22. Was any effort' made to get the Bureau of Reclamation to complete the investigation they had started?

According to the local newspaper, I understand that officers of MEA are willing to answer questions about the operation of MEA.

I have some questions which relate to the operation of MEA and the relationship between MEA and Central Alaska Power Association.

I assume that these organizations are separate and distinct, and, had not MEA funds been loaned to Central Alaska Power, I would have no right to expect an answer to these questions.

The facts as I see them are that the loans made by MEA to Central Alaska Power are totally unsecured. MEA members and its board of directors have or should have more than a passing interest in Central Alaska Power.

I wish to repeat my position on my vote at the last special meeting. I voted against loaning additional funds to Central Alaska Power because I was advised by its officers they had no budget for expenditures made or to be made. Mr. Coombs asked for an accounting of money already spent. This was refused because an audit would cost $1,000. A simple statement of receipts and disbursements would have been acceptable. It was not forthcoming.

After having had an opportunity to consider this matter more fully and to consider the desires of the people I represent in this organization, I am convinced that an open discussion of all phases of these transactions involving MEA funds is in order.

I want to take this opportunity to say I do not oppose the publicly expressed aim of Central Alaska Power Association, that of increasing the supply of cheap electric power for central Alaska. I do question the desirability of carrying on operations of any kind for any purpose in such a way as to cast reflections on this organization.

I am not sure that the people opposed to CAPA are opposed to the aims of CAPA as expressed in their news releases, but are, as I am, opposed to the methods being used. I think the questions I have set down should be answered publicly in detail.

I believe most of you have seen the newspaper treatment we are getting. I, for one, want to know what is back of these stories and insinuations. I do not think we should try to laugh them off.

If MEA is going into the power generating business or, with the debt we have, are going into the business of loaning money without interest and without security, all of its stockholders have a right to know it.

Mrs. Prost. Mr. Chairman, I have here a report from Mr. R. T. Blue, the Extension Service agent at Palmer, which gives the price of clearing land. I think it would be very pertinent information to follow at the end of the agricultural testimony here, and I ask unanimous consent that it be inserted in the record.

Mr. O'BRIEN. Without objection, it is so ordered.

Mrs. PFOST. And, Mr. Chairman, I have here a statement from V. Louise Kellogg, who is a dairy farmer, and I would ask that it be inserted in the record at this point.

Mr. O'BRIEN. Without objection, it is so ordered. (The documents referred to follow :)

SPRING CREEK DAIRY FARM, PALMER, ALASKA, September 24, 1955.

My name is V. Louise Kellogg. I am a dairy farmer. I have lived in the Matanuska Valley since 1948.

I respectfully request an adjustment downward in the number of moose each farmer is required to support for the benefit of sportsmen. This request is based on the following reasons:

(1) Damage to growing crops. Moose have learned to enjoy grazing on pasture grasses and grain.

(2) Damage to harvested crops left drying in the field.

(3) Damage to fruit trees and young trees planted for windbreaks.

(4) Damage to cows. Moose frighten them so that they jump fences and injure themselves.

(5) Damage to fences.

(6) Potential hazard to children walking to and from school bus. One moose treed not only a child, but the mother also who came to see what was delaying the child.

Respectfully,

V. LOUISE KELLOGG.

DATA FROM R. T. BLUE, EXTENSION SERVICE AGENT AT PALMER, JULY 1952

Land clearing costs are rather hard to pin down. The native vegetation, techniques of clearing, and time of clearing all vary and interact to confuse the picture. However, here are eight samples representing various types of vegetation. You can probably make some interesting observations, but draw few conclusions.

Kellogg :

Cover: Standing birch of fair size.

Method of clearing: Dozing into windrows, burning, then dozing again and burning.

No breakdown figures kept but estimated $175 per acre from forest to crop 11⁄2 to 2 years.

Thuma:

Cover: Light and heavy birch.

Total estimated cost $200 per acre, 11⁄2 years before crop.

Hoffman:

Bulldozed after ground thawed. Reports that this materially assisted in root removal.

Cover: Spruce and birch, fairly heavy.

Dozing, $105.

Breaking, $15.

Disking, $7.50.

Root picking, 8 man-days per acre.

Peas and oats: Fertilizer would give crop first year if released in early spring.

LeVan (Kink area):

Cover: Light birch, heavy birch, cottonwood.

Dozing, $100.

Root picking: No estimate but probably very high because land stripped in winter and most roots left in site.

Breaking and fitting not completed but land roughed up and sown to cover crops, 2 to 3 years into crops.

Tatre (Chugiak area):

Cover: Light birch, dozing, $80.

Roots picked and broke, $10 (probably low estimate).

Crop the first year, usually a hay crop of peas and oats.

Hanks:

Mr. O'BRIEN. The Chair is intrigued by one sentence that I notice :

I respectfully request an adjustment downward in the number of moose each farmer is required to support for the benefit of sportsmen.

Miss Kellogg, I think that is a very pertinent question, and your letter will be included in the record.

Mr. TAYLOR. Mr. R. A. Bauer asked to be heard concerning rural telephones.

STATEMENT OF R. A. BAUER, CONSULTING ENGINEER, MATANUSKA TELEPHONE ASSOCIATION, PALMER, ALASKA

Mr. BAUER. I just want to submit a short statement for record purposes of some information on the civilian aspects of the telephone situation in Alaska.

Mr. O'BRIEN. Would you identify your connection?

Mr. BAUER. I am consulting engineer to the Matanuska Telephone Association. I am R. A. Bauer. I have had numerous contacts with various people who are trying to improve civilian telephone communications.

Of particular concern at this time, not related directly to Palmer, but to rural telephones, is the situation which I wish the committee could look into down in Sitka. The telephone company down there had some assurances from REA they could secure a loan to expand and improve, modernize their telephone company if the native-service switchboard at Japomski Island could be acquired by the company. I don't know just how familiar you are with the situation. It is a case where a Government agency has existing facilities which they feel is necessary for their own use, but they find, of course, it impossible to expand their facilities and serve adjacent civilian communities, which is the situation generally throughout Alaska where we have Government agencies. But the situation is occurring where they are unable to secure finances. For that purpose, if the committee can investigate further, I will appreciate it.

Mr. O'BRIEN. I do not know, sir, how much power the committee may have to act, but I assure you we have very extensive power to ask questions, some of which are productive and some of which are

not.

Mr. BAUER. Thank you very much.

Mr. TAYLOR. Does your telephone company here have any connection with Army Signal Corps?

Mr. BAUER. It only is a connecting company. They provide the long-line service.

Mr. BARTLETT. One question. Is there a maximum size of a city so far as loans from REA are concerned?

Mr. BAUER. I believe I can answer that, inasmuch as I used to be connected with REA in Washington, to this effect: That REA's policy is restricted by law to cities with a population, I believe, of over 1,500, over 2,500, a figure in that vicinity. They can only extend beyond that in accordance with the terms of the enabling act when the outlying area expenditures are proportionately larger than the moneys they have expended.

Mr. BARTLETT. Does the same rule apply to telephone loans?
Mr. BAUER. Yes; it does.

Mr. O'BRIEN. If there are no further questions, thank you very much, Mr. Bauer.

Mr. TAYLOR. Mr. Shaw?

Mr. MICK. Mr. Shaw is not here.

Mr. TAYLOR. Mrs. Mick.

Mrs. MICK. I will submit a statement here for the city of Palmer.
Mr. O'BRIEN. Identify yourself for the record, Mrs. Mick.

STATEMENT OF LUCILLE K. MICK, COUNCILWOMAN, CITY OF
PALMER, VICE PRESIDENT, LEAGUE OF ALASKAN CITIES,
PALMER, ALASKA

Mrs. MICK. Lucille K. Mick, councilwoman from the city of Palmer. Since these questions and problems have been raised in previous testimony, I think I will just submit this for the record since they describe them merely as they apply to Palmer.

Mr. O'BRIEN. Thank you very much. Without objection, the statement will be made a part of the record at this point.

(The statement referred to follows:)

STATEMENT BY LUCILLE K. MICK, COUNCILWOMAN, CITY OF PALMER; VICE
PRESIDENT, LEAGUE OF ALASKAN CITIES

Palmer's local government problems are probably similar to those of other Alaskan communities, particularly those which are new and relatively small. Our city was incorporated May 1, 1951. Our school district, embracing the city, was incorporated in July of 1949. Before that there was no organized local government here and no local taxes.

NEED 30-YEAR AMORTIZATION ON APW LOANS

One problem we have because of our present size and because of potentialities envisoned, not only by us who live here but also by professional planning engineers, is that of building public-service facilities which will serve the community for 2 or 3 generations. In the planning stage, the size of the city is projected over a 25- or 30-year period of anticipated growth. Take our water system, for example-it was designed for a population of 15,000 and it cost accordingly. Even though we are extremely proud of and grateful for this first deep-well system in Alaska and realize the economy of planning for the future, still it is difficult for 1,000 people to pay for a system designed for 15,000 over a 20-year period. Perhaps we will achieve that growth within 20 years, but amortization costs are highest over the first years because of the interest. Most people around here consider our present water rates too high; certainly the average cost per family is double what they paid before to a private supplier whose source of supply failed to keep up with the growth of the city. Still, what with maintenance and added capital costs that could not be included in the APW contract or loan, the remaining revenues are nowhere near enough to make the yearly payment under the present amortization plan. If we had the cost amortized over a 30-year period, we believe we could do it. However APW says that these loans are limited to 20 years by congressional action.

seen.

STREETS AND ROADS; NEED FOR LOW INTEREST MONEY

We are glad that you weren't here last Sunday; yet if you had, you might have been able to understand better our problem of city streets. Approaching the city from any direction, Palmer was buried from view by an opaque layer of dust above which only the high peaks of surrounding mountains could be This is a health and safety problem as a business one. Our council felt obligated to take the one road maintenance man we can afford away from his never ending job of repairing and building up streets to watering them. Some paved streets would solve this problem, but not 1 nickel of the thousands of dollars collected here in gasoline taxes of 1 cent per gallon is returned for use of city streets. Our main street connects two so-called arterial highways. If the Alaska Road Commission could be authorized to blacktop this, it would help. I believe that through Delegate Bartlett's bill and assistance, Congress did authorize ARC to continue so-called arterial highways through cities, but Palmer was left out of the publicity listing cities that this authorization would

assist.

Also, we could do something for ourselves if we could borrow money ecenomically. On such a small budget as ours, we hesitate even to authorize expenses for someone to go outside to seek buyers. Yet, over a period of 5, 10, or 15 years, we could afford to pay for a modest street-paving program. Last year the League of Alaskan Cities adopted a resolution petitioning Congress to provide a Federal insurance program "to fully and unconditionally guarantee legally qualified general obligation and revenue municipal bonds of Alaskan cities both as to principal and interest upon the cities' agreeing to pay an annual insurance premium not to exceed one-fourth of 1 percent of the bond principal involved from year to year."

We are a member of the league, and we believe that these insured bonds could be sold even by us on a par with interest rates enjoyed by stateside cities. Such a plan might make it possible for us to make our city a decent place to live in, a place in which other people, businesses and industries would like to settle also.

PAYMENT IN LIEU OF TAXES AND ASSESSMENT

You are probably familiar with another League of Alaskan Cities resolution requesting Congress to authorize and require payment of special assessments and payment in lieu of taxes for municipal services provided Federal offices. facilities, and properties located within the cities of Alaska. Here in Palmer we have no property tax for city services--yet. We have a sales tax so our city support comes as much from Federal employees as anyone else. Still, whenever we plan improvements to the city which would be on an assessment basis, we feel frustrated from the start because of the huge percentage of street frontage occupied by Federal agencies. If these could not pay their fair share, the other properties would have to carry the additional burden. To date, we have not initiated a program calling for assessments, although we do have the preliminary engineering done on one of them. We have never approached any of the local Federal agencies to learn whether or not they could provide for their share. However, these Federal employees all live here, and we feel that they would be glad to go along with such an assessment program--if they could. As a city we believe in immediate statehood for Alaska because it would stabilize governmental operations and promote the development of Alaska and its cities.

Mr. O'BRIEN. Since the lady suggests this had been covered and applies only to the situation as it is here in Palmer, I think she would probably be satisfied, and the committee would, if we skipped the questions at this point.

Mr. TAYLOR. I understand also that Mr. Harold Dinkel, a farmer in the community, is here and would like to speak to the group. Mr. O'BRIEN. Would you come forward and identify yourself?

STATEMENT OF HAROLD C. DINKEL, MATANUSKA VALLEY, ALASKA Mr. DINKEL. Harold C. Dinkel.

Mr. O'BRIEN. And you are a farmer in this valley?

Mr. DINKEL. Yes.

Mr. O'BRIEN. Are you a homesteader, sir?

Mr. DINKEL. I was a colonist and I am a homesteader.

Mr. O'BRIEN. You came originally from where?

Mr. DINKEL. From Wyoming.

Mr. O'BRIEN. How long have you been here?

Mr. DINKEL. Nineteen years.

Mr. O'BRIEN. What, in your opinion, would be the most beneficial step for the farmers in this area or in Alaska generally that the Government could take? What do you need most?

Mr. DINKEL. We need cheap credit for one thing.

Mr. O'BRIEN. Cheap credit?

Mr. DINKEL. Yes.

Mr. O'BRIEN. I think we all at times have that need.