WAR DEPARTMENT CIVIL FUNCTIONS APPROPRIATION BILL, 1941 THURSDAY, MARCH 21, 1940 UNITED STATES SENATE, SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS, Washington, D. C. The subcommittee met, pursuant to adjournment, at 10:30 a. m., in the hearing room, Capitol, Hon. Elmer Thomas (chairman), presiding. Present: Senators Thomas (chairman), Hayden, Adams, Maloney, Chavez, Townsend, and McNary. Present also: Senators Holman, Bone, and Miller. The subcommittee had under consideration the bill (H. R. 8668) making appropriations for the fiscal year ending June 30, 1941 for civil functions administered by the War Department, and for other purposes. Senator THOMAS. The committee will be in order. We have a number of Members of the Senate and House who want to be heard before the hearings are closed, and we will try to accommodate the Members just as fast as we can. Senator Holman has been on the list for quite a while, and at this time we will hear you, Senator. BONNEVILLE DAM, COLUMBIA RIVER, OREG. STATEMENT OF HON. RUFUS C. HOLMAN, A UNITED STATES SENATOR FROM THE STATE OF OREGON AMENDMENT REQUESTED Senator HOLMAN. Mr. Chairman and members of the committee. I am requesting that on page 10, line 11, of the committee print, the lines which correspond to 16, 17, and 18 be stricken from the bill. They read, "$800,000, no part of which shall be available for obligation for any expense incident to the installation of more than six electrical power units", and substitute therefor the figure "$3,400,000.” This is a plea for the continuance without interruption or waste of a recovery project-a project which is stimulating industry and relieving unemployment in the Pacific Northwest and to that extent obviating the necessity for the continued appropriation of relief funds. The Bonneville generating plant was laid out on a river flow basis that would require the ultimate installation of 10 units aggregating an installed capacity of 518,400 kilowatts. CONSTRUCTION PROCESS LAID OUT IN FIVE STEPS To economically develop the plant, the construction process was laid out in five steps. The first step involved building of the dam, the reservoir, the fishways, the locks, foundations, and superstructure for four units and 169 the installation of the two initial units, totalling 86,400 kilowatts. This first step has been completed and the two units are in operation. The second step requires the completion of the power house superstructure for units 3, 4, 5, and 6, and the manufacture and installation of units 3 and 4 with auxiliaries and the speed ring for units 5 and 6, which is a part of the foundation work. The second step will be completed in April 1941. Funds for the completion of this step were carried in the War Department Civil Appropriations Act of 1939. Step No. 3 covers the manufacture and erection of water wheels, generators, and auxiliaries for units 5 and 6. The first session of the Seventy-sixth Congress appropriated $7,000,000 which remains available until expended, for completing the second step and the largest part of the third step of the construction schedule. AMOUNT CARRIED IN BILL FOR 1941 AND PROPOSED USE OF FUNDS The budget for 1941 carried $800,000, which is estimated will complete the third step and place units 5 and 6 in operation. This is the amount contained in the pending bill. It is estimated at this time that units 5 and 6 will be in operation not later than June 1942 and units 3 and 4, April 1, 1941. Step 4 covers the powerhouse structure and foundations for units 7, 8, 9, and 10, and the complete installation of wheels and generators for units 7 and 8. Step 5 would complete the ultimate development with the complete installation of units 9 and 10. The following indicates the amount of power capacity available at the completion of each of the 5 steps I have stated: Step No. 1 (completed). Step No. 2 (completed April 1941). Step No. 3 (completed June 1942). Step No. 4 (completion date dependent upon appropriations) As previously noted, funds already appropriated plus the $800,000 in this year's budget will complete the six units through step No. 3. NO FUNDS IN BILL FOR UNITS 7-10, INCLUSIVE No funds are provided in this year's budget for any part of the work involved in steps 4 and 5-namely, units 7, 8, 9, and 10. If funds are provided to initiate work on units 7 to 10, inclusive, units 7 and 8 will be completed in June 1943, and units 9 and 10 will be completed in June 1944. AMOUNT THAT CAN BE PROFITABLY EXPENDED, FISCAL YEAR 1941 The present estimated cost to complete units 7 and 10, inclusive, is approximately $15,000,000. The Annual Report of the Chief of Engineers for 1939 shows that $7,089,200 of this amount could be profitably expended for power facilities during the fiscal year 1941. A break-down of these expenditures is submitted for the record. I will hand that to the clerk. (Exhibit A reads as follows:) EXHIBIT A Purchase and install machine-shop equipment, electrical laboratory testing equipment, enlarge toolroom and machine shop; miscellaneous construction, by hired labor.. Powerhouse structure for power units Nos. 3 to 6, inclusive; power units Nos. 3 and 4 complete with auxiliaries; embedded parts for power units Nos. 5 and 6: Paint interior of powerhouse and install main-generator-room tile by contract and hired labor... $25, 400 Complete installation of air, oil, and water piping; miscellaneous mechanical work, by hired labor. Complete installation of two 74,000-horsepower turbines by hired Complete manufacture and installation of two 60,000-kilovolt- Power units Nos. 5 and 6 complete with auxiliaries: Commence installation of two 74,000-horsepower turbines by Purchase and install intake gates by contract and hired labor.. Purchase and install CO2 equipment, air, oil, and water piping, trash sluice gates and stop logs, and other miscellaneous mechanical equipment, by hired labor. Manufacture of three 40,000-kilovolt-ampere transformers, by contract... Purchase and install bus structure, disconnect switches, breaker, and lightning arresters for 230-kilovolt system, by contract and hired labor___ Purchase and install breakers, busses, etc., for 15-kilovolt system by contract and hired labor. Complete purchase and installation of main unit switchboards and control system by hired labor. Miscellaneous electrical purchases and installations by hired labor... Commence manufacture of two 74,000-horsepower turbines with Continue construction of substructure and superstructure by Total. 41, 850 28, 900 24, 150 203, 750 57, 200 12, 800 61, 150 630, 750 650, 000 73, 500 147, 000 65, 0 318, 700 106, 050 162, 750 44, 750 21, 000 1, 000, 000 1, 000, 000 2, 414, 500 7,089, 200 EFFECT OF REDUCING FUNDS Senator HOLMAN. This schedule of construction was designed by the Army engineers to effect the most economical and businesslike completion of the existing project. Any curtailment in the funds necessary to carry out this schedule will inevitably result in materially increasing the ultimate cost of the project due to loss of efficiency and then ecessity for shifting engineering units back and forth. An accurate estimate of this loss to the Government cannot be made as it will depend entirely upon appropriations made by the Congress. I am confident, however, that the minimum loss under the terms of the bill now before this subcommittee would be $200,000-the loss could very easily run over $500,000. In addition to loss occasioned by interrupting the construction program, there will be a very serious loss due to the fact that it will be necessary to take units 5 and 6 out of operation in order to construct the foundations for units 7 to 10, due to the fact that it will be necessary to construct a cofferdam in connection with installing these foundations. By all rules of logic and businesslike procedure these foundations should be installed at the same time units 5 and 6 are being completed. If this procedure is not followed the Government will suffer a large loss in revenue from units 5 and 6. These two units will have a capacity of 108,000 kilowatts, which, if sold on a firm basis of $17.50 per kilowatt-year, represents $1,890,000 in revenue for the Federal Government. No accurate estimate is available as to the length of time these two units would have to be shut down, but at best it would be several months, and the loss in revenue would be a very substantial amount. In addition to this, however, what is far more serious is the fact that the Bonneville Power Administration would have its hands tied with respect to sale of power from these units until the foundations of the remaining units are installed and units 5 and 6 are in permanent operation. The reason for this is that any industry desiring to locate in the Pacific Northwest and utilize Bonneville power must of necessity have a guaranty of the delivery without interruption of the amount of power contracted for. This would obviously be impossible as long as the units will have to be taken out of operation whenever the Congress decides to appropriate funds for the completion of the project. NECESSITY FOR INSTALLATION OF FOUR REMAINING GENERATORS In January the Secretary of the Interior wrote to the Secretary of War and indicated the necessity for going ahead with the installation of the remaining four generators. (See p. 223 House hearing Interior appropriation bill, 1941.) He pointed out in his letter that by 1942 there would be a demand for primary power to the extent of 231,920 kilowatts, which is 37,520 kilowatts in excess of the dependable power which will be available at Bonneville if we maintain the reduced appropriation and restrictive language contained in the pending bill as it passed the House. In order to give the committee the details of this estimate I submit a break-down prepared by the Bonneville Power Administration. (Exhibit B referred to above reads as follows:) EXHIBIT B.-The Bonneville project -Summary of estimated primary power demands status as of Dec. 31, 1939 Public utility districts (excluding Rural Electrification Administration): Skamania 2. Senator HOLMAN. I also submit for the record a statement prepared by the Administration which shows that to date a total of 121 applications for primary power have been received, totaling 657,614 kilowatts, which is considerably in excess of the ultimate capacity of the plant-518,400 kilowatts. I submit exhibit C to demonstrate the details. |