The CHAIRMAN. I can't hear you.

Mr. OSBORNE. I say I don't believe that I can state that the Department of State favors specifically the construction of the Federal powerplant. We don't disagree with the Federal Power Commission. However, we do feel that in supporting this bill we are supporting the dam. We want the dam to be completed. We are not attempting to pass on the federal power question.

FEASIBILITY OF CONSTRUCTION OF A GAS-GENERATING PLANT

The CHAIRMAN. Is it true that in this area there are vast quantities of natural gas available, just across the border in Mexico? Aren't very large amounts, in the number of 200 million or 300 million of cubic feet a day, being exported out of Mexico into the Texas Eastern Gas Transmission system?

Mr. OSBORNE. There is.

The CHAIRMAN. Wouldn't the gas-generating plant be most economical in that area, if you need power?

Mr. OSBORNE. I am not an expert on powerplants.

The CHAIRMAN. You don't know anything about that. Do you, Mr. Hewitt?

Mr. HEWITT. I am sure there is a considerable amount of gas being
exported from Mexico. They are shipping it all the way to New
York. It is coming across the Rio Grande at the present time.
The CHAIRMAN. Where does it come across?

Mr. HEWITT. There is one crossing in the vicinity of Reynosa.
The CHAIRMAN. It is not very far from there, is it?

Mr. HEWITT. It is not very far from there.

The CHAIRMAN. Pardon me, go ahead.

RECOMMENDATION AGAINST FEDERAL CONSTRUCTION OF A POWERPLANT

Senator HICKENLOOPER. Then if the Senate took out of the bill the provisions for the building of the powerplant, I suppose you would still support the bill?

Mr. HEWITT. Yes, sir.

Senator HICKENLOOPER. Where the Federal Power Commission already takes a position that, in its own language, the dependable capacity of the power of the Amistad Dam would be zero, if the powerplants are built in connection with this dam, wouldn't it be just a short time until people would be over here asking to build steamplants?

We have seen that happen in the TVA.

Mr. HEWITT. I don't think there will be any

Senator HICKENLOOPER. The steamplant business is wagging the hydraulic end of the dog down there.

Mr. HEWITT. I think the REA have a steamplant in the area. However, there is no intention on the part of the International Boundary and Water Commission to request the construction of a steamplant.

Senator HICKENLOOPER. I know there is no intention on your part now but the TVA was sold to the country, too, on the basis that power would only be an incident to reclamation and a few things down there and they would only use the water that was otherwise going to waste. But now maybe 70 or 80 percent of the power produced down there is produced by steamplants built by the Government.

Mr. HEWITT. Our policy on this is that the production of hydroelectric energy is purely incidental to the use of water for irrigation purposes and flood control.

Senator HICKENLOOPER. Well, from a practical standpoint, it is zero, isn't it?

Mr. HEWITT. No, I don't think so, Senator.

Senator HICKENLOOPER. I mean there are periods of time when the water will pour over there and you can turn turbines, but from the standpoint of producing firm reliable power

Mr. HEWITT. Firm power is possible, and if history repeats itself, during a considerable period of years. However in accordance with the standard operating procedure of the Federal Power Commission, they have to say that there is no firm power. We agree with that. But we do also believe that in the majority of years that there will be power which we can sell for an appreciable amount, and therefore we believe that there will in many a year be a capacity payment which will be far greater than the 10 mills per kilowatt-hour which has been given as the value of dump power generated by this proposed plant.

Senator HICKENLOOPER. Well, without doubt you can produce power part of the time down there. But it is the part of the time when the water is low and the power can't be produced that generates the movement for the Government to come in and build steamplants and then more steamplants to produce so-called firm power. That is what apparently happens in these cases. And we ought to know what we are getting into.

Mr. HEWITT. Well, I can't prophesy, sir.

Senator HICKENLOOPER. You can't prophesy but we can use hindsight a little.

Senator AIKEN. How about predicting?

Senator HICKENLOOPER. Well, I don't know about that. I suppose we could.

But as you see it, is it fair to say that in fact, the only firm benefits that come out of this are flood control and a more reliable water supply for irrigation?

Mr. HEWITT. Yes, that is correct on the basis of the Federal Power Commission formula.

Senator HICKENLOOPER. Those are or could be classified as the reliable, long-range benefits that would come out of the construction of this dam.

Mr. HEWITT. Yes, sir. During the hearings before the House Foreign Affairs Committee, there was testimony from a local electric power company stating that they would or that they believed that without the construction of a Federal powerplant they could build a powerplant and use the falling water for power generation. They believed that the revenues from the use of falling water would amount to about $340,000 a year, which leads me to the belief that possibly the figure of 10 mills which is given as the basic figure by the Federal Power Commission, may be somewhat of an understatement.

Senator HICKENLOOPER. You mean it might be more than that?
Mr. HEWITT. Might be more than that.

Senator HICKENLOOPER. The cost would be more than that?
Mr. HEWITT. No, the revenue would be more than that.

Senator HICKENLOOPER. The revenue would be more than that.

HEIGHT OF THE DAM

Let me ask you this: This dam is calculated to be built at a certain height?

Mr. HEWITT. Yes, sir.

Senator HICKENLOOPER. If the power project were taken completely out of this bill, with no provision for power in connection with this dam, would you build the dam as high?

Mr. HEWITT. Yes, sir.

Senator HICKENLOOPER. You would build the dam exactly the same height; is that correct?

Mr. HEWITT. Yes, sir; for flood control we need 2,110,000 acre-feet, and for conservation we need 3,550,000 acre-feet of storage.

Senator AIKEN. You say 2 million acre-feet?

Mr. HEWITT. Yes, sir; for flood control storage.
Senator AIKEN. What area would be needed?

Mr. HEWITT. At maximum flood stage there will be 87,000 acres required in the United States and Mexico.

Senator AIKEN. That is what you would have to acquire?

Mr. HEWITT. That is both in the United States and in Mexico. Senator AIKEN. How much of that would be in the United States? Mr. HEWITT. There are 56,000 acres required in the United States.

COSTS FOR LAND DAMAGE

Senator AIKEN. I see. That is about 400-odd dollars for land damage that you anticipate if the land costs are $23 million.

Mr. HEWITT. Well, we are figuring total costs of land and relocations on that basis, yes.

Senator AIKEN. Is that based on the average value of the land down through there?

Mr. HEWITT. No, sir; it is not.

Senator AIKEN. I wouldn't think so.

Mr. HEWITT. But when you start relocating railroads, that is expensive.

Senator AIKEN. What is the situation there with respect to the railroads?

Mr. HEWITT. The Southern Pacific operates one passenger train each day each way, but there are many freights.

The CHAIRMAN. Senator Carlson?

PROJECT'S BENEFIT-COST RATIO

Senator CARLSON. Mr. Chairman, just one or two questions. Those of us who live out in the Middle West where we construct large numbers of reservoirs are always concerned about the ratio of costs to benefits. You gave us that figure yesterday. What was it? Mr. HEWITT. I gave you an overall benefit-cost ratio yesterday of 1.6 to 1 on a 50-year basis, and 1.9 to 1 on a 100-year basis.

Senator CARLSON. In arriving at that ratio of benefits, how much did you allow for flood control?

Mr. HEWITT. The flood control benefits were $1,861,000.

Senator AIKEN. Annually?

Senator CARLSON. On a percentage basis what would that be? You have a ratio of 1.6 to 1.

Mr. HEWITT. I did not figure it on that basis but I can.

Senator CARLSON. What I was leading up to is this: You consider flood control, irrigation, power and recreation, and a stable water supply generally when trying to arrive at a ratio benefit.

Mr. HEWITT. Yes, sir.

Senator CARLSON. I want to ask you this question: If we eliminate the power from this project what would be the ratio benefit? Mr. HEWITT. The ratio would increase.

Senator CARLSON. It would increase if you eliminated the power.
Mr. HEWITT. Yes.

The CHAIRMAN. To what figure?

Mr. HEWITT. It would be 2.3 to 1.

Senator CARLSON. If you eliminate the power?

Mr. HEWITT. Yes, sir.

Senator CARLSON. That is on the basis of the cost of the project. However, you are going to get some income from power as I understand it and no income from irrigation.

Mr. HEWITT. This is the benefit-cost ratio, this is not repayment.
Senator CARLSON. On a percentage basis. You said 2.3.

Mr. HEWITT. 2.3 to 1 is the benefit-cost ratio, with the power eliminated.

Senator AIKEN. You will get income from irrigation water, won't you?

Mr. HEWITT. No, sir; we will not.

Senator AIKEN. You mean you are giving it free?

Mr. HEWITT. Yes.

Senator CARLSON. As I gathered yesterday, there would be only $60,000 acres available for the use of this water if you were to use it. Mr. HEWITT. No, sir; the increased water which could be made available was only about, I believe, 89,000 acre-feet per year average. Senator AIKEN. Are the people who would benefit from the water all little landowners? Are there any large ones?

Mr. HEWITT. Most of them are rather small.
Senator AIKEN. They always are.

FLOOD PROTECTION BENEFITS

Senator CARLSON. Did I understand yesterday that this would protect then 120,000 people from the Amistad to the Falcon Dam?

Mr. HEWITT. Yes, sir; it will. That will prevent flood damages to them. And certainly more too because in the lower valley we have 450,000 in addition to those living above Falcon who would also be given a considerable degree of protection by the construction of Amistad.

Senator CARLSON. Below Falcon?
Mr. HEWITT. Yes.

COSTS OF THE DAM

The CHAIRMAN. Senator Carlson, may I interject to ask on what basis of cost the 2.3 ratio was worked out? On what estimate of cost?

Mr. HEWITT. That is eliminating the cost of the powerplant from the total.

The CHAIRMAN. You are estimating that based on the cost of the dam without the powerplant? But what would the cost of the dam be?

Mr. HEWITT. The cost of the dam without the power would be the $72,290,000 minus $15,217,000, which is $56,628,000.

The CHAIRMAN. $56 million.

Mr. HEWITT. Yes, sir.

The CHAIRMAN. I thought you told us it was $49 million yesterday. Mr. HEWITT. The total cost of the dam alone to Mexico and the United States is $48 million.

The CHAIRMAN. At what date was that cost estimated?

Mr. HEWITT. January 1960.

The CHAIRMAN. That is estimated on a 21⁄2 percent interest basis. Mr. HEWITT. We estimated that on 22 percent basis; yes, sir.

BENEFITS FROM PROVISION OF WATER

Senator AIKEN. You say these small landowners of which there are a great many would get the water free from the dam. They would have to provide their own facilities for getting it.

Mr. HEWITT. They already have, sir.

Senator AIKEN. So there would be no additional cost to them.
Mr. HEWITT. No, sir.

Senator MANSFIELD. Mr. Chairman, may I ask a question there?
The CHAIRMAN. Yes.

GENERATORS TO BE BUILT

Senator MANSFIELD. Do you intend to put in generators at Amistad if you build?

Mr. HEWITT. That would depend on the authorization bill as it finally is approved.

Senator MANSFIELD. Well, would you put in generators on the basis of the bill as it passed the House?

Mr. HEWITT. Whatever the Congress authorizes we will do. Senator MANSFIELD. What does the House bill say in that respect? Mr. HEWITT. The House bill says build generators.

Senator MANSFIELD. If you put in generators, how many would you put in?

Mr. HEWITT. Approximately 70,000-kilowatt capacity.
Senator MANSFIELD. That would be one generator or two?
Mr. HEWITT. Probably three, sir.

CONTEMPLATED OPERATION OF THE DAM

Senator MANSFIELD. Do you have any information as to the average cycle for the water years? You have made the statement, I believe, that most of the time the reservoir would be full. Let's take a 30-year period. In how many of those years in that period would you estimate or guess that the reservoir would be full or nearly full?

Mr. HEWITT. We made studies of the operation of the dam by comparing what has happened in the past with what we hope will occur in the future, and we came to this conclusion, that the releases from the dam contemplated could be made under a head of 138 feet or higher, 80 percent of the time. And under head of 104 feet or