STATEMENT OF SOUTHERN PACIFIC CO. AND SOUTHERN PACIFIC LAND CO. WITH RESPECT TO ITS HOLDINGS IN THE SAN LUIS UNIT OF THE CENTRAL VALLEY PROJECT The subject of this statement is future irrigation water development in the San Joaquin Valley and, in particular, the Feather River project and proposed San Luis unit of the Central Valley project as they affect our landholdings. Southern Pacific Co. owns about 65,000 acres within Westlands Water District in Fresno and Fings Counties, and an additional 55,000 acres outside of (westerly and above) said district but within the so-called San Luis service area. The company also owns about 30,000 acres in southern Kings and Kern Counties which might be served by the Feather River project. These lands are not being offered for sale, but are being held for long-range management purposes. Nearly all of the land is under agricultural-development leases varying in size from less than 1 section to about 30,000 acres. The area in which our above-mentioned 120,000 acres are situated has been in agricultural production from irrigation wells for a considerable period of time. We are of the opinion that the acreage and other restrictions of the Federal reclamation laws should not, and probably were not intended by Congress to apply to areas of going agricultural economy which need supplemental irrigation water. We now favor State or local development and control of water resources, but welcome Federal aid provided the conditions thereof are reasonable and bearable. Further, we neither seek nor expect any Federal subsidy in the form of 40-year interest-free money, but are willing to pay our fair share of the irrigation benefits provided the capital and operating costs are such that the land and crops can afford same. We are progressive and we are anxious to see steps taken to preserve and increase the economic welfare. We will expect to cooperate in any equitable and reasonable water program. If it is determined that the Federal Government, rather than the State or a partnership or both, shall undertake this project we will wish to cooperate. However, there appear to be present serious inequities in the reclamation law. In connection with present regulations dealing with Bureau of Reclamation recordable contracts, it is our understanding that the landowner may not participate in the land appraisal. This seems unreasonable. Another unreasonable feature is, we believe, the lack of provision for price adjustments over the years (many years may be required to sell landholdings such as ours) to account for inflation and other economic factors not directly related to surface water availability. There is, of course, no existing contract between the Bureau of Reclamation and Westlands Water District. As the terms of such a future contract are unknown, we have no present basis for judging how much interest cost our lands would need bear in order to be free of reclamation law restrictions and what the water would cost. We would like to sit down with people in the Bureau of Reclamation to see if figures could be developed relative to paying our way and retaining our land free of Federal restrictions. Also it would be interesting to us to learn how the sale of the tremendous acreage of excess lands would be handled in a case like this and whether the landowners would be required under recordable contracts to conduct active sale campaigns. If a Federal program is decided upon at San Luis, we will wish to cooperate and trust that the terms provided for will be equitable. Senator KUCHEL. Thank you, gentlemen, very, very much. Mr. PETERSON. We appreciate the privilege of testifying. (Thereupon, at 12: 55, the committee was recessed, to reconvene subject to the call of the Chair.) |