General CHORPENING. No, sir, countrywide. Then we make our recommendations to the Budget looking at the criteria, the budget ceiling, and then we recommend what we think should be applied countrywide to projects.

Senator CORDON (presiding). It is your duty, or at least in practice, your job to do, the thing that Senator Ellender had in mind. Perhaps in some cases it was done by the Bureau of the Budget; that is, proportion the ceiling over certain areas. In other cases in place of the Budget doing that, that becomes your obligation in the Corps of Engineers?

General CHORPENING. It is our obligation to make recommendations back to the Budget through the Secretary of the Army.

Senator CORDON. You have, of course, back of you the record of prior appropriations and the vast knowledge of the public works in the various areas. Using that knowledge, plus the knowledge that you have a maximum ceiling within which to operate, you prorate the total amount of that ceiling between various projects and, to some extent at least, roughly in various areas?

General CHORPENING. That is correct, sir.

Senator CORDON. That has been the practice for many years?
General CHORPENING. That is correct.

Colonel STARBIRD. The next project is a local protection project, Vincennes, Ind. It is a project for the improvement of existing levees built by local interests and adding to those levees. When complete it will give protection to a city of about 20,000 individuals. I might mention that twice in recent years the flood heights have been such that emergency topping has had to be placed on the present levees. This project has an estimated cost of $4,266,000, of which $2,088,000, or 49 percent, has been appropriated to date.

The amount recommended for fiscal year 1955 is $600,000. The amount, incidentally, appropriated for fiscal year 1954 was $1,200,000. This unit has a very high benefit-cost ratio, 4.8 to 1.

We had available for expenditure in fiscal year 1954 a total of slightly over $1,400,000 including the appropriation of $1,200,000.

Senator CORDON. May I inquire as to whether this was one of the projects initially appropriated for as a result of action of this committee?

General CHORPENING. I believe that is correct, sir. I think that happened in fiscal 1952.

Colonel STARBIRD. Considering the carryover and appropriation for fiscal year 1954 we had left on December 31, $1 million. We expect to reduce that to around $664,000 by the end of fiscal year 1954.

Senator ELLENDER. Why were you not able to spend all the money appropriated? There was a good case made last year, and now you are going to carry over a half million dollars. Why is that?

TOTAL CARRYOVER

Colonel STARBIRD. We expect to reduce the total available from $1,400,000 down to something over $600,000.

Senator CORDON. Where do you find those figures?

You

Colonel STARBIRD. I do not think they are in your justification. There are basically two causes for having this much carried over. have had explainted to you earlier that a review was made to see what units might be slowed up slightly in their rate of expenditure in 1954. That review took some little time. As I remember it, it was 4 to 5 weeks. We delayed awarding a relocations contract because the railroad desired to take a little more time in order to finalize their design. We permitted them to do that in view of the fact we were investigating the situation with regard to expenditures.

The second cause was that we also delayed slightly a contract for award on one of the units. As I mentioned, we have substantially reduced the total available in spite of this during the present fiscal year, and the carryover is reflected in the 1955 program and permits a reduced request for fiscal year 1955.

Senator ELLENDER. That was the next question I was going to ask. Senator CORDON. May I inquire as to whether you use the term "carryover" to mean unexpended funds or whether it means unexpended and presently unobligated funds?

Colonel STARBIRD. It is the sum of the two. It is both the unobligated and whatever we have obligated but not expended.

Senator CORDON. You do not have any breakdown in that field? Colonel STARBIRD. I have a breakdown if you would like to have it. Senator CORDON. Of course we are interested in getting the job done. We would like to know just what the status of the job is. If you have contracts outstanding where the funds have not been earned, so far as we are concerned, as long as you took that into consideration when you asked for the new money, we understand we are appropriating here sufficient money so that this appropriation plus the other will get so much done.

Colonel STARBIRD. I can assure you we did do that.

General CHORPENING. We did that to a much greater extent this year than ever before. I do not believe the Senator was here when we stated that we will have at the end of this fiscal year only 23 percent unexpended of the total funds available to us at the beginning of the year, which is a very decided improvement over what has been the case in past years.

UNEXPENDED FUNDS

Senator CORDON. If you are going to have a practical, sound construction program, would you always have, in the case of a continuing project, unexpended funds at the end of any given period until you have finished the project?

General CHORPENING. That is correct. There will always be some unexpended funds. Our effort is to keep that to the minimum possible, but there are things that happen that you cannot anticipate, such

as weather conditions or difficulty in local protection projects of getting the right-of-way and other things. But to the maximum extent possible, that is our aim in operating this business.

Senator CORDON. You have contracts of a considerable amount with a contractor on the job where it is utterly impossible, and it would be very expensive if that contractor were compelled, in order to complete his contract and earn the amount due him, to finish up as of a given day; is that correct?

General CHORPENING. That is correct.

Senator CORDON. You can get better contracts, if I have understood the testimony that has been before this committee many times, if you can divide the project into sound segments engineeringly and constructionwise and let them to contractors on the basis of that sound and efficient division into segments, even though you know and the contractor knows when the contract is made there is not sufficient appropriation to do the full job. He takes the contract, knowing that there is so much money available and that as to the balance it is dependent upon future action by the Congress.

General CHORPENING. That is correct.

Senator CORDON. Then on that basis, I could not see any way in which you could have a cutoff date and still do a good job and get the most out of every dollar.

General CHORPENING. As I testified last year, looking over our whole program of work, running as it does from very small projects, local protection projects, flood-control dams, and multipurpose dams, I consider if we reach an unexpended balance by June 30 each year in the neighborhood of 25 percent, that represents a good piece of work. Senator CORDON. An example might well be Old Man River where as long as that water runs and its level changes there is going to have to be constant attention to the problem created. There are going to be additions from time to time, modifications from time to time, and supervision always; is that correct?

General CHORPENING. That is correct. I said 25 percent. My testimony last year was 27 percent.

Senator ELLENDER. With respect to this Vincennes project, did the Budget Bureau tinker with the amount you recommended within ceiling or did you get the whole amount?

Colonel STARBIRD. We got what we recommended, sir.

Colonel STARBIRD. The next project is a resumption; in other words, a project that was started, interrupted, and is now recommended to be restarted. It is the Coralville Dam and Reservoir project in east

ern Iowa. It is on the Iowa River approximately 85 miles above the confluence of the Iowa River with the Mississippi.

Senator ELLENDER. Why was it stopped?

Colonel STARBIRD. This was stopped in 1951 when a Presidential directive was issued to review all projects and to cut back those that did not contribute directly to national defense and had not been far advanced at that time.

Senator ELLENDER. You were given authority to do that?

General CHORPENING. You recall at that time there was an overall cutting back on account of the Korean emergency.

Senator ELLENDER. There were not projects mentioned; it was left to you to do that?

General CHORPENING. That is correct. We made our recommendations to the Budget.

Colonel STARBIRD. I understand, too, the Congress adopted the same policy, sir.

This project is a part of the overall comprehensive project for the Upper Mississippi River Basin. It is a relatively large reservoir of 500,000 acre-feet. Almost all of that will be devoted to flood control. It has an estimated cost of $18,268,000. As I mentioned, this project was started in July of 1949 and then was interrupted in 1951. There have been funds appropriated to date of $6,010,100. This project has a very high benefit-cost ratio. We are refining the one that is given in the justification. It is somewhere in the neighborhood of 2.0 to 1.0 which is a high ratio for a reservoir.

BUDGET RECOMMENDATION

The amount recommended for fiscal year 1955 by the Budget is $2,300,000. Our financial status on this project is that we carried over into the beginning of this fiscal year around $616,000. We have carried on only normal maintenance activity and the acquisition of real estate already in progress. We will reduce our carryover only slightly during this fiscal year.

Senator HAYDEN. How long will it take to finish the work? Colonel STARBIRD. The project is scheduled for completion, sir, in December of 1956 on the basis of our planned future expenditures. Senator HAYDEN. Is it an earth-fill dam?

Colonel STARBIRD. Yes, sir.

Senator CORDON. It serves no purpose other than to control water? Colonel STARBIRD. No other purpose. It is not hydroelectric. Senator CORDON. Nor any irrigation?

Colonel STARBIRD. No irrigation connected therewith. There is a slight benefit, of course, to navigation downstream therefrom.

Senator ELLENDER. This $2,300,000 $2,300,000 was your within-ceiling

recommendation?

Colonel STARBIRD. No, sir. We recommended $2,500,000 overceiling. This is a resumption, and all resumptions were overceiling. Senator ELLENDER. What did you have to do with recommending this, since it was overceiling? Was it left to the Bureau of the Budget?

General CHORPENING. That again goes back to our earlier conversation, sir, in connection with the criteria given to us for initiating

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a limited number of new starts or resumptions. This is one of the resumptions.

Senator ELLENDER. And the Engineers are the ones who selected this project?

General CHORPENING. On instructions from the Budget, on the criteria given, and the limiting amounts; this was one of those selected from the overall group we previously had placed in the overceiling, and we, within the new criteria, recommended it to the Budget. That recommendation was approved.

Senator ELLENDER. As I remember, one of the provisions of the criteria was that the local people would put up so much. Do they put up in this instance?

Colonel STARBIRD. They do not. This is a reservoir project. They do not contribute to this type project.

Senator ELLENDER. In making your criteria fit a certain condition, are we to understand that you just apply some of the criteria or all? Colonel STARBIRD. No, sir We apply all of the criteria that are applicable to that type of work.

General CHORPENING. May I read the paragraph of the criteria that covers this project?

Resumption: It is a resumption of work on a project in which the Federal Government has made a substantial investment and further postponement would result in considerable economic loss.

In this case the Federal investment thus far made is $6 million. As has been testified, this has a high benefit-cost ratio. Under those criteria it was selected.

Senator ELLENDER. To go back to that little project we have been talking about, in the State of Louisiana where within ceiling you put $605,000 and the Bureau of the Budget cut it back to $335,000, you had nothing to do about it?

General CHORPENING. No, sir.

Senator ELLENDER. They just chopped it off of their own volition? General CHORPENING. Yes, sir.

Senator ROBERTSON. What was the ratio of benefits to cost of the Coralville project?

Colonel STARBIRD. It is in the neighborhood of 2.0 to 1.

Senator ROBERTSON. You thought that was high enough to justify a resumption on the project?

Colonel STARBIRD. That is correct.

QUINBY PROJECT

Senator ROBERTSON. We had a little project called Quinby where the ratio was 9 to 1 and the overall cost was about $160,000. Senator Cordon and I, through local cooperation, worked out a plan where a sufficient channel was built for $20,000. Last year we got an item on this side for $25,000 to build a very necessary little harbor and turning basin.

The House said, "Who ever heard of Quinby? Out she goes." And out it went.

I am glad you are coming back with some of these projects that were so clearly right in the first instance that you ought to go ahead with them. Before we finish, I would like for the General to give us