rates, and that there has been a definite increase in the earnings of the company during that same period.

Now, we antitipate, and with good reason, that the utilization of this power will enable us, as consumers and I am looking at this largely rom the standpoint of the consumer-will enable us to obtain power at somewhat lower costs. We do not ask for it on anything like the basis of cost of development without profit or without taking into consideration amortization of the investment. We do not ask for that, but we do feel certain, in view of the developments and the progress of the electric company in reducing year by year the rates on power, that when this block of power is put on the market we will enjoy, as consumers of that power, a somewhat lower rate, and that, at the same time, the reclamation service and these two irrigation districts will not only get back their investment in the plant and equipment, but will realize a profit that can go, as has already been stated, toward the repayment of the original cost of the dam itself.

Mr. FITZPATRICK. Pardon me right there. You said there would be a reduction in the electric rates by increasing the amount of power used?

Mr. NORCOP. Yes.

Mr. FITZPATRICK. Did you ever make any application to the Rural Electrification Commission for any relief down there?

Mr. NORCOP. Mr. Congressman, my understanding of that act is that it is designed, of course, to enable agencies or groups to combine and to obtain loans with which to build some additional lineage, or something of that sort, in order to obtain power where existing agencies are unwilling to extend lines. I do not understand that we could go to the Rural Electrification Authority and expect to get funds from them for any such project as this.

Mr. FITZPATRICK. Well, they are erecting projects through nonprofit organizations, and they are making deals with the electricpower companies now.

Mr. NORCOP. That is true.

Mr. FITZPATRICK. That is where they can show that there will be a greater number of people applying for electric power. So, I am asking you if you have ever made any application at all to the Rural Electrifiction Commission, as to whether they could help you out?

Mr. NORCOP. I made an investigation, Mr. Congressman, and found that it was utterly out of the question for a project of this kind. Now, there are other features, Mr. Congressman, in this respect, that have been little touched upon. We must remember that the development of the water storage in that territory did not originate in irrigation at all. It originated away back in the early days, when a treaty was entered into with Mexico, as a result of which, the United States of America, in order to satisfy certain claims, and in order to obviate certain difficulties with Mexico, agreed to construct a dam to control floods and to insure the delivery of a certain amount of water to Mexico. Mexico had certain rights, of course, in the waters of that stream. That is an international as well as an interstate stream. As a result of that, a number of the people in our area, recognizing at the same time that the lands on our side of the international boundary might be better served with water and made more valuable by the construction of a larger dam, applied for it, and the result was the Elephant Butte Dam. But we must always bear this in mind, that

the United States of America must retain title to or control of the dam S and be in a position to comply with our treaty obligations to th Republic of Mexico.

Mr. SCRUGHAM. Does that conclude your statement?

Mr. NORCOP. In view of the limitations of time of the committe unless there are some other questions, which I would be very glad t answer, that is all, except that I merely want to say, in conclusio gentlemen, that the feeling down there is very positive, very acute this subject. We have many low-grade deposits of minerals dow there, and we also have some minerals that are highly valuable the event of a war, and, of course, we hope a war will never come but we have those minerals there that would be highly valuable Manganese is distributed throughout that territory, and there is s lot of low-grade copper, and there is also a large distribution of les silver, and gold. Hundreds of thousands of production can be ades to that southwestern territory and it made a much larger market ir the rest of the country, if additional power facilities are provided use in industry and agriculture.

Mr. THOMASON. May I present, Mr. Chairman, County Ja Joseph McGill, of El Paso County?

Mr. SCRUGHAM. Mr. McGill.

STATEMENT OF HON. JOSEPH MCGILL, PRESIDING OFFICE COMMISSIONER'S COURT, EL PASO COUNTY, TEX.

Mr. MCGILL. Mr. Chairman, and gentlemen of the committee, am county judge of El Paso County. As such presiding officer of th commissioner's court, which is the governing agency of the county the title county judge is a misnomer, as it is an executive positio that I hold, but as chairman of the governing body of the county, am intensely interested in this project. I vouch for what Mr. Noree Mr. Phillips, and Mr. Harwell said with reference to the interest our people in this project.

INTEREST IN PROJECT FROM ECONOMIC STANDPOINT

The commissioner's court of El Paso County, which has to do w levying taxes and appropriating money, is interested from an economy standpoint in this project. They feel that this hydroelectric powe will increase values in that county, that it will increase the value the dairying, the mining, and the manufacturing industries, and for that reason I ask, Mr. Chairman, the earnest consideration of thes project by this committee.

I believe that sooner or later it will come to pass, because the Federal Government has already spent too much money out there the construction of the dam and straightening of the river and in the irrigation and reclamation of that valley to overlook this thing, which is the biggest thing they will ever do in that community.

Mr. THOMASON. Our next and last speaker is Mr. E. H. Simons. manager of the El Paso Chamber of Commerce, who will speak for the

business interests of the State.

STATEMENT OF E. H. SIMONS, MANAGER OF EL PASO CHAMBER OF COMMERCE, EL PASO, TEX.

Mr. SIMONS. Mr. Chairman and gentlemen of the committee, I want to concur, absolutely, in everything that has been said by the previous gentlemen who have appeared before you in behalf of this project, and simply add one statement, which is that the business interests of El Paso and the surrounding communities are intensely interested in this; and from a businessman's viewpoint we can only see one thing, and that is, it is a good investment for the Federal Government and good insurance for the investment that they have already made.

I want to thank you for the opportunity of appearing before you and to urge your favorable action on this project.

Mr. THOMASON. May we transgress for just a minute or two longer in order to ask Čommissioner Page if he would be kind enough to make a statement in connection with the matter, because it will connect up with the other testimony and give it continuity, and because I know these gentlemen want to hear him. Our people at home would also appreciate knowing his attitude on the matter.

STATEMENT OF JOHN C. PAGE, DIRECTOR, BUREAU OF RECLAMA

TION

Mr. PAGE. The statement of facts presented by these witnesses, I think, is correct and accurate. From the report we have made on this development I feel that it is a good investment for the United States, because of the very direct return which will come from the revenues derived from the sale of power.

PERMANENT ASSET OF THE UNITED STATES

Likewise, it can be made a perpetual asset of the United States if it is developed with appropriated money and retained in the hands of the Bureau of Reclamation or the Federal Government. In all of these projects the title to the works is held perpetually by the United States. It seems to me highly important and consistent with the national policy that the natural opportunities for hydroelectric power be grasped, and that these developments should be completed as soon as it is possible to do so. Water is a precious resource, especially in the semiarid and arid regions. Where the over-all efficiency of our use of it can be increased by making it do double duty, provide for irrigation and generate power, this possibility of increasing the benefits should not be disregarded. Great benefits can flow to the local community as well as to the Nation from this double use of water. Regardless of the present status of the local power companies which now serve the territory, a block of new power from any source is of benefit to a community of this kind.

I recently made a trip through the territory, and I met a large number of people there. My own reaction was that the development of a hundred million kilowatt-hours of power a year at Elephant Butte Dam will be no handicap to the power company, because of the new markets which can be developed. Especially is this true in view of the mining activity which has been so intense during the last few months,

with the increased prices of metals. The mining industry can absor the power without encroaching in any way on the territory of the local outlet. I think, to some extent, it was submitted at the varios meetings which I attended, by the representatives of the power cor pany and others who were well informed in the matter, that there was: potential market there that the company could not hope to take care of at this time without material expansion of its generating facilities. For these reasons I feel that the development of this power by the United States is meritorious and is simply a matter of good business. Mr. THOMASON. Thank you, Mr. Chairman and gentlemen of the committee.

TUESDAY, APRIL 13, 1937.

ALL-AMERICAN CANAL

STATEMENT OF HON. EDOUARD V. IZAC, A REPRESENTATIVE CONGRESS FROM THE STATE OF CALIFORNIA

Mr. IzAC. Mr. Chairman and gentlemen of the committee, I am going to introduce the former Congressman from my district, Pa Swing, who represents the Imperial irrigation district and the Co chella Valley County Water District. Last year, in December, the took $1,500,000 away from our appropriation for the completion of the All-American Canal and gave it to relief. That makes it impossibe to complete the canal in the time contemplated; and since the conpletion of many of the contracts will be next spring, unless this money is put back in the Budget we cannot complete the All-American Can in the time allotted, and it will have to carry over another year.

It is for that reason we are here, namely, to explain the necessity f putting back the money that the Budget had already allowed us. was already appropriated, and it was there for us until it was take away, because of the need of relief funds last December.

STATEMENT OF HON. PHIL SWING, REPRESENTING THE COACHELLA IRRIGATION DISTRICT

Mr. SCRUGHAM. This is former Congressman Swing and the authe of the Swing-Johnson bill.

Mr. SWING. Mr. Chairman and gentlemen, as intimated by my Congressman, we really did not expect to be here asking for any thing, as the Department estimate, as originally submitted, was satisfactory to us. It was after this Budget was made up that emergency relief requirements resulted in taking $1,500,000 of the unexpended money from the All-American Canal fund to meet emergency relief needs and to run Mr. Hopkins until such time as Congress could give him some more money.

ASKS RETURN OF $1,500,000 BORROWED FROM PROJECT

So, in a technical sense of the word, while we are asking for an increase of the item in the Budget, truly it is simply restoring this project to the funds which the Budget thought it should have when this $1,000,000 item was approved.

Mr. SCRUGHAM. What fund was the $1 500 000 taken from?

Mr. SWING. That is a mere matter of bookkeeping. The last Congress appropriated $6,500,000 for the All-American Canal. The year before that there had been a large allotment by Walker's Emergency Relief Council. It was 111⁄2 million, I believe.

Then, before that, there had been $9,000,000 allotted from P. W. A.. The appropriation by Congress could not be borrowed, because it was appropriated for a certain specified purpose, so I believe the bookkeeping shows that the $1,500,000 was taken from the Emergency Relief Council's allotment.

The project is $1,500,000 worse off than it was when the Budget said that this $1,000,000 item was the right amount for next year. This money has been borrowed, and we say it ought to be returned..

RETURN OF MONEY SUBJECT OF EXECUTIVE ORDER

Mr. SCRUGHAM. Well, has this committee the power to return that money? Is not that a matter of Executive order?

Mr. SWING. The Constitution gives you the power to appropriate.. I think the Supreme Court has not contracted that power, as yet. Mr. LEAVY. I think what the Governor has in mind, and I know what he has in mind, is: Out of this $790,000,000 of emergency money, could there not be an equal sum restored, Mr. Swing?

Mr. SWING. No, not that I know of. The money came from the Emergency Relief Council. There is no such organization any more. That is all past.

Mr. LEAVY. Well, there was a recent appropriation, just very recently, and, of course, there probably will be another. This Congress has passed an emergency appropriation for relief purposes. Mr. FITZPATRICK. Your contention is that the money you have lost since the Budget was made up is money that was under the jurisdiction of Mr. Hopkins as relief money?

Mr. SWING. No, it was not under the jurisdiction of Mr. Hopkins. Mr. FITZPATRICK. That is what I understood you to say.

Mr. SWING. It was under Mr. Hopkin's jurisdiction after it was borrowed. Before than it was under the jurisdiction of Mr. Page, Commissioner of Reclamation. Mr. Page was spending the money, but it came to him, not from Mr. Hopkins, but from the Walker Emergency Relief Council funds.

Mr. SCRUGHAM. It was a so-called E. C. W. fund?

INTERNATIONAL COMPLICATIONS THREATENS WATER SUPPLY

Mr. SWING. Something like that; yes, sir.

But here is the critical situation that has brought us here. This [indicating on map of Imperial and Coachella Valleys] is the international boundary line. Here is the main canal from the Colorado River to Imperial Valley now supplying 70,000 people with every drop of water the people in this valley drink. All of the stock water, for more than 100,000 head of livestock, mostly dairy cattle, all comes from the canal. It starts at the river on the American side of the line, and crosses here into Mexico, and for 60 miles is in Mexico before returning to the United States. That is our jugular vein on which we are dependant for life.

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