary and 3 mills for the prime power. It would also be possible to ship leucite rock from Wyoming. This vast deposit contains 11.5 percent of potash and 13 percent, or about 200,000,000 tons, of alumina.

Mr. JOHNSON. How far is this project from Boulder Dam? Mr. O'SULLIVAN. It is about 1,200 miles from Boulder Dam. Mr. JOHNSON. There is no competition between the two power projects?

Mr. O'SULLIVAN. No, sir.

This [indicating] is a map of the State of Washington, and these circles indicate where the mineral deposits occur. We have in Idaho, Montana, Wyoming, and Utah the largest deposits of phos phate rock in the country. There are 6,500,000,000 tons. Then, we have plenty of lime.

Mr. SCRUGHAM. What is the significance of the big phosphate rock deposits there? We want information in regard to that in the record. Do you have information as to the cost per unit of handling that phosphate rock as compared with the cost of the production of phosphate at other places? Your statement that there are 6,500,000,000 tons of phosphate rock does not mean anything unless we know something about the cost of phosphate production.

Mr. O'SULLIVAN. The Consolidated Mining & Smelter Co. of British Columbia has the world's largest smelter at Trail, B. C., about 180 miles upstream from the Grand Coulee site. This plant receives phosphate rock from Idaho or Montana, from which it makes fertilizer by the sulphuric acid process. The double superphosphate fertilizer produced is supplied to western Canada. The plant also makes ammonia, securing nitrogen from a fixation plant and hydrogen from the electrolysis of water.

Mr. SCRUGHAM. Do they produce 16 per cent phosphate, as the Tennessee Valley Authority does? We would like to have information in regard to that, in view of the latest developments in the production of phosphate. We would like for you to supply a statement, in concise form for the record covering that phosphate rock matter.

STATEMENT RE PRODUCTION OF FERTILIZER FROM PHOSPHATE ROCK, FURNISHED BY MR. O'SULLIVAN

Idaho, Montana, Utah, and Wyoming have about 5,000,000,000 tons of highgrade phosphate rock and perhaps 1,500,000,000 tons with a low phosphate content. The Trail Smelter and the Anaconda Copper Co produce phosphoric acid and a double superphosphate fertilizer from this rock by the sulphuric-acid process. The cost of producing phosphoric acid at these places is estimated by authorities to be about equal to the cost of phosphoric acid produced in New Jersey and higher

than that produced in Tennessee. The cost of the superphosphate production is estimated to be less than that in the South. Authorities say that the production of phosphoric acid by the electrothermal process could be done cheaper in the Northwest than in the South.

Mr. O'SULLIVAN. Referring again to the map, this [indicating] is the State of Washington near the boundary of Idaho. The Columbia River enters the State at its northeast corner, and comes down here past the Grand Coulee Dam site. That dam site is adjacent to the Grand Coulee, which was cut out years ago by the river when it was blocked downstream by a glacier.

Mr. SCRUGHAM. Is that below the confluence of the Snake River? Mr. O'SULLIVAN. This is above the confluence of the Snake River. The storage reservoir in the river will be 151 miles long. This [indicating] shows the market area for Grand Coulee power.

Mr. SCRUGHAM. You spoke about the discharge through the Columbia River being greater than that of any stream in North America except the Mississippi: Is that the discharge through the Grand Coulee section, or at the mouth of the river?

Mr. O'SULLIVAN. I spoke of that at the mouth of the river.

Mr. SCRUGHAM. What does that have to do with the Grand Coulee? Mr. O'SULLIVAN. The river at the Grand Coulee dam site has five times the flow of the Colorado River at Boulder Dam.

Mr. SCRUGHAM. What is the discharge at the Grand Coulee? Mr. O'SULLIVAN. The average annual run-off at Grand Coulee is about 80,000,000 acre-feet.

Mr. LEAVY. That land indicated in red will be reclaimed.

Mr. O'SULLIVAN. Yes, sir; a great deal of this land [indicating] has been farmed. The farmers produced good wheat crops for several years on moisture stored through the years. Then they found that they were in a region with but 6 to 12 inches of annual precipitation. Mr. SCRUGHAM. I understand that the great value of the land lies in the fact that you have a long growing season there.

Mr. O'SULLIVAN. Yes, sir; and a very rich soil. Three transcontinental railroads cross the project. They are the great Northern, the Northern Pacific, and the Chicago, Milwaukee & St. Paul. The Union Pacific also serves the southern end of the project. Mr. JOHNSON. What is the value of those lands?

Mr. O'SULLIVAN. The average value is about $7.50 an acre. It ranges from $1.25 to $15 per acre depending upon the character, location, and improvements, if any.

Mr. JOHNSON. Has there been any land speculation up there? Mr. O'SULLIVAN. Our commission has been warning the public against speculation in these lands for the past 4 years. Considering the size of the project there has been relatively little speculation. I doubt if more than five or six sections of this land have been sold during this period for speculative purposes.

Mr. JOHNSON. Who owns that land now?

Mr. O'SULLIVAN. As I recollect, about 40 or 50 percent is owned by individuals. The State and the counties own a considerable block. Banks and mortgage companies through foreclosure proceedings have acquired holdings.

Mr. LAMBERTSON. How much money authorized under emergency funds have already been expended at Grand Coulee?

Mr. O'SULLIVAN. The first allotment was made by the P. W. A. in the sum of $15,000,000 and the second by the Emergency Relief Administration in the sum of $20,000,000. Congress appropriated $20,000,000 for the project for the fiscal year ending June 30, 1937. Of the total of $55,000,000, about $43,000,000 was expended by January 1, 1937. Total expenditures to April 1 probably amount to $50,000,000. Mr. LAMBERTSON. Making $55,000,000 allotted?

Mr. O'SULLIVAN. Yes, sir.

Mr. LAMBERTSON. What is the estimated cost of completing the work at this time?

Mr. O'SULLIVAN. $70,000,000 will be required to complete the dam and install two power units with a capacity of 300,000 horsepower. That makes a total of $125,000,000. During the following 15 or 20 years, as the power is disposed of, between $50,000,000 and $60,000,000 will be needed to install the balance of the power units. That makes a final total of between $175,000,000 and $185,000,000. With the expected revenue from the sale of this power, the total investment in the dam and power plant and the reclamation of the Columbia Basin lands, spread over a period of from 30 to 40 years, will not exceed $260,000,000.

Mr. JOHNSON. I did not understand your statement with reference to the amount of cement yardage in the Grand Coulee Dam being larger than that in Boulder Dam.

Mr. O'SULLIVAN. The concrete yardage in Boulder Dam itself is 3,300,000. If the concrete in the diversion tunnels and the powerhouses is included, the yardage is 4,300,000. The Grand Coulee foundations require about 4,500,000 cubic yards. When completed, the Grand Coulee Dam and power-houses will contain about 11,250,000 cubic yards of concrete.

Mr. O'SULLIVAN. Yes, sir; the 11,250,000 yards in the completed Grand Coulee Dam and power-houses includes the yardage in the foundations.

Mr. LEAVY. You have been intimately associated with this project since its inception.

Mr. O'SULLIVAN. Yes, sir; for 19 years.

Mr. LEAVY. You are a contractor and construction man.
Mr. O'SULLIVAN. Yes, sir.

Mr. LEAVY. And you have been in that business for how long?
Mr. O'SULLIVAN. For 20 years.

Mr. O'NEAL. Is there any limitation on the amount that a contractor can make under this contract, or is there any provision that he cannot make over 10 percent profit?

Mr. PAGE. No, sir; there is no limitation on that. The contracts are let entirely on competitive bids. The contractor furnishes only the labor, while the Government furnishes the material that goes into the permanent structure. Because of the type of construction involved, it is almost impossible to set up such a clause as they have in some Navy contracts. The competition is very keen on most of the projects.

Mr. RICH. You spoke about the authorization by Congress: Do you mean that when Congress last year made an appropriation of $20,000,000, that was the first authorization they made?

Mr. O'SULLIVAN. No, sir. The first authorization was an amendment to the Rivers and Harbors Act of August 30, 1935, when Con