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[APPENDIX 41]

DECISION OF THE SECRETARY ON OBJECTIONS TO THE ALL-AMERICAN

CANAL CONTRACT

NOVEMBER 4, 1931

561

MEMORANDUM

THE SECRETARY OF THE INTERIOR,

Washington, D. C., November 4, 1931.

On October 3 there was submitted to me for approval as to form, a draft of proposed contract between the Imperial Irrigation District of California and the United States for repayment of the cost of the AllAmerican Canal authorized by the Boulder Canyon project act (act of December 21, 1928, C. 42; 45 Stat. 1057). In general, this draft provides for the construction on American soil of a diversion dam ("Imperial Dam") across the Colorado River above the present Laguna Dam, and a main canal of 15,000 second-feet capacity from Imperial Dam to Siphon Drop, at which point up to 2,000 second-feet are to be diverted into the Yuma Main Canal and conveyed by siphon under the river for Yuma project in Arizona; construction of a section of 13,000 second-feet capacity down to Pilot Knob, California, where the canal turns westward with a capacity of 10,000 second-feet into Imperial and Coachella Valleys (after dropping the surplus back into the river at Pilot Knob, where the district plans to build a power plant). The main canal branches into two parts when it has crossed the sand hills, one branch connecting with the present Imperial canal system and the other passing through Coachella Valley to the north for the irrigation of that valley. Both valleys are below sea level and drain into the inland Salton Sea. The construction is to be accomplished by the Reclamation Bureau of the Interior Department at a total cost not to exceed the authorization of the act, $38,500,000, which the district is to repay in not more than 40 years after completion, commencing with installments of 1 per cent annually for 5 years, 2 per cent annually for the next 10, and 3 per cent annually for the next 25 years. As required by the act, the construction money is interest free, but delinquency penalties are provided. Merger of all lands into one district is required, resulting in a merger of the Imperial Irrigation District and Coachella Valley County Water District into an enlarged Imperial Irrigation District for the purposes of this contract. The obligation will be that of the district, regardless of default of individual landowners in their payments to the district. A large area of public lands is required to be included. On completion of the works, the district will assume operation and maintenance, but the United States may resume operation of Imperial Dam in its discretion and may resume operation of all works, in the event of breach by the district of the contract provisions. The district undertakes to carry Yuma project's water to Siphon Drop, where, because of the increased elevation of Imperial Dam over Laguna Dam, an increased power drop is accorded Yuma free of charge. Although Imperial will not use Laguna Dam, it will continue to pay, under its contract of 1918, $1,600,000 toward the cost of that dam. About half that sum has already been paid. The district agrees to save the United States harmless against all claims for damages.

The United States reserves the right to enlarge the canal, prior to completion, to carry water for other contractors, subject to the Colorado River compact. The United States agrees to deliver water

from Hoover Dam in sufficient quantities to make the total available for district diversions for its own use correspond to the water allocation recommended by the State division of water resources, as per agreement among the allottees of August 18, 1931. Power possibilities, as required by the act, are reserved for the United States down to and including Siphon Drop, and for the district from that point on. The district's power development will be apart from this contract, but all net power profits will be paid the United States for credit on the district's annual obligation. The United States will measure water diversions and uses wherever advisable. Water deliveries to the district may be refused or reduced pro tanto in case of default. Title to all works will remain in the United States until paid for, when, in the Secretary's discretion, title to works beyond Siphon Drop may be transferred to the district. Construction is made contingent on appropriations.

This contract, after approval as to form by the Secretary, does not become effective until executed by the district and the Secretary, ratified by a vote of the district's electors under the laws of California, confirmed by a court decree and until certain public lands are included in the district.

Upon submission of the contract to me I set October 22 as a date for public hearing on any objections or protests, and notified all parties who had expressed an interest. Among those notified were the Palo Verde irrigation district, the Yuma County Water Users' Association, First Yuma Mesa Unit Holders' Association, Water Rights Protective Association, Coachella Valley Landowners' Association, the county of San Diego, city of San Diego, the Imperial irrigation district, Coachella Valley county water district, and several individuals who had written, including F. W. Greer and J. C. Allison. All of those replied, some filing briefs and letters, and letters were also filed by Charles N. Stahl, S. S. M. Jennings, and Fred L. Brainerd. Numerous individual indorsements need not be tabulated here. Palo Verde irrigation district, Imperial irrigation district, and Coachella Valley county water district were personally represented.

I have given careful consideration to all of the objections made, the most important of which are discussed below. The protests will be discussed separately.

SAN DIEGO

The city of San Diego and the county of San Diego have advised. that they have no objections.

COACHELLA VALLEY LANDOWNERS' ASSOCIATION

The chief objection of this association is the proposed combination of the Imperial and Coachella Valleys in one contract, the inclusion of new lands, and the apprehension that 10,000 second-feet of water will be insufficient to irrigate the 1,000,000 acres of land ultimately proposed. This association admits that Colorado River water is indispensable to Coachella Valley's further and complete development. It is generally agreed that the Coachella Valley would be unable to finance or furnish security for construction of a separate canal from the Colorado River. If water from this river is to be secured, the only feasible plan appears to be the construction of a

joint canal along the lines of the present contract. The water allocated (which, by the way, is not 10,000 second-feet, as stated) is regarded as sufficient for the irrigation of all land to be included in the Imperial district when its boundaries are extended to include Coachella Valley and other lands.

Postponement until further soil surveys and economic studies are made, as suggested by the association, seems unnecessary and inadvisable. Soil surveys heretofore made and the economic studies conducted are regarded as fully adequate to justify proceeding along the lines contemplated. Some other objections made by this organization are discussed under the next heading.

WATER RIGHTS PROTECTIVE ASSOCIATION

This association also wishes separate contracts for the Imperial and Coachella Valleys and objects to the lands of the present district being obligated for the new lands' share of the cost of canal construction and power development.

Unified control is regarded as desirable, both from the standpoint of the Government and that of the landowners. General liability is a requirement of the reclamation law and practice. Segregation of costs between the various units provided by the contract is considered fair and reasonable. Under this arrangement there is no reason to apprehend that any undue hardship will be worked upon any given area. It is legally feasible for such adjustment to be carried out. This is largely an internal matter which should be adjusted by the landowners themselves through the district organization.

The association desires an allocation of water greatly in excess of any that could be made and leave water available for other California interests which can not be ignored. The allocation embodied in the contract is in accordance with the recommendation of the Chief of the Division of Water Resources of the State of California, who made an investigation and submitted findings at my request, and is adopted as being fair and equitable to all concerned. The allocation made to the district is regarded as sufficient for its legitimate requirements.

As to the economic objections made by the Protective Association and the Coachella Valley Landowners' Association, it should be pointed out here that the maximum annual payment to the United States (commencing 15 years after construction is completed) will be 3 per cent of $38,500,000, or $1,155,000, assuming that the project costs the maximum authorized. As the district now has assessment-paying land in excess of 450,000 acres, the maximum per acre annual charge would be less than $3, even if no new lands are added. Actually, an ultimate acreage of about 1,000,000 is expected. As to Coachella, the måtter is one of necessity in view of the area's dependence on pumping from a rapidly falling water plane. Imperial also faces a necessity which can not be reckoned solely in terms of cost. It is under court injunction to remove its temporary diversion works, and permanent works to replace them will run into many millions. Further, a silt-removal cost in excess of $500,000 annually to the district and in a probably larger amount to the individual farmer will be materially lessened when Hoover Dam's desilting effect comes into operation.

Entirely aside from power revenue, savings in silt costs, savings from the alternative requirement of new diversion works, elimination

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