Last year, speaking for the State perspective, I pointed out that many States were well ahead of the Federal Government in the extent of their commitment to combat water pollution control.

At that time, Senator Muskie had proposed legislation which would authorize an additional $25 billion, half of it Federal, to put pollution control on a course calculated to achieve significant results by 1976. The Muskie bill's chance of passage was hampered by the fact that the administration was only calling for a $10 billion effort, 40 percent of it Federal.

This latter effort would not have cleaned up our waterways in this century.

Today I am happy to note that the situation has changed.

The Muskie bill still represents, in my estimation, the most realistic appraisal of the costs of clean water.

Its 5-year expenditure of $25 billion is within reach of the League of Cities 6-year estimate of between $33 and $37 billion, and the Federal rate of $2.5 billion per year will provide for reimbursement of the $15 billion now owing to States which have prefunded the Federal share.

Significantly, however, the administration has recognized that their earlier program was inadequate, and they have come forth with a program recommending an annual authorization of $2 billion which makes specific provision for prepayment of prefunding costs.

This program is still too low, but it has reached a meaningful order of magnitude, and I feel that President Nixon deserves commendation for moving closer to the levels shown by this subcommittee's hearings to be necessary.

When I say that the administration's proposed $12 billion 3-year program is inadequate, I am referring not merely to the fact that the total program will cost more. We all know that. In fact, it may well end up costing more than the more realistic $25 billion over 5 years. I am also referring to the ability of the States to move ahead more rapidly with total cleanup.

As Chairman of the National Governors' Conference Committee on Natural Resources and Environmental Management, I asked each of the Governors to indicate the three areas to which they would like to see my committee devote its attention.

Nineteen of the 30 Governors who have replied chose water pollution control as one of their top priorities.

Within my committee, this choice was unanimous.

As proof that the States are prepared to move faster than pas Federal funding has permitted, I have assembled figures from som of the States represented on the subcommittee.

In Maine, we have a backlog of 31 projects representing $60 million in total construction. All that is missing is the Federal share.

In Michigan, the figures are $400 million for 174 projects; and In Virginia, $310 million for 169 projects.

Nationally, according to a National Governors' Conference survey last year, the gap between the $1 billion Federal appropriation and th amount which the States felt that they could use was more than $ billion.

The existence of such a gap is a double illustration of false economy First, inflation in construction costs is such that the costs of a give project may double in 10 years or less.

Therefore, any unnecessary deferment of any plant will cause vast cost increases.

Second, I believe that we are missing an important opportunity to stimulate our economy in a constructive direction.

At a time when we are reexamining the wisdom and propriety of large governmental subsidies to such essentially private projects as the SST, we might cushion the blow to the job market by stimulating more employment in the recognizedly public sector of municipal pollution control.

With regard to the nonfinancial aspects of water pollution control, I believe that the pending legislation represents an impressive step toward more effective enforcement.

The provisions for nondegradation, closed cycle systems, citizens' rights to sue, and river basin planning with systematic priorities provide strong assurance that past patterns of delay, which were frequently justified by doubt as to the extent and direction of the Federal commitment, may be behind us.

At the same time that the Federal commitment is strengthening, we in Maine are beginning now to see signs of real progress.

Last month in our State, the Scott Paper Co. announced that they are evaluating two sites for a new pulping mill to take over the pulping operations of their Winslow and Westbrook plants.

If built, this new mill, which is being considered in part because of the need to meet water quality standards, would assure us that both the Kennebec and Presumpscot Rivers should have an easier time meeting their classifications before the 1976 deadline.

Significantly, there would not be a great loss of total employment in the State, although there might be some relocation.

The total State tax base will, of course, gain from the new mill. We in Maine are determined to continue this program, but, in a period of rising tax consciousness, our $9,418,000 burden of unrepaid prefunding does cause some hesitation.

The burden on Maine people has also been intensified by our enormous amount of water.

We have approved $75 million in bonds for the State share.

If the national effort were comparable to ours, we would be talking about a $22 billion program to date.

Because the present program apportions funds strictly on a per capita basis, it does put States like Maine at a disadvantage.

It is for this reason that I reiterate my suggestions of a year ago that an apportionment formula be set up which takes appropriate account of the total cost of doing the job in each State.

Conceivably some combination of surface water area and pollution equivalence could be devised.

There may be less cause for optimism nationally than we have in Maine.

Maine's principal bodies of water are rivers, which cleanse themselves relatively easily.

As a Nation, we have not yet taken the steps which we can be sure will save Lake Michigan or redeem Lake Erie.

Still, S. 523 and, to only a slightly lesser financial extent, the bills in the S. 1012 series are significant steps in the right direction.

I think we can fairly say that the environment has taken on a high national priority which must be a source of considerable satisfaction

to those Senators who have been speaking out on this issue for the past decade.

Thank you.

Senator EAGLETON. Thank you very much, Governor.

I think you have pointed up the general dilemma that we find ourselves in under the present formula. Most States, yours included, find themselves in dire financial straits as to counties and municipalities. Unless the formula is one that is truly realistic whereby the State and our local share is an obtainable amount, then there is going to be no progress in the program.

I think we have to take a very long and realistic look at the present formula and see if we are not going to be obliged to increase the Federal participation in it, and not only increase the Federal participation by authorization, but also by appropriations, so we can move in this

area.

Governor, in the event we have questions from committee or staff that we would submit to you in writing, could you give us your comments and answers to be included in the record?

Governor CURTIS. I will be delighted to.

Thank you, Senator.

Senator EAGLETON. Our next witness is Mr. James C. Kellogg, executive assistant to Hon. William G. Milliken, Governor of Michigan. STATEMENT OF HON. JAMES C. KELLOG, EXECUTIVE ASSISTANT TO HON. WILLIAM G. MILLIKEN, GOVERNOR OF MICHIGAN; ACCOMPANIED BY L. PURDY, EXECUTIVE SECRETARY, WATER RESOURCES COMMISSION

Mr. KELLOG. Thank you, Senator.

I would like to introduce the gentleman on my left, Mr. Lake Purdy, executive secretary of the Michigan Water Resources Commission, and also extend regrets from Governor Milliken, who could not be here today but who did want to communicate with the committee and, with your permission, I would like to enter the statement on behalf of the Governor.

Senator EAGLETON. Yes; your entire statement will be made a part of the record. You can read from it or summarize it, whatever is your pleasure.

(The statement follows:)

STATEMENT OF HON. WILLIAM G MILLIKEN, GOVERNOR OF MICHIGAN

It is indeed a privilege and a pleasure to have the opportunity to appear before you today on a matter that is of vital concern to Michigan.

My comments today are devoted to legislative proposals presently before you designed to amend the Federal Water Pollution Control Act. For convenience and clarity, I will refer to Senate Bills 1012, 1013 and 1014 as the administration's bills and Senator Muskie's bill as being Senate Bill 523.

In Michigan, we have been engaged in fighting pollution for over 40 years, since our original stream control statute was enacted in 1929. Initially our program was quite small with limited personnel, funds and public support. Over the years we have acted on numerous occasions to strengthen our program through increased funding and statutory changes. The process is still continuing as this year I have asked our Legislature for additional statutory powers to

combat sediment pollution, to increase pollution penalties, and to provide regional units with increased authority to construct and operate treatment facilities. The net result of this period of pollution control experience and program maturation is a program which we believe is among the most comprehensive, sophisticated and effective in the nation.

So that you may fully understand our evaluation of the proposed legislation before you, I would like to briefly highlight Michigan's water pollution control efforts.

MICHIGAN'S WATER POLLUTION CONTROL PROGRAM

Water pollution control in Michigan is primarily the responsibility of the Michigan Water Resources Commission, a seven member body composed of four department heads and three appointees of the Governor representing industry, municipalities and conservation groups. The Commission is quasi-judicial and has power to issue formal orders to abate pollution. Such orders are enforceable through court action.

The Commission has promulgated and is implementing a program of water quality standards for all of Michigan's surface waters both inter- and intrastate. It was the first water pollution control agency to embark on a statewide program requiring phosphorus removal from municipal and industrial wastewaters and, moreover, has taken recent positive action on such pollution issues as recreational watercraft discharges, fail-safe systems for the treatment of cyanide wastes, and the encouragement of area wide waste treatment systems. The Commission administers the $335 million Clean Water Bonding Program which provides state funds to match federal funds for local sewage treatment works construction. This program is having a substantial impact on treatment plant construction needs. As of February 1, some $101 million of state funds has been committed to nearly 200 treatment works projects.

A separate staff of over 100 persons serve the Commission. This staff includes sanitary and civil engineers, planners, biologists and laboratory personnel. It is a highly professional staff with competitive salaries and is within the personnel classification system administered by the Michigan Civil Service Commission. A comprehensive training program for pollution control and planning is carried out including the use of University student assistants.

To adequately monitor and protect the waters of the state, a variety of techniques are utilized. Each incipient pollution problem is inspected regularly. All orders adopted for both municipalities and industries require routine analysis and regular reporting of the quality of waste discharges. An established statewide monitoring network is maintained and additional water quality and waste effluent surveillance efforts are conducted to provide for the early detection of problem situations. Separate staff units are responsible for industrial waste surveillance, comprehensive stream studies, and biological evaluations. These units employ an array of sophisticated hardware including a mobile bio-assay laboratory, computer simulation techniques, and both aerial and watercraft modes of surveillance.

Control over the emergence of new pollution problems is handled through the new use permit system. Any person proposing to make a new or substantial increase in use of the waters of the state for waste disposal purposes must file a statement detailing the volume and character of the proposed discharge. The Commission then adopts a formal order specifying such effluent restrictions as it deems necessary to adequately protect the quality of the receiving waters.

The Commission's programs are complemented by the activities of the Michigan Department of Public Health. This Department exercises supervisory authority over all aspects of municipal sewage collection and treatment. Among other things, the Department must approve all plans and issue a permit for sewage collection and treatment facilities before construction may commence. Sewer construction permits are issued only after a determination has been made that adequate treatment is or will be available.

All treatment facilities, both municipal and industrial, must be operated under the specific supervision of a state-certified operator. Such operators are required to file monthly operating reports showing the performance of the treatment facility and the quantities of wastes discharged.

The Commission is also served by a planning staff responsible for general water and related land resources planning as well as basin water quality planning. To handle the vast amount of data generated through monitoring and reporting activities, a new computerized data storage and retrieval system is being finalized.

Legislation enacted last year has added two new pollution control tools. First, all industries and commercial establishments are required to report annually on all materials used in their establishments which are listed on the Commission's critical materials register. This program element is designed to help anticipate and avoid potential water quality problems. It will, we hope, help prevent any future environmental disaster such as the 1970 mercury crises.

Second, a water quality surveillance fee has been authorized for all commercial and industrial waste dischargers. With the revenue to be raised from this source, we intend to approximately double our field staff and to significantly augment our total pollution control capability.

This, then, is a capsule summary of Michigan's program. It reflects our extent, depth and commitment to the preservation of the quality of our waters. Our evaluation of the proposed federal legislation before you stems from the perspective our own program experience.

PRIMARY RESPONSIBILTIY OF STATES

Both the administration's bills and Senate Bill 523 propose extensive changes to Section 10 of the Federal Water Pollution Control Act. By and large, we realize the value of most of the new program elements proposed including water quality standards for practically all waters, effluent restrictions, discharge permits, mandatory reporting, and enforcement procedures for the violation of water quality standards.

We can testify to the value of most of these program elements because they are by and large integral parts of our own existing water pollution control program. The danger that we see here, however, is the establishment of redundant procedures and requirements which will foster administrative chaos and inflict delays on current water pollution control efforts.

We strongly feel that any amendments to the Act should clearly differentiate the respective and proper roles of the Federal Government and the States. Such a differentiation should begin, we suggest, with due recognition of the policy enunciated in the original Act wherein Congress declared its intent “* * * to recognize, preserve and protect the primary responsibilities and rights of the States in preventing and controlling water pollution. *

This policy in our minds remains valid and clear and should continue to be fully adhered to. To dilute and obscure the primary responsibility for water pollution control will act to retard present efforts and may rebound to undo much that has been achieved.

WATER QUALITY STANDARDS

The extension of the present program of water quality standards to practically all waters poses no unsurmountable burdens for Michigan as this has already been completed with the exception of groundwaters. It should be recognized, however, that efforts to enforce and implement existing intra-state standards will have to be curtailed pending the establishment of federally-approved standards. In regard to standards already approved, every effort should be made to minimize changes and, we hope, the final draft of any legislation will clearly reflect such a provision.

In revising existing standards and in establishing new standards, we believe a time schedule of a full year would be most appropriate.

The projected date for the achievement of standards must also be pragmatic and realistic. Three years for this is too short. The first step of implementing standards is to fully delineate substandard waters and, following appropriate statutory procedures, promulgate a remedial course of action. Then, industries and municipalities are usually allowed a three year schedule to plan, design, finance, construct and place into operation needed treatment facilities. To achieve standards within three years would necessitate the completion of this process simultaneously for all problem areas in a state. There is simply not enough manpower available to bring this about. We would not object, however, to a three year timetable for the resolution of identified problems of substandard water quality starting from the date the standards and plan of implementation receive federal approval.

Both bills attempt to deal with the issue of preserving high quality waters. We do not disagree with the purpose sought but this issue is fraught with practical difficulties. The administration bill merely proposes to maintain high quality waters through regulations. Senate Bill 523 provides for no degradation of present quality. Both provisions are unamplified and are suggestive of an