INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS, LOCAL UNION 66, Houston, Tex., February 29, 1960. In re H.R. 8080, Diablo Dam project. Hon. CLARK FISHER, House Office Building, Washington, D.C. DEAR SIR: I would like to take this opportunity to express to you our feelings on the above project. Local Union No. 66 of the IBEW believes in the American way of life which, of course, includes free enterprise along with free labor. Therefore, it is our sincere belief that the best interests of all Americans and Texans, in particular, could be better served if the power facilities at the above mentioned project were allowed to be developed by investor owned utilities. The officers and members of Local No. 66 wish to commend you for your efforts on this bill, of which we understand you are the sponsor. Thanks for your efforts. Sincerely, J. C. EPPERSON, Business Manager. Mr. KILGORE. Mr. Chairman, may I submit a further statement from Frank Y. Hill for the city of Laredo and Laredo Chamber of Commerce. Mr. SELDEN. Without objection, those statements will be included in the record. (The statement referred to is as follows:) SUPPLEMENTARY STATEMENT OF FRANK Y. HILL, ATTORNEY, FOR THE CITY OF LAREDO, TEX., AND REPRESENTING WEBB COUNTY, ZAPATA COUNTY, AND LAREDO CHAMBER OF COMMERCE Chairman Selden and gentlemen of the subcommittee, with your leave I beg to file this supplement to my written statement presented before your committee on February 10, 1960, in order to further develop the position of the city of Laredo in respect to certain proposed provisions of H.R. 8080. As previously stated the city of Laredo strongly supports the construction of Amistad Dam and the enactment of authorizing legislation for the reasons set out in my original statement. However, certain proposed provisions of the bill profoundly concern the city of Laredo and it is to these provisions of the bill that I now speak so that the committee may have the facts and may know the position of the city of Laredo. The city of Laredo is a Spanish pueblo town on the Rio Grande River, as will hereafter be more fully stated, and deraigns its rights to the waters of the river for municipal purposes and the use of its individual inhabitants from the Crown of Spain through the chain of sovereign governments of which it has been a political subdivision down to the present time and its status of a home rule city under the Constitution of the State of Texas. The city's title to its water rights originated with the grant from the Crown of Spain to the Pueblo of Laredo, and such title was successively recognized and validated by the Government of Mexico, the Republic of Texas and the State of Texas, and the United States, never at any time acquired any character of rights or claims adverse to such title, and the city of Laredo does not now nor ever has recognized any right in the Federal Government or the State of Texas to appropriate, control, or levy a charge on the riparian water taken by the city from the normal flow of the river. In respect to the floodwaters of the Rio Grande which are the property of the State of Texas, the city recognizes the State's authority to allocate such waters, but does not recognize the right of either the State or Federal Governmen to impound, divert, or allocate the riparian or normal flow waters of the stream, for to do so would be a taking without compensation a property right vested in the city for 200 years. There can be no question but that the State of Texas owns and holds the public waters of the State of Texas in trust for the people. The Republic of Texas, under its Constitution, held title to all its public lands, navigable streams, and public waters, including the banks and beds of flowing streams (Constitution of the Republic of Texas ratified by the vote of the people, September 5, 1836). Under the Articles of Annexation, the State of Texas retained all the public domain theretofore held by the Republic of Texas under the provisions of such articles, to wit: Joint Resolution of the Congress of the United States March 1, 1845 (5 U.S. Stat. 797); Joint Resolution of the Congress of the Republic of Texas; approved June 23, 1845; Joint Resolution of the Congress of the United States, December 29, 1845 (9 U.S. Stat. 108), admission of the State of Texas into the Union. Section 2 of the Joint Resolution of the U.S. Congress cited above provides, among other guarantees, that the State of Texas “shall also retain all the vacant and unappropriated lands lying within its limits" and such condition was given effect in the subsequent articles cited above. The State of Texas, in its first Constitution of 1845 which was approved by the U.S. Congress as being in compliance with the terms of annexation, declared the State to be vested with title to the public domain held by the Republic of Texas. Acting by virtue of this constitutional provision, the legislature enacted the following law: 66 ‘ARTICLE 7467, VERNON'S TEXAS CIVIL STATUTES "Property of the State.-The waters of the ordinary flow and underflow and tides of every flowing river or natural stream, of all lakes, bays, or arms of the Gulf of Mexico, and the storm, flood or rainwaters of every river or natural stream, canyon, ravine, depression or watershed, within the State of Texas, are hereby declared to be the property of the State of Texas, and the right to the use thereof may be acquired by appropriation in the manner and for the uses and purposes hereinafter provided, and may be taken or diverted from its natural channel for any of the purposes expressed in this Chapter." The ownership dominion and control by the State of Texas of its public lands and the banks and beds of its flowing rivers, its flood and storm water and all runoff surface water has been historically recognized by the State and Federal courts and by the U.S. Government in the many transactions between the Government and the State in development projects on the rivers and streams of Texas, including the Falcon Dam. The question is so well settled that it no longer is in issue: Goldsmith & Powell v. State, Texas civil appeals, 159 S.W. (2) 534 (error refused). South Texas Water Co. v. Bieri (Civ. App. 247 S.W.) Motle v. Boyd (116 Texas 82, 286 S.W. 458) (Texas Supreme Court). Recent case of Martinez v. Maverick County Water Control and Improvement District No. 1, et al. (219 Fed. 2d 666 (5th Circuit)), holding that the ownership of and riparian rights in the waters of the Rio Grande is a question for the State courts. Therefore, we urge that the Congress, as a matter of law, is without authority to impose conditions in the authorization bill whereby the State of Texas or any riparian diverter on the river below Amistad Dam is compelled to purchase the impounded waters or conservation storage. The Texas courts have upheld the Spanish doctrine of riparian rights attached to the land of the Spanish and Mexican grants as patented by the State of Texas, which includes practically all the land abutting the river below the Amistad site. Under this doctrine riparian waters may not be impounded since the riparian diverter, as a matter of property right, has the right to have the normal flow pass his riparian land abutting on the stream. The city of Laredo claims such riparian right. The same situation applies to all riparian lands abutting the river in Webb and Zapata Counties. These riparian lands compose approximately 90 percent of the river land in the two counties with approximately 200 individual owners. These owners in respect to riparian rights stand on an equal footing with the city of Laredo, deriving their title from the same source. The State of Texas, having control of the releases of water from the Amistad Dam, would be required by law to give effect to such right in its ordered re leases. However, neither the State of Texas nor the Federal Government could compel the riparian diverter to pay for this water since it is his by right of law. The above is stated to demonstrate to the committee that the proposal of the Bureau of the Budget to require repayment of the cost of the conservation portion of the dam by the sale of water to diverters below the dam, is not only unsound in law but in fact is impossible to implement. The riparian question is only one of the many legal impediments and fact situations cited in other statements before the committee that rule out the repayment of the conservation cost in the construction of the dam. The history of the 1944 treaty with Mexico shows that it was the intention to provide for a treaty dam and the proceedings contain nothing to the effect that the implementation of the treaty was conditioned upon whether the U.S. water could be sold to pay for the conservation cost. Unless the treaty itself so provides the U.S. Government is bound by its obligation to proceed with the construction of the dam with available public funds. Therefore the authorization bill should contain no provision in respect to such repayment. To further indulge the patience of the committee and to buttress the position of the city of Laredo as a "pueblo" riparian town the following is shown. The city's claim is based upon the following: The City of Laredo was founded in the year 1767 by the Spanish Government by a public act of foundation known as the “Vicita-General", by a Commission appointed by the Marquez of Croix, Viceroy of Spain, composed of the Lieutenant Captain-general of the Province of New Santander, later called Tamaulipas, and the Secretary of the Royal Council. The Vicita states, "It is now ordered to proceed to the execution of the resolutions as provided in Chapter 4th, of the Royal patent dated at Buen Ritrio on the 29th of March 1763. The "General Decree of Vicita" as recorded in book "A", page 148, of the Webb County, Texas, Records. The "Vicita-General" as archived in the General Land office of Texas. City of Laredo v. MacDonnell (Tex. Sup. Ct.) 52, Texas, 511. Texas Mexican Railway v. Jarvis, 7 S.W. 210. Royal Register of Oct. 15, 1754; 2 White, Rec. 62; Lib 4 tit. 12, Laws 2-5-8-11-12; 2 White Rec. 48; Hall-Mexican Law 17-38; Royal "Cedula" of Oct. 15, 1754; Esp. Art. 12. The State of Texas, by Letters Patent No. 233, dated July 18, 1884, patented to the City of Laredo its town tract, by virtue of the Grant from the Crown of Spain, dated 1767, and confirmed by Act of the Legislature approved Sept. 4, 1850, as Survey No. 799, Webb County, Texas. The special legislative charter from the State of Texas granted February 23, 1911, now in force, contains the following provisions in respect to the confirmation of property rights and riparian rights of the city: "SEC. 49. All rights, property, actions, franchises, choses in action, penalties, and forfeitures which are owned or have accrued to said city under any law heretofore in force, shall be vested in and possessed by the corporation hereby created, and no suit pending shall be affected by the passage of this Act, but the same shall be prosecuted or defended by the corporation hereby created. "SEC. 50. All the toll, ferry, bridge, and riparian rights along the Rio Grande river now enjoyed, owned, or claimed by the city of Laredo, and all rights of whatever nature granted to said city, or claimed by it under the Crown of Spain, shall remain in full force and effect." From the above it will be seen that the municipality of Laredo, as presently incorporated, succeeded to all the rights and powers of the original town or "pueblo," and is vested with all the rights, titles, and privileges granted to the pueblo and its inhabitants. By the terms of the Treaty of Guadalupe Hidalgo, ratified May 30, 1948, and the provisions of the several relinquishment acts of the Republic of Texas and of the State of Texas, and authorities of other States, it is well settled law that the property rights vesting under the laws of Spain and Mexico particularly as to "pueblo towns," validated and guaranteed to the owners thereof, their heirs and assigns, that the laws of Spain then in effect are controlling as to the nature and extent of these rights. Among the many authorities so holding are the following: Devine v. City of Los Angeles, 202 U.S. 313, 50 L. Ed. 1046; City of Brownsville (Tex) v. Cavazos, U.S. 100, 138, L. Ed. 25, 574. Hooker v. City of Los Angeles, 188 U.S. 314; 47 L. Ed. 487-63, L.R.A. 471. Vernon Irrigation Co. v. Los Angeles, 39 Pac. 762. Cal. Jur. 25, Page 1095. I wish to thank the committee for myself and for those for whom I speak for the opportunity to make this statement. Mr. SELDEN. This completes the open hearings on the Amistad Dam project, and the subcommittee is adjourned. (Whereupon, at 3:45 p.m., the subcommittee was adjourned.) (The following were subsequently submitted for inclusion in the record :) STATEMENT BY ALEX RADIN, GENERAL MANAGER, AMERICAN PUBLIC POWER ASSOCIATION My name is Alex Radin. I am general manager of the American Public Power Association, a national trade organization representing more than 1,000 local publicly owned electric utilities, mainly municipally owned systems, in 42 States and Puerto Rico. Our offices are at 919 18th Street NW., Washington, D.C. Our interest in H.R. 8080 stems from language in section 2 of the bill which would have the effect of preventing municipal electric systems in Texas from obtaining electric power at reasonable rates from this proposed dam. We support the bill's purpose of authorizing "the conclusion of an agreement for the joint construction by the United States and Mexico" of the Amistad (Diablo) Dam on the Rio Grande River near Del Rio, Tex. We urge, however, that your subcommittee delete language beginning on page 2, line 21, through page 3, line 9 of H.R. 8080 which would permit "the lease of the power privilege." Although the language of this section states that "preference shall be given to a public body or cooperative as the lessee," the practical effect of this provision would be to lease "the power privilege" to Central Power & Light Co., a private power company with headquarters at Corpus Christi, Tex. It is unfortunate that a bill to authorize negotiation of this agreement between the United States and Mexico should be the vehicle for another attempt to obtain congressional approval of the so-called partnership concept in water resource development. The "partnership" idea has been rejected by the Congress in connection with several projects, the most recent being at the Trinity River division of the Central Valley project in California. The "partnership" concept is based on the assumption that the falling water made available by construction of an otherwise all-Federal multipurpose project should be sold to the highest bidder. The proposed Amistad Dam, then, would be constructed jointly by two governments, but with the power generating facilities on the U.S. side being built and owned by a private power company. Under this unusual situation, an international multipurpose dam-providing great public benefits in flood control, stream regulation, irrigation, and recreation-would include one privately owned part, the power generating facilities. The Federal Government would build the dam, the penstocks, and the intake works for delivery of water. A major factor in this "partnership" proposal apparently is the Federal Power Commission regional engineer's letter of April 1, 1958, to Commissioner L. H. Hewitt of the International Boundary and Water Commission that "we cannot assign dependable capacity to the Diablo plant due to the capacity and energy shortages *** However, FPC Chairman Jerome K. Kuykendall, in a letter to the Secretary of State, does not say that dependable capacity cannot be assigned to Diablo Dam, but refers to "the conjectural nature of the capacity benefits" as the reason for opposing Federal power facilities. Chairman Kuykendall states that with 100,000 kilowatts of generating capacity installed at Amistad Dam, "a capability of at least 75,000 kilowatts would be available some 81 percent of the years, including a continuous period of 28 years; and a capability of 100,000 kilowatts would be available about 62 percent of the years." [Emphasis supplied.] Furthermore, the Department of the Interior says the Department's "present contracts for the sale of power from Falcon Dam," downstream from the proposed Amistad Dam on the Rio Grande, “are based on capacity being available a percentage of the time * * * ." [Emphasis supplied.] The experience at Falcon, says the Interior Department, "indicates that higher revenues than 1.7 mills can be anticipated at the Diablo project." Revenues from Falcon in 1958 averaged 3.2 mills per kilowatt-hour. It is evident, then, that if federally generated power at Amistad Dam were marketed on a "dependable" basis during the period when dependable capacity was available, the Federal Government would derive more than enough revenues to make the power features feasible. In fact, Charles A. Robinson, Jr., staff engineer of the National Rural Electric Cooperative Association, states that the annual value of Federal hydroelectric power would be $1,337,400, with surplus power revenues of $526,400 a year after meeting all operation, maintenance and amortization requirements. This surplus would assist in paying for other project features. Under the Central Power & Light Co. proposal, the total revenue received by the Federal Government would not exceed $337,000 a year, and could well be considerably below that amount, while the net power revenues would not exceed $247,000 a year. An analysis of Central Power & Light Co.'s letter of April 14, 1958, to Commissioner Hewitt reveals that the company's proposed payments to the Federal Government would only average $337,000 a year under the most favorable water conditions, and that the conditions which would produce less revenue to the Government from federally owned generation would also be likely to mean lower payments to the Government under the Central Power & Light Co. proposal. For example: 1. The Central Power & Light Co. letter states that "the Diablo hydroplant and its electrical facilities should cost no more than $140 per kilowatt of installed capacity. Should subsequent cost studies at Diablo show that the powerplant costs will differ appreciably from this base, the value of falling water would accordingly change." Colonel Hewitt's estimate before your committee was that the power features would cost $15.2 million, or $202 per kilowatt for 75,000 kilowatts of installed capacity, or $19.4 million-$194 per kilowatt-for 100,000 kilowatts of installed capacity. The company's estimate of the cost (based on $140 per kilowatt) is about $10,400,000 for 75,000 kilowatts, which closely parallels the $10,600,000 estimate of Roy Krezdorn, consulting engineer retained by the Texas Electric Cooperatives. If the cost of the hydroplant and its electrical facilities were above the company's estimate of $140 per kilowatt, then the company would apparently have to revise downward its payment to the Government, since the company would be faced with higher investment costs. If 2. The Central Power & Light Co. letter states: "Our evaluation is also based on 100-percent availability of peaking capacity." Thus, the company says that Amistad power is worth $337,000 a year to them if there is 100-percent availability of peaking power. Yet Mr. Robinson's estimates-based on assumptions similar to those of the company-show that federally generated power will produce surplus power revenues of $526,400 to the Federal Government. these assumptions are correct, the Government would derive much more revenue from federally owned generation than from the "partnership" arrangement with Central Power & Light Co. If peaking capacity were not available on a consistent basis, Central Power & Light Co.'s payments to the Government would apparently be reduced accordingly. The $337,000 a year offer, therefore, is far from firm, and the same factors which might reduce Government revenue from federally owned generation would reduce the Government's income from Central Power & Light Co. 3. The Central Power & Light Co. letter states: "We would, therefore, like to reserve the right to modify our evaluation of falling water in accordance with whatever action a regulatory or legislative body might take toward exercising control of or enacting legislation affecting the use of water on the Rio Grande below Fort Quitman, Tex." This is another company provision, which could affect its tentative offer of $337,000 a year. 4. The International Commission states that the annual cost of amortizing the $2,190,000 Federal investment in "the required power intake works and penstocks for delivery of falling water" to Central Power & Light Co. would be $90,000 a year over a 50-year period. Even assuming that Central Power & Light |