Senator EAGLETON. I think there have been GAO studies that describe less than optimum operation, in some cases inept operation. What clout or inducement, if any, should the Federal Government have to rectify maloperation, considering the substantial investment the Federal Government has made in the plant at the outset? Mr. KAISER. Well, in our State, we have a permit system and we get a permit from the State to operate our plant and I think that someone should have the right to revoke a permit to operate the plant if it is not puting out a satisfactory effluent and is not being operated and maintained properly. Senator EAGLETON. How about penalty provisions to deny future funds, or the like? Mr. KAISER. Sir, I feel so strongly about what you are talking about, that the penalty can't be too severe. Maybe they disagree with me. Senator EAGLETON. Will somebody please disagree with me? These hearings aren't any good if somebody doesn't disagree with me. Mr. SOSEWITZ. Senator, it appears since major responsibility in the arena must lie with the State, whatever formula is arrived at to insure minimum standard is maintained has to be on the basis of relationship between Federal Government and States rather than have local communities involved, because I think it is on that basis that information comes out of the GAO report; that is what the foundation is. Senator EAGLETON. Mr. Gibbs, on page 3 of your statement, you have described river basin planning as the tool necessary for effective pollution control. In your judgment and in your interpretation, does river basin planning include land-use controls, for instance, zoning, against the development which would exceed the capacity of existing waste treatment works or regulating development that results in runoff that would cause degredation of water quality? Mr. GIBBS. Å land-use plan is the essential element of any river basin plan. It must be. Otherwise, the plan is completely useless. I would not want this to be a federally imposed land-use plan. We, of course, feel, being local officials, that local land-use planning is important. The land-use plan must look to the future, it must be a longrange land-use plan, and there must be techniques available at the local level for implementing the plan. The planning that we are undertaking for areas beyond our current service boundaries in the Seattle area will necessarily include adopted, and accepted, land-use plans for the community. Senator EAGLETON. What Federal approval, if any, or Federal sayso in this land-use plan, et cetera, should there be? Mr. GIBBS. I think that land-use planning decisions are inherently local in nature. It may well be necessary for the Federal Government to provide the basic tools that the local planners use in developing population projections. I think if we added all of the population projections that are being used in facility design today, we would find the country could be several times larger than anybody expects it to be. So, I think there has to be basic input as to tools and criteria-the information used to develop land-use plans. We all should be planning from the same base. Senator EAGLETON. If we are going to have Federal water quality standards of some type or other, isn't it inescapable that there would have to be some Federal say-so in land-use plan. If there are Federal standards, doesn't it logically result that there would be some Federal approval procedure or disapproval procedure as the case may be? Mr. GIBBS. I am not sure that the word "approval" is one that we would agree with. However, as I say, going back to my earlier comment, I think Federally supplied criteria for land-use planning the allocation of population growth potential, and things of that nature are important beginning points for local planners. As I say, I think many, many communities are planning on growth well beyond reasonable growth expectations. Senator EAGLETON. I have some questions from Senator Boggs who could not be with us this morning. He is participating in other hearings. They will be submitted to you in writing and we would like to have your answers. (The questions and answers to be furnished follow :) Senator EAGLETON. Senator Dole, do you have any questions? Senator EAGLETON. Senator Bentsen? Senator BENTSEN. No questions. Senator EAGLETON. Thank you, gentlemen, for being with us this morning. You have been most helpful. Our next witness is Mr. Keith Krause, chairman of the Legislative Committee. Interstate Conference on Water Problems. I will yield to Senator Dole. Senator DOLE. Mr. Chairman, let me say briefly that Mr. Krause has been working very closely with our staff and, unfortunately, it is one of these mornings where we have three committee meetings at 10 o'clock in the morning, so I can't stay for the entire presentation, but I want to be here to welcome Mr. Krause to the committee and recommend him and what he may say to members who can or must be present this morning. Senator EAGLETON. Thank you, Senator. Mr. Krause, you may proceed. STATEMENT OF KEITH KRAUSE, CHAIRMAN OF THE LEGISLATIVE COMMITTEE, INTERSTATE CONFERENCE ON WATER PROBLEMS; ACCOMPANIED BY DEAN CONRAD, COUNCIL OF STATE GOVERNMENTS Mr. KRAUSE. Thank you, Mr. Chairman, members of the committee. I would like, with the chairman's permission, to enter for the record two additional statements. One is with reference to a resolution adopted by the Interstate Conference on Water Problems at the 13th annual meeting, October 28-29, 1970, in Portland, Oreg., and Interstate Conference on Water Problems reports of the Health Committee at the same meeting. Senator EAGLETON. Without objection, they will be made a part of the record. (The statements referred to follow :) INTERSTATE CONFERENCE ON WATER PROBLEMS-REPORT OF THE (13th Annual Meeting, Portland, Oreg., Oct. 28-29, 1970) On this occasion of our meeting in the western part of the nation, where, I believe, the idea of nationwide interstate conference on water problems was first conceived, it seems appropriate to consider briefly the objectives that support our existence the reason for our being. Accordingly, as an introduction to our report, your Policy Committee respectfully submits for your consideration and suggestions, a listing of some of those objectives, as follows: (a) To provide as wide a range of representation on water problems as is consistent with the Council of State Governments Charter to ICWP; (b) To seek out and support improved procedures for insuring a voice in federal government planning for the private, local and state government's representatives; (c) To act as a watch dog to prevent further erosion of private, local and state responsibilities in the management of water resources; (d) To act as a stimulus to private, local and state governments to accept their responsibilities for water resource management in an effective manner; (e) To oppose government programs at all levels which are emotionally motivated rather than factually based; (f) To promote greater efficiency in resource use as a means of providing for a resource base upon which future generations may rely; (g) To identify the role of water in the nation's economic and social structure so that the role is not subverted, to the nation's embarrassment, by well-meaning but uninformed interests; (h) To identify and illuminate water problem areas so that logical resolution of those problems may be sought; (i) To promote legal, financial and physical research for the resolution of water problems; (j) To cooperate with and promote cooperation among water groups seeking resolutions to problems; (k) To provide a forum of responsible public servants in which a consensus on public water policy at the national level may be obtained; and (1) To support retention of the tax exempt status of water resource development bonds. The years since the inception of the Interstate Conference on Water Problems have seen rapid and extensive growth of the Federal establishment in the field of water resource management and, increasingly in recent times, in many other aspects of the environment. The States, too, have responded to the challenge of broadening environmental problems and now not only have specially assigned agency functions in this broadened field but, through their state agencies, like those represented in our particular group here, have established interstate associations to improve their capacities for providing worthy counterparts to the Federal system. Steps are now under way to explore possibilities for further coordinating our state positions through some type of affiliation among these interstate associations that are concerned with the component but complexly interwoven aspects of our total environment. Basically, the assumption of major stature and vigorous responsibility by the Federal Government is welcomed by the States when it provides strong and effective capabilities for advancing our common objectives in managing the Nation's vital water and other resources. Indeed, the Conference was a major if not the chief agent in shaping the legislation under which the Water Resources Council was established and now operates, and it has consistently supported expanded budgets and services of many Federal agencies. This vast and rapid emergency of Federal capability with all its attendant exigencies of staffing up, developing programs and establishing policy has, not surprisingly, been attended by some growing pains and impingement upon traditional State functions. Many-perhaps most of these travails have been resolved through the application of patience, perception and mutual desire to get on with the job, and on the eve of the reorganization prospective under EPA and NOAA it is our first and most urgent recommendation that this Conference strongly endorse the continuation of the established general policies and practices that have been worked out through the years, until the development of improvements can be effectuated through joint Federal-State effort. The race against time to protect and shore up the environmental foundation of man's continued existance on earth is too urgent to endure the disruption and delay attending wholesale policy and practice changes that are made unilaterally or in haste. Above all, we urge that this organization support Federal acceptance of continued, responsible involvement of the States in resource administration. This is by no means to repudiate the need for similiarly responsible Federal improvement but it is all too easy for Federalists, either in Congress or the agencies, to confuse backstopping the States' efforts with preemption of authority that nullifies the States' capacities to act. Even at this juncture we would identify certain specific policy needs that we suggest you commend to the attention of the new environmental agencies and the new Congress, as follows: 1. Revamping the conference procedure in enforcement action under Section 10(d) of Public Law 84-660. As conceived by State advisors in the drafting of section 10(d), these conferences were intended to be work sessions among the principals, devoted to the examination of problems and identification of appropriate measures for their resolution. As practiced, however, they are forums for the public exposure and deploring of deficiencies that tend firmly to polarize the participants and to identify the States as delinquents in the public eye. Such an approach to a mutual problem casts the States and the Federal Government as antagonists rather than partners. 2. Abandonment of the unilateral edict practice in identifying goals. "Guidelines for establishing water quality standards" contained many wellknown requirements for secondary treatment. Michigan, in its standards, exempted from secondary treatment requirements for municipalities that could demonstrate, to the satisfaction of the State Water Resources Commission and the Secretary of the Interior, that a lesser degree of treatment would provide the requisite water quality enhancement, and the Secretary approved that portion of the State's standards. The exemption now appears to have been meaningless, however, for the Federal Water Quality Administration has so far declined to approve Federal grants for any such lesser degree of treatment. More recently, Under Secretary Carl S. Klein dumbfounded the Lake Michigan States with a policy statement that thermal discharges to that lake should not be more than one degree warmer than the lake's ambient temperature. While that policy has not been subsequently pursued, it was indelibly imprinted in the public mind as a pronouncement by the highest authority, and any less restrictive standard that may ultimately be agreed upon will quite certainly be interpreted as a reluctant Federal capitulation to the demands of industry-dominated States. The identification of program goals is most certainly a partnership matter, to be reached on the basis of demonstrated need and possible attainment-not of sensitivity to superficial public approval. 3. Restriction of Federal impingement on State programs to the minimum levels necessary for effective operation. Federal demands upon State agency staffs have become so excessive in areas of mutual involvement, such as the municipal grant program and enforcement conferences, as to interfere seriously with staff attention to State agency enforcement programs. These demands entail staff compilation of information that go distinctly beyond what is truly germane to instant needs, and they also entail time-consuming staff participation in enforcement conferences and committees thereof that are reconvened with excessive frequency. 4. Continuation of States' primary responsibility and authority in control of pollution in ground waters and intrastate waters. The States have made very substantial progress in the control of ground water and intrastate water pollution and their rate of accomplishment in these areas is, generally, accelerating. Proposed extension of Federal jurisdiction to preempt those areas can only react to the very severe impairment of the State effort, since it would destroy the confidence that waste dischargers can place in State requirements and, accordingly, would make them unwilling to expend funds to meet those requirements. Substituting Federal requirements for, or superimposing them upon, State requirements must shift enforcement functions to the Federal Government, which is totally unprepared, both in staffing and in local problem knowledge, to assume such functions. Rectifying that deficiency by developing the requisite field force would have essentially the same validity as Federal assumption of law enforcement functions presently performed by State and local police. Certainly before the proposed extension of Federal purview is seriously considered, the job of effectuating pollution control in interestate streams should first be put into effective operation. Presumably, it is the view of those who support extension of Federal jurisdiction to ground and intrastate waters, that the Federal role would be that of backstopping or buttressing the State effort. We are unable to envision the actuality of such a role, since the persons subject to dual authority must look, for their instructions, to the dominant authority, who alone has the power to enforce them. 5. Continuation of States' primary responsibility in evaluation of and control over waste effluent quality. Proposed extension of Federal involvement in pollution control to the physical evaluation of effluents and the assumption of supertending authority over effluent restriction must axiomatically negate the States' standing in such matters, since the Federal evaluation will prevail and State action in effluent restriction cannot be accepted by waste dischargers as a dependable basis for plant operation. 6. Establish a mechanism by which to determine the adequacy of consideration given to total environment effects of specific projects so that the projects may proceed timely. Recent years have seen the development of a new and highly appropriate philosophy of conditioning approval of a wide range of water resource projects upon full consideration of their side effects on all aspects of the environment, and on the inclusion of proper provisions in project enhancement while minimizing injuries to the total environment. While this philosophy has unquestionably resulted in improvement of projects from the standpoint of overall benefits, it has also injected a new time factor in project design that results from problems of deciding when adequate consideration has, in fact, been given to side effects and to the need for project revisions. Where this decision rests with the project sponsor, if he is to avoid charges of arbitrary action, it is incumbent on him to postpone finalizing the design until all proposers of side-effect evaluations have been fully satisfied, which in some cases may take considerable time. We, accordingly, suggest that the responsibility for making such decisions be vested with an agency having broad environment policy purview, such as the Council of Environmental Quality. We further suggest that appropriate Federal agencies establish standardized procedures for environmental quality review of water and related land resource projects. We recommend that States seriously consider providing a single contact to coordinate and present a consolidated State position on project effects on the environment. 7. Congressional removal of restrictions against the exemption from Federal taxes of interest paid on water supply bonds. Recent interpretation of Section 103 (c) of the Internal Revenue Code, by the Internal Revenue Service, have placed in serious question such tax exemption of bond interest in certain circumstances, the effect of which is to impede seriously or even prevent the construction of badly needed water supply projects. Since Section 103 (c) of the Internal Revenue Code was placed in the code without public hearings and the language is so vague and ambiguous, this Conference would request a clear definition of words such as "local furnishing." The Conference opposes the present position taken by the Treasury Department in defining "local furnishing" so far as water supplies are concerned in which they apply two meanings: (1) geographic, and (2) nature and quantity of users. This applied meaning would bring about the removal of the tax exempt status of water resource development bonds and result in many projects around the Nation being delayed or canceled because of the inability of States or local political subdivisions to provide financing. This Conference believes in providing a tax exemption on interest income of all water resource development bonds which has been the historic custom of this type financing. 8. Resolution by the Federal flood control agencies of their differences in application of the Log-Pearson Type III method for determination of flood fre |