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FRIDAY, MARCH 18, 1960

House of REPRESENTATIVEs, CoMMITTEE ON FOREIGN AFFAIRs, SUBCOMMITTEE ON INTER-AMERICAN AFFAIRs, Washington, D.C. The Subcommittee on Inter-American Affairs met at 2 p.m., in room 1304, New House Office Building, Hon. Armistead I. Selden, Jr. (chairman of the subcommittee) presiding. Also present were Hon. O. C. Fisher, a Representative in Congress from the State of Texas, and Hon. Joe M. Kilgore, a Representative in Congress from the State of Texas. Mr. SELDEN. The subcommittee will come to order, please. Today we will complete the series of open hearings which began on February 8 on the Amistad Dam project, with specific references to the bill H.R. 8080. During an earlier session representatives of the rural electric cooperatives requested they be allowed to present additional material respecting the proposed dam construction after they had had an opportunity to discuss the testimony of the other witnesses. oday we will hear two representatives of the rural electric cooperatives, and we will also have a statement from the president of Central Power & Light Co. of Texas. Our first witness this afternoon will be Mr. Thomas Hurd, general manager of the Rio Grande Electric Cooperative of Brackettville, Tex. Mr. Hurd, will you come forward, please.


Mr. HURD. Mr. Chairman and gentlemen of the committee, my name is Thomas J. Hurd. I am general manager of the Rio Grande Electric Cooperative, Inc., with headquarters in Brackettville, Tex. I was employed as the cooperative's first general manager September 20, 1947, and have served in that capacity since that date. The Rio Grande Electrict Cooperative renders electric service to about 46,000 square miles of rural areas in the extreme western and southwest portions of Texas. The cooperative's area extends along the Rio Grande for somewhere in the neighborhood of 730 miles, starting at a point 40 or 50 miles north of Laredo and extending northwest to the El Paso County line. The cooperative's service area includes all or a part of 18 different west Texas counties and a portion of two counties in New Mexico.

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In my capacity, one of my basic responsibilities is to keep informed of present and future activities within the areas served by the cooperative and to evaluate these activities as to how they will affect the cooperative and its operations.

This statement made by me on behalf of the Rio Grande Electric Cooperative is in full support of the immediate construction of the Amistad Dam and for the inclusion of Government-owned generating facilities.

The construction of the Amistad Dam without further delay is imperative as a medium toward minimizing the loss of life and damage to personal property resulting from ravaging floods along the Rio Grande between the proposed Amistad Dam and Falcon Dam below Laredo, Tex. The cooperative's support of Government-owned generating facilities in connection with the Amistad Dam is based on the generally accepted belief or opinion that the area from the proposed dam site northwest to El Paso is on the edge of an area of growth and expansion of industrial and agricultural activities.

It is not uncommon within the area concerned to hear the statement that this country will have to grow as it is the only part of Texas not already developed.

Naturally, such developments will require adequate electric service and power. Unfortunately, the area between the Amistad Dam site and El Paso has no major generating facilities at the present time. Further, the area is not covered by an integrated transmission system but, to the contrary, is served from the tail ends of transmission lines, with one exception of private utility companies serving areas adjacent to the area under consideration, this area being better known as the Big Bend area of Texas. Up to date electric service has been adequate in the area, but definite indications crop up each day which show that the area has started to grow.

One example is the Big Bend National Park, which comprises slightly under 1 million acres of land area and is located at the lowermost portion of the Big Bend area. At the present time the park is adequately served and, based on projected growth, power will be available in adequate quantities for the next 15 years. This refers to the Big Bend Park only. The adjacent areas to the park entrances will naturally build up with fringe activities such as tourist centers and accommodations. As the Big Bend Park is a year-round attraction, there is no way to determine the extent of growth around the borders of the park.

Of recent years, activities in oil production have increased immensely in three different areas within the Big Bend area. These oil and gas fields are continuing to expand and their electrical requirements will naturally increase as the fields are further developed.

These are several irrigation projects within the area that will require electricity for operation of electric irrigation pump systems. These areas represent the most rapid need for and the most extensive use of electric energy. Irrigation, coupled with oil production activities and recreational requirements in the area, along with the resuitant population increase, represent electric energy requirements far in excess of what is now available through presently installed generating facilities.

I concur thoroughly in the statements made by Senator Yarborough of Texas before this committee at the first hearings. The area north and west of the proposed Amistad Dam is growing and will require power.

In conclusion, I would like to point out that there is no major generation between Laredo, El Paso, and a West Texas Utility Co. plant on the Pecos River near the town of Girvin, Tex. As previously mentioned in this statement, there are some transmission lines within the area, but they are, generally speaking, one-way feed, and being such cannot render dependable, continuous service.

We respectfully request that the committee give favorable consideration to the installation of Government-owned generating facilities. This request is made so that our cooperative, as well as others, will have the opportunity by preference, to utilize sufficient quantities of power generated at a reasonable and relatively constant cost for distribution throughout the Big Bend area.

Our cooperative has by its efforts up to date definitely expressed its interest in and desire to promote the growth of the area. The cooperative has to date constructed approximately 2,000 miles of rural electric distribution lines and has under construction at present an additional 1,000 miles.

The cooperative has extended transmission lines in two areas whose growth would have been slowed considerably due to the lack of adequate power. The cooperative, with the assurance of adequate power at a reasonable rate, could and would cooperate with existing utility companies in completing an integrated transmission system in the Big Bend area.

Mr. Chairman and members of the subcommittee, we sincerely appreciate the opportunity you have given us to further explore the need for this project in the Big Bend area and sincerely hope that you will favorably vote out and pass the necessary legislation. Mr. SELDEN. Thank you very much, Mr. Hurd, for your statement. Are there any questions? Mr. Fascell.

Mr. FASCELL. What do you mean by the statement you would give assurance you would cooperate in an integrated transmission system?

Mr. HURD. That means existing transmission lines that feed into the area now, that we would be willing to cooperate with the utility companies that own those lines with the transmission line of our own, which we could possibly prove feasible and construct from Amistad Dam. It would be an interconnecting transmission line.

Do I understand your question, sir?

Mr. FASCELL. Yes. But I am not sure I understand your answer. Does this mean agreement would have to be entered into between the private power company and the cooperative?

Mr. HURD. You mean for joint• Mr. FASCELL. Any reason, either for transmission or

Mr. HURD. Well, yes, sir. In other words, if we were to tie into, say, their line with a transmission line of our own, there would have to be some agreement there, yes.

Mr. FASCELL. If the cooperative went to the site to get the power, would distribution depend on a wheeling agreement with the private power company?

Mr. HURD. That would require more detailed engineering study than we have made. But there is

Mr. FASCELL. You are saying, in effect, you would be willing to enter into such agreement, but you don't know where the private power company stands?

Mr. HURD. I have nothing in writing. I have talked by phone to one of the utility companies, and they in fact approached us, that if we were successful they would like to talk to us. They didn't say about what, but said they would like to talk to us.

Mr. FASCELL. As a preference customer under the law ?
Mr. HURD. Yes.
Mr. FASCELL. That is all I have.
Mr. SELDEN. Mr. Burleson.
Mr. BURLESON. No questions.
Mr. SELDEN. Mr. Fisher.
Mr. FISHER. No questions.
Mr. SELDEN. Mr. Kilgore.
Mr. KILGORE. No questions.
Mr. SELDEN. Thank you very much, Mr. Hurd.

Our next witness is Mr. Tom Reavley, attorney for the Texas Electric Cooperatives, from Austin, Tex.

We are glad to have you with us, sir. Will you proceed with your statement?



Mr. Chairman, members of the committee, and Congressmen Fisher and Kilgore. My name is Tom Reavley. I am a lawyer practicing with a firm in Austin, Tex., and we proudly represent Texas Electric Cooperatives, Inc., which is the statewide cooperative to which the individual 76 distribution cooperatives belong.

We are very appreciative of the opportunity to come and have again the time of this committee, especially since you are as pressed as you are.

You have already heard several of our witnesses say we hope Amistad Dam will be constructed, and I believe the record has made a good case for the construction of the dam with conservation storage and hydroelectric generation.

There is no debate here as far as I know between advocates of a big dam and advocates of a little dam, as is often the case. We have been told that Mexico will have its own hydroelectric installation on its side of the river on the dam. The witnesses here have all agreed, as far as I have heard, that tunnels and penstocks should be put into the dam on our side.

The only issue as to the power feature is whether the Federal Government will build the powerhouse and sell the power, or whether some non-Federal agency will be left to build these facilities and produce its own power.

It could be thought or said that this committee would be able to leave this issue unresolved—as to whether the Government would build its own plant or some other agency build the plant-leave this unresolved and advance H.R. 8080 as it is, inasmuch as the bill on its face says the dam can be built either way.

But that would not be the effect of approval of H.R. 8080 in this form. Approval of the bill in its present form would be a clear decision by this subcommittee, by the full Foreign Affairs Committee, and by Congress, against public ownership of the power. It would close the door, so far as Congress is concerned, to us, the cooperatives. It would be saying someone else must build the plant and have the power. And that someone else could only be, under the circumstances, the Central Power & Light Co. This preference proviso in the bill with reference to falling water means nothing as far as we are concerned under the present circumstances, since the buyer of that falling water has to have a $10 million powerplant to use the water's fall.

This would be the consequence of the bill as drawn, because the administration has made it clear how any alternative allowed to it will be in fact exercised. The "partnership” plan is official policy. The Federal Power Commission says the Government could not recover the cost of a powerplant. The preference of the IBWC Commissioner is quite clear from his testimony. He has testified here that he assumes a longtime contract would be entered into permitting Central Power & Light Co. to build a powerplant and to operate it. The $337,000 figure he considers as reliable average rental from the water fall has been included in all of the computations of benefit and cost.

The bill itself requires approval by the named committees of Congress of any agreement between the Government and a non-Federal entity by which the latter would build the plant and buy the fall of the water. But the Bureau of the Budget has told this committee that the executive department regards this extra step as unconstitutional; and, should the bill be enacted in this form, the administration will ignore the required approval.

In view of the record, I say again: If H.R. 8080 is enacted, the Congress has presented Central Power & Light Co. with a site for a hydroelectric station.

The electric cooperatives hope that at least some of the power generated at Amistad will be available for their purchase. Their power demands are growing in the case of each of the six or eight electric cooperatives in this general area. The price of fuel for steam generation is rapidly advancing. For many of these co-ops, the sole source of power is the Central Power & Light Co. That is not necessarily a comfortable position for them, particularly at rate fixing time. Incidentally, Texas has no State utility regulation by which excessive rates might be attacked.

Therefore, we hope the second paragraph of section 2 of this bill will be eliminated-lines 21 on page 2 through 9 on page 3. This is the provision to authorize the administration to lease the falling water. Then, when the time comes to provide for the marketing of the power, we would hope that the usual pattern will be followed: The Government will be directed to set a price to pay for the investment and to sell at that rate first to the normally preferred customers. · But whatever is to be finally done, as it now stands unless this committee prefers to resolve all questions about power availability and feasibility on the basis of this hearing in favor of leasing the falling

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