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were granted to the port authority it would only result in considerable more taxes added to our now large tax bills, and the only benefit would be for a chosen few.

The present facilities at the port take care of all the cargoes of cement, gypsum, and oil. Larger cargoes could also be taken without overloading. The only possibility of increased cargoes, would be from the fruit crops in the Santa Clara Valley, not Redwood City. This, however, is not to be considered as the development of large areas for nes, is rapidly occupying the land that was once orchards.

The promoters of this port, we believe are doing all within their power to have our Government expend additional large sums on the waterways so that they may go before the voters with arguments that the port is going to be a large successful development, otherwise the United States Government would not have spent $1 million at this time when they are trying so hard to reduce expenditures, so as to give their citizens some relief on their income taxes and still balance the national budget.

During their last campaign, wherein they asked the taxpayers to vote them $1 million for improvements, a good deal of their literature stressed the fact that the Truman budget contained an appropriation of $1 million, which as you no doubt know was stricken from the tentative budget.

Recently the port authority revealed to the public, through the press, that they enjoyed a banner year with a profit of about $68,000. They told the public through their campaign literature and I quote, “The million dollar bond issue will not cost you 1 cent in taxes. It will easily pay for itself out of port earnings and still leave a profit."

Gentlemen, just to point out to you how far from right this would be, permit me to quote some of their own figures. Money owed by the port on an old bond issue payable at $20,000 a year plus interest.

* $64, 000 Plus interest about--

1, 600 A new bond issue requested.

1,000,000 Payable a year plus interest.

50,000 Interest, a year-

30,000 About cost of floating this bond..

10,000

Total, about--Profit, about.-

111, 600 68,000

Balance that would have to be paid for by taxpayers--

43, 600 * Port figures as of Mar. 2, 1953.

Gentlemen, I could ramble on for some time about costs and expenditures, but your time is of great value and in closing let me ask you to consider our request and not let the promoters attempt to use you for their selfish gains, and again compel us small taxpayers to take some more of our meager savings to combat one campaign after another to vote bonds which they will be placing before us in the future. Many thanks for your kind attention.

ALBERT H. MORGAN, Jr.,

Chairman, Taxpayers Committee. Mr. Hand. Mr. Morgan, what is the status of this proposed bond issue now?

Mr. MORGAN. We have no bond issue before us now, but we have defeated 3 bond issues in the last 3 years.

Mr. HAND. Can you give me the approximate dates?
Mr. MORGAN. I can give you the last two very readily.

Mr. HAND. Is it necessary to approve a bond issue there by the people by a referendum?

Mr. MORGAN. The port is owned by the people and it is under a port authority and in order for the port to obtain any tax money or guaranty of tax money in case they default on their payments, they have to have a two-thirds vote of the people.

In one request, they wanted to buy a lot of transit sheds that the Government had abandoned and were torn down on the Southern Pacific property. That vote was in April of 1950. They only received 50 percent. That expenditure would have cost them for tearing the old building down, dragging it away, putting in water towers, and so forth. That vote was 6,900 against and 1,700 for. We beat that bill.

I would say in beating that, that the citizens which I represent only put up $42.50 to beat that.

Now they came out with a $1 million bond issue, put banners all over town. They had to get a two-thirds majority and they spent, as close as we can get, $8,000 to $10,000 in the campaign. Our property owners, the best we could get together, by the people campaigning and everything, was $352. Naturally they made a fair showing by the argument they were going to give the people back their money, which their own figures prove they cannot do. They got 2,966 for and we only got 1,804 against. They needed two-thirds. They were short 118. Naturally, with a hot campaign, as you know, if you can spend a lot more money you can gather a few more votes here and there, particularly if you put out a lot of information that you may say is not exactly on a straight line.

Mr. HAND. When was that?

Mr. MORGAN. This was April 7, 1953. And now they are talking about putting another one before us. They have not come up with it yet. What they hope is that they can get this $1 million through and tell the Federal Government they have this very large venture, it is a great project, and so forth, and that you people should let them have another million.

And just for the sake of argument, they have one little project. Here is another pamphlet. They want $80,000 for an office, and the last I know they only had 3 or 4 people working in their staff, and $80,000 is a lot of money to put into an office, particularly when you take into consideration they only have 3 or 4 people.

And Friday-I won't be there Friday-we are voting on $3,200,000 for high school bonds, and $1,500,000 for elementary school bonds, which are absolutely needed and on which I am doing everything I can to get through; but a project like this is just too burdensome, and especially when it is for the benefit of just a few, and is wrong.

Mr. HAND. Are these bonds issued by the port authority guaranteed by the community or city!

Mr. MORGAN. They are guaranteed by the vote of the people.

Mr. HAND. If the people should approve, then the bonds would be a lien on the property of the community and the people would have the right and duty to raise money, without limitation, to pay the bonds off? In other words, it does not come out of the port revenues; it comes out of the general revenues of the municipality?

Mr. MORGAN. If they cannot pay their way it does.

Mr. HAND. But if approved by the people, it is guaranteed by the municipality?

Mr. MORGAN. It is just like you guaranteeing my note at the bank; it is exactly that way.

Mr. RILEY. How is your port authority constituted? Is that a State-constituted port authority, or is it constituted by the city of Redwood?

Mr. MORGAN. It was constituted in the charter of Redwood City. In other words, it was established in the charter when they set it up. That must have been twenty-odd years ago.

Mr. Riley. How do the members of the port authority get their positions; are they elected or appointed ?

Mr. MORGAN. They are appointed by the mayor and approved by the council. I used to be a member of the council myself of Redwood City, and they function without pay. They are fine citizens, gentlemen, and are doing what they think is right; there is no question about it. Any of us, when we go on these boards, is trying to do the best when we serve as individual members. And when they do pay, they pay $5 a day, which is nothing. I believe they are sincere in their efforts, but as taxpayers we do not see the thing the same way they do.

Mr. Riley. I believe Oakland is your nearest deep-sea port?

Mr. MORGAN. San Francisco is sort of right at the head of the peninsula, and then we come down to Redwood City. San Francisco is the biggest harbor, takes the biggest transit ships. Then you go over to Oakland, and they have waterways going up in the Alameda Channel, and the ships go in there.

Mr. Riley. Do you have any land means of transportation between either San Francisco or Oakland ?

Mr. MORGAN. You have to come down. You have two bridges going across the bay which are used industrially. In fact, the State owns both of them now and they intend to widen them and make them quite an artery. And coming down the peninsula, they are putting in what they call a superhighway that will go clear to San Jose, with three lanes on each side of the highway, and no side lanes. We have .spent $100 million in California from an extra tax on gasoline, in order to get proper roads, and we are all behind a thing like that.

Mr. Riley. There is no hardship, then, in getting transportation facilities out of Redwood to a major port?

Mr. MORGAN. Oh, no; only it is a little longer haul. We are about 25 land miles right to the port of San Francisco. If you go across the bridge into Oakland, it may be equally as far, or it may be a little farther, but there is not much difference.

Mr. Riley. Your port is adequate for ordinary barge transportation, as I understand, for oil?

Mr. MORGAN. That is true. Actually the oil comes in by barge and is then pumped in by tankers. They have storage tanks on the property and they come in and have been using those for quite a while.

And there is a big salt company, the Morton Salt Co. there, and they bring boats in and out all day long. That has been going on for some time.

Then they have the Pacific Portland Cement Co., and they dig ciamshells out of the bottom of the bay, and put them on barges and send them where they wish. Then gypsum comes into the port and cement goes out in what you call small vessels; not large vessels.

Mr. Riley. But the facilities are adequate?

Mr. MORGAN. They have been going on for some years. They maintain a number of boats there is a lot of cargo that they can get. We have asked them time and time again, but they cannot show where there is a lot of cargo coming that way. If there was, we would get behind it; because, naturally, if they could make $7 million and help us on the tax burden and schools and improvements, we would be on the other side of the fence and trying to get the money there and everybody else would have voted for it.

Mr. Hand. Thank you, gentlemen.

WEDNESDAY, FEBRUARY 17, 1954.

FLOOD CONTROL, WELLSVILLE, N. Y.

WITNESS

HON. DANIEL A. REED, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW YORK

Mr. Hand. We had expected to have before us at this time Congressman Daniel Reed in connection with the project at Wellsville, N. Y. Chairman Reed is occupied with important meetings of the Committee on Ways and Means and will not be able personally to be presented and has requested that his statement be inserted in the record in lieu of his appearance.

STATEMENT OF REPRESENTATIVE DANIEL A. REED OF NEW YORK BEFORE THE CIVIL

FUNCTIONS SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS OF THE HOUSE OF REPRESENTATIVES ON WEDNESDAY, FEBRUARY 17, 1954

Mr. Chairman and members of the Civil Functions Subcommittee, I appreciate this opportunity to submit this statement requesting favorable action on the proposed $26,000 item in the budget for advanced engineering and design in connection with the Wellsville flood-control project.

Year in and year out I have appeared before House and Senate committees in behalf of this project.

I respectfully request and urge that favorable action be taken upon the proposed $26,000 so that the planning of this project may be completed as soon as possible to enable construction to begin. The Army engineers can begin construction, it is believed, in 1956, if the full appropriation is made by that time, of course, and if the planning of the project is completed.

Wellsville, N. Y., is a splendid civic and industrial town and it is a shortsighted policy not to protect flood-ravished areas. More than once I have taken the floor to oppose sending billions of dollars abroad to build beautiful hotels, power dams and railroads at a time when flood-ravished areas in our own country could not get the necessary appropriations to rebuild.

From September 1948 through September 1953 Italy has received from this country $12,800,000, in a counterpart fund, for flood-relief control.

There has been earmarked for flood rehabilitation in the Netherlands 400 million guilder ($105,264,000 of our money) which will probably be spent during this fiscal year.

I want to stress the fact that the industries in Wellsville, N. Y. endangered by frequent and devastating floods are industries engaged in national defense. For instance, the Air Preheater Corp. in Wellsville manufactures Ljungstrom preheaters, and it is the only manufacturer of them in the United States. They are for installation in steam plants, furnishing power for public utilities, atomicenergy projects, navy yards, ordnance plants, synthetic-rubber plants, and refineries producing high-octane gasoline.

General Chorpening has advised this committee previously that there are a number of manufacturing concerns in Wellsville, such as the Sinclair Refining Co., Julius Kaiser Co., and Bausch & Lomb Co., all of which plants supplied equipment to the Armed Forces in World War II and are important at this time in connection with defense production.

Let me say this: Wellsville, N. Y., is subject to floods each year. It is a flooded defense area. The flood project has been authorized by law. An item of $26.000 for advanced engineering and designs is in the budget. It has the approval of the Army engineers.

This committee has vast material on the Wellsville flood-control project submitted by me and the Army engineers and others, which material gives all of the facts, therefore I shall not go too much into details about this serious situation.

However, I want to call this to your attention; that flood damage begins in Wellsville when the river rises above 7.5 feet on the gage at the water and light plant. As a result of heavy rains the river rose above this stage early in the afternoon of November 25, 1950. It rose to 14.3 feet. The peak was the highest on record. The damage amounted to $400,000.

The population of Wellsville, N. Y., in 1940 was 7,641. Since 1942 flood damage in Wellsville has amounted to $1 million. (This is about one one-hundredth of the amount the United States has earmarked for flood rehabilitation in the Netherlands.)

In 1948 I had the Legislative Reference Service of the Library of Congress supply me with official and factual information as to what the cost would be to each city, village, and town in my congressional district for the Europeanrecovery program. The cost to Wellsville, with its population of 7,641 was figured at $986,530—just $13,470 less than the million dollars' worth of damage done to Wellsville by floods.

This small town's share for the foreign-aid program has just about equaled the million dollars it has lost in flood damage. I urge this committee to permit Wellsville, N. Y., to use some of its tax money at home for further planning of the Wellsville flood-control project. I sincerely hope that this committee will approve the $26,000 item in the budget for advanced engineering and design so that the planning of this project may be completed as soon as possible.

The threat of war is ever with us, as vast military appropriations indicate. Therefore, it is of the utmost importance that we preserve our essential defense industries in Wellsville, N. Y., from flood damage as well as from enemy destruction.

Again I respectfully request approval of this $26,000 item for Wellsville, N. Y.

WEDNESDAY, FEBRUARY 17, 1954. FLOODWALL, MAYSVILLE, Ky.

WITNESSES

HON. JOHN SHERMAN COOPER, UNITED STATES SENATOR FROM

THE STATE OF KENTUCKY HON. BRENT SPENCE, A REPRESENTATIVE IN CONGRESS FROM

THE STATE OF KENTUCKY HON. REBEKAH H. HORD, MAYOR OF THE CITY OF MAYSVILLE, KY. D. B. COUGHLIN, CHAIRMAN, FLOODWALL COMMITTEE OF MAYS

VILLE, KY. T. M. DONOVAN, MEMBER OF THE FLOODWALL COMMITTEE OF

MAYSVILLE, KY.

Mr. Hand. We meet this morning to hear testimony from Members of Congress and from local interests in connection with the floodwall on the Ohio River at Maysville, Ky.

Congressman Spence, if you will introduce your witnesses.
Mr. SPENCE. Thank you, Mr. Chairman.

This is Mayor Hord, of Maysville; and this is Mr. Donovan, a member of the Floodwall Committee of Maysville; and this is Mr. Coughlin, chairman of the Floodwall Committee of Maysville. They are all leading citizens in one of the best towns in my district.

Mr. Hand. We will be very glad to hear from all of them.

Mr. SPENCE. We come to ask for the appropriation recommended by the Army engineers and contained in the budget for the continua

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