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the Water Quality Act of 1965 (Public Law 89-234) provided incentives to the States to participate, but only with respect to a part of the funds authorized for fiscal years 1966 and 1967. H.R. 16076, as reported by the committee, contains substantial inducements to the States to participate in the cost of projects under both the accelerated existing program and the proposed new clean rivers program. This will not only bring the States more actively into the program, as we have urged so long, but will also reduce the need for future Federal and local funds by the amount of the States' contributions.

In determining the degree of acceleration of the Federal grant program, we must consider the ability of the States and communities to utilize the Federal funds made available. It will take time for the States and communities to "tool up" for a program which would be doubled in the first year and increased to over six times the present level in just 4 years. Preparation of plans, and making arrangements to finance the State and local shares of the cost of projects will take a great deal of time. Furthermore, the availability of materials and qualified contractors and the ability of States and local governments to sell bonds at acceptable interest rates may be controlling factors. During the hearings, the committee heard that at least one State (Vermont) has no backlog of unfinanced sewage treatment plants, in the sense of need for Federal money. Mr. Reinhold W. Thieme, member of the executive committee of the Interstate Conference on Water Problems, and commissioner on water resources in Vermont, testified with respect to his State:

Our program at the present time is about all that we could support either financially or through the capabilities of contractors that have been dealing with these services. In fact, we have had some where we have not been able to get bids because the contractors were all busy.

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While this situation may not exist in many or even any other States, it illustrates the fact that we cannot solve the problem by simply pouring out floods of Federal money. The amounts to be made available for Federal grants must bear some relationship to the ability of the States and local communities to utilize such grants. We believe that the amounts which would be authorized by H.R. 16076 are the absolute maximum which could be wisely used, and may exceed the ability of many of the States.

It is our belief that those who advocate increased authorizations to the level of a crash program are guided by their emotions more than by facts and evidence as to the actual needs, and are perhaps overlooking other Federal programs which provide assistance in the construc

tion of sewage treatment works. The following programs must be considered:

Public Works and Economic Development Act of 1965.—Under this act, Federal grants up to 50 percent of the total cost and loans up to 100 percent of the total cost are available for "the acquisition of land and improvements for public works, public service, or development facility usage, and the acquisition, construction, rehabilitation, alteration, expansion, or improvement of such facilities, including related machinery and equipment" within redevelopment areas. Sewage treatment works can be and have been financed under this act.

In addition to this, section 101 of the act authorizes supplementary grants for the purpose of increasing the Federal contribution up to 80 percent of the cost of projects constructed under other Federal grant-in-aid programs, including sewage treatment works financed under the Federal Water Pollution Act.

Under the act, specific amounts are not set aside for sewage treatment plants, but a total of $500 million is authorized for all grants and supplemental grants for the fiscal years 1966 to 1969, inclusive, and annual appropriations for making and participating in loans are authorized up to $170 million for fiscal years 1966 to 1970, inclusive. Appalachian Regional Development Act of 1965.—This act, Public Law 89-4, authorizes the Secretary of the Interior to make grants for the construction of sewage treatment works in the Appalachian region in accordance with the provisions of the Federal Water Pollution Control Act, as amended. The act authorizes a sum not to exceed $6 million to be appropriated for the program.

In addition to this, section 214 of the act authorizes supplementary grants to increase the Federal contribution up to 80 percent of the cost of constructing projects under other Federal grant-in-aid programs, including sewage treatment works under the Federal Water Pollution Act. A total of $90 million is available for making supplementary grants under section 214.

Housing and Urban Development Act of 1965.-The Housing and Urban Development Act of 1965, Public Law 89-117, provides for Federal grants of up to 50 percent of the total cost of the project to finance specific projects for basic public water facilities, including works for storage, treatment, purification, and distribution of water, and for basic public sewer facilities in areas with comprehensive planning as defined in the act. Such Federal grants may also be made for the advance purchase of land to be utilized for future construction of works thereon. The act authorized $200 million per annum for each of the fiscal years 1966, 1967, 1968, and 1969, exclusively, for such purposes totaling another $800 million from the Federal Treasury.

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Consolidated Farmers Home Administration Act, as amended.Under this act, as amended in 1965 (Public Law 89-240), the Secretary of Agriculture may make grants totaling up to $50 million each fiscal year to finance "specific projects for the development, storage, treatment, purification, or distribution of water or the collection, treatment, or disposal of waste in rural areas."

In addition to this, the act (as amended by Public Law 89-240) authorizes the Secretary to make or insure loans to finance, among other things the "conservation, development, use, and control of water, and the installation or improvement of drainage or waste disposal facilities" in rural areas.

As used in the act, the term "rural areas" does not include any area in any city or town which has a population more than 5,500 inhabitants, thus assuring that the financial assistance will go to those areas which are least likely to have adequate taxing authority, bonding capacity, or other financial resources.

Public Facility Loans (42 U.S.C. 1491-1497).-This program provides long-term construction loans to local public agencies for needed public works for which financing is not otherwise available on reasonable terms and conditions. Loans may be made to finance up to 100 percent of the project cost for a wide range of non-Federal public works, including sewage treatment works.

Proposed Demonstration Cities Act of 1966.—Title II of the Demonstration Cities Act of 1966, as reported by the House Committee on Banking and Currency, provides for Federal grants of up to 70 percent of the total costs for facilities within a metropolitan area as defined in the act and meeting all qualifications for metropolitan comprehensive planners set forth therein. Water pollution control and sewage treatment facilities are eligible for such assistance under the provisions of the bill, if enacted in its present form.

We have discussed these facts in an attempt to place this matter in proper perspective, and to consider the admittedly critical problem on a factual rather than an emotional basis.

We believe that the authorizations for construction grants contained in H.R. 16076 can be supported. We have no reliable evidence that the $6 billion which would be authorized by S. 2947 as passed by the Senate is needed or can be fully used.

We feel very strongly that it would be a bad mistake to provide for an authorization of $6 billion at this time. The question may be asked if there is admitted uncertainty in the exact amount, why not take the higher figure and leave it to the Committees on Appropriations to appropriate only the amounts actually needed. This might appear to make sense except for some overriding facts. For instance, the inherent danger which lies in the use of a figure far greater than the

amount we believe can be geared into the program at this time. The figure may actually be dangerous in the sense that it leads to a completely false sense of progress. The principal objective to be achieved now is to make the States, cities, and communities so conscious of the threat of water pollution that they will make every effort to produce maximum results in the way of increased planning and increased financial assistance. A figure of $6 billion might easily be taken to mean that the Federal Government has solved the problem; that it has applied the dollar formula to achieve a panacea; that it has followed the Washington formula of applying dollars to [p. 96]

solve the problem. The fact that the figure is an authorization and not an appropriation will be overlooked by most people. The fact that the actual appropriations may bear no resemblance to this figure will not mitigate this false sense of progress.

Instead of a bill which will urge States, cities, and communities to exert their utmost to accelerate the program, it may well have the exact opposite effect and make everybody think that the problem is well in hand. And all this because of a sleight-of-hand reduction of a mythological total cost of $100 billion to an unsupported figure of $20 billion for work to be accomplished in the immediate future which itself has no fixed time period, finally to arrive at an authorization total of $6 billion determined by multiplying $20 billion by an admittedly incorrect factor of 30 percent. The $6 billion, in our opinion, is something less accurate than the computations used to put a man in orbit, and we had better wait for better figures before we delude the American public by this mirage.

WILLIAM C. CRAMER.
JOHN C. KUNKEL.
JAMES R. GROVER, Jr.
DON H. CLAUSEN.

CHARLES A. HALLECK.
CHARLOTTE T. REID.

ROBERT C. MCEWEN.

JAMES D. MARTIN.

JOE SKUBITZ.

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1.2j(2) SENATE COMMITTEE ON PUBLIC WORKS

S. REP. No. 1367, 89th Cong., 2d Sess. (1966)

FEDERAL WATER POLLUTION CONTROL ACT AMENDMENTS AND CLEAN RIVERS RESTORATION ACT OF 1966

JULY 11, 1966.-Ordered to be printed

Mr. MUSKIE, from the Committee on Public Works, submitted the following

REPORT

[To accompany S. 2947]

The Committee on Public Works, to which was referred the bill (S. 2947) to amend the Federal Water Pollution Control Act in order to improve and make more effective certain programs pursuant to such act having considered the same, reports favorably thereon with an amendment and recommends that the bill as amended do pass.

PURPOSE

The purpose of S. 2947 is to

(1) Establish the Clean Rivers Restoration Program as a supplement to the existing water pollution control program for planning and construction of treatment works on a river basin basis. This title, will enable designation of planning agencies for each river basin or portion thereof in a State or States, at the request of the Governor or Governors, for the purpose of preparing detailed pollution control and abatement plans. After designation of a planning agency, the Secretary may make grants not to exceed 50 percent of a project's cost if (a) the Governor agrees to establish water quality standards for all rivers and streams in the State and (b) if the State provides 30 percent of the cost of each project.

(2) Eliminate existing dollar ceiling limitations on individual and joint sewage treatment construction project grants and provide a 30-percent grant for every approved project regardless of the total cost of any single or joint project.

(3) Provide a bonus of 10 percent of the total project cost for

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