Senator DwORSHAK. Will not the expenditures of that amount depend to some extent on what kind of a report is made by the Board? Mr. VOGEL. Not at the present stage of the work. But the lock will have to be rebuilt and we think what we have requested is approximately what will be needed.

Senator DwORSHAK. Then what is the prime purpose of having the Board make an investigation so that you will not make the same mistake twice?

Mr. VOGEL. I think that is a very important reason, sir.

Senator DwORSHAK. You made a mistake; I am assuming that. Senator KEFAUVER. If the Senator will yield, the TVA did not make the mistake.

Senator DWORSHAK. I did not mean him personally.

Senator KEFAUVER. The organization did not build the first lock. Mr. VOGEL. In any case, we all want to know what should be done to eliminate mistakes of the past, if any were made.

Senator DWÓRSHAK. That is logical.

I was not blaming anyone, Senator Kefauver; I was merely questioning the chairman as to whether any specific information had been made available for guidance of the Board in its future planning at that particular point.

Mr. VOGEL. We hope that this experience will be also of assistance in the advancement of scientific knowledge.

Senator KEFAUVER. May I say, I thought your question implied that TVA built the first lock. It was not built by the TVA.

Senator DwORSHAK. I asked him, and he said the Army Engineer Corps built it.

Senator HILL. We have had a rollcall from the Senate. We will stand in recess for a few minutes.

(Whereupon, a recess was taken.)

Senator HILL. The subcommittee will be in order.

General, you gave us a splendid summation of your budget, the items in the budget and the need for those items, and we have had a splendid presentation of a fine program of tributary development by Mr. Wagner.

I wonder if one of you gentlemen or some member of your staff might give us a summarization-a picture of your fertilizer operations?

TRIBUTARY DEVELOPMENTS

Senator KEFAUVER, Mr. Chairman, I wanted to ask some questions about the tributary developments, unless you want to come back to it later.

Senator HILL. No; you might as well go ahead right now.

Senator KEFAUVER. I know that the members of the Board are greatly concerned and interested in connection with the development of the tributaries of the Tennessee, and the local people and the States and counties are very interested, as evidenced by the fact that associations have been formed. We have recited some of the steps that have been taken. I know that you have been doing a lot in connection with the tributaries, and that you have plans for the future, but, frankly, I have been fearful that the job is not going to get done as expeditiously as it should under the plan that you are now following.

In the first place, I always felt that the TVA Act gave you the responsibility of at least taking the lead in the development of navigation, flood control, power, and general resource development in the valley, and traditionally these things have been a Federal project of the TVA.

I am sure the local authorities, the State, the counties, and the cities, want to do what they can. But the trouble is that rivers go through some counties, some States, some towns, that to work out a coordinated and effective plan would seem very difficult, and would seem to have the possibility of greatly hindering many things from being done that ought to be done.

Furthermore, you say that some of them may not have sufficient promise of profit at the present time to warrant exclusive development by the TVA. But as time goes on and the section develops, their benefit-cost ratio would increase, I would think.

So I would hope that unless you feel quite sure that your program is going to bring about these developments expeditiously, you might reconsider your responsibility in connection with it.

Mr. VOGEL. Senator, I think Mr. Wagner, who discussed this whole program at some length, covered many of the points which you have raised. Unfortunately, I do not think you were in the room at the time.

Senator KEFAUVER. I did not get to hear all the discussion.

Mr. VOGEL. But it is clear, I am sure, that TVA has taken a very definite lead in connection with the development of the tributaries. We regard our mission as one which relates to the development of the entire Tennessee River Valley and all its resources. The tributary areas are a part. These areas have profited as a result of what has been done up to this point.

DEVELOPMENT OF VALLEY IMPROVEMENT ASSOCIATIONS

It is true, I think, of any large undertaking such as we are discussing that as you accomplish first the things which are most important and most dramatic, it becomes a little more difficult to gain understanding of the necessity to give careful attention to the further development of all the resources. And it is for this reason that we have ourselves encouraged the development of these tributary area associations of which there are now quite a number.

We think this is healthy, because it stimulates the interest of the people themselves; it creates a broader interest in the utilization of all the resources.

I have said before that were we to develop the river in its entirety for navigation, were we to free the adjoining lands from the ravages of floods, were we to provide power in any degree possible, all this would be to no avail if the people themselves did not make use of it, if they did not find ways in which to use these developed resources. So this is moving in the right direction, I am sure.

75050-61-6

BASIO LEGISLATION

Senator KEFAUVER. Let me say in that connection, General Vogel, if I may interrupt, that all through the TVA Act, wherever the Tennessee River is mentioned, it says "and its tributaries." Take, for instance, in section 3(j)—

to promote navigation on the Tennessee River and its tributaries, flood control on the Tennessee River and its tributaries, transmission lines

and so forth

on the Tennessee River and its tributaries.

If you had this concept in the beginning before you built Chicamauga Dam or Norris Dam or any of the great dams that have been built that have meant so much to the Nation and to the defense of our country, had there not been some joint arrangements worked out between Alabama, Tennessee, and Mississippi, Hamilton County, Meigs County, and Chattanooga and Knoxville, nothing would ever

have been done.

Mr. VOGEL. I do not think this is an issue, Senator.

The valley associations of which we have both spoken go completely across political boundaries. They are organized for the welfare of the areas which they represent. This gives us groups with which to talk, with which to work, with which to advise, and whom we can assist in making the best use of the resources available to them.

Surely we are well aware that the tributaries of the Tennessee and the areas drained by them are part of the entire overall Tennessee Basin. This is what we have worked with over the years.

Senator KEFAUVER. And yet you are applying different criteria to the development of the tributaries than you are for the Tennessee River?

Mr. VOGEL. I do not think we are, Senator.

The criteria are exactly the same. But we are trying to find better and newer methods which will enable us to go further than has been possible in the past under existing methods.

Senator KEFAUVER. What I mean by different criteria is that you did not and should not have waited until the State of Tennessee and Anderson County agreed to acquire the land or do certain other things before starting Melton Hill Dam. And yet I understand that on the tributaries you are putting as a condition precedent the doing of certain things by the local authorities themselves.

Mr. WAGNER. Senator, Melton Hill Dam is on one of the tributaries. Senator KEFAUVER. Well, let's take Norris Dam.

Mr. WAGNER. All right, Norris Dam is on a tributary too, but my point is this: that the act does instruct us to develop the Tennessee River and its tributaries. And of the 20 dams the TVA has built, only 7 are on the main stream, 13 are on the tributaries, and the one under construction now is on a tributary. So the tributaries have not been neglected.

I think the point is that the act also instructed us to build dams for purposes of navigation, flood control, and power production. Wherever we have been able to find a dam which contributed to those purposes in sufficient amount to justify its construction, we have built it. But we are talking now about dams where the benefits for these Federal purposes specified in the TVA Act fall far short of justifying the kind of expenditures that would be required to build them.

And instead of saying, let's not build those dams at all, let's turn our backs on this particular area, we are saying let's see if there is not a way that we can find to combine the resources and the interests and the objectives of the Federal Government, the local government, the State government, to build these projects.

It is this program in which we are engaged that I described at some length. We believe that this is an opportunity for TVA to again demonstrate something new in the field of water resource development, to demonstrate a way to build a project that will serve the people in the area where it exists which could not have been built through the normal procedures of justifying and building dams. This is the kind of a problem we are talking about.

I think that the TVA Board from the beginning has not neglected the tributaries.

I would point out to you, for example, that Norris Dam, the first dam we finished, is on the Clinch and Powell Rivers, tributaries to the Tennessee.

Senator KEFAUVER. I know that. I am talking about the new projects.

Mr. WAGNER. I believe they are all about the same age. talking about additional projects?

NEED FOR LEADERSHIP

You are

Senator KEFAUVER. I am talking about additional projects. Let me make it clear of course, whichever way it is going to be done, I am all for it. But I think that the act does give you a leading responsibility, as you admit. And the second thing is that I am very fearful that unless you go on and take the lead in doing these things, it is going to be a long time before they are done.

Mr. WAGNER. To take the lead in doing these things is precisely what we are proposing in this program.

Senator KEFAUVER. Well, take the chief responsibility. I know the Corps of Engineers does have a method whereby, if a project does not quite come up to the benefit-cost ratio, they make some provision for local people to assume some part of the expense, usually small, like the acquisition of rights-of-way or something of that kind.

NEW APPROACH TO APPRAISAL OF PROPOSED PROJECTS

Mr. WAGNER. We would like to approach this a little differently than by the traditional cost-benefit ratio. We would like to satisfy ourselves, when we approach one of these projects-in studies made jointly with other agencies that might be concerned that all of the good to come from one of these projects over a period of time, to whomsoever this good may redound, is more than enough to justify the cost of the project.

Now, you can call it cost-benefit ratio or economic justification, but we do not think it should be a question of saying, "Can you squeeze another $10,000 worth of benefits out of this?" We think it is a question of fair appraisal of the benefits of a project; then seing what it costs and comparing the two; and after that has been done, it is a job of trying to decide where these benefits fall, whether they are in line with Federal responsibility, State responsibility, or local responsibility. If we can get agreement among all the groups that we are talking with as to where they fall, then we would like to tackle the question of how to raise the money that is directly related to these benefits.

This, I say, has been a part of TVA's thinking from the very beginning. It is referred to in general terms, in reports of the first Board of Directors of TVA. It is referred to again in Mr. Lillienthal's book. The principle is reiterated in a publication this year of the National Research Council of the National Academy of Sciences. We believe this is a great new opportunity.

TOTAL FUNDS FOR TRIBUTARY DEVELOPMENT

Senator KEFAUVER. I asked you informally a little while ago the total that you have for tributary development, and I believe they total $408,000 in rough terms.

Mr. WAGNER. My figure was incorrect. I was speaking from memory. It is $628,000.

Senator KEFAUVER. Is that going to be sufficient to start into construction in conjunction with benefits applied locally or not?

Mr. WAGNER. There are no construction funds included in those figures. But I can assure you that when and if we find projects where we believe we can come to you conscientiously asking for Federal funds to make our contribution, we will be in here asking for those funds.

LOCAL ASSOCIATIONS

Senator KEFAUVER. We do have these associations like the Tennessee Tributary Association, the Elk River Association, and others that are trying mighty hard to work in cooperation with you to get some of these projects underway that you have been working on jointly. Every time I go to Tennessee I meet with these people, and they continue their enthusiasm, but they do not feel that very much progress: is being made.