ured this $97 million nonreimbursable benefit to wildlife and recreation. Mr. ROGERS. Will the gentleman yield? Mr. JOHNSON. All I was trying to ask for here was what kind of a yardstick was put on this thing, how the figure was arrived at. I do not know myself. Mr. ROGERS. Will the gentleman yield? Mr. JOHNSON. Yes. Mr. ROGERS. The basic purpose of these hearings is to get the proper predicate laid so this committee will have sufficient information to treat the very subject to which the gentleman from California is addressing himself, whether it is Auburn-Folsom South, Columbus Bend, or Waurika, or any other project. I think the subcommittee and the full committee would be not properly armed insofar as carrying one of these projects to the floor unless we had the documented information that I hope to gain through this hearing and subsequent hearings on the matter. Mr. HALEY. Will the gentleman yield? Mr. JOHNSON. Yes. Mr. HALEY. I think one of the things that is quite disturbing, at least it is disturbing to me, and I am sure to many other Members of Congress, here we have, we will say, one project that I have in mind at a cost of $760 million, allocated for fish and wildlife and recreation, $2 million. Here, I understand, is a proposed project of $900 million and you ask $400 million fish and wildlife and recreation. In a recent project that was submitted, the fish and wildlife and recreation originally was figured at 36 percent and when that was questioned, it was reduced to 24 percent of the same project. How in the world is a man going to take a reclamation project to the floor of the Congress and defend on the floor any such fuzzy-headed thinking as that. Either $2 million was right in the first place or the $400 million is right. Mr. JOHNSON. Will the gentleman yield at that point? Mr. ROGERS. You have the time, Mr. Johnson. Mr. JOHNSON. This particular project was in here before on the basis of a million acre-foot reservoir, calling for a much smaller power facility to match the stored waters. Since that time they have restudied the hydrology out there and have come in with a reservoir of some 212-million acre-feet, with a sizable increase in the powerplant to match the availability of the stored water, and they have increased this in scope and have also brought the new formula in. Based upon the old criteria that was followed by Congress heretofore, in my State at least, this project could very readily have fit right into the cost-benefit ratio. It needs no new formula. But the question I wanted to ask these gentlemen, I think it is mandatory on their part now that they bring these projects into the Congress with this in there. Whether the executive branch of the Government has a right to say this is the way it is going to Congress and let Congress do what they will about it is more than I know. I presume they do. Mr. SAYLOR. Mr. Johnson, if you will yield, your statement might be correct if the four Secretaries would have gone ahead and done what they were charged to do in the first place. You see they were given five responsibilities, the easy one they tackled. Oh, they were happy. They jumped in feet first for that. The dip into the Treasury that is not reimbursable they all jumped on that and said, "Boys, let's give it to them, let's give it to them." But look at what they did not do. **for "There is need*** for up-to-date policies, standards, and procedures relation to"-No. 2, "cost allocation"-No. 3, "reimbursement"-No. 4, "cost sharing *** and other subjects of mutual concern to your four Departments" and so on. Those things that put dollars back into Uncle Sam's Treasury, this they are not interested in doing, and have not done. And I think it is a disgrace that they have not gotten together. They were willing to do anything to give it away, give it away, give it away, but to get down to the hard nut of things and say "Look, the cost of water has gone up, the cost of other things has gone up, you cannot look at all projects and come up with the same old chestnuts you did in 1902," and they did not want to attack the problem. And they do not want to look at your new project in the light of that. They would like to look at it in the light of writing $97 million off. But they do not want to look at the other four major features. That is a real tough problem and that is one that will cut across more than party lines, that will really cut deep and departments do not like to face up to reality. Mr. JOHNSON. I merely want this record to show that with or without the new formula, this project will stand on its own and stand very well. That is the point I tried to make because when this was brought in here the gentleman said this project is coming in and the recreation benefits have been raised from 41 to 97 million for nonreimbursable fish and wildlife and recreation. And when you have one of these projects you are trying to get authorized, I just do not want something like this to stop it and wipe it out before we get started because this thing has been well studied, well engineered, and from an engineering standpoint, a feasibility standpoint, financial feasibility, from a cost-benefit ratio criteria, any other criteria, this can very easily and readily stand on its own without this new formula. Now Congress is going to have to make that determination. I have watched other projects go through the Congress where this increased contribution has been given to fish and wildlife and recreation, but I say we do not need it. Now I have never been able to find out just how this got to be $97 million. At the present time this report is clearing the various agencies and will be up here and will be filed as a new House document and will come to this committee. There is legislation introduced by all of us from California, and when we go into the hearing, if we do, this will all be brought to bear. Whether these gentlemen can say whether it is mandatory they follow this procedure in reporting these projects-I imagine it is, that is why they do it, but we do not have to accept it in the Congress or in this committee. Mr. ROGERS. Is that all you have, Mr. Johnson? Mr. JOHNSON. That is all. Mr. ROGERS. Mr. Burton. Mr. BURTON. Mr. Chairman, I hope you can enlighten me a little bit on this. I have heard some of you senior members talking about the old formula and the new formula. What formula is it we are talking about? Mr. ROGERS. Mr. Burton, I can enlighten you to this extent. We have spent a lot of time trying to find out what the old formula was and before we found out it changed to a new formula. You are on your own. Mr. BURTON. In appraising these formulas I have heard three different figures used, I suppose in reference to this same project. One is a $2 million figure, another $42 million and another $97 million. Mr. HALEY. Will the gentleman yield? Mr. BURTON. Yes. Mr. HALEY. The projects I was referring to did not include the project of the gentleman from California at all. They were other projects. Some of them have been presented, some of them have not. I did not call out all of the figures. But we have a project here of $700 million in which these nonreimbursables were $11 million. We have a project of $465 million in which the benefits for nonreimbursable items were $50 million. In the works now is a proposed project, as I understand it, costing $900 million and yet the nonreimbursable items will be $400 million. Mr. BURTON. I see. Mr. HALEY. So you see from the original figure a project was recommended of $760 million and only $2 million was for nonreimbursables. So this committee, as the chairman has well said, we have been trying to find out what is the formula used downtown to make this wide variance in these projects. I also stated we had a project proposed that had nonreimbursable items of 36 percent. When we began to look into it, the figures were suddenly changed to where the nonreimbursable items were only 24 percent. This committee does not know what, when, and where the change some place in the dark of the night. What is the formula? This is what we are trying to find out now. There does not seem to be any formula other than this. Here is my feeling in the matter: They bring these projects here under a formula set by the Congress and it looks to us, and I think this is a fair statement-in order to make the project feasible they add on fish and wildlife and recreation or any other thing they can bring here in order to make it a feasible project. Mr. BURTON. Was it you, Mr. Haley, or was it the gentleman from Pennsylvania who said that under these formulas one project had jumped from 2 to 400 million in nonreimbursable costs? Mr. HALEY. No: I did not. Mr. BURTON. Was it the gentleman from California? Mr. JOHNSON. No; not that high. In connection with AuburnFolsom South, I want to say this. The project up here before was a million acre-foot reservoir, its total cost and related work were about 250 million. There was 41% million allocated to recreation and fish and wildlife in that project. The river was restudied and the report that is coming in here will call for a reservoir of better than 2 million acre-feet, the estimated cost somewhere around 400 million, and they have in there, as we understand it, a figure of approximately $97 million for recreation and wildlife. Mr. BURTON. I see. I thank you particularly, Mr. Haley, for helping clear that up in my mind. What you apparently told me is that we do not have any well ordered, intelligent formula to calculate nonreimbursable costs to apply to all of the projects. Mr. HALEY. Will the gentleman yield? Mr. BURTON. Yes. Mr. HALEY. I think that is substantially my feeling in the matter. In other words, it seems to me and I am not particularly speaking about the project of the gentleman from California because he says it can stand up under any formula. It seems to me when we go down into these depths, in order to meet the reclamation criteria, they just hand on the balance of the cost of it in order to make it a feasible project. There is no formula as I see it because the wide variation fringes in these one, two, three, four, five projects I have called your attention to, it runs anywhere from 1 percent or even less than 1 percent, practically nothing, and now the proposed project, I understand, is being considered on the basis of $900 million, $400 million in it for nonreimbursable items, or better than 45 percent. Mr. BURTON. Thank you, Mr. Haley. That is all, Mr. Chairman. Mr. ROGERS. Mr. Roberts. Mr. ROBERTS. No questions. Mr. ROGERS. Mr. Duncan. Mr. DUNCAN. One question: Would it be fair to say at least the nucleus or basis under which the so-called new formula is put into effect could be found within the pages of this pamphlet, Senate Document No. 97? Is that a fair statement? Mr. ROGERS. I think you could address that question to Mr. Caulfield and I think it is very proper. Mr. CAULFIELD. With respect to the cost benefit analysis, yes, sir. With respect to reimbursement, and for reimbursement, no, sir. Mr. DUNCAN. The cost benefit, yes, but not reimbursables or nonreimbursables? Mr. CAULFIELD. I am sorry. If you would like me to elaborate on that, I will. Projects have two tests that the committee applies and the executive branch applies. One we call the economic benefit-cost analysis where we try to calculate the benefits on the one hand and the costs on the other hand, and this results in a finding of whether the benefit exceeds the cost. Mr. DUNCAN. And you look into these pages for it, for the criteria which you follow? Mr. CAULFIELD. That is right. When we talk about reimbursement and nonreimbursement we are talking about the financial feasibility test depending upon the laws the Congress has passed with respect to reimbursement or nonreimbursement. And in the absence of such laws, the executive branch will propose certain things to Congress with respect to Mr. DUNCAN. Project by project. Mr. CAULFIELD. Project by project. And that is the position we are in, sir, on that. As the chairman indicated, in this field of reimbursement and nonreimbursement, with respect to recreation now patricularly, the policy of Congress, although there are precedents in congressional action, as Mr. Johnson said, clear precedents in the Public Works Committee, we do not have a general statement from the Congress on this subject with respect to recreation. That is responsive to Mr. Saylor, I believe, on the point Mr. Saylor was making. Mr. DUNCAN. That is all. Mr. ROGERS. Mr. White. Mr. WHITE. Thank you, Mr. Chairman. In your statement, Mr. Caulfield, you made reference to your duties under the Secretary covering a broad range. We have addressed ourselves just to the reclamation projects here. Do your duties extend in the recreation field greater than to the reclamation projects that are being considered by the Interior Department? Mr. CAULFIELD. You mean the whole field of recreation, say national parks? Mr. WHITE. National parks and other areas in the Interior Depart ment. Mr. CAULFIELD. They could upon assignment of the Secretary, sir, and they have upon assignment of the Secretary. Mr. WHITE. They have so been assigned? Mr. CAULFIELD. At one time or another. Our duties largely are upon specific request and the assignment of the Secretary to do certain things for him, yes. I might be concerned with a recreational matter that has nothing to do with a reclamation project, for example, if that is what you are asking, sir; yes. Mr. WHITE. I gathered from what you said a moment ago, first of all, you had not attacked these reclamation problems through Mr. Dominy's office, but had done this under the Secretary and had reviewed certain reclamation projects as specifically requested by the Secretary; is that right? Mr. CAULFIELD. Yes. Mr. WHITE. The question I asked myself: What are your other duties, merely recreation and fish and wildlife, or do they have a broader scope? Mr. CAULFIELD. Our staff assists the Secretary upon his request in any field of the responsibility of the Interior Department. It could be a public lands question. Mr. WHITE. Is it that it could be any part of the activities of the Interior Department? Mr. CAULFIELD. Yes. Mr. WHITE. It just so happens that you are addressing yourself at the present time to this particular part. Mr. CAULFIELD. That is right. He might ask me, or one of our staff, to look into something in the Office of Territories out in the Pacific somewhere, for example, something that he wanted specifically looked into. Mr. WHITE. I understand your functions much better. Mr. WHITE. Are you separately budgeted in the budget for your office? |