This represents a ratio of one business place closing its doors for every six farms that have had to close up shop and move into the cities. You know as well as I do that when these farmers leave the land and these businessmen close their doors, there is only one place for them to go where opportunity is. And thus far the opportunities have been in the urban areas, so they have left the land and moved into the cities. And when these people have moved into the cities-now, I am not saying that our farmers go in there and they go on the welfare rolls. We feel that our farmers with the technical knowledge that they have gained over the years in farming, they have an asset that is valuable to any industry, this technical knowledge that they have. And they are skilled in so many of the various fields. So they go in there and they take jobs that would probably be held by a lesser skilled person that has been living in the city, maybe in some cases the Negro, in other cases it is the white. And these are the people that are pushed into the ghettos and the slums of the cities and are committing, I think, the riots and the disturbances that erupted this past summer. So indirectly, the mass migration of our farmers and our rural businessmen to the cities caused the riots that occurred this past summer in the cities. And the situation is going to get worse if we do not rectify it. And I feel that the Oahe project would rectify both problems. Now, the Bureau of Reclamation report contends that completion of the first phase would add 500 more farms and 1,700 more farm people to South Dakota. In addition, it claims that another 12,300 people would find new opportunities in farm service businesses, new basic agricultural industries and other services and activities. So it seems only logical that we should go ahead and develop our rural areas to open the gates to new industries, higher income and more employment opportunities to stem this present trend of migration into the urban centers. Skipping along, I would like to say to whatever extend irrigation strengthens the farm economy of South Dakota, the nonfarm economy would benefit from increased farm spending, because the farmers are going to spend these dollars. They have got a lot of improvements to make on the farms. There is going to be new machinery. And the Bureau of Reclamation report once again estimates that business activity could increase by more than $71 million. And this increased income is also going to mean a bigger tax take for State and Federal governments, a boost of some $6 million in tax revenue. And we also feel that while the project is underway it is going to mean a boost in expansion for the State, because we are going to need construction workers and workers to level the land, and help repair the feeder canals, and drainage ditches. All these things will produce new jobs for people in the State. So when the project is completed, with some of our farmers, if the work is feasible, if they can shift to vegetable crops, sugar beets or other crops of this nature, some of these perishable crops are going to require some processing. So consequently the shift in agricultural economy brought about by irrigation could produce a variety of new jobs in the fields of processing and transportation of new commodities. In summing up, just let me say that the potential gain for the South Dakota farmer would be on two fronts. First, the direct dollar boost to the agricultural producer, and the second advantage to farmers which would accrue from increased industry and job prospects in our State, all of which will tend to upgrade our economy and enhance farm income. In view of South Dakota Farmers Union members, the potential for economic and social benefits inherent in the Oahe unit far outweigh the costs. We therefore sincerely urge your favorable consideration of H.R. 27 and H. R. 1163 and that the Congressmen on this committee take whatever steps necessary and practical toward expediting the authorization and eventual completion of this project. Thank you for giving me the opportunity to speak before you. (The prepared statement of Mr. Ricci follows:) STATEMENT OF RICHARD L. RICCI, DIRECTOR OF PUBLIC RELATIONS, SOUTH DAKOTA FARMERS UNION My name is Richard Ricci and I am Director of Public Relations for the South Dakota Farmers Union, an organization of more than 14,000 farm families and the largest farm_group in our state. At the outset I would like to emphasize that the South Dakota Farmers Union is in full support of efforts to bring the Oahe Project to completion. This is a matter of record in our 1966-67 program of policy and action and also in our new policy program for 1967-68, adopted by delegates to our 52nd state convention held earlier this month. The wording in the adopted program is as follows: "Because the Oahe Irrigation Project has been found feasible and would bring great benefit to the economy of South Dakota, we urge immediate action by the Administration and Congress for the authorization and appropriation of funds to initiate this project." The Bureau of Reclamation report, which was completed after more than 15 years of investigation and study, shows that the Oahe unit is both a sound investment for the federal government and an economic necessity for the future water resource development of South Dakota. Last month we were especially heartened when the Bureau of the Budget approved the Department of Interior's favorable report on the Oahe unit because it brought the project one step nearer to reality. We were disappointed however that the Budget Bureau refused to go along with preconstruction costs in the main canal. As originally planned, the pumps and the main canal would have been constructed so as to eventually supply the entire 495,000 acre project. The Budget Bureau report however calls for holding capacity in the canal and foundations at pumping stations to take care of only the first stage project to irrigate 190,000 acres. Our organization feels that this project has been delayed too long already and every effort should be made to expedite bringing it to its conclusion to fulfill a promise made 20 years ago when our farmers and ranchers gave up farmland for the flood control reservoirs which benefit the entire Missouri River Basin. With the aid of this committee I am confident we can continue this project to its conclusion. It goes without saying that not all of our members will share directly in the benefits of the Oahe Project, but indirect benefits will also accrue to farmers outside the irrigable area. In a limited rainfall area such as ours, along with our total dependence on adequate feed supplies to carry our livestock operations, the certainty of water in the area insures plentiful amounts of forage and feed being available to surrounding area farmers and ranchers. Eventual completion of this project, together with the installation of irrigation systems on many acres of our South Dakota farmland, carries a tremendous potential for improvement in the farm sector of the economy. Farmers Union is very hopeful that the Oahe unit, when completed, will provide an answer to our state's diminishing farm population and provide an upward stimulus to a declining farm prosperity. Our organization, for many years, has been fighting diligently in an effort to halt the exodus of farmers from the land. This also becomes the immediate problem of our towns and small businessmen because according to the latest farm census, South Dakota lost 6,000 farms during the 1959-1964 period for an average of 1,200 per year. In a like period 1958-1963, as docmented by the 1963 Census of Business by the U.S. Department of Commerce, our state suffered a net loss of 1,101 retail business establishments. This represents a ratio of one business place closing its doors for every six farms that disappeared. I am sure this committee also recognizes the impact this exodus of farmers from the land has on our nation's metropolitan areas. I feel that indirectly part of the blame for this summer's unrest in our cities can be placed on the mass migration to the cities over the years of thousands of family farmers, displaced because of inadequate farm income. The Oahe Project could well be a step in the right direction toward rectifying both problems. According to the Bureau of Reclamation Supplemental Report on this first stage of the Oahe unit, completion of this phase would add 500 more farms and 1,700 more farm people. In addition, another 12,300 people would find new opportunity in farm service businesses, new basic agricultural industries, and other services and activities. It seems only logical to develop our rural areas to open the gates to new industries, higher income, and more employment opportunities to stem the present trend of migrating into our metropolitan centers. According to the Bureau report, the Oahe unit will result in a total estimated population boost for South Dakota of 14,000 persons. The Bureau report also estimates that development of this first stage alone will bring in nearly $31.5 million dollars in new wages, profits and investment earnings. It estimates gross farm income will increase by $30 million. And, certainly, to whatever extent irrigation strengthens the farm economy of South Dakota, the non-farm economy will benefit from increased farm spending. This investigative report by the Bureau indicates that business activity could increase by more than $71 million, and this increased income is going to mean a bigger tax take for state and federal governments-a boost in tax revenue of some $6 million. When the construction of this needed project gets underway there also will be some increase in job opportunities for construction workers, plus the workers that will no doubt be hired to aid in leveling land, helping prepare feeder canals and drainage ditches on individual farms. All of this activity will produce new jobs for non-farm people in South Dakota. It is our hope, given proper economic planning by our own South Dakota leaders, that these job opportunities can continue to grow after construction is completed. If farmers in the potential irrigation area should shift to vegetable crops, sugarbeets or products of that nature, the more perishable crops will require some processing in the communities where they are grown. Thus the shift in the agricultural economy brought about by irrigation could produce a variety of new jobs in the field of processing, storing and transportation of new commodities. Farmers Union, as well as other citizens, is also interested in the potential this project offers for developing our hunting and fishing in South Dakota, thus injecting new lifeblood into our tourist industry which brings about an increased local demand for farm produce as well as increasing the number of service jobs connected with tourism. In summing up, just let me say that the potential gain for the South Dakota farmer would be on two fronts. First, the direct dollar boost to the agricultural producer and the secondary advantage to farmers which would accrue from increased industry and job prospects in our state, all of which will tend to upgrade our economy and enhance farm income. In view of South Dakota Farmers Union members, the potential for economic and social benefits inherent in the Oahe unit far outweigh the estimated costs. We therefore sincerely urge your favorable consideration of H.R. 27 and H.R. 1163 and that the Congressmen on this committee take whatever steps necessary and practical toward expediting the authorization and eventual completion of this project. Thank you for giving me this opportunity to express these views. Mr. JOHNSON. I want to thank you, Mr. Ricci, for your statement and your summary. Are there any questions from any members of the committee? Mr. SAYLOR. Mr. Ricci, I want to commend you on your statement, but I would like to call your attention to the fact that this committee has been responsible for the Bureau of Reclamation taking a real good look at some of the projects which were tentatively authorized in bygone days when they made large surveys. We found some of those surveys that were put out in the first instance were not very good. One of the things we found was that a lot of land they included was not suitable for irrigation. This is probably one of the reasons that the project has been cut now from its initial stage from the almost 500,000 acres to 190. And as this project is developed, the land comes into cultivation, the Bureau will then be in a position to take a look at the remaining land area and determine whether or not they were right in the first instance. Mr. RICCI. Very good. Thank you. Mr. JOHNSON. We thank you, Mr. Ricci. Our next witness will be Mr. Randall Mercer, a farmer from Hughes County, S. Dak. STATEMENT OF RANDALL MERCER, FARMER, HUGHES COUNTY Mr. MERCER. Mr, Chairman, committee, I am honored to be here. My name is Randall Mercer. I live at Blunt, S. Dak., and I am a landowner and irrigator in Hughes County. I know from experience that irrigation will stabilize the farming industry in Hughes County. At a meeting in Blunt, last April 6, of landowners along the Pierre Canal, approximately 60 farmers having over 7,000 acres of irrigable land expressed their desire to irrigate from the Pierre Canal. Hughes County has lost 33,933 acres of land to the Oahe and Big Bend Dams and will lose another 1,035 acres to the Pierre Canal. Irrigation development can compensate some of this loss of land and tax base. I am in support of House bills H.R. 27 and H.R. 1163 and urge Congress to approve authorization of the Oahe project. Thank you. Mr. JOHNSON. We want to thank you, Mr. Mercer. Mr. SAYLOR. Mr. Mercer, you are one of the farmers who is referred to as living in this area who would take water if it was made available to you? Mr. MERCER. That is right. Mr. SAYLOR. And these other farmers that you refer to are in that same class? Mr. MERCER. That is right. Mr. SAYLOR. Thank you, sir. Mr. JOHNSON. Our next witness is Mr. Roy Terwilliger, executive secretary, South Dakota Bankers Association. STATEMENT OF ROY W. TERWILLIGER, EXECUTIVE SECRETARYTREASURER, SOUTH DAKOTA BANKERS ASSOCIATION Mr. TERWILLIGER. Thank you, Mr. Chairman and members of the subcommittee. My name is Roy Terwilliger and I am executive secretary-treasurer of the South Dakota Bankers Association which is the organization in South Dakota for all banks, both State and National. I appear today to express the complete support for the Oahe irrigation project by the banking industry of South Dakota. As the principal supplier of agricultural credit in South Dakota, the commercial banking industry is well aware of the need in our State for the stabilization of cash farm income. With more and larger amounts of capital needed each and every year to run our Nation's farms, our farmers must receive a better return on their investment to continue to fulfill the needs of America and the world. Because of crop diversification and stabilization of production, the Oahe irrigation project will afford more stability of income to the farmer and will help to assure him of a more normal return on his investment. The Oahe project will benefit the economy of the entire State of South Dakota, the upper Midwest, and the United States with the future development of agriculture and industry and is of prime importance to our future generations. At our convention in May this year, 1967, a resolution was adopted supporting the Oahe project. A copy of that resolution is attached for your perusal. The banking industry stands completely behind the Oahe project and we thank you for this opportunity to urge your favorable consideration on H.R. 27 and H.R. 1163. Mr. JOHNSON. The resolution, Mr. Terwilliger, will be made a part of the record Mr. TERWILLIGER. Thank you, sir. Mr. JOHNSON (Continuing). Following your statement. Are there any questions of Mr. Terwilliger? Mr. SAYLOR. One question that has nothing to do with this. I am just trying to find out how progressive your banks are. Congress is considering an act to authorize the licensing in the 50 States of the Union of mutual savings banks. Is your organization in favor of it? Mr. TERWILLIGER. Our organization has not taken a formal position on this. However, we do subscribe to the testimony previously submitted by the chairman of the American Bankers Association before the House committee a week and a half ago which states that there are certain reservations by the banking industry in the country on a series of, or should I say another system of banking. Mr. SAYLOR. Let me say to you folks who do not know about it that there has never been a mutual savings bank that has failed in the history of the country. That is more than the commercial State and National banks can claim. I happen to come from one of the areas that has mutual savings banks and I am very much in favor of them. Mr. TERWILLIGER. We have no mutual savings banks in this area. There is one in Minneapolis, which is the closest one. Mr. EDMONDSON. Mr. Chairman, I would just like to say I am glad to see that the bankers association of the State is supporting this, and I hope you will do a little missionary work with your American Bankers Association to see that they adopt a little broader view of irrigation, reclamation, flood control, and some of these other national resource development programs. There is kind of a tendency when you get into the national organizations to label them as "pork barrel" projects and programs and not to look at it from the standpoint of the need to develop these resources locally. Mr. TERWILLIGER. Yes, sir; I certainly will. Thank you. |