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CONCLUSIONS

(a) There is urgent need from the viewpoint of the United States rfor a major international storage project on the Rio Grande upstream from Falcon Dam, as contemplated by the 1944 Water Treaty, to protect against loss of life and safeguard property in this country along the river from Del Rio, Tex., to the Gulf of Mexico against serious flood damages which, without additional flood control, are estimated to average $1,864,000 annually in the future, which figure is revised from amount shown in Project Report dated September 1958, Senate Document No. 65, 86th Congress, 1st session, to include more recent data.

(6) The Amistad site, because of its strategic location below the confluences of the Pecos River and the Devils River, the sources of the greatest floods of history on the Rio Grande, is, as determined jointly by the United States and Mexican Sections of the Commission, the most suitable of the many studied for the second major international storage dam, from the standpoint both of flood control and conservation.

(c) To achieve the optimum feasible control and regulation at the Amistad site, the total reservoir capacity required is 5,660,000 acrefeet, consisting of 2,110,000 acre-feet of flood control capacity as determined by the Commission, in which each country would have an undivided interest, and 3,550,000 acre-feet of conservation and silt

• capacity, of which the U.S. share, as determined by its Section of the 'Commission, would be 1,995,000 acre-feet.

(d) The most appropriate general type of dam at the Amistad site, determined by the Commission, would consist of a gated concrete spillway channel section flanked by earth embankments.

(e) The annual monetary value of direct benefits alone, that would be provided to the United States by the Amistad Dam and Reservoir, consisting of flood control, conservation, power production, recreation, and fish and wildlife resources, would exceed the U.S. share of the annual costs by a ratio of 2.4 to 1; U.S. participation with Mexico in

■construction of the project is therefore found economically justified.

(/) In addition to the direct benefits, important indirect benefits, both tangible and intangible, would accrue to the United States as a result of construction of the Amistad Dam and Reservoir.

(g) Had Amistad Dam been operable only since 1954, savings to the United States from flood control and prevention of waste of its waters would have exceeded the U.S. share of cost of the dam.

That completes the formal presentation, Mr. Chairman. I shall be glad to answer any questions which the committee desires to ask.

Mr. Seldek. Thank you, Colonel Hewitt, for a very thorough statement. I am sure there are questions the members would like to ask you.

Let me ask you this: Are the criteria used by the International Boundary and Water Commission in computing the cost-benefit ratio the same as that used by the U.S. Corps of Engineers?

Colonel Hewitt. Substantially the same.

Mr. Selden. In your statement—I believe it is on page 8—you point out that one of the items listed in the estimated costs in connection with this project is the land cost.

How many acres do you estimate will have to be acquired in fee simple?

Colonel Hewitt. It is the policy of the Commission, exactly the same as it is of the Corps, to acquire title to the property only up to the point in which that property will be inundated on the average of once every 5 years. We do not acquire title above that. We obtain flowage easements above that point.

Mr. Selden. In connection with a project in my own district some years ago, the Department of the Army acquired fee simple title to land in excess of what was actually needed. Their policy was changed during the acquisition of the land, and I had to introduce a bill to allow those who had let their property go to repurchase it. So there has been changes in the Corps' policy over the years.

Colonel Hewitt. There has been some change, Mr. Chairman. We also have run into that same problem in our original acquisition of property in the vicinity of Falcon, and have revested to the original owners desiring to have their property returned to them the excess properties acquired.

Mr. Selden. Then the policy you intend to follow is to obtain fee simple title only to the property actually flooded, and flowage easements above that point ?<

Colonel Hewitt. That is right.

Mr. Fascell. Is part of that policy to allow the fee simple titleholder to construct buildings, or allow any construction on the flowage easement?

Colonel Hewitt. Above the ordinary flow line he could construct certain things, but that would only be down to the elevation which we would expect the reservoir would reach, rather infrequently.

Mr. Fascell. Do I understand by that that the Commission would obtain the flowage easements and would contract with the fee simple owner to prescribe the uses that he could make of his remainder?

Colonel Hewitt. Let me tell you what we do in the case of Falcon at the present time: The ordinary maximum level which we expect to have the reservoir attain is elevation 307. Below 307 the Federal Government acquires fee simple title. Between 307 and 314 is the area in which we acquire a flowage easement, but in the area between 307 and 314 we do not restrict the owners of the property from building in that area. However, they build in the area with the full knowledge they may be flooded and we pay to the flowage easement.

Do I make myself clear?

Mr. Fascell. Yes, sir.

Now, somewhere I recall this plan contemplates the construction of five access roads to public rights along the

Colonel Hewitt. That is in the supplemental report which is included in the report of the Commission in which the National Park Service indicated that it would be desirable to provide for the convenience and enjoyment of the public of the United States additional areas for recreational purposes.

Mr. Fascell. It is desirable but it is not contemplated, is that correct?

Colonel Hewitt. Their report was included with ours and we naturally included it for the consideration of the committee.

Mr. Fascell. Do you mean the matter is now before us as to whether or not we will recommend it, or authorize it?

The point I want to know is, has the Commission recommended it?

Colonel Hewitt. We have submitted it for the consideration of the committee.

Mr. Fascell. With or without recommendation?

Colonel Hewitt. Without recommendation.

Mr. Fascell. Now, that would be an additional cost, would it not, to acquire in fee simple public properties and to provide access roads thereto?

Colonel Hewitt. That is true.

Mr. Fascell. That cost is not included in here and there is no estimate of it?

Colonel Hewitt. Those costs are included in the report, sir.

Mr. Fascell. That is all. I just wanted to be sure they were in there.

The plan does not contemplate, then, any contract with the private property owners and this Commission for public access; is that correct?

Colonel Hewitt. Yes, sir.

Mr. Fascell. Your benefit-to-cost ratio includes power production on the basis of the proposal made to you by Central Power & Light Co.; is that correct?

Colonel Hewitt. That is correct.

Mr. Fascell. That is not a firm proposal?

Colonel Hewitt. It is not a formal proposal as yet. We are of the opinion, however, that it can be considered as reliable.

Mr. Fascell. And one on which the Commission could act?

Colonel Hewitt. I believe so; yes, sir.

Mr. Fascell. Then, I gather from that, the Commission would let the contract with the Central Power & Light Co.?

Colonel Hewitt. Under the proposal for the Central Power & Light Co. to build a plant to utilize the flowing water from the reservoir, it is assumed that a longtime contract would be entered into permitting the company to build a powerplant and to operate it.

Mr. Fascell. And that contract would be let by the Commission?

Colonel Hewitt. That contract would be let by the Commission; yes, sir.

Mr. Fascell. The State of Texas would have nothing to do with it?

Colonel Hewitt. No, sir.

Mr. Fascell. In your study, was any comparison made with respect to benefits in the use of the power to the preference customers if the power development were a Government project?

Colonel Hewitt. To answer that question, I would have to state that the other Federal agencies' activities are governed by the Federal Power Commission. In other words, if the Federal Power Commission says that the production of power by a federally owned plant is not economically feasible, we have to be controlled by what they say.

Mr. Fascell. In other words, this Commission has made no independent study of that fact but has taken the study of the FPC in the determination that a federally constructed powerplant is not economically feasible %

Colonel Hewitt. We made our own studies, and on the basis of the assumptions made by the Federal Power Commission it was found that the construction of the Federal plant was not feasible.

Mr. Fascell. In other words, your studies concurred with those studies of the Federal Power Commission?

Colonel Hewitt. Yes, sir—based upon their assumption.

Mr. Fascell. Based upon the same assumptions which the Commission made?

Colonel Hewitt. Yes, sir.

Mr. Fascell. Now, this proposal with Central Power & Light Co., is that based on, I believe it was $337,000 per year

Colonel Hewitt. Yes, sir.

Mr. Fascell. Is that based on dump power rates? Are they contemplating purchasing that power at those rates?

Colonel Hewitt. They have a rather extensive system in the valley whereby they can, with their other powerplants, integrate the power from the proposed plant at Amistad into their system.

Now, whether they propose to use it as dump power or as peaking power, I don't know.

Mr. Fascell. That is not the point I make. I mean, maybe my question was asked improperly.

The amount of money that is paid would be paid to the Government as a result of this contract, for the use of the water. Would that be equal to the sale of power at dump rates if you had your own generating plant? Or do you know?

Colonel Hewitt. I am not sure that I understand the question, sir. I assume:

Mr. Fascell. What is the $337,000 under this proposal? What does it represent?

Colonel Hewitt. It represents the value of the falling water in the generation of power to the Central Power & Light system, when integrated with the remainder of their system.

Mr. Fascell. Now, the question I need to know and have asked is, is that equal to, more, or less than would be received from the sale of power to a private power company if the Government had a generating plant there at dump rates or at whatever rates you could sell it to the customer?

Colonel Hewitt. If we were selling the power at dump rates we would not get net revenue of this amount.

Mr. Fascell. How much less would it be, do you know?

Colonel Hewitt. I am informed we would get probably one-fourth of this amount, selling it at dump rates.

Mr. Jackson. Will the gentleman yield for a moment?

Mr. Fascell. Surely.

Mr. Jackson. Will you tell a nonelectrician what a dump rate is?

Mr. Fascell. I am no expert, I am just inquiring.

Colonel Hewitt. You generate power for a commercial system and sometimes that power generation is not at the time of day or in the quantity at which you want it. If it is not available in the quantity and at the time you want it, you take it anyway but you take it at a reduced rate. In other words, it is there and you pay a little for it and maybe you can use it, but it is not the same rate you would take for peaking power which would be dependable at a certain time of day and for a certain quantity.

Mr. Selden. Mr. Jackson, have you further questions?

Mr. Jackson. Has any estimate been made, Colonel, as to the cost to the Federal Government of construction of a generating plant at a dam site?

Colonel Hewitt. Yes, sir; we have such an estimate. I will give it to you in just a second. We have made estimates for two different size plants, one of 70,000 kilowatts at $15,217,000, and one for 100,000 kilowatts at $19,287,000.

Mr. Jackson. This would appear to be one of the matters which is in controversy. Are there any other issues of which you know that are in controversy with respect to this project?

Mr. Selden. Off the record.

(Discussion off the record.)

Mr. Jackson. During the course of the hearing we must necessarily explore those areas in dispute or else there would be no necessity for holding a hearing. If there were no matters in dispute and everything was perfectly cut and dried—I might say I told the author of the resolution that I am very much predisposed toward the project. However, if there are these differences of opinion and perhaps you are not the one to whom the question should be directed, these things must be brought out.

I will withdraw the question.

I have nothing else at the moment.

Mr. Selden. Mr. Burleson

Mr. Burleson. Thank you, Mr. Chairman.

I am perfectly willing to abandon discussion of the issue also, but perhaps to clarify somewhat, although hydroelectric power would be charged to a primary benefit, you are discussing the matter as a potential and not as a part of the immediate proposal; is that correct?

Colonel Hewitt. What we are proposing is to show the committee that we believe that there is a potential benefit, if you will, in the construction of the dam; that whether the powerplant is constructed or not, we have the opportunity, we believe, of disposing of that energy at an advantageous figure which would go far toward amortizing the cost of the structure.

Mr. Burleson. Now, let me develop this a little further and then I shall abandon the matter at the moment.

As of now, you are discussing the potential. Now, if it is decided that hydroelectric power shall be a part of this installation, the policy as to priority of rights—purchase of power—would follow. I assume that would be accepted as laid down by the Federal Government?

Colonel Hewitt. I believe that that would naturally follow.

Mr. Burleson. If we authorize the construction of the plant, if existing provisions of law establishing the priority of purchase of power are not applicable, then it would be a matter of the Congress determining and establishing a policy, would it not?

Colonel Hewitt. I think that the result would be exactly similar to that of Falcon, where the Department of the Interior is authorized to take control of the power at the bus bars and to dispose of that power.

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