nass / "I 2 PRESERVATION OF NIAGARA FALLS HEARINGS BEFORE THE COMMITTEE ON FOREIGN AFFAIRS HOUSE OF REPRESEl^TATIYES JANUARY 16, 18, 19, 20, 23, 26, AND 27, 1912 ON H. R. 6746 BY MR. SMITH OF NEW YORK : A BILL TO GIVE EFFECT TO THE FIFTH ARTICLE OF THE TREATY BETWEEN THE UNITED STATES AND CANADA, SIGNED JANUARY 11, 1909 AND H. R. 7694 BY MR. SIMMONS : A BILL TO GIVE EFFECT TO THE FIFTH ARTICLE OF THE TREATY BETWEEN THE UNITED STATES AND GREAT BRITAIN, SIGNED JANUARY 11, 1909 COMMITTEE ON FOREIGN AFFAIRS. (Committee room, gallery floor, west corridor. Telephone 230. Meets on call.] William Sulzer, New York, Chairman. Henry D. Flood, Virginia. Charles M. Stedman, North Carolina. John N. Garner, Texas. Edward W. Townsend, New Jersey. George S. Legare, South Carolina. Byron P. Harrison, Mississippi. AViLLLVM G. Sharp, Ohio. David J. Foster, Vermont. Cyrus Cline, Indiana. Willl\m B. McKinley, Illinois. Jefferson M. Levy, New York. Henry A. Cooper, Wisconsin. James M. Curley, Massachusetts. Ira W. Wood, New Jersey. J. Chas. Linthicum, Maryland. Richard Bartholdt, Missouri. Robert E. Difenderfee, Pennsylvania. George W. Fairchild, New York. W. S. Goodwin, Arkansas. N. E. Kendael, Iowa. Frank S. Cisna, Clerk. WASHINGTON GOVERNMENT PRINTING OFFICE 1912 PRESERVATION OF NIAGARA FALLS HEARINGS BEFORE THE _ .. u'^ COMMITTEE ON FOREIGN AFFAfiS" HOUSE OF REPRESEI^JTATIYES JANUARY If). IS, 19, 20, 23. 2«i, AND 27, 1912 ON H. R. (i746 BY MR. SMITH OF NEW YORK: A BILL TO GIVE EFFECT TO THE FIFTH ARTICLE OF THE TREATY BETWEEN THE UNITED STATES AND (CANADA, SIGNED JANUARY 11, 1909 AND H. R. BY MR. SIMMONS : A BILL TO GIVE EFFECT TO THE FIFTH ARTICLE OF THE TREATY BETWEEN THE UNITED STATES AND GREAT BRITAIN SIGNED JANUARY 11, 1909 COMMITTEE ON FOREIGN AFFAIRS. ICommittee room, gallery floor, wesl corridor. Telephone 230. Meets on tall.] William Sui.zer, New York, Chairman. Henry D. Flood, Virginia. Charles M. Stedman, North Carolina. JouN N. Garner, Texas. Edward W. Townsend, New Jei-sev George S. Legare, South Carolina. Byron P. Harrison, Mississippi. " William G. Sharp, Ohio. David J. Foster. Vermont. Cyrvs Cline, Indiana. Willlam B. Mckinley, lUinois. Jefferson M. Levy, New York. Henry A. Cooper, Wisconsin. James M. Curley, Massachusetts. Ira W. Wood, New Jersey J. Chas. Linthicum, Maryland. Richard Bartholdt, Missouri. Robert E. Difenderfer, Pennsylvania. George W. Fairchild, .New York W. s. Goodwin, Arkansas. N. E. Kendall. Iowa. Frank S. Cisna, Clerk. WASHINGTON GOVERNMENT PRINTING OFFICE 1912 ; 1 / : a(v n. jpi? >Ni COI^TENTS. Page. Statement of Rei)resentative James S. Simmons " 1-7 House bill No. 7694, Sixty-second Congress 7 House bill No. 6746, Sixty-second Congress 7-8 Statement of Representative Charles B. Smith 8, 285-292 The Burton law 8-10 House joint resolution extending operation of the Burton law 10 Treaty between the United States and Great Britain 10-16 Protocol of exchange 16 Statement of — Representative Daniel E. Driscoll 16-17 Representative Frank E. Doremus 18-1^ Mr. George P. Sawyer 19-26 Gen. Wm. H. Bixbv, Chief of Engineers, United States Army 26-40 Mr. Richard B. Watsons '.' 35, 169-179, 279-281, 311, 315 Mr. Edward A. Wickes 37 Rome G. Brown 40-77, 281-284 Rules of law as to Federal control 43 Rules of law as to State control and as to vested property rights of ripa- rian owners 43 Engineer's report on navigable capacity of river and lake 56 Permits for diversion 58 Summary of reports published in Senate Document 105 and in House Document 246, Sixty-second Congress 67-75 Memorandum on Senate joint resolution 143 75-77 Senate joint resolution 143 77 Gen. Francis V. Greeue: Oral statement of 77-95, 202-204, 311-315 Written statement of 95-104 Supplementary statement of 308-311 Statement of — Edward T. Williams 104-105 Mr. .Morris Cohn 105-110, 281, 307 Mr. A. C. Morrison 110-112 Mr. Millard F. Bowen 113-117, 124-130 Mr. Oscar E. Fleming 117-122 Maj. W. B. Ladue. . ^ 122-124, 190-204, 299, 308 Written statement of Mr. Isham Randolph 124-127 Contract form with municipalities 127-129 Changes in Smith bill suggested by Mr. Bowen 130 Petition in behalf of Erie and Ontario Sanitary Canal Co 130-132 Act granting Keokuk and Hamilton Water Power Co. right to construct dam across Mississippi River 132 Proposed bill giving effect to treaty of Jan. 11, 1909 133, 323 Brief of Millard F. Bowen. for Erie and Ontario Sanitary Canal Co 135 Statement of — Mr. George F. Monahan 135-143 Mr. J. Boardman Scovell 143 Letter of Gov. John A. Dix. of New York 157-167 Statement of — Mr. Albert F. Eells 167-169 Mr. J. Winthrop Spencer 179-189^ Paper on '• E^■olution of the Falls of Niagara," by J. W. Spencer 185- Letter of Referendum League of Erie County 187 Opinion by Secretary of War Taft .' 191-19S Act of June 29, 1906, for the control and regulation of the waters of Niagara River, etc 198 Permit to Niagara Falls Electrical Transmission Co. and other companies 202 Senate Document No. 242. 5f)th Congress 205-229 28305—12 1 1 II CONTEXTS. Page. Report of the American member? of the International Waterways Commist-ion, with letters from the Secretary of State and the Secretary of War, including memoranda regarding the preservation of Niagara F'alls. 205-213 Reports upon the existing water-jwwer situation at Niagara Falls, so far as concerns the diversion of water on the American side 213 Report by ("apt. Charles W. Kutz. Corps of Engineers 215 The Niagara Falls Power Co 216 The Niagara I'alls Hydraulic Power and Manufacturing Co 217 Industries using water for water purposes derived from Erie Canal at or near Lockport, N . Y., and at Medina, N . Y 218 Reports concerning the Canadian power companies and their associated trans- mission comj)anies 220 Report by Capt . ( harles \N'. Kutz, Corps of Engineers 222-229 The ( )ntario Power Co 222 The Electrical Devi?lopment Co 224 The Canadian Niagara Power Co 225 International Railway Co 226 Statement of — Mr. Clark H. Hammond 230-242 Mr. Edward Haggeman Hall 243 Mr. J. Horace MrFarland 243-250. 279-280 Dr. Allen D. McLaughlin 251-258 Extracts from Bulletin No. 77, Hj-gienic Laboratory 251 Paper bv Health (XKcer Robert Talbott, of Niagara 'Falls 257 Mr. Philip B. Barton : 259-274, 284 Telegram— LvTiian Abbott to Chairman 275 Statement of Prof. James Henry Harper 275-277 Table showing geographical distribution of typhoid fever in the State of New York 278 Letter of — Frank C. Ferguson 285 Charles M. Heald 286 George B. Burd. 287 Petition of citizens of Niagara Falls, N . Y 287 Statement of Judge Daniel J. Fennewick 292-298 Table and statement — estimated diver.-^ions, December, 1911 299 Stalemeut of effect on Lake Erie. commerce 299 Statement as to use of water diverted from Erie Canal bv the Ilvdraulic Race Co .^ '. 300 Letter of Hydraulic Race (^o 300-301 Permit to — Lockport Hydraulic Co 301-302 Niagara PXlls Hvdraulic Power and Manufacturing Co 302-303 Niagara Falls P(iwer Co 303-304, 305 Permit for the transmission of electrical power from Canada into the United States ; 304-305 Permit to Niagara, Lockport & Ontario Power Co 306-307 Statement of — Hon. Thomas Cai-mody, attorney general, State of New York 316-329 Mr. George H. Blackstock ".^ 329-331 Mr. Millard F. Bowne 331-332 Closing summary by Rome G. Brown in behalf of the Niagara Falls Power Co. and Canadian Niagara Co 332-344 The situation of the Niagara Falls Power Co 332 Situation of the Canadian Niagara Power Co - . 333 The equitable position of bolJi the American and Canadian power companies 334 The question of rates 336 As to rates for power produced on the American side 336 First charge for demand 337 Second charge for energy 337 Demand rate 337 Rates for power produced on the Canadian side 339 Scenic beauty plus industrial grandeur 339 The camjKiign of scare 343 Resolutions of the Board of Trade of Niagara Falls .-••.••• '^^^ Letter of J. S. Kennedy, secretary public service commission, second district, New York 345 CONTENTS. Ill Page. Letter of W. J. Meyers, statistician, public service commission, second district, New York 345 Argument of Hon. Francis Lynde Stetson before the Secretary of War 346 Some misstatements by Mr. McFarland 346 Letter of the Queen Victoria Niagara Falls park commissioners 347 The comparative cost of Niagara power 352 The marvelous achievement of the Niagara Falls Power Co 353 H. G. Wells on the Niagara Falls 353 The testimony of the Rev. J.N. Halleck, D. D 354 The Niagara Falls Power Co. not a vandal 355 Letter of New York State engineer and surveyor 359 Prior and preferential right of Canadian Niagara Co 362 The Ontario Co. 's position 363 Power deliveries by our two companies 364 The claims of the two transmission companies 365 The claim of the Electrical Development Co 365 Concerning international treaty .' 365 Conclusion 367 Appendix A. The priority of the Canadian Niagara Co 368 Appendix B. Letter of the president of the American Civic Association and reply of Mr. Stetson 369-370 Appendix C. Letter of Mr. Stetson to Capt. Barden, Corps of Engineers. . 370 The preservation of Niagara Falls 372 Letter of C. T. WilHams to Scientific American 373 Letter of Secretary of War Stimson 373 What the American Civic Association is and does 373 Decision of the Circuit Coiu-t, United States, within and for the district of Colo- rado, The Cascade Town Co. and Leander A. Bigger, complainants, v. The Empire Water & Power Co. " 374-380 Telegram of the Merchants' Association of New York 380 Letter of J, L. Hudson to Mr. Richard B. Watrous 380 Erie & Ontario Sanitary Canal Co., proposed bill for Congress 381 Resohitions of the Trades and Labor Council of Niagara Falls, N. Y 382 Letter of — The Toronto Power Co. to the Secretary of War and indorsements 382-393 The Erie & Ontario Sanitary Canal Co. to Secretary of War 383 John W. Williams to Chairman Sulzer 384, 386 Millard F. Bowen 384 James King Duffy 384 Clifford B. Harmon 385 New York Conservation Commission 385 Senator T. E. Burton 385 Chamber of Commerce and Manufacturers' Club 385 Telegram of — New York State Conservation Commission 386 Reply of chairman ' 386 Chairman Sulzer to — Gov. Dix 387 Governor's secretary 387 Public-service commission, second district. New York 387 Letter of — J. Horace McFarland 387 Attornev Gener.d Thomas Carmody 388 Message of President Taft ." 388 Letter of Secretary of War to President 388 Memorandum concerning the re.^trictionr-on the u.-. The villages of Niagara Falls and Suspension Bridge at that time had a population of 10.000 people. These people had their money invested in boarding houses, hotels, stores, and the like, and their principal occupation Avas taking care of the tourists visiting the Falls. These people had a greater interest in Niagara Falls than any other people in the world, for the reason that they were the only people who had a financial interest in them ; and if there had been any- thing proposed or contemplated which in their judgment would have a tendency to mar the scenic beauty of Niagara Falls, they would have been the very first people to have raised their voices in opposition, and I think they would have had the best right to have objected, for the reason that they were the only people who had a vested interest in the Falls. Now, I am here this morning to represent those people and also to represent about 2.'),000 additional residents who have come there since the power development started; and T want to say to you that if it were possible to liave all these people come before this committee this morning, they Avould frankly and unanimously'' state that the diversion of water from the Falls has not atfected the scenic beauty of the Falls in the slightest extent, and that the tourist travel has not been afi'ected thereby, but on the contrary it has been largely increasing. This is no issue, in my judgment, which contemplates doing a thing which is going to interfere witli the I )i PRESERVATION OF NIAGARA FALLS. scenic beauty of Niagara Falls or to any appreciable extent change its scenic status. All that we are asking to do is that we ma}' use some of the surplus water of the Niagara Kiver which is not at all necessar}' for scenic beauty. AVhcn the present law was en- acted it was onl}' as a temporary measure: it was only enacted for three years, and its object was that it would stop jiower development at Niagara Falls until we could determine the quantity of water that could be diverted from the Niagara Eiver without affecting scenic beauty. Mr. Flood. When did this power development begin at Niagara Falls? Mr. Simmons. About 1895. Mr. Morris Cohn, of Niagara Falls. That is hardly correct. The company that I represent had a canal put through in 1873. Mr. Simmons. I supposed lie meant the thing on a large scale. Mr. Flood. That is what I meant. Mr. Simmons. Mr. Simmons. Noav, as so(m as this present law was enacted this Government took up the question wdth Great Britain for the purpose of constructing a law for both sides of the river. We knew it would be useless for us to do anything if Canada was not going to act with us. Commissioners were appointed by this Government and com- missioners were appointed by Canada, or Great Britain, and they took up this question to determine what quantity of water could be di- verted from the river without harmful etl'ect on the scenic i)eauty. They gave the matter the most careful investigation and finally reached their conclusion and made their report, and upon that the treaty between the United States and Great Britain was made. Under that treaty we were permitted to divert 20,000 cubic feet of water per second on this side and our good neighbors, the Canadians, were permitted to divert 3(5,000 cubic feet of water per second. We thought at the time that the provisions of the treaty were made known that it was unfair to us in that we were })ermitted to take 20,000 cubic foot seconds while our neighbors were permitted to take 36,000 cubic foot seconds, Avlien we supposed both countries to own the waters jointly. We, to use a connnon expression, thought that w^e had rather the short end of it. But we were not dissatisfied. We are perfectly satisfied now. All that we are asking is that we may be permitted to take the water that we were allowed under the treaty. INIr. Flood. AVhen was that treatv negotiated or concluded? A Member. 1910. Mr. Simmons. Of the 20,000 cubic feet per second that we were permitted to use under the treaty we are only diverting ir),()00. The Chairman. The convention or treaty between the United States and Great Britain was concluded January 11, 1909. Mr. Simmons. Therefore, gentlemen, the only question that is be- fore you, in so far as the diversion of water is concerned, is whether or not this 4.400 cubic feet can safely be diverted from the river. In the treaty wo were willing that Great Britain might divert 36,000 cubic foot seconds with our consent, and it would seem to me, under the circumstances, to be altogethei- unreasonable if we were now to limit ourselves to the present diversion of only 15,600 feet and deny ourselves the right to take the additional 4,400 feet. Mr. Dii'ENDERFER. How luucli of the 36,000 feet do the Canadians divert at this time? PRESERVATION OF N'lACiARA FALLS. 6 Mr. Simmons. I think I have the tigures here. Mr. DiFEKDEHFKR. But they do not r.se all they are allowed under the treaty? Mr. Simmons. Oh, no. A Member. How much are we allowed under the treaty ( The Chairman. Twenty thousand cubic feet. Mr. Simmons. Twenty thousand. This can be diverted Avithout the slightest effect upon the Falls. In fact. I do not believe there is a liA'in" over the Falls at the time. To the enoineer's calculation there is a slight effect, but to the eye there is none. The engineer's instrument dis- closes the fact that the diversion of 4,400 feet would affect the American Falls one-tenth of an inch and the Canadian Falls less than an inch and a half. I have looked upon the Falls under so many different C(mditions that I am perfectly satisfied that this 4,400 feet of water could never be observed by the eye of man. If legislation was ])roposed to take water from the Niagara River that v. ould impair its scenic beauty, the people I represent would be the first to raise the voice of opposition to it. I think I understand the situation from daily contact with it : and we are perfectly satisfied this diversion could be made without any harmful effect. Under the existing law the Secretary of War has issued permits for 15,600 feet of water. Five hundred of this was given to the Erie Canal and 15.100 has been given to the two existing power companies, 8,600 feet to the Niagara Falls Power Co. and 6.500 feet to the Niagara Falls Hydrau- lic Power & Manufacturing Co. Mr. DiFENDERFER. Thev are corporations? Mr. Simmons. Yes. The Chairman. Those are the only companies on our side that are using the water? Mr. SiJiMONS. Yes, sir. I want you gentlemen to get into your minds the great benefit that has come from the use of something that has not hurt anybody. Now. from the use of this 15,100 feet of water we are making a daily generation of 204,800 horsepower. To produce this horsepower from coal would require the annual con- sumption of 3,686,400 tons of coal. The accomplishment of this prodigious result has been done without the least harmful effect to the scenic beauty of Niagara Falls and without the use of any of the exhaustible resources of our country — mea^ely making use of some- thing which has heretofore never performed any service to the American people. Now, with these facts before us. both as to results and effects, the question is whether Ave can safely diA'ert the 4,400 additional feet. A Me:\iher. Hoav much is being utilized of this 15.600 feet ? The Chairman. All of it. Mr. SoiMONS. Practically all of it. M> have hoav to get at the results of actual tests made there. SeAeral years ago we closed doAvn the poAver houses, restored to the river all the Avater, and made careful measurements, and they disclosed the fact that the diA^ersion of 15.100 feet of Avater loAvered the American Falls three-* eighths of an inch and the Canadian Falls 4.8 inches, and upon this hypothesis the diA-ersion of the 4.400 feet of Avator Avould lower the American Falls less than one-tenth of an inch and the Canadian Falls les^ th.an H inches. Noav. Avhile these diA-ersions Avill show the 4 PRESERVATION OF NIAGARA FALLS. small results I have mentioned, they have ])ositively no effect upon the eye. Now, this is a perfectly cleai- and simple proposition that you have before you. If you will permit me to digress a little from the diversion of water on the American side. I want to bring to your attention the results that would come fnmi the use of .^6,000 feet of water used on both sides of the river, and which. I claim, can be diverted without harmful effect. Mr. Flood. In your bill, who gets the benefit of this 4,400 feet? Mr. Simmons. My bill does not atteuipt to give it to anybody. Mr. Flood. You leave it with the Secretary of War? Mr. Simmons. Yes; to increase this power from lo.GOO to 20,000. The Chairman. That is the amount we are entitled to under the treaty ? Mr. Simmons. That is the amount we are entitled to under the treaty. Mr. Levy. That is given by the State of New York. Mr. SiM^roNS. Not necessarily. Mr. Frx)0D. No; the Federal Government controls that. Mr. Levy. Do you mean that that 4,400 feet additional shall be given without the consent of the commissicmers of the State of New York? Mr. Si^rMONS. Yes; we want the commissioners of the State of New York to consent to that. Now, if we use tiiis oG,000 feet of water, it will enable us to develop 790.200 horsepower. To produce this same horsepower from coal would require the annual consump- tion of 14,241. (100 tons of coal. I therefore assert, without, I think, any fear of contradiction, that the Niagara Falls power proposition is the greatest conservation project in the United States. Mr. DiFEKDERFEK. Then is it not too great to give to any individual corporation? Mr. Stmmoks. Now that is entirely with the counnittee. I am not commenting on that just now. j\Ir. DiFENDEKFEK. That, to uie. has a greater point than the scenic beauty. Mr. Simmons. The difference in this Avould be the period of one year. Just let us carry that to the results that would be accomj^lished in 50 years: then we would save in nature's storehouse 712,680,000 tons of coal. I Avish to bring to your attention these points: First, will you per- mit the 4,400 feet of water to be diverted, which we are allowed under the treaty and which I have tried to explain can be done without any harmful elfect. and the benelits of which will be so great to us if it is permitted? Second, will you not consent to raise the limitation on the im]jortation of power from Canada? It seems to me it would be unbusinesslike for us to legislate, erecting barriers against our getting the benefit of this power that is being generated in Canada. We have willingly consented that Canada shall take the water, and under the provisions of the treaty Canada left it en- tirely open — that the water, while developed on their side, could be brought over and used in this country. Mr. Flood. You make no limitation on Canada in your bill? Mr. Simmons. No: Canada was the one, if anyone should have desired to prohibit its couiing over. They were the ones to have done PBESERVATION OF NIAGAEA FALLS. 5 it, and in making the treaty they were perfectly willing that the power should be brought over, and it would seem to me that it would be perfectly absurd for us to continue a law denying the right for us to use it. Mr. Flood. Have you considered the question of whether there should be a charge on what is being used ? Mr. SiMMOisS. As far as New York is concerned, we have a public service commission. If it went into another State it would be under another arrangement. ]Mr. Flood. Do you think this company should be permitted to charge more on this side than in Canada? Mr. SiMMO?«s, I think not. but the Canadian Government transmits the power to the people without any profit, or actual cost to the Gov- ernment. Now, if the United States Government is going to transmit this power, why, I would say that we would probably get it under like conditions; but I do not think that a private corporation could de- liver it at the same price as in Canada. Mr. Flood. Don't you think there ought to be some limit, so that the cost would not exceed the price of transmission '( Mr. Simmons. ^Ve liave a commission which regulates all these things. Mr, Flood. Is there such a commission in Michigan ? Mr. Simmons. I do not knoAv ; but in so far as the State of New York is concerned, we have ample protection. Mr. Kendall. Does your State commission have jurisdiction over commodities transmitted into the State by other commissions? ]\lr. S131MONS. I think so. I am not a lawyer, but we are going to have some who can ansAver. Mr. Kendall. This is a commodity transmitted into this State The Chair3Ian. The New York Public Service Commission has the right, under the statutes of New York, to regulate the price of power. ]Mr. Kendall. But suppose the i^urchn.se is made by the consumer in Buffalo from the Canadian authorities, and the delivery is made in pursuance of that purpose ( The CiiAiKMAN. That would be a ci)ntract, and the State could not interfere with that. Mr. Levy. That does not cover the point. The private concern you are speaking of ]Mr. Kendall. I am speaking of a consumer in Buft'alo who pur- chases in Canada. "Would the public service commission in New York have jurisdiction to control the rates? Mr. Si:\iM0NS. To charge the i:)rivate consun^.er? Mr. Kendall. Yes. Mr. SoiMONs. Absolutely. Mr. Difendekfek. Without a tariff? [Laughter.] Mr. Simmons. The tariff would not have anything to do with it. They have only to do with Avhat the company shall charge the con- sumer. If they think it is too high, they have full authority to make that price whatever they please, and there is no redress from the public service commission. jNIr. Levy, What is the present hnv with reference to transmission? That is, do you ha\e to have a permit from the Secretary of AA'ar in order to brine it here? 6 PRESERVATION OF XIAGAEA FALLS. Mr. Snr.MONs. The existino- law provides that we can bring in 1(>0.000 liorsepower. and that states the amount that each company shall bring in. Mr. Kendall. I did not mean to interrupt your statement, I think you had better go on. Mr. Simmons. I thouglit I could give you my statement better if I was not draAvn out on ditt'erent phases of the case. There are a great many to be heard and they want to get away. I shall be veiT glad to come before the committee at any time you wish. Now, the importation of liower from Canada I tliink 1 covered. There is one other feature of the existing law that I want to bring to your at- tention, and that is that under the present law we can only divert 15.(i00 feet of water from the Niagara River. We have a fall in the Niagara Kiver. between what is known as the Devil's Hole and the Whirljiool Rapids — about a mile and a quarter — this section is about •J miles below Niagara Falls, and has no more to do with the scenic beauty of the Falls than the Potomac River here. But the law provides that only so much can be diverted from the river. Un- questionably it was intended that the limitation should l^e placed u])on the river above the Falls, but it was not. I can not conceive that the Members of Congress voting for the bill at that time com- prehended the fact that they were regulating water that had noth- ing to do with scenic beauty. The bill itself was entitled. "An act for tlie preservation of Niagara Falls." and this section of the river had nothing whatever to do with it. The bill I have introduced is merely for the purpose of perfecting the treaty. In brief, it enlarges the powers of the Secretary of War and raises the limita- tion against the importation of ]:)Ower from Canada. Under the existing law we can only bring over 160.000 horse])ower. whereas if this bill is enacted we can bring over all that we can ^et. The Chairman. Quite true, and any limitation is conducive to monopoly, is it not ? Mr. Sim:\ions. Yes; within the treaty. I do not think there should be any limitation whatever. That was only ])ut in the law tempo- rarily until we could negotiate with (Jreat Britain, and we have had that negotiation. Mr. Flood. We bring over 160.000 horsepower. AVho brings that over now ? Mr. Simmons. The Niagara Falls Power (^o. and the Niagara, Lock])ort & Ontario Co. The present law limits the diversion of water in the Niagara River. The treaty states that the Avater affected is the water above the Falls and therefcn-e it leaves the situation open as to the lower river, and if it is desired later that ])ermission should l)e given to take water in the lower river. Congress could have it done. T can not conceive of anything in connection Avith the original bill which was so imjustified as to have prevented a development in some other place. Avhen the object sought to be (obtained Avas the preserva- tion of Niagara Falls. I thank you very much for your kind attention. I should like to say more, but there are many others to be heard after me. A Mk:mbf,k. Does the public seiwice commission fix the ])rice of the power that the corporations take? Do they fix the priced Tliat is, PEESERVATION OF NIAGARA FALLS. 7 do the power companies piay anything? Or is there any revenue com- ing to the State of New York or the General Goverjnnent ( Mr. Simmons. No; there is none. [H. R. 7694, Sixty-second Congi-fss. First Session.] A lUI.L To jjive (Effect to the (illth article of the treaty between the I'nited States and (ireat Britain si>;ned January 11, 1909. Be it enacted by the i^cnate and Hoii.se of Rcpr(senta1ire>< of the United i:itate3 of America in Congress assembled, That no water shall be diverted from the Niagara River above the Falls of Niagara within the State of New York for power purposes without the written consent of the Secretary of War, who is hereby authorizetl to give snch consent by revocable j)erniits. to persons, com- panies, or corporations having authority from the said State to make such diversions, and to a total amount not exceeding in the aggregate the amount allowed by the treaty between the United States and (ireat Britain signed at Washington on the 11th day of .January, in the year lOOij: I'rorided, That no such permit shall be granted allowing diversions of water exceeding in the aggregate 15.600 cubic feet per second without the consent of the State of New York and of the commissioners on the part of the United States in tlie inter- national joint commission provided for bj- said treaty. Every diversion of water in violation of the foregoing provisions shall be a mi.'-demeanor. punishable by a tine not exceeding ,$2,5y imprisonment not exceeding one year, or both, in the discretion of the court. The Secretary of War shall make regtilations for preventing the diversion of water from the Niagara River above the Falls of Niagara in excess of the amounts consented to by him pursuant to the said treaty and to this act, and all permits for the diversion of water granted under the act entitled "An act for the control and regulation of the waters of Niagara River, for the preservation of Niagara Falls, and for other purposes," approved June 20, 1908, shall continue in force until revoked by the Secretary of War or superseiled by other i>ermits issued by him. The Chairman. The committee will now hear from Representative Charles B. Smith, who has a bill before the committee — No. 6746. The Smith bill reads as follows: in. H. 0740, Sixty-second Conjin^ss. tirst session.] .V EILL To give eftect ti) the fifth article of the treaty between the United States and Cauad.i, signed January 11, 1909. Be it enacted by the Senate and House of Representatires of tlie United States of America in Congress assembled, That no water shall be diverted from Niagara River above the Falls of Niagara, within the State of New York, for power purposes without the written consent of the Secretary of War, who is hereby authorized to consent, by revocable permits, to the making of such diversions to a total amoimt not exceeding in the aggregate the amount allowed by the treaty between the the United States and Great Britain of January 11, 1909: Provided, That all permits for the diversion of water granted under the act entitled "An act for the control and regulation of the waters of Niagara River, for the preservation of Niagara Falls, and for other purposes, approved June 29, 1906," shall continue in force and effect to the recipients thereof and their respective successors until revokeil by the Secretarj- of AVar or superseded by other permits issued by him: Provided further, That any permit for such diversion of water in excess of a daily diversion at the rate of 15,600 cubic feet of water iier second shall only be made to the State of New York, with full power and authority to said State to make such grant or grants of the use thereof as it may determine to be for the public interest: Provided further. That no one individual, company, or coi-poration shall be permitted to divert \mder any permit or permits granted under the authority of said act of June 29, 1906, water exceeding in the aggregate a daily diversion at the rate of 8,600 cubic feet per second. Sec. 2. That no person, company, or corporation shall transmit from the Dominion of Canada into the Unitetl States electrical power developed from the use of the waters of the Niagara River in excess of the amount so trans- S PKESERVATIO^• OF .MAGAKA iALl.S. initted by such person, coiupauy, or corporation on or before May 13, 1910, the date of proclamation of said treaty, without the written consent of the Sec- retary of War. who is hereby authorized to give consent for such transmission of additional electrical power by revocable permit, to contain an express con- dition that the person, company, or corporation receiving or operating under such permit shall not directly or indire<^'tly, tluo\igh any subsidiary company or otherwise, charge or receive for any such additional electrical power so trans- mitted within the United States a higher price than is charged or received by such person, company, or corporation, or any allied or subsidiary company, under like or substantially similar circumstances, within the Dominion of Canada for electrical jiower developed froiii said waters, and that such condi- tion in respect of i trice shall be by the terms of such permit made specifically enforceable in and by any State within which such electrical power so developed within the Doniinun of Canada shall be transmitted. Sec. 3. That any i)erson, comjiany, or coi'poration diverting water from the said Niagara River or its tributaries, or transmitting electrical power into the United States from Canada, except as herein stated, or violating any of the provisions of this act, shall be deemed guilty of a misdemeanor, and on con- viction thereof shall be punished by a fine not exceeding $2, 500 nor less than ^500. or by imprisonment (in the case of a natural person) not exceeding one year, or by both such punishments, in the discretion of the court: Provided, That the removal of any structures or parts of structures erected in violation of this act, or any construction incidental to or used for such diversion of water or transmission of i)ower as is herein prohibited, as well as any diver- sion of water or transmission of power in violation hereof, may be enforced or enjoined at the suit of the United States by any circuit court having jurisdic- tion in any district in which the same may be located, and proper proceedings to this end may be instituted under the direction of the Attorney General of the United States. Sic. 4. That tl!o.i)n)visi()i!s (if lliis act .-^hall reuiiiiu in force and effect during the life of said treaty. Sec. 5. That for accomi)lishiug the purposes detailed in this act the sum of $10,000, or so much thereof as may be ni'Cessary, is hereby appropriated from any moneys in the Treasury not otherwise appropriated. Sec. 6. That the right to alter, amend, or repeal this act is hereby expressly reserved. Mr. SiiAiu'. Mr. Sniitl). has the nnioiint of the diversion been fixed bv a treaty? My. SMrrH. Yes. sir; it is 20,000 feet on the American side and 36,000 feet on the Canadian side. Mr. Sn.ARP. Now. has there been some leofishttion by this (70\ern- ment ? ]\rr. S^riTH. That legisUition was prior to the establishment of the treaty. I -want to say, Mr. Chairman, that I do not desire to go into the merits of the legisLttion now. My main piir]K)se in address- ing the committee was to place in the record the Burton Act and also the treaty with Great Britain. The Chatijman. There being no objection, the rep"iter will incor- porate in the record the treaty between the United States and (h-eat Britain and the Burton Act and the resolution extending the same. the joint resolution of the House, No. 262. approved March :'>. 1909. THE BUKTOX LAW. . U'ulilio. \<). :{c>7.| An .\ct For lln- cuiitrol .-inii r.';,'iil;ition iu' ti)o w.-ilcrs of .\iay::n-:i lUvor. for tlic pn-stTv.-i- v:ifion of Ninjiarn K.-ills. nnrl for other purposes. Br it rwnctrd hji the Sciiatr and Jlnuf>c of Rrinoirntdtircfi of the Vnitcd >^t(itcs of Amehcn hi Conrirriist aftsrnihlrd. That the diversion of watei- from Niagara River or its tributaries, iu the State of New Yorlc. is hereby prohibited, except with the consent of the Stx-retary of War as hereinafter autlKuized in section two of this act: Proridcd, That this prohibition shall not be interpreted PRESERVATION OF NIAGARA FALLS. 9 as forbidding tlie diversion of the waters of the Great Lalves or of Niagara River for sanitary or domestic purposes, or for navigation, the amount of which may be fixed from time to time by the Congress of the United States, or by the Secretary of War of the United States under its direction. Sec. 2. That the Secretary of War hereby authorized to grant permits for the diversion of water in tlic United States from said Niagara River or its tributaries for the creation of power to individuals, companies, or corporations which are now actually itroducing power from the waters of said river, or its tributaries, in the State of New York, ov from the Erie Canal; also permits for the transmission of power from the Dominion of C'anadainto the United States, to companies legally authorizeil tlierefor. botli for diversion and transmission, as hereinafter stated, but permits for diversion shall l)e issued only to the indi- viduals, companies, or corporations as aforesaid, and only to the amount now actually in use or contracted to be used in factories the buildings for which are now in process of construction, not exceeding to any one individual, com- pany, or corporation as aforesaid a maximum amount of eight tliousand six hundred cubic feet per second, and not exceeding to all individuals, companies,^ or corporations as aforesaid an aggregate amount of tifteen thousand six hun- dred cubic feet per second; but no revocable permits shall be issued by the said Secretary under the provisions hereafter set forth for the diversion of addi- tional amounts of water from tlie said river or its tributaries until the approxi- mate amount for which permits may be issued as above, to wit, fifteen tliou- sand six hundred cubic feet per second, shall for a iteriod of not less than six months have been diverted from the waters of said river or its tributaries, iu the State of New Yorlv : Proridcd. That the said Secretary, subject to the pro- visions of section five of this act, under tlie limitations relating to time above set forth, is hereby authorized to grant revocable iiermits, from time to time, to such individuals, companies, or corporations, or their assigns, for the diversiout of additional amounts of water from the said river or its tributaries to such amount, of any. as, in connection with the amount diverted on tlie Canadiau side, shall not injure or interfere with the navigable capacity of said river, or its integrity and proper volume as a boundary stream, or the scenic grandeur of Niagara P^alls; and that the quantity of electrical power wliich may by permits be allowed to be transmitted from the Dominion of Canada into the United States shall be one hundred and sixty thousand horsepower: Provided further. That the Secretary, subject to tlie provisions of section five of this act, may issue revocable permits for tlie transmission of additional electrical power so generated in Canada, but in no event shall the amount included in such per- mits, together with the said one hundred and sixty thousand horsepower and the amount generated and used in Canada, exceed three liuudred and fifty thousand horsepower: Provided iilirays. That the provisions herein i)ermitting diversions and fixing the aggregate horsepower herein permitted to be trans- mitted into the United States, as aforesaid, are intended as a limitation on tlie authority of the Secretary of War, and shall in no wise be construed as a direc- tion to said Secretary to issue permits, and the Secretary of War shall make regulations preventing or limiting the diversion of water and the admission of electrical jiower as lierein stated; and the permits for the transmission of elec- trical power issued by tlu» Secretary of War may specify the persons, com- panies, or corporations i)y wliom the same shall be transmitted, and the persons, companies, or corporations to whom the same shall be delivered. Si;('. 3. That any person, company, or corpoi-atiou diverting water from the said Niagara River or its tributaries, or transmitting electrical power into the United States from Canada, except as herein stated, or violating any of tlie provisions of tliis act. shall be deemed guilty of a misdemeanor, and on con- viction tliereof shall be punished by a tine not exceeding two thousand five luiudrcd dollars nor less than five liundred dollars, or by imprisonment (in the case of a natural person) not exceeding one year, or by both such punish- ments, iu the discretion of the court. And, further, the removal of any struc- tures or parts of sti-uctuies erected in violation of this act. or any construction incidental to or used for such diversion of water or transmission of power as is liereln luvhibited. as well as any diversion of water or ti-ansmission of power in violation hereof, may i»e enforced or enjoined at tlie suit of the United States by any circuit court baving jurisdiction in any district in which the same may be located, and proper proceedings to tliis end may be instituted under the di- rection of tlie Attorney (Jeiieral of the United States. Sf.c. 4. That the President of tlie United States is respectfully requested to- open negotiations with the Government of Great Britain for the purpose of 10 PRESERVATION OF NIAGxVRA FALLS. effectually providing by suitable treaty with said (iovevunient. ff»r such regula- tion and control of the waters of Niagara Kiver and its tril>utaries as will pre- serve the scenic giandeur of Niagara Falls and of the rapids in said river. Sec. f). That tht- provisions of this act shall remain in force for three years from and after date of its passage, at the exiiiration of which time all permits granted hereunder by the Secretary of War shall terminate unless sooner re- voked, and the Secretary of War is hereby authorized to revoke any or all permits granted by him by authority of this act, and nothing herein contained shall be held to confirm, establish, or confer any rights heret»)fore claimed or exercised in the diversion of water or the transmission of power. Sec 0. That for accomplishing the purposes detailed in this act the sum of fifty thousand dollars, or so much thereof as may be necessary, is hereby appro- priated from any moneys in the Treasury not otherwise appropriated. Sec. 7. That the right to alter, amend, or repeal this act is hereby expressly reserved. Approved, June 20. llX)(j. House joint resolution lifil!. extrndiriR the operation of an act for the conti'ol and resu- lation of the watrrs of Nia;.';ua Iliver. for the prcstrvatiou of_ Niagara Falls, and for otiier purposes. Whereas the [irov isit/iis of ihe :\v\ cntitkHl "An aet for the control and regu- lation of the waters of Niagara Itiver. for the preservation of Niagara Falls, and for other purposes." aiiproved .Tune twenty-ninth, nineteen hundred and six. will expire by limitation on .June twenty-iiinth, nineteen hundred and nine; and Where;; s a date foi" the termination of the operation of said act was pro- vided therein, but with a view to the more iiernijinent settlement of the ques- tions involved by a treaty with Great Britain, and by further legislation appro- priate to the situation, and such treaty not having been negotiated, it is de- sirable that the lu-ovisioiis of said act should be continued until such permanent settlement cjui be made: Therefore, be it Rcsdired. etc.. That the i>rovisi(ins of the aforesaid act be, and they are hereby, extended for two ye;irs fioni .Tune twenty-ninth, nineteen hundred and nine, being the date df the expiration of the ojieration of said act. save in so far as any portion thereof may be found inapplicable or already complied with. Appro vetl. March 3. 1909. TREATY SKiUES. XO. .■.4s — TKEATV BETWEEN THE t^MTEU STATES AND GREAT BRITAIN norXr.ARY waters I!.KTWEEN the united states AND CANADA. Signed at Washiuglon .January IL 1909. I{atification advised by the Senate Maivh 3, 1909. Itatified by the I'resident April 1. 1910. Ratified by Great lirit.iin Mnrch 31. 1910. liatificiitions exchanged at Washington May 5. 1910. Proclaimed May 13. 1910. 1;Y llii: I'KESJIiENP OE THE UNITED STATES OF AMERICA. A Proclamation. Whereas a treaty between the T'nited States of Ameriea and Tils .Majesty the King of the Tnite'd Kingdom of (ireat P>ritain and Ireland :ind of the P.ritish dominions beyon.l the seas. Emperor of India, to prevent disputes regarding the use of boundary waters and to settle all questions which are now pending betwe<'n the T'nited States and the Dominiim of Canada involving the rights, obligations, or interests of either in relation to the other or to the inhabitants of the other along their conunon frontier, and to m:'ke provision for the adjust- ment and settlement of all such questions as may hereafter arise, was concluded and signed by their resi)ective ]t]enii)otentiaries at Vv'ashington on the eleventh day of Januiiry. one thousand nine hundred and nine, the original of which treatv is, ws. not exceeding in the aggregate a daily diversion at the rate of thirty-six t lioiisainl cubic feet of water i)er second. The prohibitions of this article shall not ajtply to the diversion of water for sanitary or domestic* purposes, or for the service of canals for tlie i)iirj><)ses of navigation. Akticle VI. The high contracting jiarties agree that the Saint :XIary and ?.Iilk Rivers and Iheir tributaries (in the State of Montana and the Provinces of Alberta and Saskatchewan) are to be treated as one stream for the purp«^ses of irrigation and power, and the waters thereof shall be apportioned equally heiwe(>n tlie< two countries, but in niakinrr such e(pial apportionment, more than lialf may- be taken frcnn one river and less than half from the other by either country so as to afford a more beneficial use to each. It is further agreed tiiat in the division of such waters during the irrigation season, between the first (^f April PKESEliVATlON OF XIAGAKA FALLS. 13 nnd tbirty-tirst of October, inclusive, annually, tbe TJnited States is entitled to a prior apiiropriation of five buntlred cubic feet per second of the waters of the Milk River, or so much of such amount as constitutes three-fourths of Its nat- ural flow, and that Canada is entitled to a prior appropriation of five hundred cubic feet per second of the flow of Saint Mary River, or so much of such amount as constitutes three-fourths of its natural flow. The channel of the Milk River in Canada may be used at the convenience of the United States for the conveyance, while passing through Canadian terri- tory, of waters diverted from the Saint Mary River. The provisions of Article II of this treaty shall apply to any injni'y resulting to property in Canada from the conveyance of such waters through the Milk River. The measurement and apportionment of the water to be used by each country shall from time to time be made jointly by the properly constituted reclama- tion oflicers of the United States and the properly constituted irrigation otTicers of His Majesty under the direction of the International Joint Commission. Abticle VII. The high contracting parties agree to establish and maintain an International Joint Commission of the United States and Canada composed of six commis- sioners, three on the part of the United States appointed by the President thereof, and three on the part of the United Kingdom appointerts shall be made by the eoniniissinuers on each, side to their own (lovernnient. The high oontractinj; parties shall thereupon endeavor to ajrree upon an adjustment of the question or matter (tf difference, and if an agreement is reached between them it shall be reduced to writinir in the form of a protocol, and shall be communicated to the conunissioners. who shall take such further proceedings as may be necessary to carry out such agreement. Ainicrj; IX. The high i-ontracting i)arties further agree Ihat any other questioMs or mat- ters of difference arising between them involving the rights, obligations, or interests of either in i-elation to the other or to the inhal>itants of ti)e other, along the conunon frontier between the Tnited States and the Dominion of Can- ada, shall be referred from time to time to the international joint commis.sioji for examination and report, whenever either the (lovernment of the T'nited States or the Government of the r)ominion of Canada shall request that such questions or matters of difference be so referred. The international joint conunission is authorized in each case so rc-fci'vcd to examine into and report upon the f.acts and cin.'u.mstances of the partifuhiv questions and matters refern-d. together with sijch crmclusions and recommenda- tions as may be apjtropriate. subject, however, to any restrictions oi- .exce]*- tions which may be imposed with respect thereto l)y the terms of the reference. Such reports of the connuissioiis shall not Ite regarded as decisions of the questions or matters so sultmitted either on the facts or the law. and shall in uo way have the character of an arl)itral award. ..The' conunission shall make a joint report to both Cnverinneuts in all cases in which all or a. majority of the commissioners agree, and in case of disa.irree- pient the minority may make a joint report to both Governments or sejtarate. reports to their res))ective Governments. In case the commission is evenly divided upon ;niy question or tuattcr ro-. ferred to it for report, separate rejiorts shall be made by the connnissioncrs on each side to their own Govermnent. .\uri( IK X. Any questions or matters of difference arising betwccMi the high contracting parties involving the rights, obligations, or interests of the I'liited States or of the Dominion of Canada either in relation to each other or to their respective inhabitants, may be referred for decision to the international joint conunission by the consent of the two parties, it being imderstood that on the part of the United States any such action will be by and with the advice and consent of the Senate, and on the i>art of His Majestys (Joverninent with the consent the duty of the cominissioneis so make a joint rejiort to both <4overnmeiUs. or separate rei)orts to their respective (rovennnents. showing the different c«m- clusions arrived at with regard to the matters or questions so referred, whicli questions or matters shall thereuiion be referred for decision by the high con- tracting ]>arties to an nmi)ire chosen in accordance with the procedure pre- scribed in the fourth, fifth, and sixtli para.irraphs of Artich> XI, V of The Hague Convention fm- the pacific s<>ttlement <.f intern.itional disjiules. dated Octolver eighteenth, nineletvi hundred and seven. Such nmi)ire shall have power to render a final decision with resixvt to those matters and questions so referred on which the commission failed. PRESERVATION OF NIAGARA FALLS. 15 Ainu'i.ii XI. A fhiplictite oriiriii.-i] of ;ill decisions rciulored and Joint n^iiorts made by the conmiission shall he transmitted to and tiled with tlie Secretary of State of the United States and the Governor (Jeneral of the Dominion of <'ana(hi. and to them shall he addressed all connminications of tlie conunissions. Article XII. Tlie international joint connnission shall meet and orixanize at Washinirtoii promptly after the members thereof are appointed, and when organized the connnission may ttx such times and places for its meetings as may be necessary, subject at all times to sjjecial call or directi(m by the two (Jovernments. ICaeh commissioner, upon the first joint meeting of the commission after Ins appoint- ment, shall, before proceeding with the work of the commission, make and subscribe a solenni declaration in writing that he will faithfully and impar- tially perform tlie duties iniiK)sed upon him under this treaty, and such declara- tion shall be entered on the records of tlie proceedings of tlie commission. Tlie T'nited States and Canadian sections of the commission may each appoint ji secretary, and these sliall act as joint secretaries of the commission at its joint sessions, and the commission may employ engineers and clerical assistants from time to time as it may deem advisable. The salaries and personal ex- l)enses of the commission and of the secretaries shall be paid liy their res[)ective Governments, and all n>asonable and necessary joint exiienses of the commission incurred by it shall be iiaid in ecpnil moieties by the high contracting parties. The commission shall have power to administer oaths to witnesses, and to take evidence on oath whenever deemed necessary in any pnjceeding, or inyuiry, or matter within its jurisdiction under this treaty, and all i)arties interested therein shall be given convenient opportunity to be heard, and the high con- tracting parties agree to adoi)t such legislation as may he approiiriate and necessary to give the commission the powers above mentioned on each side of the boundary, and to provide for the issue of subpcenas and for compelling tlie attendance of witnesses in proceedings l)efore the commission. The commis- sion may adopt such rules of- procedure as shall be in accordance with justice and equity and may make such examination in jierson and through agents or enijiloyees as may he deemed advisable. Ainici.K Xlll. ' In all cases where special agreements between the high contracting parties hereto are referred to in the foregoing articles, such agreemenrs are under- stood and intended to inclmle not only direct agreements between the high contracting ijarties. but also any mutual arrangement between the United States and the Dominion of Canada expressed by concurrent or reciprocal legislation on the part of Congress and the Parliament of the Dominion. Article XIV. The i>resent treaty shall be ratitied by the President of the United vStates of America, by and with the advice and consent of the Senate thereof, and by His Britannic ^Majesty. The ratifications shall be exchanged at Washington as .soon as possible and the treaty shall take effect on the date of the exchange of its ratifications. It shall remain in force for five years, dating from the day of exchange of ratifications, and thereafter until terminated by twelve mouth's written notice given by either high contracting party to the other. In faitli whereof the resiiective plenipotentiaries have signed this treaty in duplicate and have hereunto alttxed their seals. Done at Washington the eleventh day of January, in the year of our Lord nineteen hundred and nine. (Signed* ICliiiu Root. | seal. 1 ( Signed I J.Imks Hryce. Jseal.I And whereas the Senate of the I nited States by their resolution of March third, nineteen hundred and nine t two-thirds of the Senators jire-sent concurring tiiei:ein), did advise and consent to the ratification of the said treaty with the following understanding to wit: Refiolved further {as a part of thin ratiJivatioH) , That the United States approves? this treaty with the understanding that nothing in this treaty shall he 16 PRESERVATION OF NIAGARA FALLS. construed as affef-tiufr or ehaiiKinfi any existing territorial or riparian risiits in the water, or ri^rhts of the owners of lands under water, on either side of the international boundary at the rapids of the Saint Marys Kiver at Sanlt Sainie Marie, in the use of the waters flowinj; over such lands, subject to the require- ments of navifration in boundary waters, and of navij;ation canals, and with- out i>rejndice to the existinji right of the United States and Canada, each to use the waters of the Saint Marys Kiver withui its own territory; and further, that nothing in this treaty shall be construed to interfere with the drainage of wet. swamp, and overflowed lands into streams flowing into boundary watei's, and that this interi)retation will be mentioned in the ratification of this treaty as conveying the true meaning of the ti-eaty, and will, in effect, form part of the treaty. And whereas the said understanding has been accepted by the Government of Great Britain, and the ratifications of the two Governments of the s;iid treaty were exchanged in the city of Washington on the fifth day of May, one thousand nine hundred and ten ; Tsow, therefore, be it known that I, William Howard Taft, President of the United States of America, have caused the said treaty and the said understand- ing, as forming a part thereof, to be made public, to the end that the same and every article and clause thereof may be observed and fulfilled with gootl faith by the United States and the citizens thereof. In testimony whereof I have hereunto set my hand and caused the seal of the United States to be affixed. Done at the city of Washington this thirteenth day of May, in the year of our Lord nineteen humlred and ten. and of the independence of the United States of America the one hundretl and thirty-fourth. [seal.] Wm. H. Tafx. By the President : P. C. Knox, Secretary of State. Pbotocol of Exchange:. On proceeding to the exchange of the ratifications of the treaty signed at Washington on January eleventh, nineteen hundred and nine, between the United States and Great Britain, relating to boundary waters and questions arising along the boundary between the United States and the Dominion of Canada, the undersigned plenipotentiaries, duly authorized thereto by their respective Governments, hereby declare that nothing in this treaty shall be construed as affecting, or changing, any existing territorial or riparian rights in the water, or rights of the owners of lands under water, on either side of the international boundary at the rapids of the Saint Marys River at Sault Sainte Marie, in the use of the waters flowing over such lands, subject to the require- ments of navigation in boundary waters and of navigation canals, and without prejudice to the existing right of the United States and Canada, each to use the waters of the Saint Marys River, within its own territory ; and further, that nothing in this treaty shall be construed to interfere with the drainage of wet, swamp, and overflowed lands into streams flowing into boundary waters, and also that this declaration shall be deemed to have equal force and effect as the treaty itself and to form an integral part thereto. The exchange of ratifications then took place in the usual form. In witness whereof they have signed the present protocol of exchange and have affixed their seals thereto. Done at Washington this fifth day of May, nineteen hundred and ten. Philander C. Knox, [seal.1 James Bryce. [seal.] The Chairman. The committee will now hear from Mr. Driscoll. of Buffalo, N. Y. Mr. Driscoll. I shall not take up more than a minute or two of your time. I realize that you mean to give both bills a great deal of your valuable time. In my judgment, both bills are good bills. I come from the city of Buffalo, and you all know that the city of Buffalo is located about 22 miles from Niagara Falls ; and the people PRESERVATION OF NIAGARA FALLS, 17 there and in the surrounding country have but two objects in view, and that is to get more power and cheaper power, and I think that they shouhl have cheaper power rates. I listened to my colleague and I think he has made a very fair statement. Mr. Kendall. Have the people no concern about the preservation of the Falls? Mr. DifiscoLL. As far as the preservation of the Falls is concerned, the question before your committee is whether or not the diversion of the 4,400 cubic feet of water per second that is allowed under this treaty, and which is not at present being used, will in any Avay harm the scenic beauty of Niagara Falls. In my judgment, not in the slightest degree. The Chairman. The treaty provides for 56,000 cubic feet per second. ^[y. Driscoll. AVe have no jurisdiction over that. All we have jurisdiction over would be the 15,600 cubic feet per second that is now being used and the 4,400 feet additional that is not being used. Mr. Cooper. How^ much would it be in the aggregate? Mr. Driscoll. Twenty thousand on the American side. The limi- tations that have been placed upon the waters of Niagara Eiver should be released. That is, I do not believe that it was the inten- tion of the law^ to control the Avaters below" Niagara Falls, where I understand there is a drop of some eighty odd feet. If that water should be used for power purposes in the lower Niagara it would be a great benefit to the people, and it would not impair in any Avay the scenic beauty of Niagara Falls. I do say, gentlemen, that when your committee present the bill it should, in my judgment, be one so perfect that it would not be necessary for Congress to cross a "' t " or dot an " i " in its amendment. The Chairman. But how can we do that? ]\lr. Driscoll. I am going to leave that to the chairman and the gentlemen of the committee. I loiow that it is a veiy difficult propo- sition. I full}^ agree with Mr. Simmons that this is one of the greatest questions that will ever come before this committee affecting power regulation. I believe there should be some law in this country regulating the maximum and minimum cost of powder. We have been told that there is 160,000 horsepower coming in from Canada. I can not find any reason why we should not have more power if we have the market to develop it. Mr. Flood. But do you think that the price to the consumer should be limited ? Mr. Driscoll. Absolutely. I thank you, gentlemen, very kindly. There are several gentlemen here, including representatives of the chamber of commerce of the city of Buffalo. They have been spending a good deal of time here and I hope they will be heard. Mr. Si:mmons. I would just like to ask one question. Do you think the public-service commission would safeguard that proposition in the city of New York ? Mr. Driscoll. That I can not answer, gentlemen ; that is quite another proposition. The Chairman. The committee will now hear from Representative Doremus. of Michigan. 18 PEESERVATION OF NIAGARA FALLS. Mr. DoREsius. Mr. Chairman and gentlemen of this committee, I think you all miderstand that perhaps no city is more deeply interested in this question than Detroit. We have pending at the present time a street car settlement that will be voted on by the people next Tuesday. That settlement carries with it the ques- tion of embarking in the municipal ownership of street railways. If they decide to operate the street railway system now or at a later period they might be interested in getting this cheaper i)()wer. "We have in Detroit a municipal lighting plant Mr. Levy. What is the distance from Detroit to Niagara ( Mr. DoREMUs. I do not know, but I Avould say, offhand, 300 miles. A Member. Two hundred and twenty-five. Mr. DoREMt's. The ccmstitution of the State of Michigan gives the city the power to engage in private lighting. There again you will see the interest which the people of Detroit have in this proposition. Our manufacturers would like to get cheaper poAver and the citizens of Detroit would naturally like to get cheaper lighting. Under the Burton Act, as I understand it, it is absolutely impossible for them to get this power from Niagara Falls. A private corporation has a contract at this time for 25,000 horsepower Avith the hydroelectric commission of Canada, but Mr. Monaghan. Avho is to appear before this committee, is on his wa}' here now, and he will tell you about that. I understand his train has been delayed, but he will be here some time this forenoon. AVhile we are deeply interested and Avant to utilize a portion of this power, we are also interested in seeing some sort of regulation over the prices charged the consumers in Detroit. I do not think it should be left in the power of any cor- poration to exact exorbitant prices from the people of Detroit or any other city. I merely Avish to make a suggestion. I think this is a matter over Avhich the Federal Government has exclusive conti'ol. Certainly if we have the right to exclude this poAver from Canada entirely, we have the right to regulate the price; and it occurred to me that it might be a good idea to place this entire matter in the hands of the Interstate Commerce Commissiell the power to the city? Mr. DoREMi s. They have a contract to sell -25.000 horsepoAver, and they intend noAv to extend the poAver to Windsor. I am assum- ing, gentlemen, that tlie treaty betAveen this country and (ireat Brit- ain accomplishes the purposes for Avhich it Avas made and that it does amply protect the scenic beauty of the Falls. A Member. What is the nearest place to Detroit ? Mr. Doremus. I am not prepared to ansAver that. I should have mentioned it, Mr. Chairman, but Ave have no public-service com- li PRESERVATION OF NIAGARA FALLS. 19 mission in Michigan with power to reguhite prices charged the con- sumers of light and })ower. ^Ir. iSiiAitP. Do you tliink it wouhl be competent for C(mgress to confer jurisdiction upon the Interstate Commei'ce Commission to determine the reasonableness of rates on power transmitted from Canada into this country? Mr. DoREMUs. I do not think there is any question about it, under our constitutional power, to regulate commerce between the States and foreign countries. ^Ir. Flood. I notice in the Smith bill a provision tiiat no charge shall be made to individuals or munici])alities greater than in Can- ada. AVhat do you think of that? Mr. DoREMUs. I dt> not how that would operate in practice. The object of the Canadian Government is to furnish power from the Falls to Canadian cities at actual cost. Xow, if this power is to be used in Detroit through a private corporation it would be entitled to a fair return on the capital invested, which, of course, it could not obtain if required to furnish the power at cost. Mr. Cooper. Where can w'e get the specific information? Mr. DoREMLS. I think from the hydroelectric commission of Can- ada. Mr. Cooper. I mean, is there any official document in this country that will giA'e us that information? Mr. DoREMUs. I do not know. ]Mr. Flood. You think, then, Mr. Doremus, it will take some more legislation than that indicated in the Smith bill? Air. DoRE-Airs. "^Miy, I judge that ought to be changed in some de- gree, although I have not given that particular feature much con- sideration. But I do think there should be some legislation, and the rates should be under the control of the Federal Government. Mr. CuRLEY. I was going to ask you if you could state the differ- ence in prices between the manufacturers of electric light in Detroit and that which would be made in consequence of this lighting scheme? Mr. DoREjrxs. The only thing I can say is what Mr. Monagban said, that they could furnish it for "20 per cent less than is now charged. Mr. CuRLEY. Would the private operating companies that are now doing the work in Detroit find it advisable to continue it at 20 per cent of the present rate? Mr. DoRE.Airs. AVell. I do not think that they would be driven out of business. The Chairman. The committee will now hear from Mr. George P. Sawyer, chairman of the committee representing the Chamber of Commerce of the city of Buffalo. Mr. George P. Saav^-er. The chamber of commerce in the city of Buffalo has thought it worth while to send a committee here, con- sisting of myself and my two colleagues, in order to say to you gentle- men that there is a very exigent demand in the city of Buffalo and in western New York for an increased amount of power. From the time of the Pan American Exposition, 10 years ago. we have called our.selves the " Electrical City." Our plans, our investments, our de- velo])uient. have been based upon the benefit of Niagara Falls power. We now get from the Niagara Falls, through its distributor, an 20 PRESERVATION OF NIAGARA FALLS. average of about 160,000 horsepower. Another company only skirts the boundaries of it. Our sovereign neighbor, the city of Laclva- wanna, where one of the hirgest steel companies is located, is a large consumer of power and practically a part of the city of Buffalo. There is a consumption b}^ this secondary company of perhaps twenty or thirty thousand horsepower, so that we use, maybe, a himdred thousand horsepower there. Mr. Flood. AVho do you get this power from ? Mr. Sawyer. The Niagara, Lockport & Ontario Power Co. dis- tributes to Lockport and the Ontario Power Co. distributes in the city of Buffalo. The Niagara Falls Power Co. is a growing comi)any. Mr. Flood. How much do you get from that ? Mr. Sawyer. The entire amount? I heard some of that comes from Canada ; but while gentlemen representing these companies are here they can tell you better than I can. I am speaking now of mat- ters that are well known and which are matters of common knowl- edge. The Canadian Niagara Powder Co. is practically owned by the same people who make up the American Niagara Power Co., and they report in their permit about 150,000 horsepower. Mr. DirENDEKFER. That is. about loO.OOO that they are permitted to bring into this country? Mr. Sawyer. That is all that this company can bring. Mr. DiFENDERFER. How much of that is being brought into the United States under the treaty? Mr. Sawyer. All of it. Mr. Cooper. Who issues this permit? Is it by virtue of a treaty or a law, or what? Mr. Sawyer. The treaty has amended the Burton Act: but of course, while I am very anxious not to venture upon subjects that can be better treated by other men — the amount is not strictly limited because the companies have the power — they have limited the power that they can import, but just in what way I do not know. You can get that from the power companies. But we will get about a hun- dred thousand horsepower if, as Buffalo asks* you to do, you give us the treaty — the treaty which is the supreme law of the land — or. we think, should be — and which was negotiated after two years, when every circumstance bearing upon the matter was brought up to a highly skilled and trained body. Since then, by means which seem to me to be unfortunate — but I am not here, gentlemen, to make a speech or to be lengthy ; I want to bring my reuuirks to a close. On February 16. 1911. the Chamber of Commerce of Buffalo sent a telegraui to Senator Root. At that time the act was pending. The telegram stated that the Chaml)er of Commerce of l^uffalo de- sired most earnestly the extension of the Burton lull for a further period of five years, and asked for a public hearing at wliirh to present their views, asking his leadership in placing the l)ill in his hands. This was signed by the president of the rhaniber of com- merce. That was answered by a telegram from Senator Poot saying that i)ublic hearings Avere not arranged for, and then another long and very emphatic telegram was sent. This w^as in February. 1011. I hold in my hands a resolution appointing this commitee, and asking, among other things, the increased amount of power. Now. gentlemen, that fixes my official status: and I can say. with- out powev to represent technically, without any authority except that PRESERVATION OF NIAGARA FALLS. 21 covered by the Chamber of Commerce of Buffalo with its 3.500 mem- bers, that from Dunkirk to Syracuse, in the middle of the State, this same prayer goes up to you. The street cars in Syracuse are run by Niagara power. Rochester, Auburn, and many other places — a dozen — have their public utilities operated by this power, and they all want more. These two companies — one in Buffalo and one in the immediate vicinity of Buffalo— can take on to-day a new cus- tomer who wants more than 2,000 horsepower ; but they must reserve that for the man who has taken 20,000 horsepower. As his business increases he must have more and more. We are noAv at a power famine. This treaty has been negotiated, and yet it has been ob- structed, and we have come to pray that it be no longer obstructed. Mr. DiFENDERFER. Then, your principal concern is that more power be created for the purpose of consumption by people who need it in your city of Detroit? Mr. Sawyer. Yes, sir. yir. DiFENDERFER. That is your principal contention. Then, if that is true, is it not just as necessary to your people that it should be transmitted more cheaply? Mr. Sawyer. Just so. Mr. DiFENDERFER. Then, would it not be better for a commission to regulate that? Mr. Sawyer. I hesitate to ansAver that. I am a layman in this matter. I do know that there is nothing so complex or difficult as computations about electrical power. It is not like ale, which you can measure by the drink or pint or quart or by the gallon. There are gentlemen who are producing large amounts of power who say they can produce it just as well by steam. Mr. Frank Henry, of the Washburn Mills, told me the other day that he could make it just as cheaply making it in the city of Buffalo; and yet there are people who can tell you that electrical power does not cost half the amount that steam costs. Mr. Levy. I understood you to say that there is a practical i)ower famine? ]\Ir. Sawyer. Yes, sir. Mr. Levy. And that to do justice to the people of Buffalo and vicinity and a large part of New York, it is necessary that the Falls may be made to yield more electric power. Is that so? Mr. Sawyer. AVell. we should import what we can under tlie treaty; yes, sir. Mr. Levy. Yes. Now. then, when that limit is reached there will be large plants, and won't there be another famine? Mr. Saavyer. AVell, sir, that I can not ansAver. Mr. Levy. And then Avon't there be another famine? Mr. Sharp. A demand for the abrogation of the treaty? Mr. Saavyer. AVell. the treaty exists. When you come to move as large a party as the United States Government, plus the Government of (irreat Britain, why, that thing Avill have to be met by a future generation. Mr. Levy. If they should invent a storage battery that is as use- ful — and that is practically possible — there is no reason why they shoidd not store up power during the night? Mr. Saavyer. Yes, sir; enough for a generation. 22 PRESERVATION dl' NIAGARA FALLS. Mr. Li:vy. There luiglit be tliscoverecl some substitute for elec- tricity, but that is not probable. You say that the people oi Butialo want this on account of the power famine. Now, then, if this is done, the limit will be reached again and there will be another famine? Mr. Sawyer. Is it not an adequate answer to that question to say that we have a treaty siirned by the President, that this treaty was practically imattacked for a length of time, and then this was slipped over on use? "We come, seeing that the presumption is in our favor on account of this treaty, and I can not assume the role of a prophet as to Avhether we shall want more. Mr. DiFENDERFER. Right on the line of Mr. Cooper's question; as I understand it. it is a fact that out of IGO.OOO horsepower that Canada is permitted to put into this country only 110,000 of it is being used now. If that is true, then there are 50,000 horsepower remaining in Canada that can be used. Why should there be a famine ? Mr. Sawyer. I could answer that, but Mr. Garner. Might I ask you a question? The basis of this treaty was the preservation of the beauty of Niagara Falls? Mr. Sawyer. Yes. sir. Mr. Garner. And thus we are fighting the proposition of per- mitting a gi^eater amount of power to come from Canada. That is with the presumption that Canada will not use all the ])ower that the treaty now gires: is that not true? Mr. Sharp. Domestic. Mr. Sawyer. Why. no; I think that is a matter of information. Mr, Garner. I will ask you this question, then: If Congress did not ])ass laws regulating the importation of power from Canada, you could bring in the full amount that the treaty permits Canada to produce? Mr. Sawyer. Yes, sir. Mr. Garner. And also use the full amount that the treaty permits the United States to utilize ? Mr. Sawyer. Yes. sir. Mr. Garner. Now. the only discussion would be to determine whether or not Canada could use that power at present ^Ir. Sharp. Domestic. Mr. Garner. All kinds of power: from both Canada and the United States. Mr. Sawyer. I admit that: I admit that: but we who have been in Buffalo know that the cry about the l)eauty of the Falls is more neurasthenic than ])rac-tical. You know that we can go to the Kails day after day and year after year and never see any perceptible dif- ference in the beauty of the Falls. Noav, there are other men who can argue that better, but the substance of your question was that there was some invasion on this scenic beauty, and that I deny. Mr. (iarner. !My object is this: In case Congress should extend it it 1(10.000 horsei)ower. would it not naturally follow that in the course of time manufacturing establishments would be created along the border, where the entire power would be utilized by Canada and the United States Avould have none? ]\Ir. Sawyer. Certainly; the water will be abstracted anyway. PRESERVATION OP NIAGARA FALLS. 2:3 Mr. Garner. As I uiKlerstand the Representatives who Avoukl like to see the scenic beauty preserved, if we prevent a foreign power being imported into the United States it will be years and years — probably a century — before the power will give out? Mr. Sawyer. Oh, no. Mr. Smith, of XeAv York. Mr. Garner, there is one other speaker following who will answer that. Mr. Curley. What is the difference in the prices charged by the two operating companies up there? Mr. Sawyer. I do not know anything about the price. Mr. Curley. AVhy. of course you know ; you are a member of the chamber of conunerce. Mr. Sawyer. No; I am struggling to fully answer all your ques- tions. Mr. Flood. It seems to me that these companies have divided the territory' up. Mr. Sawyer. Apparently ; but that is not true. The greatest diffi- culty I have is in talking about two things at the same time. All that I know is that there are two companies in Buffalo. Unfortu- natelj^ we have certain theoretical gentlemen who have never at any time accomplished any good for themselves or anybodj^ else, but who are abundantly able to run all the civic associations, public-service corporations, banks, and everything else. These gentlemen say that we will be obliged to go outside; that is what sent them, I assume, to Dunkirk, to Auburn, and to Montmorris. Mr. Flood. AVhat sort of a contract did this company in Buffalo make ? Mr. SA^\'YER. I can not go into that. Mr. CrRLEY. You will agree that it is a very important question? ]\Ir. Sawyer. Oh, no. Mr. Curley. Then you can withdraw it. Mr. Sawyer. Yes ; but they Avanted to specify other things. Mr. Kendall. What do they charge for a kilowatt? Mr. Saavyer. I do not know. Mr. Kendall. You are here representing nobody ? ]\Ir. Sawyer. Xo. sir Mr. Kendall. Are you interested in any of these companies ? Mr. Sawyer. Certainly I am not. Mr. Kendall. What do you use in your place — kerosene or gas? Mr. Sawyer. Gas; natural gas. Mr. Kendall. Are you in business in Buffalo ? Mr. Sawyer. Yes, sir. ^[r. Kendall. Use kerosene? Mr. Sawyer. I am a director in various com])anies that use that, but I am not strictly a manufacturer. Mr. Kendall. You buy a lead pencil in a store and you know what you pay for it? Mr. Saavyer. Xo. sir; I have a stenographer aa-Iio buys them, and I AAould go crazy if I tried to knoAA- what I paid for eAcrvthing. [Laughter.] Mr. Curley. I assumed that you AAere a {)ractical man because you spoke so slightingly of the theorists, and as a practical man you should be familiar AA'ith the prices charged per kiloAA-att Mr. Difenderfer. Will you ansAver my question? 24 PRESERVATION OF NIAGARA FALLS. Mr. Sawyer. Every contract that is made has to be filed with the public service commission. I am a director of a company — I hapj^en to be the president of a company which had to negotiate for a con- siderable quantity of Niagara power, and we could not do it because I thought Ave could light our office building cheaper in the old way, and we have been going on and taking care of things. Last month we made a contract for a long term of years with an electric com- pany. I do not know Avhether we have gotten it more liberally, but I think they have come down. Now, these prices all have to be O. K'd. ; ever}" contract that is put on file. The Utilities Commis- sion of the State of New York has been in operation since July 1, 1907. Its decisions and the character of its members has given that commission a standing that is similar to that held by our Supreme Court or even our Court of Appeals. A good many of them are laymen, but some of them are lawvers, and I think that answers the question of price in New York State. I think tlie complications growing out of any attemj^t to make the price parallel to that of any other country is likely to be futile, but that is only my opinion about it. Now, gentlemen, I have one otiier thing to say from the chamber of commerce, and that is, that we want you members of this commit- tee to come up there as our guests and see the Falls and study them at close hand. Gentlemen, remember that we have been studying this proposition since 1890, when the first electrical installation be- gan, and it is full of pitfalls and full of complications, and a man must be almost superhuman who can handle this as an academic proposition without having the thing before his eyes and mind, to get really the idea. I have had the h(mor of conducting to the Niagara Falls the President of the United States and spending a day with him Mr. Legare. I want to ask you this question: Was not the question of scenic beauty settled by this treaty? Mr. Saavyer. Certainly. Mr. Legare. Was not the treaty brought about by the endeavor to find out just hoAv much Avater could be used Avithout affecting the scenic beauty? Mr. Saavyer. Yes. Mr. Legare. And did not that commission of scientists decide that the amount of Avater used in the treaty could be used without affect- ing the scenic beauty and no more? Mr. Sawyer. Yes. ^Ir. Legare. And avc can use the limit, tlien. mentioned in the treaty ? Mr. Saavyer. Yes, sir. Mr. Flood. A more important question is the question of the price of this power transmitted from Canada. ^Ir. Saavyer. T only AAant to get my invitation out. ^Ir. Garner. If it is the duty of this committee to go to Buffalo and Niagara Falls for the purpose of seeing the Falls, is not it the duty of the people of the LTnited States to pay the expenses? Mr. Saavyer. I am not a casuist, but I can not answer your question. The Chair:man. You have no objection to the members paying their OAvn fares? PRESEBVATION OF NIAGARA FALLS. 25 Mr. Sawyer. Not the slightest. I have been there on several oc- casions with the Committee on Rivers and Harbors. Now. we want you to come to the city of Buffalo, which has a hundred thousand dollars to spend on advertising . Mr. Kp:xdall. And entertainment. Mr. Sawyer. And this would be a very cheap method of coming there. If you don't want to come at our expense, come at your own. It seems to me a needlessly sensitive question — only a matter of two days' banging around in a sleeping car. I think it is almost a sense- less objection. We are so confident that you will agree with our posi- tion if you will come there and look at the Falls. Mr. Kendall. The treat}'^ had its origin out of a general demand that existed in this country and in Canada for the preservation of the scenic beauty of the Falls? Mr. Saavyer. Yes. Mr. Kendall. I think you will agree to that. Mr. Sawyer. Yes. Mr. Kendall. And prior to the negotiation of the treaty the tes- timony of the most competent experts in this country and in the other country was taken as to the amount of water diversion that could be safely authorized and contemplated the preservation of the Falls? Mr. Sawyer. I so understand it. Mr. Kendall. I think Mr. Root represented this Government and Mr. Bryce the other Government? The Chairman. Yes. Mr. Kendall. They determined that not more than 36,000 cubic feet of water a second on the Canadian side and 20,000 cubic feet a second on the American side could safely be diverted. What is the equivalent horsepower of a cubic foot of power? Mr. Saavyer. That depends on the effectiveness of the installation. It takes from 13 to 15, or even to 17. Mr. Flood. It was said before this committee last summer to be 17. Mr. Kendall. Taking 15 as the mean, that would mean then that the United States would have the right to create 300 horsepower Mr. Saavyer. Fifteen The Chairman. Fifteen times twenty thousand. Mr. Saavyer. Yes. Mr. Kendall. And Canada would have the right to create 36 times 15? Mr. Sawyer. Yes. Mr. Kendall. Now. under the provisions of the Burton laAv only 160.000 horsepower can be transmitted into the United States? Mr. Saavyer. Yes. Mr. Kendall. How much of that is now being appropriated by people on this side? Mr. Saavyer. "Why don't you let these engineers answer that Avhen they come? I think there is a dead charter over there that is held in a dog-in-the-manger kind of way; but there are gentlemen here who can answer that, so please let me go. The Chairman. Mr. Sawyer, there are eminent engineers here Avho .can go into those details. \Vhat I would like to have you tell us is what the people of Buffalo Avant. I am a friend of Buffalo. Tell us Avhat the chamber of commerce and the people of Buffalo want ? 26 PRESERVATIOX OF NIAGARA FALLS. Mr. Sawyer. Thev want more power. They want the limitation removed. They want all the power that will come from forty-four hundred additional cubic feet per second on this side. The Chairman. In other words, they want what the treaty gives the United States^ Mr. Saavter. Yes; any they don't lake any hand in the distribu- tion of this forty-four hundred feet. Of course, we want it where we can get it. Mr. (tarner. We want to thank you for your very kind invitation. Mr. Sawyer. I do insist that that is open to you at any time. The Chairman. The committee will now hear from Gen. William H. Bixby. Chief of the Corps of Engineers of the United States Army. REMARKS OF GEN. WILLIAM H. BIXBY, CHIEF OF THE CORPS OF ENGINEERS OF THE UNITED STATES ARMY. Gen. Blxby. Gentlemen. I came here with a little more haste than I expected this morning, because I did not have much notice that I would be called to 10 inches will produce in scenic effect. Now, our reports give photographic views at high water, at low water, and at mean water on th.e Falls, so that anvbody cnn look at these pictiu-es and see how much each portion of the Falls is affected — how the Falls show up. The Chairman. And can it be perceived. General? Gen. BixBY. Oh, yes; the pictures show the three stages of water. Mr. Garner. General, might I ask you whether or not you have es- timated the effect it would have to consume the entire Avater allow- ance authorized by the treaty on both sides of the Falls? Gen. BixBY. We have not figured that out for the total consump- tion, but it can be figured out roughly from these other figures and there would not be much difference. Mr. (lARNER. In other words, it would not affect navigation? (xoi). l^ixBY. Its effect on navigation Avould be something less than 2 inclies on Lake Erie, and of course a fraction of that would back up on LalvC Huron. Ml'. Kenoall. What is 26,000 feet per second, general? (tcu. BixBv. AVhv, we had the authorized diversion of the United States and the estimated diversion on the Canadian side, and we had taken the actual measurements at different stages as bases, and then figured these dispersions to get the mean effects for these places. Mr. Kendall. The authorized diversion on the American side is 15.600. (ren. BixBY. Not by the treaty. That is 20.000, but at the time when these reports were going through we were working undev the Burton Act. v 28 PBESERVATIOX OF NIAGARA FALLS. Mr. Kkndall. Of course, the Burton Act does not authorize any hirger diversion than is inchuled in the treaty. Ml'. Flood. He is talking about (ien. BixBY. They were estimated to be using 11.000 on the Cana- dian side: we took 26,000 as the total. Mr. Flood. You said to divert the additional 4,400 feet would not hurt the Falls (jcn. Blxby. The additional 4.400 would not be noticeable. Mr. Flood. But the difference in the Falls that you can see in the .pictures is that due to the low water or to the diversion that has already taken place? (leiL BixBY. To both. Mr. DiFENDERi-ER. Now, just let me get this into my head. Maybe you understand it, but I do not. Suppose it is low water, it is 10 inches lower than it would have been if there had been no diversion, is it not, at low water? Mr. Le<;are. If there had l3een no diversion at all. Gen. BixBY. Ten inches lower from what? Mr. Cooper. If there was no diversion at all, this taking out of 26,000 puts it 10 inches lower than it Avould have been had there been no diversion. Gen. BixBY. The total diversion is figured to produce 4 inches drop in level at the American end and 9 at the Canadian end. That is fig- ured at a mean stage, and it is probable that it would be the same at a low stage, or at the high stage. That is, figuring 15,600 cubic feet on the American side and 11,000 on the Canadian side, making 26,600 total diversion from the Falls. Four thousand four hundred would- be about one-sixth of that. ISIr. Kendall. The computations you have made there were on the assumption that only 26,000 cubic feet were diverted? Gen. BixBY. Yes, sir. Mr. Kendall. Under this treaty Canada has the right to divert 36,000 cubic feet per second and the United States has the right to divert 20,000? (ren. BixBY. Yes. Mr. Kendall. Now, suppose that entire diversion should occur? Gen. BixBY. Yes. Quite likely we would get double the drop we have at present — about 8 inches on the American end and about 18 inches on the Canadian end. Mr. Kendall. That probably would not affect navigation ma- terially ? Gen. BixBY. No, sir. Mr. Kendall. What effect would that have on the scenic beauty of the Falls ? Gen. BixBY. It would make more than the difference you can see in the photographs, between the mean and low stages. Mr. Cooper. That does not include the Chicago Drainage Canal? Gen. BixBY. No. Mr. KENDALii. How much is utilized bv the Chicago Drainage Canal? Gen. BixBY. Well, they have an allowance of between four and five thousand cubic feet from the Secretary of War. They are practically using, I am told, in the neighborhood of 7,000. They built their works for 10,000; and their statement that their canal could carry PRESERVA'LION OF NIAGARA FALLS. 29 10,000 was in tlieir original request for a permit, and this is consid- ered as their limit, and was so treated in the International Water- ways Commission reports. Chicago has been requesting the Secre- tar}^ of War to grant them the privilege of using 14,000, saying the canal can take it. Now the actual consumption of to-day is between five and eight thousand. A Member. Now, we are utilizing at Niagara 15,600 diversion — practically ? Gen. BixBY. We have not found that yet. Last year the report of June 30, 1911, showed the total diversion on the American side as being only 13,800 cubic feet a second, and the total diversion on the Canadian side was only 11.010 feet per second. A Me:mber. Whv do we get the figures constantlv recurring here — 20.000 and 36,000 ? (xen. BixBY. Because that is allowed by the treaty. A Member. But it is not what is being actually taken? Gen. BixBY. No; it is not what is being actually taken. A Member. Now, take what the Chicago Drainage Canal takes in addition to this 20,000. Gen. BixBv. Nobody knows just how much they are entitled to at Chicago. The figures at Niagara are the 20,000 for the United States undei- the treaty and the 30.000 for Canada, and have nothing to do with Chicago. A Member. Is it your idea that the 20,000 does not affect the amount taken out for Chicago? Gen. BixBY. Why, 3'es. Ml-. Kendall. You mean from a treaty standpoint? (xen. BixBY. From a treaty standpoint. The Chairman. General, there seems to be some confusion as to the figures that yo\i used. I believe you stated that Horseshoe Falls has been lowered about 4 inches on the American side and 9 inches on the Canadian side, and I understand you to say that the. American Falls show only about five-eighths of an inch. Is that correct? Gen. BixBY. Those are the figures; they are given very carefully in a statement in this printed I'eport that is coming out. The Chairman. General, have you made any investigation as to the effect on the lakes? Gen. BixBY. The efl'ect follows from one lake to another, but it is diminished in passing from Lake Erie to Lake Huron. If Lake Erie stands higher, so does Lake Huron, but the difference is small if you consider what is backed up. Mr. Cooper. ^lay I ask you a question ? Do you know wljether all the water that is now being taken is being taken from the river above the Falls? Gen. BiXBY. It is taken from dilferent places along the river, up quite a distance. Mr. Cooper. Would it be possible to secure sufficient power from the lower river? It has been stated that tlie Falls drop about 82 feet in the distance of about a mile and a half. Do you think it would be possible to change that for commercial purposes ? Gen. BiXBY. Why. I could not judge how" much Buffalo wants; but you could get a large power, of course, by putting a dam across 28305—32 -3 30 PKESKHVATIOX OF NIAGARA FALLS. the Niagara Kiver at the lower end where it comes int(> tlie lake, and so utilize the water that conies from the Falls. A Mk:\ihei{. But that is not on the Falls. (len. BixBY. Down below the Falls. The Chaiioian. Gen. Bixby, Mr. Eome G. Brown would like to ask yon a few questions. Gen. Bixby. Ye.s, sir. jNIr. Broavn. Simply for this purpose, having in mind what I remember to have been one or two conclusions of the engineers' report last year, I thought I would ask the General if my conclu- sions as to his conclusions are correct. Is it not true that the sur- vey's made by the United States surveyor show substantially that the entire aniount of the diversions at Niagara Falls — those actually made and those authorized — would not have any appreciable effect, any substantial injurious eifect, upon the navigation of the Niagara River or Lake Erie? Gen. Bixby. Yes, sir. Mr. Brown. That, as I understand it. is a conclusion, is it not— that there is no serious injurious effect ujion navigation? (xen. BixBY". The effect is appreciable. The question is whether its effect on conunerce is of serious moment. The difference in level in Lake Erie would be approximately about 2 inches: and with all the commerce that floats upon the lake the question, then, is, What is the value of a difference of 2 inches in a draft of 19 feet? Mr. Brown. That is 2 inches at the outlet? Gen. Bixby. Yes. sir. Mr. Brown. The entire lalce? Gen. Bixby. Yes; because Lake Erie is supposed to be level. Mr. Brown. As I understand you. the diversions made and au- thorized Avould not have any substantial effect upon navigation? Gen. BixiiY, Well, the report says that the effect can not be neg- lected. Its effect is small because it is only 2 inches. The Chairman. General, practically all of this water goes over the Falls, does it not? Gen. Bixby'. All of the water that is used for power purposes at Niagara River comes down toward the Falls: some of it is taken out and goes around the Falls, and it all goes out of the river into Lake Ontario. The CHAiR:vrAN. The water used for power does not go over tho Falls, does it? Gen. Bixby. The amount that is used for power does not go over the Falls. The Chairman. In other words, if the water was not diverted it would go over the Falls ? Gen. Bixby. Yes, sir. The Chairman. That is the point. Gen, BixBY'. Yes. The Chairman. So that so far as the lowering of Lake Erie is concerned — that is immaterial because it would be lower anyway ? Gen. Bixby. No, no; there is a point in there that does not show up at first sight. The Chairman. Tell us just what difference does it make? A Member. A layman might understand that if you offer a means of outlet the water will go out. If you build a dam across a creek PEESERVATION OF NIAGARA FALLS. 8iL or ill a gutter it will flow around; if you put a ditch there it will flow more rapidly. The CiiAiKMAN. Tluit is the proposition I wish you would explain. Gen. BixBY. Yes, sir. Now, when the water flows over the crest of the Falls it drops freely and there is not anything to stop it ; con- sequently it falls downward at a greater speed than it has in the Niagara River above the Falls, and the only reason it does not move so fast in the Niagara liiver above the Falls is because of the fric- tion of the rocks on the bed of thei stream, and also because of the particles of water in its own way, so that the Avater above the crest of the Falls has to go somewhat slower. When it goes over the Falls it goes much more rapidly. NoAv, the pumping of water out of the Niagara River for power purposes does take aAvay from that river above the crest of the Falls a certain amount of water and a certain amount of resistance to the water above; so that the water above comes down much more rapidly than if you did not take oiU the water below. In the same w'ay as if a crowd of people were coming down a staircase: if you have a policeman come along and take away the front third of the people, then the crowd in the rear can move along so much the faster. So that at Niagara Falls the diverting works do the policeman's work of taking the water awa}^ more quickly below, and the water above moves faster (m account of the diversion ; and as it moves faster the level of Lake Erie drops somewdiere between 1 and 2 inches. The Chairman. I think, General, you have made that dear. Mr. DiFENDERFEij. Moviug faster? Gen. BixBY. Yes, sir. Mr. Kendall. Let Mr. Brown finish his exauiiiiation ; he is still on his feet. Mr. X>R(^- like that. Mr. BRt)WN. That is, an easterly bree/e has been known to raise the level of Lake Erie^ Gen. BixBV. The easterly breeze raises one end and the westerly raises the other. Mr, Bijowx. Well, it piles it up — may make 14 feet difference? A Membkk, Fourteen feet where ? Mr, Broavn. An easterly breeze might pile up the waters 8 feeti' Gen. BiXBY. SomcAvhere around that. Mr. Broavn. And at the same time would affect the depth to some extent all over the lake, and at the same time it affects the depth over the Falls ^ Mr. Kekdall. These propositions seem so self-evident. Mr. Broavn. I Avas only bringing them out to emphasize the effect of natural canses — for comparison. Mr. Cooper. Noav, I ask you to refer to page 15; it is later and, under the ordinary rules of construction in laAv. ought to represent your later impressions. , ] Heading from document :] " The Falls are held in trust, etc.. from the Canadian side." Is tliat your con- clusion? Gen. BixBA'. That Avas the conclusion of the Avriter of this report. Mv. Cooper. Who wrote that ? Gen. BiXBY. Maj. Keller. ]\Ir. Kendall. Is he an expert in your department? Gen. BixBY. Yes, sir. Mr. Cooper. I Avould like to read this on ])age 15 [reading] : ''An earnest consideration of the effects, five to five-tenths inches." Mr. Kendall. Canada is likely to diA'ert all under this treaty Avithout our control. Mr. Cooper. I observe this photograph was taken at a time Avhen tourists are most generally at the Falls — midsummer, July 26. I observe for a long distance there is no Avater going oA'er there, ap- parently ; and if it is, it is a very straggly, scraggly stream. If that was loAver, how much more scraggly Avould that look? Gen. BixBY. If you take aAvay all the Avater, the Falls Avill be gone. The question is simple: but Avhere are you going to draAv the line as to amount to be taken? Mr. Garner, (ieneral, I did not know until Mr. Cooper read it into the record that your department Avas considering the question from the scenic vieAvpoint. There are four propositions being con- sidered. The first question is. Will Congress take any action to govern the taking of this water or let the treaty stand as the laAv? The second proposition is, if we do, Shall we permit on the American side more diverting of Avater than is contemplated under the Burton Act? The third is Avhether Ave shall permit i)OAver to be transmitted from the Canadian side in excess of Avhat is alloAved — 100,000 horse- poAver. Gen. P>ixBY. AVell. I should like to take up the questions rather in the inverse order, because I can ansAver them more quickly in that Avay. So far as the importation of poAver is concerned, the P^ngineer Department has no interest whatever, so far as I am able to discover, I have ahvays considered that it was a question of protection or tariff or both. It has no value to us from an engineering point of view. It is a question that would possibh^ come up under conserva- 34 PRESERVATION OF NIAGARA FALLS, tion. If we want to conserve power to the United States, there should not be any objection whatever to importation of electricitj' ; but the United States, through the War Department and Chief of Engineers, has watched that question simply because it was laid down in the Burton Act, and as souiebody had to do it, the Secre- tary of War did it. Xow, we have tried to follow out the condi- tions of the Burton Act, but it is exceedingly difficult for us to hud out how nuich electricity is generated on the Canadian side, and it is a question of some difficulty to say how much thej^ would send over the Niag-ara River if there were more cables; and such measurement is a piece of difficult work which the Engineer Department is not specially interested in, but it is willing to do as well as it can at any time if Congress saj's so. We are willing to do it if Congress so wishes. As far as the importation of power is concerned, the War Depart- ment has no interest one way or the other as to where the electricity goes nor how much of that power is moved in one direction or an- other, but there is a point about the power that we think somebody ought to look after, and that is, in the interests of conservation, the United States ought to see that so nuich of the surplus Avater as is allowed to be diverted should be made to develop all the power that it can give and, therefore, if anybody is going to take water from the Falls to develop power, they ought to use the entire drop of the Falls down to I^ake Ontario, because every foot of drop means that uuich extra power, for if 1 f(K)t gives 1 horsepower, '2 feet will give •2 horsepower, and 10 feet will give 10 horsepower, and so on; and so 1 think the United States ought to select the individuals who can get the most work out of it. We* ought to get some legislation on it somewhere. ^Ir. Kexdaix. I think the legislation in the Burton Act was for the purpose of controlling, as far as it could be done by this (tov- ernment, the diversion on the Canadian side. If that limitation is advancetl or removed, it would to some extent appreciably diminish the scenic appearance of the Falls? Gen. BixBY. Well, personally I do not know auA'thing about this except my own personal views; but I do not expect to see but a very few years elapse before Canada will use every bit of water that it can take and the United States will use every bit of water that it can take; and if the Canadians have any ti'ouble in exporting the poAver fnmi Canada, I do not think it will be more than a few years before they will be using it up at jiome. I think all this power will be used for electricity, and the place of its use is not the concern of the War Department, nor does it concern navigation. Mr. (tarxeh. In other words. General, if we pass a law prohibit- ing that power from being utilized by American citizens. Canada will allow it to be used on the Canadian side? Gen. BixBY. Yes, sir. Mr. Sharp. Of course, that is on the assumption that the Cana- dian Govennnent will not interfere? Gen. BixHY. AA'ell, if they can not find capital at home they will use American capital. Mr. Sharp. I mean for the preservation of the Falls? Gen. BixBY. Oh, yes. II PRESERVATION OF NIAGARA FALLS. 36 A Member. You mentioned tlie fact that this water should be used with greater or more i^otency to devek>p power;' Gen. BixBY, There are jihints now on the American side that do not derive as much j^ower as they can from the water used by them. The Niagara Falls Hydraulic & Manufacturing Co. drops its water 205 feet and gets every foot of work out of it. Now. the Canadian Niagara Co. uses a dro]) of but 140 feet, the Electrical Development Co. uses a drop of but 135 feet, etc., the Hydraulic Co. and the Ontario Co. get about 200 feet drop out of that water, and some others only get 50. Mr. Garnek. General, in that connection, your contention is that, in the interests of conservation, the companies taking the power on both sides should be required to get the greatest ])ower out of the water being utilized? Gen. BixBv. Exactly. Mr. Garner. Now, I can see no way by which the American Con- gress can control the Canadian side, unless they control the importa- tion of power into the United States. We can not control it unless we say to the Canadian ]:)ower companies, *" You nmst cout 11,000 cubic feet. Mr, Sharp. Twenty-four thousand eight hundred. Gen. BixBY. CoL Eiche. in charge of the lake survey, made this report. Mr. Cooper. I observe on page 16 of that report, dated November 30, 1908. reported to the Secretary of War January 30, 100!), a little less than tAvo months later, and then by the President sent to Con- gress August 21. 1911 — I think that is the day we adjourned — the Secretar}' of War sent it to the President on that day. Now. (ien- eral, I observe on August 21 Gen. BixBY. On January 21. 1909; sent to the ]*re>*ident Aui>ust 19, 1911. Mr. Cooper. That is over two years. I observe here on page 10 that there is quite a criticism of the plant there. T have been told by an electrician — I was told by him when I went through the plant — he said at that time that the machinery that was all right three or four years ago had practically become obsolete. Xow, there is some \Qvy suggestive language on page 10 of this report. There is a state- ment in regard to the Niagara Falls Co. that would seem to indicate that that plant is not up to date. Is that so? Gen. BixBY. I judge so. Mr. Cooper, They do not get more than two-thirds of what they ought to get ? Gen, BixBY. Well, if they could have gotton mo!<^ funds at the start, thej could have gotten a bigger development, but they probably went as far as their finances allowed. The Chairman. Mr. Edward A. Wickes, president of the Niagara Falls Powei- Co., desires to make a statement on this point. There being no objection he will proceed. Mr. Edward A. Wickes. AVhen these works w^ere i^-ojected our first three dynamos produced more alternating current than was produced in the United States. We solved every problem that was presented to us. The men whose advice we followed were Lord Kelvin, Turretini, of (leneva: Mr. Unwin, the dean of the Central Institute at London; Mascart, of France; and Colenuin Sellers, of America. They were in session for months. The plans that were followed were laid down by them and superintended here b}' the most eminent body of engineers that we could get. AVe have made no error, and when I asked some engineers the other way — they came from California — ^hoAv many managed to avoid trouble they said, " Why. we copied your methods." Nov.- I make this statement, because " bad work " and "■ bad management " have been suggested. There was never a time when our work halted for one moment for lack of money. AVe started with $2,000,000 and we now have $25,000,000 in it; and every step has been under the best advice. I say this that you might relieve yourselves from asking questions relative to ab- sence of knowledge, AVe installed and have maintained our works so as to get the Ijest efficiency, the most head, consistent with full regard for scenic beauty. If we had put our buildings lower down or at the Fall-, we could have used a hio-her head, but, under the advice of the best artists, to 38 PRESEEVATION OF NIAGARA FALLS. avoid iiian-ing the scenery at the Falls, we placed our power house and works up river, and carry the water from our wheels by a long underground tunnel — all at extra expense and with loss of head: but both these losses were deliberately incurred so as to protect scenic beauty. To discriminate against us noAv in the distribution of this proposed increase, because our head is lower than that of another company, is to penalize us for regarding and to reward others for disregarding the very object of this proi)osed legislation and of the treaty — the preservation of scenic beauty. Gen. BixBY. We have in our office no other thought than that mentioned by the last speaker. Even in our last reports all we are talking about is how it might be done with modern appliances and knowledge to get everything that could be gotten out of it. Mr. Cooper. This officer says "All this is not intended as a criti- cism." That is all. Mr. Garner. General, you have been somewhat diverted. Mr. Sharp. Mr. Chairman, I move that the committee adjourn. It is evident that we can not conclude this hearing this session. The CiiAiR^rAx. Very well: we will now recess until 1 o'clock. Gen. BixHY. Mr. Chairman, I think that I can say all that is ex- pected of me in a very few words. One of the other questions asked was whether the 15,600 feet per second should be increased to 20,000 cubic-foot seconds. So far as navigation and scenic beauty are con- cerned, I do not know of anything in my office that shows that the increase would seriously affect the two; the effect of the diversion of this 4,400 feet around the Falls Avould be practically inappreciable. Tlie second question was Mr. Gar>;p:r. Is any legislation necessary under the treaty? For instance, you have just answered that it would not affect navigation or scenic beauty if the full amount under the treaty was taken from the other side. Gen. BixHY. Yes, sir. Our understanding in the Engineer Office has been that there is nothing in the Burton Act that Avould allow the Secretary of 'War to divide up that 4,400 cubic feet per second. The treaty gives 20,000 cubic feet as a limit, and nobody has been found in our office who is willing to say which company the additional water is coming to; the joint commission says it is not its business, and none of the secretaries will say that the law authorizes him to step in; so nobody has a right to say who shall get it; and anj^ action we would take in the engineer department Avould be simply to rei)ort against anybody taking it. Mr. fiARXER. Then, as I understand you. we nuist either perpetu- ate this treaty or give the War Department authority to revoke per- juits? Gen. Bixnv. Oui- office thinks that Congress nmst say how that 4.400 feet is to be divided and who is going to divide it. Now, as i-egards the increase from the old amount — uj) to 20,000 on the American side and 80,000 on the Canadian side — it has at least one good point, and that is that it does fix a limit on the Canadian side, where no limit was before. Whether that SG.OOO feet total diversion is going to injure navigation or seriously injure the Falls, is some- thing tiiat our office thinks can be judged from the data which we l)ut into this last re])ort. which is being printed aiid which is dated PRESERVATION OE NIAGARA FALLS, 39 in June, 1911, we think that report will give you gentlemen in Con- gress all the facts so far as they can be put down on paper. One of the photographs shows the contrast between the looks of the Horse- shoe Falls on three occasions. At one of them the flow is about 60,000 feet a second greater than it is at the other, and you can see the effect in the difference between the photographs. The CiiAiRMAX. HoAv soon Avill this last report be printed? Gen. BixBY. We are looking for it every day. Mr. Garner. Has it been sent to Congress? Gen. BixBY. Oh, yes ; it has passed the proofreader. Mr. Smith of New York. How do 3^011 account for a lowering of 9 inches on the Canadian side and 4 inches (m the American side? Gen. BixBY. It is due to the slope of the bed of the stream and to the way the water is taken out and to the shape of the Falls. Mr, DiFENDERFER. The Falls are about 4 feet lower on one side? Gen. BixBY. Yes, sir; and it is due to the force of the Avater and the way it is pumped out. Mr. S311TH of New York. The photographs show an exposure of the crest line of the Horseshoe Falls. You made a suggestion by which the water could be spread out, thereby continuing the scenic beauty of the Falls. I wish you would explain that plan to the committee. Gen. BiXBY. It is ahvays possible from an engineering point of view, though sometimes expensiA^e, to regulate the flow of water in a rock-bed river like the Niagara River at that point. We could construct sills for that part of the river in such a way as to stop the present rapid retrogression. We could make the water quite uniform. Those things can be done, but they are, of course, very expensive. The best we can do is simply to get a little better appearance out of the Falls with a lesser quantity of water than we are getting to-day by correcting the irregularity of the flow at the borders; but in such matters I always go back to my boyhood days when I went to the Kauterskill Falls. I suppose as a very small boy the Kauterskill looked large. But I went up there some years afterwards, and if I would pay the OAvners so much they would turn the water on and let me see half as much Avater as I saAv formerly. If I did not pay, they AA^ould not turn the AA^ater on. So it is simply a question of AAdiere you Avill draAv the line betAAcen no Avater-poAver dcA^elopment and the unaltered Falls, and a full Avater-poAver dcA^elopment and no Falls; and only Congress can draAv that line Avith the cooperation of Canada, The Chairman, I belie A-e that ansAvers the questions, Mr. Sharp. Mr. Chairman. I move that the committee rise. The Chairman. Just a moment. Gen. BixBY. I do not think of anything else that I care to say, except to re})eat once more that the Engineer Department, of course, finds a great deal of trouble and Avorry in supervising the water diversions and the water poAvers; but we probably haA^e, at the lake surA'ey, as good an organized force as is needed to do the work, and so we can do the AAork; and AAhile we do not especialh' AAant it. we are not espe(nally objecting to it. If Congress says that the War Department should do it, why, avc shall expect to go right along doing it. and if the Congress says that the War Department shall not do it. and any joint national commission should be selected to 40 PRESERVATION OF NIAGAKA FALLS, do it, why. the commission will be sad and Ave will be happ5\ [Laughter/; The Chairman. Gen. Bixbv, if you desire to submit, as a part of your remarks, any additional statement, the committee will be glad to have you do it. We hope at the next meeting Maj. Ladue will be here. Gen. Bixiiv. And we would be glad if you would put up these little remarks into sonie shape so I can look them over. Tlie CHATR:NrAN. That will be done. AVe are obliged to vou. (ien. Bixby. I will say to those present that to-morrow the committee will be obliged to take up the annual diplomatic and consular appropriation bill, and hence we will adjourn this hearing until Thursday morning at 10 o'clock. Whereupon the committee adjourned at 1.15 o'clock p. m. until Thursday morning at 10 o'clock a. m. Committee on Foreign Affairs, House of Representatives, January 18, 1912. STATEMENT OF ROME G. BROWN. FOR NIAGARA FALLS POWER CO. AND CANADIAN NIAGARA POWER CO. The Chairman. We will hear Mr. Brown this morning. Mr. Brown, Avill you state your name, your residence, and whom you re])- resent ? Mr. Eome G. Brown. I am from Minneapolis, jSIinn. I represent here the Niagara Falls Power Co. and the Canadian Niagara Power Co. Mr. DiKENDEuiER. Of wliicl) Mr. Wickes is pre.^ident ? Mr. BitoAVN. Of which Mr. Edward A. AVickes is presidem. (ien- tlemen, I appreciate the necessity of brevity in statements. I have tried to arrange in as brief a way as possible certain matters for con- sideration Avhich. I believe, are important for you to have in mind in regard to legislation in carrying out this treaty. In going over my summary I shall be A'cry glad to answer any questions that I am capable of ansAvering, but if you Avill be patient it may be that I shall anticipate your (luestions in presenting my statement. I Avill say that Avhen I left Minnesota the thermometer Avas 40 below zero, but since I came doAvn here T have caught a cold. Avhich. like some Congressmen, is not only both reactionai-y and insurgent, but it is also progressive. [Laughter.] Gentlemen, the concrete question before you, as I understand it. is Avhat shall be the nature of a legislatiA-e act under the treaty of 1900 to take the place of the Burton Act, so called. Now, in making up your minds upon the nature of that act you Avould have in mind, and Avish to have in mind and consider, certain propositions. You would Avant to have in mind Avhat. if any — I am not stating them noA\' — Avhat, if any. are or may be the legal rights of those avIio have made investments at the Falls. Even if you did not regard fully their legal rights, at least you Avould Avant to consider Avhat, if any, PBESERVATION OF ^'IAGARA FALLS. 41 might be the equities of those people who have made their invest- ments. Mr. DiFENDERFER. AVho gave them their legal rights? Mr. Browx. I am coming to that; I said "if any.'" You would also want to consider what rights and equities the people generally in the locality of the Falls and the general public, as represented by the National and State Governments, might have. Now, then, in order to have in mind what are — or, if you would not agree with me what might be claimed to be — the legal rights or the equities of the parties, as well as what might be the equities, rights, and inter- ests of the public, it has seemed to be necessary — it certainly might be helpful — to In-ing ourselves down to date by a brief summar}' of what has taken place prior to this time; and let me give you the smnmary. T will try not to be prolix, and some of the details of my argument I will hand to the reporter to be inserted as part of mj statement. No one will disagree Avith me when I say that the important inter- ests that we have to protect here are the interests of the American investors and of the American public, as paramount, from our view- point, to the interests of the Canadian side. Now, way l)ack in the nineties there were two interests — and I may say, gentlemen, that the interests of the hydraulic company and the Niagara Co. are not in conflict and not in dispute; their interests are similar. These two interests, prior to the passage of the Burton Act in 1906 and in the nineties, acquired on the shores of the Niagara River and appurte- nant to the Falls, certain real estate interests, and they became at that time riparian owners. I am going to be brief. They became riparian owners on the Niagara Eiver at the point of the Falls. Their situa- tion then was this : The Niagara Co. above the Falls, the hydi-aulic company below them but above the Falls, and the State of New York at the Falls — all had certain riparian interests imder the law. The Niagara Co. acquired by grant from the hydraulic company below them, and from the State of New York at the Falls, the express grant and privilege (and the law is that such riparian rights are severable and can be granted in whole or in part), they acquired the riparian rights to do certain things, to wit, this: To go upon their land above the Falls and construct their works, including tunnels through the hydraulic company's land and through the State's land, and thereby use, that is, divert water sufficient to develop 200,000 horsej^ower, and to discharge the same below the Falls. Now, then, not only from these granted rights, but from the law of riparian rights, these companies were at that time advised by their counsel (not myself, but I would have told them the same thing) that they had the legal right under the law of the land, under the law of the State of New York, under the law of property right in this country, they had the legal right that could not be disputed or invaded by any man or by any Government, to make their structures and enjoy their rights, subject to this one qualification : That they must see to it that their diversions, whatever they might be, should not be such as unreason- ably to interfere with the navigability of the Lakes or of Niagara River; and if they did not cause such interference, then neither the Government of the United States nor of the State of New York had an}' right or authority to prevent them from going ahead Avith 42 PKESEKVATIUX Ol' ^lAGAKA FALLS. their improvements and enjoying fol•e^■e^• the beneficial use to which they were entitled under their riparian rights. Mv. Sharp. "What, in your judgment, woukl the vested interests to which you refer — woukl there be any (;omphiint on their part if the Burton Act was reenacted, rather than if the whole amount were used, as under the treaty? Mr. Brown. I would say yes. Their vested-property rights would be interfered with. But I Avish to say this: I am not here to argue to you against your right to legislate at all nor to try to cram down your throats what I think the law is. I am only trying to show you the circumstances under which these companies went ahead, and I want you to understand that what I shall urge u])on you is to consider the equities of these companies, as they exist, under all the circumstances, to have proper regard for their rights, at least tlieir equities, in fix- ing the terms of the proposed statute. Mr. DirENDERrEi;. In a nutshell, then, 3 our contention is that this committee has no right to enact any law ? Mr. Brown. On that theory I think this conunittee has no right to enact any law. Mr. DiFENOERrER. Has Congress, then, any right to pass any law? Mr. Brown. I think Congress has a right to ])ass a law within certain limits. Mr. DjFENDEHiER. That is what the conunittee would like to hear. Mr. Leoare. You may not want to answer my question at this time, but just keep it in mind. Having these vested rights, if Congress should pass a law fixing rates would it not be retroactive? Mr. Brown. I was not going to go into the matter of rates until later, but I think it woukl not properly be called "' retroactive." If I understand the essence of your question I would say, in regard to rates, that it would not only be unwise for Congress to attempt to fix rates, but I think that such an attempt would be invalid and in- effectual. That i)ower so far as it exists belongs to the State of New York. Mr. Legare. That answers my question. Mr. Brown. I have certain things that I want to follow along and draw conclusions from. Mr. Levy. Is it your contention that the riparian owners, by the purchase of the adjacent land, acquired the right to divert any water that they might desire to divert, with the consideration that the in- terests of navigation should not be interfered with, no matter what became of the Falls? Mr. Brown. As purely a question of legal right, yes, sir; no mat- ter what became of the JFalls. Now, I am going to put into the rec- ord the summary of a 90-page argument on this point. The Chairman. The reporter will incorporate it in the record. Mr. Brown. I w ant this printed as my summary of the law at this point : LAW AS TO BIPABIAN RIGHTS — LIMITATIONS OF FEDERAL CONTROL — LIMITATIONS OF STATE CONTROL — PROPOSITIONS STATED AND LEADING CASES CITED. Rules of lO'iv as to Federal control. 1. That the authority for Federal control of fresh navigable streams and waters in the United States, which at the same time defines and limits such con- trol, arises solely from that power which has been expressly reserved to the 1 TKESEKVATION OK NIAGARA FALLvS. 43 Uiiit(Hl States by the Federal Coustitiitiou — the power to regulate coiiimerce between the several States and foreign nations. 2. That this iwwer of control was expressly reserved to the Federal Govern- ment by the States originally adopting the Federal Constitution and by all States since admitted under that Constitution: and, subject to this specific power so reserved in the Federal Government, there has passed over to those States, upon their entry into the Union, all powers and interest, whether of ownership or of control, now or formerly belonging to the Federal (iovernment. in the beds and waters of such navigable streams, and the Federal Government has since retained, and still retains, eitlier as against any claim by a State or by an individual riparian, or both, only the specific paramount right of con- trol for the specific and limited pnrpose of commerce — that is, of navigation. Moreover, this Federal power of control is purely a sovereign power of control for a specified pnl)lic use, and does not include, and can not l)e extended to, any element of a proprietary right or interest. 3. That, subject to this pnrely sovereign right of control of navigation, all right, title, and interest, sovereign and propi-ietary, belongs to the States or to individual riparian owners, or both: and it is not within the Federal ;uithority or power, eitlier judicial or legislative, to fix or dt^teruiine. as between n State and an individn;il owner, the limitalions between State and individual owner- ship or control of water powers. The rights and obligations, .is between a State and an individual owner, are fixed by the law of property .-is established by the decisions of the State supreme couit in the State in ipiestiou. This law of property, as so fixed in any State, is. as to streams in that State, binding npon the Federal (lOvernment and its Supreme Court. Rules of I'lir (IS !<> State control iinil as to nstefl i>roitertii viijhtx of riimrian oirtier.^. 1. The title and power of control by the State over the beds and waters of navigable streams are not in any degree prtiiirietary in nature or extent. They are limited to a holding in trust as a .sovereign ff)r the specific purjiose of pro- tecting a pulilie use. to wit. navigation and certain allied public uses. 2. The title and the power of the State are subject only to the Federal para- mount ix)wer of control as established and defined a.^ above demonstrated. They are limited also by the private proprietary right of the riparian as fixed by tlie law of the State. 3. The private riparian owner owns and retains all and the only proprietary title, right, and interest, either to the beds and waters of such streams or to the nsufruct thereof. He has the proprietary right to the beneficial use of the flow of the waters in connection with the natural head and fall upon or oppo- site his riparian land and to the whole thereof: he has a proprietary right to utilize the bed and waters for the development of power and for the operation of water-power plants. This right belongs to him jure naturte — that is. because it is a natural resource and right belonging to and appurtenant to his riparian land and a part thereof. And this private proprietary right is subject only to the sovereign right of control by the Federal and State Govern- ments for the public use of navigation. 4. As between the State and the riparian owner, the sovereign iiower of con- trol of the former ends where the proprietary right of the latter begins; and the private right exists uii to the point beyond which it would bo inconsistent with the specific and limited public right. This private proprietary right of the riparian is the same, whether the title to the bed of the stream, either below high water or behjw low-water mark, is said to be held by the State or by the riparian. The attempted distinction between the riparian rights, on the basis of the riparian's having a mere easement instead of a title, is, "^o far as these questions are concerned, purely speculative. The above rules of law are established by the following leading cases : Water Power Co. v. Water Board (168 U. S., 358-365) ; Hobart v. Hall (174 Fed. Rep., 433) ; Hall v. Hobart (108 C. C. A. Rep., 348) ; United States r. Chandler-Dunbar Co. (209 U. S., 447) ; People l\ Mould (37 App. Div., 35, 30) : Peoi>le ex rel. Niagara Falls Hydraulic P. & M. Co. i'. Smith (70 App. Div., 543; affirmed, 175 N. Y., 469) ; Niagara County I. & W. S. Co. v. College Heights L. Co. (Ill App. Div., 770, 772) ; Sweet v. Gity of Syracuse (120 N. Y., 335) ; Smith 44 PRESERVATION' OF NIAGARA FALLS. r. KocliPSter t.r»li N. Y.. 474) : Kiiiiisfy /•. IM. Co. (1.",:! X. V.. Tlti : r.ionidiavtMi r Siuitli (ISS Ni. Y.. 74). See also decision of WlscDiisin Sui»reiiie ("ouit (Jan. .'Ut, l!tl2» in Stat*> ex re). Wassan Ry. Co. r. Bancroft (Atty. den.. — X. W. Uep., — ). Mr. Brown. The ChancUer-Duiibar caise (209 U. S.) and the Xew York oa.se of People r. Smith (TO App. Div.), above cited, expre^>'sly hold tliat the rules of law aljove stated apply as well to international- boundary .streams as to other streams: and tlie case of People v. Smith expres.sly holds the riparian rights on the Niagara lliver at the Falls to be a.s above stated. These rules of property rights were relied upon by the oAvners of the power plants at Niagara Falls when they made tlieir original investments and constructed their woi-ks Avith the capacities which have since been maintained. Such is a summary of the law upon this subject; and it is so well settled that these rules. of law are irow recognized not only by the P^ederal Supreme Court Ijut by the highest courts of every State in which the common-law principles of riparian rights are recognized. This includes substantially all the States lying in whole or in part east of the Mississippi River. It does not include those far western States wdiich never had any law of riparian rights, but where the law oi prior occupation or prior appropriation prevails, such as Colo- rado. Cases from such States are not authority in either Minnesota or New York. The Federal courts recomuze and enforce tlie law of propeity rights on these questions according as they find the local law to have l>een esta))lished by the courts of the respective States; and the United States Supreme Court has so expressly held in 108 U. S., 358, and other cases. So the Federal court would enforce riparian rights at Niagara Falls as such rights have been established by the New York courts. In passing I would say that the same rules of law prevail in Caniida. the only diflerence betA\ecn the two ccjiintries being that here vested p)-o])erty rights are. through the courts, protected under the Constitution against cucroachmerits by the legislature of either the State or the Nation, while in Canada ihe Parliament can not be so restrained. The right that Congress has — now, gentlemen. I talked about this matter before the National Waterways Commission the other day. and one of the gentlemen said: " That is merely your theory, isn't it, Mr. Brown'!'" So uiuch the less merely my theory, it is the state- ment of the law that iias been made by the United States Su])reme Court, and the courts have had this decision before them for years. I demonstrate this proposition as a rule of laAv, to wit: That the power that the Federal Government has oNer navigable streams is for the specific purpose of navigation; it gets that power expressl}^ from the clause in the Constitution of the United States giving Congress the power to regulate commerce. It does not own the waters: it does not own the bed; it has no proprietary interests; it has only a right of control in its sovereign capacity for a limited and specific purpose, to wit, for navigation. It is a power simi)ly to i)revent unreasonable interference with navigation. That is the law. Now, then, every bit of interest in or power over these streams and their beds, except this limited right of the Federal Government (this is not my statement ; it is the statement of the United States Supreme Court — 168 U. S., 38.")). has passed to and is retained by either the State or individuals, or both, as the case may be; it all belongs to one i PKESEEVATION OF NIAGARA FALLS. 45 or the other; and if yoii want to find where the right of the State, New York, for instance, and the rights of the riparian owners begin and end the Federal Supreme -Court says you shall go to the law of property rights of the State as shown by the State decisions. The Federal Government having reserved only the paramount power to control navigation, everything else hase gone either to the State or to the riparian owners; and in the determination of how that which is left is or shall be divided between the two neither the Federal Government nor the Federal Supreme Court has anything to say. Consequently, Ave have this situation; that if we want to find out Avhat the riparian rights are in New York we go to the New York decisions. Under the law the Federal Government has no more' to do with " scenic beauty " than it has to do wdth the color of my hair. Mr. DiFENDERFER. You liavcn't any. Mr. Brown. That's right — neither hair nor . scenic beauty. fLaughter.] Mr. Levy. Aside from this proposition of navigability, do you think it is aifected as a boundary stream ? Mr. Brown. That is incidental. There is one thing that is certain : If a thing can not affect the navigability of a stream is can not affect .500 cubic feet. You take the (j.500 that the hvdraulic compan-\ had had under the Burton Act and add 3,000 to that and it makes 0.500. You take the S.C'OO allowed the Niagara company under the Burton Act and add to it to the 1,400 and it makes 10,000; there is just the difference between the 15,000 in the Burton Act and the treaty amount of "20.000. That was one of the main considerations of making it 20,000 on this side. It was the main consideration of fixing it down as low as 20,000, because up to that point it was considered that these companies had not only their legal rights, but they had equities. This treaty was made iu 1000 and promulgated in 1010. Nobody ever supposed or claimed that the Burton Act was intended as anything more than a temporary measure to govern for the three 3'ears necessary to get the informa- tion for thelbasis of a treaty and to make the treaty. Then after this treaty was made, these companies came in and asked for their rights under the treaty. Several joint resolutions were introduced and amendments were proposed to bring them in line with the treaty, but. on account of a mix-up that always occurs when full hearings are not had. the Burton Act has simply been car- ried along; and, although the treaty (which was contemplated by the Burton Act to take the place of the temporary provisions of that act) has been made, the Burton Act is still the statute that controls these limitations. As a precautionary measure the Burton Act cast every doubt against the investor. But you now have a treaty made upon investigations which show the results as I have stated : and the proposition now before you is: AA^hat sort of a statute are you going to enact to carry out that treaty? Mr. DiFENOERFER. You liavc referred to the Hvdraulic Power Co. Is that known also as the Schoellkopf Co.? Air. Brown. Yes, sir. Mr. DiFENDERFKR. Is it uot truc that they have an open canal through which they create their power? Mr. Brown. I understand that is true. Mr. DiFENnERFEu. My reason for asking that was to know whether it would add to tlie scenic beauty of Niagara Falls to have an open canal. Mr. Brown. I wish you would discuss that Avith the Hydraulic people. I represent the Niagara Co. AA^e have no connection or agreement with the Hydraulic Co., but both know the scientific fact that, in order to operate economically under present installations, we need 1,400 cubic feet per second more and they need 3,000 cubic feet per second more. AA^e would have no conflict with them on tliis question. If you should leave this question to these two companies we would agree. Mr. DiFENDERFER. No doubt. PRESERVATION OF NIAGARA FALLS. 53 Mr. Brown. Don't make an act so inelastic that aUhoug-h these companies could come together you would have put it out of their power, or of anybody for them, to make a proper division, and ex- clude the Niagara Co. without even a chance to present its claims. Mr. Garner. You speak about the posible inelasticity of the pro- posed act. Suppose we should go ahead and give you the full power that you are entitled to under the treaty; you would then come in Avith an additional claim, no doubt, that you had vested interests and could take all the power. AMiat. then, about the inelasticity of the act ? Mr. Brown. I^et me call your attention to that. Our works (speaking for the Niagara company, which is now limited to a diver- sion of 8,000 feet per second), from a time long before the Burton Act was introduced, have been maintained with their present capac- ity — a capacity well within our legal and equitable rights. For that capacity 10.000 feet is not a maximum but a moderate amount. We have not. since the Burton Act, increased our capacity for the purpose of creating a use for the extra amount that we ask for. Gentlemen, we do not ask you to put into th.is act that Ave should have control of this 4,400 feet more, nor any part of it. because we say that is a detail which you don't Avant to go into. On the other hand, while not making it so specific as that, we don't Avant you to make an act so inelastic that we can not go before a proper tribunal and have our equities, at least, considered. Mr. Garner. But would it be elastic if we let the Burton Act pass out of existence and then give you a new act alloAving you the use of the entire power? Mr. Broavn. If the proposed act makes any limitations, then, under the circumstances Avhich have been here shown to exist and which now appear in the United States survey reports, it seems to me that the limitations of the act should be the same as the limitations of the treaty. Mr. Garner. It Avould be inelastic, then, if it Avere coequal Avith the terms of the treaty; there would not be any change at all. Mr. Broavn. I see your point. "We don't ask to receive all the extra amount. "\Ye want, at least, that Ave should have a chance to be considered in the distriluition. There is no doubt tliat this extra 4.400 feet should be alloAved. Noav, then, whether it shall be to some new industry or the Niagara Co. in part or alone or the Hydraulic Co. in part or alone. Avho shall get it, and in what proi)ortions, I say that question should be left, we will say. for instance, to the Secretary of War to determine, after a hearing. By the express terms of the act he should be alloAved to take into consideration the legal rights and the equities of the present investors, Avhatever he shall find them to be. and also, of course, the interests of the public and all interests. I Avould like to come down to the question of Avliat the proposed act should ])rovide. The Citaikman. Come down to the legislation before the com- mittee. Mr. Broavn. The legislation before you, it seems to me. gentlemen, should, in the first place, add 4.400 feet more, so as to make 20,000 feet the total limit on the American side. That is the first ])roposi- tion. Why? Because it has l>een shoAvn by the re])orts of these sur- veys and stated to you orally on Tuesday by Gen. Bixby as his con- 54 Plti:SEHVATU)N CJ' NIAGARA FALLS. clusidii tl);U thai wouKl not have any ertWt upon navi«j;alion. nor upon the stream as a boundarv line, nor even upon the scenic- beauty of tlie falls. It would have no effect — hardly measurable, nuich less per- ceptible, on the American Falls. Mr. Gakxer. AA'ould it be possible for the 4,400 cubic feet extra to i)ecome the property or right of any other company besides the two that are now operating? Mr. Brown-. You ask me mv ])resent opinion as a pure matter of law ( Mr. Garner. Yes. Mr. Brown. I say frankly, no. Gentlemen, don't misunderstand me. I am only stating that ui)on which we depended when we made our investment. I am simply- reminding you that we had good ground to believe it ; that we acted upon that belief, and that we were right; and upon the strength of that I appeal to your sense of justice to consider our equities. Mr. Garner. I only ask for information. The Chair^ian. If this committee should vest the power in the Secretary of War or the Public Service Connnission of New York to dispose of this water for power, either one of those agencies can dis- pose of it to whom it desires ( Mr. Brown. You mean the}- would have the legal right to do it — give it all to some one else and ignore us^ The Chairman. Yes; you can put it that way. Ml-. Brown. As a matter of law, I don't think they would. The Chairman. What would you do if they did:? Mr. Brown. That I can not tell. I know what I would advise. I Laughter.] One tiling is sure. Before the power is allotted I would ask for a hearing, and I would go before the commission of New York, or before the Secretary of War. whichever has the say, and knowing the fact that our equities could be considered, I would rely upon the faith that before we got through we would impress those gentlemen with what is right and fair in the matter. The Chairman. Have you considered the fact that the Secretarj^ of Win- can revoke your permit? Mr. Brown. The terms of the- act so provide: yes. sir. Ml-. Garner. Before you go from the other proposition, you made a suagestion as to what the provisions of the bill should be, which woui(i be virtually a direction that ycuir companies be giyeu this additional amount? Mr. Brown. Not necessarily. Mr. Garner. Yes: but if the bill should ]novide that they shall take into consideration your legal and eipiitable rights — if a bill con- tained that kind of a clause, and if I were Secretary of War. I should feel that Congress directed me to give jireference to those rights over those of any newcomers; whereas if you left that out, you could still appeal to tlii^ commission or to the Secretary of War in an argument based upon j^our legal and equitable rights? \Mr. Brown. You see, I wouldn't ai)peal to men's favor nor to prejudice; I say again we are not here holding the law over you as a threat. I would say to the authority having the power of disposal, " Here are our rights under the law. It is your duty to consider them. In view of all the circumstances, it is fair that the Niagara Co. should be given 1,400 of this 4.400 feet; the Hydraulic Co. can PRESKKVA'IION OF NIAGARA FALT.S. 55 speak for itself.'- Instead, for instance, of civing it, in terms, back to the State of New York, who have ah^ead}^ in advance given it to us, it is more equitable to leave it open, so we may be considered. If the permit were expressly confined to those utilizing the highest head, they might have to give it to some man who comes up here with a $35,000^000 proposition (on paper) which is only an in futuro dream, and who says, " Until Ave get our scheme financed, we want to tie up the use of this extra poAver and prevent its use by those who have already made investments on the faith that they would be allowed enough to operate at normal capacity." Mr. Garner. You could do that very easily, Mr. BroAvn, if the Secretary of War should direct it as he sees best, because otherwise it Avould be an expression of Congress as to Avhat its vieAvs Avere in the premises. Mr. Broavn. In general, I agree with you. Now, the point is this: It is impracticable for Congress to determine in advance the exact limits, conditions, or grantees of these permits; but you can deter- mine the general policy and leave the details to somebody else, so that a proper and equitable distribution can be made. Mr. Garner. And it would be more elastic if we did not compel the Secretary of War to take into consideration the legal and equita- ble rights Mr. Broavn. I beg your pardon; I think I intended to state that the proposed act may be too elastic and that it may be too inelastic. Is it no reflection on Congress that, Avhen it leaves a discretion to a certain department or a certain commission, it shall say to that de- partment or commission : "' Not exclusivel3% but besides other things, you shall, in reaching your conclusion, take into consideration the A'ested property rights inider the law and equities, whateA'cr a'OU shall find them to be." Why, gentlemen, that seems to be doing only what the Burton Act did (although inaccurately) and AA'hat this country did (but more accurately) in its convention Avith Great Britain, each country being represented by its most prominent laAvyer and citizen. Why should you noAv, in an act to give effect to that treaty, be less considerate of equities and ])ropert_y rights than is the treaty itself ? I^ess considerate than even the Burton Act? Mr. DiFENDERFER. If Avc Avcrc to grant this extra amount of ))OAver to tAvo of those companies, wouldn't the Niagara Falls PoAver Co. be the principal beneficiary, in Adew of the fact that the Hydraulic Power Co. is A^ery limited in point of production and distribution? Mr. Broavn. Now, as I understand the situation, there is no mem- ber of this committee but knowns — and I think Ave can take Gen. Bixby's Avord for it— there is no worry that these companies Avill not have a market for all the poAver they can get. They need all the extra power allowed under this treaty. Four thousand four hundred more will put us AA'here we can operate our plants economically; 1,-tOO feet puts the Niagara company in proper condition; 8,000, the hydraulic company. Mr. Legare. Who do I understand fixes the amount of water noAv being used by each company? Mr. Broavn. The Secretary' of War. Mr. Legare. The Secretary of War fixes how nuich Avater you shall use and the other company shall use? 56 PRESERVATION OF NIAGARA FALLS. Mr. Brown. Yes, sir; now, I stated the general conclusions as to the effect upon navigability, upon the river as a boundary stream, and upon the scenic beauty, as stated in the reports, made by this 4,400 feet. I have a short statement from the United States En- gineers' Reports (S. Doc. No. 105 and H. Doc. No. 246), which T wish to go into the record at this point. The Chairman. Yes ; put them in the record. Mr. Brown. It is as follows : EFFECT ON NAVIGABLE CAPACITY OF RIVER AND LAKE. The reports show that the ouly diversions that need be considered with refer- ence to this topic are those made above the upper cascade of the rapids in tlie so-called Chippewa-Grass Island pool ; that is to say, the diversions of the two American companies and that of the Ontario Power Co. The diversions made by the Canadian Niagara Power Co. and the Electrical Development Co. being below the upper cascade can not possibly affect the level of the navigable por- tions of the river or of Lake Erie. (H. Doc. No. 246, 62d Cong. 2d session, p. IL) The presQiit permitted diversion from the Chippewa-Grass Island pool, as- sumed to be 39,350 cubic feet per second, is stated to lower the level of Lake Erie 0.07 feet, or about fourth-fifths of 1 inch. (S. Doc. No. 105, p. 12.) Maj. Keller states categorically that this divei-sion " will not injure nor interfere with the navigable capacity of the Niagara River." (S. Doc. No. 105, p. 12.) The effect upon the navigable capacity of the river of further diversions is stated on page 51 in a table showing the effect of each 10,000 cubic feet i^er second ad- ditional diverted from this pool. The effect at Lake Erie for each 10,000 cubic feet per second diverted is stated to be 0.04 foot. The maximum diversion now proposed from the Chippewa-Grass Island pool is about 32,0(X) cubic feet per second (20,000 on the American side of the river and 12,000 by the Ontario Power Co.) ; that is to say, 12,750 cubic feet per second in addition to the amount stated in the report as the amount now permissible. This additional 12,750 cubic feet iter second, therefore, will cause a lowering of Lake Erie of 0.05 foot, or about three-fifths of 1 inch. These predicted lowerings at the head of the river, measured in fractions of an inch, are quite negligible in comparison with the variations of lake level due to nature, which swing through a range of 14 feet. (S. Doc. No. 105, p. 24.) Now, Gen. Bixby stated to this committee, on Tuesday, the fact — and it is a self-evident fact— that the full amount of diversion al- lowed on the Canadian side will surely be made within two or three years, whether transmission to this side is allowed or not. The ques- tion, then, which interests this committee is as to the effect upon navigability caused by allowing an extra 4,400 cubic feet per second on this side. That extra diversion woidd manifestly cause a differ- ence of levels of Lake Erie of only about one-fifth of an inch. It therefore is manifest that this extra diversion can not affect naviga- bility. Indeed, Gen. Bixby stated to this committee that the diversion of the full amounts fixed by treaty on both sides of the river would not appreciably affect navigation. EFFECT TI'ON Tin: INTI'nRITY (IH 1M!01M:R VOLUME OF ISMAOARA RiVKK AS A HOUNPAKY STREAM. The reiM)rls make il quite clear (S. Doc. No. 105, p. 13) that no diversions that have ever been proposed will injuriously affect the river in this regard. (See also II. Doc. No. 24(5, ]). 12.) The report of the United States engineers, made after most careful investigation, shows therefore that the diversion of the full amounts PKESEKVATION OF NIAGARA FALLS. 57 iixed by the treaty would have no appreciable effect upon the navigability of the stream or of Lake Erie and no effect upon these waters as boundary streams. It remains to consider the results present and prospective upon the scenic beauty of the Falls. As to the "American Falls, both the reports of 1908 and 1911 show that the diversions are such that " it is doubtful Avhether the diversion would be appreciable " and " these changes can not be considered as important." (S. Doc. No. 105, p. 14; H. Doc. No. 24(3, p. 12.) Again, the only material question here now is as to the effect upon the scenic beauty of the extra diversion of 4,400 cubic feet per second on the American side, for Congress can not limit and the Canadian Government will not limit the amount of the diversions upon the Canadian side below the treaty amounts. Figuring from the data Avhich is given by the United States engineers in Senate Document No. 105, page 53, and House Document No. 246, page 13, and Senate Document No. 105, page 51, a diversion of 4.400 cubic feet per second on the American side w^ould have the following effect : At the crest of the American Falls, less than one-eighth inch. At the Goat Island end of the Horseshoe Falls, approximately nine- sixteenths inch. At the Canadian end of the Horseshoe Fall, less than l^V inches. At Lake Erie, approximately one-fifth inch. These quantities are evidently insignificant, and with reference to the effect of the diversion of an extra 4,400 cubic feet per second Gen. Bixby on Tuesday stated to this committee that the diversion of that extra quantity w^ould have no appreciable effect upon either the American Falls or upon the Horseshoe Falls, Therefore, the diversion, over which Congress is assuming control, for the preservation of the scenic grandeur — that is, the diversions up to the treaty amount upon this side of the river,, and especially the additional amount of 4,400 now asked to bring the American diver- sion up to the treaty amount, can have no appreciable effect upon the scenic granduer of either the American Falls or the Canadian Falls. So I say, gentlemen, so far as this 4,400 feet is concerned, it should be granted to somebody. In other words, the limit of 15,000 feet total diversion upon the American side which is fixed by the Burton Act should be extended to 20,000, as provided by the treaty. Mr. Garner. That could be effected by changing the figures in the Burton Act. Mr. Brown. Sure; certainly; I could make that change and other changes very easily. [Laughter.] Now, gentlemen, let us examine the other propositions. The first (already discussed) is to raise that restriction which now deprives everybody, individuals and the public, of the use of 4,400 cubic feet of water per second. The second is to do away with the prohibition upon the transmission of power from Canada. The limitation is now 160,000 horsepower. Mr. Watrous made the statement or inference here the other day that of the 160,000 horsepower allowed to be im- ported from Canada under the Burton Act they are now permitting only 110,000. Now, gentlemen, I have those figures; and this will be the third insertion I wish to make. It is as follows : 58 PRESERVATION OF NIAGARA FAIXS. The following permits for diversion ha\o been operative since August. lOOr (H. Doc. No. :>4f). p. 13) : Cubic feet per second. Niiigara F.ill.s Power Co 8,600 Niiigara Falls Hydraulic Power & Machinery Co. (uow Hydraulic Power Co.) 6,500 Lockport Hydraulic Co 500 Total 15,600 These figures are maxinuinis. By the same report the following have been the permits for trans- mission from Canada since August, 1907: Horsepower. Canadian Niagara Power Co. to Niagara Falls Power Co 52,500 Electrical Development Co. to certain companies 46,000 Onlario Power Co. to Niagara L. & O. P. Co 60,000 Total 158, 500 'J'he same report (H, Doc. Xo. 246, p. 15) shows that the transmis- sion permit from the Canadian Niagara Power Co. and from the Ontario Power Co. was practically all transmitted, the 52,500 allowed from the Canadian company being. fully transmitted, and about five- sixths of the amount permitted to the Ontario Co. of the 46,000 permitted from the Electrical Developing Co. only 10,000 has been due. This is because of temporary conditions. Mr. Garner. The total authorized importation is 160.000 horse- power ? Mr. Brown. Yes: and the total amount actuallv permitted is 158,500. Mr. (xARNER. The total amount actually transmitted is how much? Mr. Brown. The maximum in June, 1911, was 110,000, the differ- ence being because the electrical company does not use all theirs; but that does not give the other companies the right to import more. Mr. Garner. T assume those permits are revocable? Mr. Brown. Yes, sir. The Chairman. In a nutshell, as I understand it, you are in favor of utilizing the additional power we are entitled to under the treaty; secondly, you are in favor of remo\ing any restrictions upon the im])ortation of power from Canada: third, we would like to know, now. which of these. two bills you prefer — the Smith bill or the Simmons bill ? Mr. Brown. I would like to finish certain points. We are in favor of lifting these restrictions, from the standpoint of business men. When Gen. Bixby spoke to you Tuesday he said: "Gentlemen, the treaty between these two countries allows 36.000 cubic feet diversion upon the Canadian side" (now these are not his exact words, but it is the .substance of them). "If you think that l)y prohibiting the importation of Canadian power you are going to do anything that is directly or indirectly to protect scenic beauty, you are mistaken, be- cause it is not going to have the effect in the end of diminishing what would otherwise be the actual diversion on the Canadian side." Somebody asked the question. " How long — five or ten years? *' " No. gentlemen,'' he replied, "I say if yon don't take this restriction off PRESERVATION OF NIAGARA FALLS. 59 within two or three years, they are going- to use every bit of that power on the Canadian side.'' Mr. DiFEXDERFEit. Where? Mr. Brown. On the Canadian side. There are industries in Buf- falo and on this side which can not be run by electricity economi- call}', because the^' can not get tliis power that would be developed on the Canadian side. There is great demand on this side for more power. Industi-ies would immediately take U}) this power if it is found that the policy of the American Government is to refrain from restriction on iriiportation. They can only import al)out half of that power, because they have practically agi'eed to save half of that for the Canadian side. Mr. DiFENDEUFER. You sav that power is likely to be used to its limit within the next few years? Mr. Brown. T said that Gen. Bixby said it would be within two or three years, and anyone who knows conditions up there knows he is correct. Mr. DiFENDERFER. For the very reason, as I have stated before, that thev can s^et that j>ower for 12, while on our side the miniuuim is 20. ■ ' " Mr. Brown. Those figures are not correct, but I was going to speak about the rates in a moment. And right here, would it not be a strange thing for a legislative body to come in and interfere in the mattei- of rates between the consumer and the producer when there is no demand for interference? The only cry from the present and prospective consumers is for more power at the same rates. Have you heard any substantial complaint of inefpiity or inequality or in- justice on the American side? Mr. DiFENDERFER. It is quitc evident that there is a discrimination. Mr. Brown. Isn't the man who is taking the power and paying for it the man to kick? And is it not strange that this rate question is not troubling him, but is troubling only outside agitators? The rate questicm in Buffalo is not an economic question; it is simply one of politics. Mr. DiFENDERFER. If you take the evidence of the counsel of the city of Buffalo, it looks to me as if it would take $35,000 to make the kick. Mr. Brown. Wait a minute. The city of Buffalo has devoted $35,000 to have the rates investigated. Is that right? Mr. DiFENDERFER. That is right — to appease the kickers. Mr. Brown. Xow. gentlemen, when anybody makes a complaint the party that asks the change has to show the proper facts. And isn't that true before a conunission or before a court or before any judicial body? Isn't that true? If somebody says that in the city of Buffalo the rates are high they know it requires an investigation, and it is long and it is expensive; and then there is tliat other awful item — lawyers' bills. Mr. DiFENDERFER. Yes. sir: that is an item. Mr. Brown. And they have to be paid — at least they haAC to be incurred. [Laughter.1 Mr. DiFENDERFER. I am glad you make that distinction. Mr. Bartholdt. T should like to ask a few questions. I want to ask for niv own information and satisfaction. 60 PRESERVATION OF NIAGARA FALLS. Mr. Brown. You soe. I have lK?en drawn off on this (luestion of rates. I am coming to the conchision that the Congress should not trouble itself about rates. The CHAiR:kiAN. In regard to rates, the Public Service Commission of New York can fix them if there is any complaint ? Mr. Brown. Certainly, sir, Mr, Bartholdt. I am concerned only in the beauty of the Falls. I regard it as the greatest asset of the people of Buffalo ; I regard it a very poor investment to detract from it, Mr. Cooper, Would you amend that bv saving '" the people of the world?" Mr, Bartholdt, Yes, sir. Mr. Cooper. At many places in Europe Niagara Falls is the first thing they ask about — " Have you seen the Falls? " Mr. Bartholdt. Xow. I want to ask this question. Mr. Brown, the only excuse for tlie Burton bill was to prevent detraction from the Falls — from the scenic beauty of the Falls? Mr, Brown, To protect the scenic grandeur, Mr, Bartholdt, Precisely. Now, was the question, in connection with the treaty betAveen Canada and the United States, of limita- tion, as fixed in the treaty, considered as satisfactorily answering all possible doubts as to detraction from scenic beauty? Mr, Brown, Certainly; yes, Mr, Bartholdt, And also to the extent that the treaty findings were made after very careful investigations by the Government engi- neers and the National Waterways Commission, and the question of international Mr, Brown. Yes: all those were considered by those who made the treaty. Mr. Garner. Doctor, Mr, Brown went over that before you came in. Mr, Bartholdt, Noav. is there any law on the statute books of the United States to preserve the beauty of Niagara Falls? The Chairman, Nothing but the treaty, Mr, Bartholdt, So that the jurisdiction of Congress is only witli regard to navigation, and the other is all sentiment? The Chairman, Yes. Mr. Legare. T understood Gen, Bixbv to say it woidd be iuii)er- ceptible, Mr, Bartholdt, We are naturally interested in preserving the beauty of the Canadian side as well as the American side. Mr! Broavn, So far as the 4.400 feet is concerned, it is practically imperceptible in the length of the Falls, If you take the entire amount of diversion, you have only 4 inches less depth on the Ameri- can side of the Horseshoe Falls and 9 inches less on the Canadian side, Mr, Bartholdt. But Gen, Bixby said that amount would be total? The Chairman, That is on the Horseshoe Falls side, Mr, Broavn, But remember this thing. The United States has power only to protect the American side. When the two countries have got together and said that Canada may take 36.000 and we may take 20,000 feet, is there any reason why we should say: "You Canadians over there are not doing anything to protect scenic grandeur; we will take care of that by refraining from exercising PEESERVATIOJSr OF NIAGARA FALLS. 61 our privilege inider the treaty and by restricting importation to our side, so as to force industrial development on your side at the expense of American interests which are now ready to use the power." We know the Canadian companies are going to take the 36,000 feet. We know that it can not hurt in any degree that is sensible to the eye. Now, the extra amount on this side is 4,400 feet, and the Canadians have only to add 15,000 to get their allotted amount. Are Ave going to hang back until they utilize their last foot and lose this vast power forever? Is it wise, gentlemen, when the Canadians are going to divert their entire 30,000 feet and when the whole amount is. for all practical purposes, not sensibly injurious to scenic beauty? Xow, gentlemen, while I am more than willing to answer all your inquiries as best I can, your questions often anticipate points which I have in mind to cover later and thereby cause diversions, which, in this instance, I frankly admit are injurious; they injure the con- tinuity, and hence the scenic beauty, as well as the boundary lines, of my argument. [Laughter.] Now, before I come to the questions of rates, I wish to emphasize further the objections to any restriction upon importation. It is clear, from what has been shown, that dis- couragement of importation can not serve any public interest. It can not help to preserve navigation, nor any boundary line, nor help military defense, nor help to preserve scenic beauty. On the contrary, it is positively repugnant to both our public and private interests. That countr}^ will permanently enjoy the advantage of this as yet unused power which first preempts it by actual use. The next year or two is to decide this question and the decision depends upon the fact of whether j^ou continue provisions prohibitive or restrictive of importation. It is clear, then, that any such restrictions are bad policy. Even from an American viewpoint alone, the interests of this country and of the people of the State of New York demand that we should get hold of this power as quickly as possible. But there are other objections which are conclusive against anj' attempted re- striction or prohibition b}^ act of Congress. I refer to the legal ob- jections. This special and localized prohibition which is suggested is arbitrary and unreasonable. It does not treat all citizens alike in regard to the same subject matter. It is a special restriction im- posed for the mere purpose of asserting the poAver of restriction. There is no demand for it, there is no need for it. No one appears here to advocate it, except the representative of that association of self-appointed guardians of a theory prevalent 8 or 10 years ago, but which theory has been exploded by the careful surveys and reports of the War Department ; and the Chief of Engineers now tells you that if this restriction is not remoA'ed immediately this country will lose forever the use of this power, and that such restriction will not. in any degree, limit the total diversion at the Falls. But. what is even more important, any prohibition of or restriction ni)on importation is contrary to the spirit and terms of the treaty of 1909, by which this countiy and Great Britain agreed upon the limitations to be allowed by either country with respect to the use of poAver at Niagara. All these questions, including that of importa- tion. Avere discussed and passed upon. It was decided that it was neither necessary nor expedient to restrict importation, and such 28305—12 5 62 PRESERVATION OF NIAGARA FALLS. restrictions Avere omitted from tiie treaty. That treaty spoke the promise and policy of each country to the other. Each country said to the other that Cana(hi might divert 30,000 feet; that we "might divert 20.000 feet per second, and with those amounts as a maximum each country niigiit fix limits on its own side, but that in every other respect the rights and privileges and opportunities of each country should be left free. The idea was that the Canadians could use their 36,000 feet to supply a demand wherever they might find it; and the American market was in mind. By a prohibition or restriction upon importation of i^ower from Canada to this side we assert the right not only to control amounts of diversion upon this side but also upon the Canadian side. We deprive the Canadian investors of the market with reference to which the treaty was made. For Congress, after the treaty, to attempt to control or restrict the intended use by the Canadians to their share of the total diversions allowed (as by restrict- ing importation) is not keeping good faith with the other party to the treaty. It is an invasion of the rights of Canada and of the (yanadian investors, contrary to the treaty. Developments and construction proceeded upon the Canadian side on the theory that the demand for power on the American side might be freely supplied by Canadian investors. This proposed legislation is for the purpose of carrying out the treaty provisions, to give.efl'ect to the treaty in so far as legislation is required. Importation should be free, therefore, not only because it is wise and consistent with the treaty, but also because any prohibition or restriction upon importa- tion would be repugnant to the spirit and terms of that treaty. Mr. Cooper. Mr. Brown. I don't want to " divert " you. but I would like to have your opinion as a lawyer, if you are willing to give it to this committee as such, as to the power of Congress to regulate rates. I am sure that question is going to be discussed in the House, and, realizing your ability as a lawyer. I would like very much to get your o])inion. Mr. Brown. Xow, I want to stick a pin right there, because that is my very next proposition. Mr. Cooper. T am glad to hear that. Mr. Brown. You mean a regulation of rates in connection with a restriction upon importation or upon the use of the extra 4,400? Mr. Cooper. In both instances. Mr. Brown. Well, let us take importation. I say the importation restrictions should be removed, and there should be nothing said about tarilf. rates, tolls, or other restrictions. That is a legal and business like proposition. Now. in this instance you could not justify a charge on the ground of a tariff. Congress can not say that pota- toes brought over the boundary line at one place should be subject to a charge to which the same goods brought over the same line at a point 100 miles away would not be subject. The control of the tariff is not an arbitrary one. Now, " toll " comes out of something of ownership. Now, no lawyer would say that either the United States Government or the States owned the waters. Nobody owns the waters; the riparian owner does not owmi it; he owns the use of it, the right to use it; the Government does not own the waters, but it has only the right to prevent unreasonable interference with navigation. There is no basis for any charge based on Government or State ownership. PRESERVATION OF XIAGABA FALLS. 63 jVIr. Difeiiderfer said the other day: ''Aren't they going to pay for this water that we are giving them ? " Why, as a lawyer, 1 would say : " In the first place, you don't own the water. In the next place, you don't give it to them." Why? Because the right to its use belongs to the riparian owners. Neither the Government nor the State of Xew York has any ownership of the water itself, and neither could impose a toll or charge for its use. Next, can the Government of the United States regulate the rates? I say, " No," for two reasons : In the tirst place the United States has no power to regulate rates within the State of New York. That power can not be based on any power to regulate scenic beauty, even if the latter power existed in Congress. But it does not. If the Gov- ernment of the T'nited States has the right to regulate the waters at Niagara to protect scenic beauty — much more, if it has a right to prohibit on the ground of preservation of scenic beauty — then every Avater power upon a navigable stream in the TTnited States, every w'aterfall, which proportionate to its size and character has value as a feature of the landscape, can be prevented from being used for water power on the ground of preserA'ation of scenic beauty. Mr. Cooper. Has the United States any right to prevent importa- tion of power from Canada ? The Chairmax. Well, it has done so. Mr. Cooper. I am speaking about rights. Mr. Browx. That is a tariff question. It is a commerce question. We say '"'■ Yes." if it is general. But do you suppose this is the only locality where power is being imported ? Mr. Cooper. No; but it Avould seem to me that they would have the right also to name the conditipns under which they shall grant the permit. Mr. Browx. Has the Congress of the United States a right to say that Jim Jones shall not, at the tOAA'n of Smithville, on the line, bring across daily 10 barrels of potatoes to this side of the line? Mr. Cooper. That is not a parallel case. Mr. Broavx. But that is Avhat they are doing here. Noav, if you haA^e a general laAV Avhich applies to all people equalh', then it be- comes a tariff proposition. Gentlemen, I am not trying to ram that proposition down your throats, but I am simply trying to tell you to pass that for a moment and listen to the equities of the question. Mr. Cooper. Suppose in passing a statute of that kind just the naked law aa^ouIcI provide for the regulation and there Avould not be in the statute any statement of the motives of the legislator, Avhether it was for scenic beauty or Avhether it was a matter of discretion in carrying out its power under the connnerce clause. Courts don't in- quire into the motiAe: if the law is constitutional it stands. Mr. Broavn. I would not say '" Yes '" unqualified Iv- I would say they hesitate to do so, but when they find a ground Avhich is ap- parently unconstitutional and illegal they set it aside. Mr. Cooper. If, on the other hand, the law is not on its face ab- surd and ridiculous, but could he fairly interpreted as carrying out the commerce clause, or navigation, the court AA-ill sustain it upon this proposition: That a laAv shall not be set aside unless it is uncon- stitutional beyond a reasonable doubt? Mr. Broavn. Yes, sir; that is the tendency under the laAv. Noav, then, you and I Avon't differ on that ; but notice hoAv I AA'ant to ap- 64 PRESERVATION OF NIAGARA FALLS. peal to your sense of fairness and right, and I am not hypocritical. The Burton Act upon its face shows that it was an act by the United States Government to protect scenic beauty. The treaty upon its face and by the terms in which it was drawn says it Avas made solely with reference to scenic beauty. That act and that treaty were frank in expressing their objects. The engineers of the United States have told you that there is no practical ground why you should legislate on the ground of protecting navigability or boundary streams, and the only ground anyone e-ver claims here is scenic beauty. Indeed, the only purpose of this proposed act is to carry out the treaty. Now, if I should hear a gentleman on the other side of the argument say to you : " Mr. Cooper, the Burton Act was not sharp and shrewd enough. As a matter of fact, there was no ground of legislation ex- cept to protect scenic beauty, but they gave this away on the face of the act. Then, when they came to the treaty, they fell down, too. There was no sufficient ground, in law or in fact, based on scenic beauty; but they gave themselves away. Xow, beat them. Get up a law that will enable us to get something that is in fact unconstitu- tionah but which ma}^ be made to appear to the courts as otherwise, by concealing its effect and object." If anyone should tell you that, I should say that he is not honest and he has asked you to do some- thing that is not honest; and I don't believe that this committee of Congress will recommend to the House to do what no man who is not dishonest would do. Am I clear? Mr. Cooper. You are pretty pointed, though. Mr. BnowN. Absolutely, noAv, I did not mean anything personal. I appreciate the fact that you were merely speculating about possi- bilities. ]Mr. CooPEK. That is all right, but I had in mind the tax on State banks, to get revenue and for other purposes : but on the face of it it was unconstitutional and the motive of the legislator Avas for the purpose of smashing the State banks. On the other hand, take the oleomargarine law, and the preamble of it. Everybody could see it was not for revenue; it was simply to make it very embarrassing for the oleomargarine people to do business and to compel them to state what their article is. Xow, then, Congress passed a law — no, two laws, and they were attacked and Avent to the Supreme Court. The arguments of counsel were that the motives of the legislator were unconstitutional. The court said they did not have the right to consider the motives, and so they sustained them both. So in this particular case, if Ave should pass a statute and leave out the mention of scenic beauty and control that, in the exercise of our discretion under the poAvers granted by the Constitution, Avould it be uncon- stitutional ? Mr. Broavn. I can not tell Avhat the result would be, but I hope mighty Avell it Avould be declared unconstitutional. But Avhy this seeming anxiety at times to get around the consti- tutional barriers which are intended to protect property rights? Why, in Canada, Avhere there are no constitutional limitations to legislation, and Avhere Parliament ma}', if it chooses, diminish and even destroy private property rights and investments, and Avhere the courts have not the poAver to declare a legislative act invalid, once it should be seen that the effect of any proposed legislation Avas to take aAvay such rights, e.specially after inA'estments made, no com- PRESERVATION- OF NIAGARA FALLS. 65 mittee of Parliament, nor Parliament itself, would consider it with favor for a moment. But here in this country we have express con- stitutional prohibitions against legislation, the enforcement of which would impair contracts or injure or destroy property rights, or dis- criminate between citizens of the same class, and we have a judiciary whose privilege and duty are to see to it that no legislation, State or National, which is repugnant to such express prohibitions shall be enforced. Why, then, should we, before a committee of our national Congress, be trying to solve the puzzle of how Congress might do something indirectly which it is confessedly not within its powers to do directly? Why this anxiety, disclosed before a body of men here who are sworn to protect the Constitution and laws of this Nation, and property rights established under those laws, to get around the Constitution and the courts in order to legislate against or regardless of vested property rights? And this, too, with refer- ence to the rights of investors who do not ask for the protection of their full legal rights, but only to the extent of about one-half — that is, to the extent that investments and installations have already been made ! Indeed, the}' do not ask you in this proposed legislation ex- pressly to protect even that remnant of their right. We ask only that you shall not so legislate as, in terms, to prevent a fair con- sideration of our rights and equities in connection with the distribu- tion of this water power. May I close, please? The Chairman. Yes, Mr. Brown; and I trust you will be allowed to proceed. Mr. Legare. I do not understand you to contend that Ave are with- out authority to prohibit the importation of power? Mr, Brown. I would not say that, if it is general. jSIr. Legare. Now, then, the other question that was asked you : If we have the power to prohibit importation, why haA^e we not the poAver to put restrictions upon it ? I am asking you this question because ^\e AA'ant to be in a position to ansAAer questions in the House. Mr. Broavn. Noaa', I haAe not investigated these questions much, but my opinion as a lawyer is that, AA^ith general importation restric- tions, proper conditions may be attached: but, taking the facts of tlie <;ase here, the only purpose could be to protect scenic beauty, and the restriction on importation is a special and local one. But, gentlemen, even at that, ayc, the Niagara company, say this: That if you AA^ill only leave the rates to the State commission or the proper body in New York and giA'e us a chance to be heard, the question will be decided on the facts, AA'hich you can not sift out here, and (Uir equities and rights will haA'e a chance to be preserA'ed. Noaa-, gentlemen, giAe us some chance of relief, if Ave shall sIioaa- aa'c are entitled to it, and place the limit of diversion alloAA'ed to any one company at 10,000 instead of 8,600. There should be no restriction upon importation. More than that, the amoimt fixed by the treaty is not a diversion of 20,000 cubic feet in any one second : it is a diversion by the day at the rate of 20,000 feet per second. Do you see the difference? A Member. A good deal. ^Ir. Broavn. Suppose the 20,000 feet were all granted to one com- "P'Any. Under the Burton Act provisions that company could only diA^ert for auA' one second that amount, although the average for the day was much less. 66 PRESERVATION OF isiAGARA FALLS. You know how factories are run: you know what tlie peak of the load is in one day. You know this: That, so far as alfecting Lake Erie and the river for scenic beauty, the variation of two or three hours can not at the end of the day have any practical effect. The treaty saj's that the diversions shall be " not exceeding a daily diver- sion at the rate of 20,000 cubic feet per second." The present permits are granted on the assumption that it is a limit of 20.000 feet in any one second. So far as it affects these other ccmditions of general public interest, it does not amount to anything, but it does hamper the efficient use of the power plants. Mr. Cooper. Now. suppose you only took 40,000 a second for half a day, and the other half of the day you shut up : what would be the average? Mr. Browx. The largest part of this power is 24-hour power. Mr. Barixjn. Most of it. Mr. Brown. Mills and factories to-day do not shut up in the night- time; they are working all the time. They work longer hours where they can get more and cheaper power; but it happens that about 5 or 6 o'clock the peak of the load comes up — only slightly in this case. But the treaty provisions are in daily diversions at the rate of 20,000 cubic feet per second. May I suggest that the act should substantially contain what is contained in this proviso, Avhich reads as follows : Tliat in fulfillment of the purposos of Article V of said treaty the several amounts of water of the Niagara Kiver within the State of New York above tlie Falls which may i)e diverted under the s:iid act or under permits of the Secretary of War in puisuance thereof shall be limited only so that the total diversion within the State of New York of the waters of said river above the Falls of Niajiara for power i)urposes shall not exceed in tlie agjire.i^ate a daily diversion at the rate of 2(MX)0 cubic feet of water per second, and that the Sec- retary of War shall have authority from time to time to grant revocable permits for such daily diversion in several amounts not exceeding in the aggregate said 20.000 cubic feet per second, nor to any one individual company or corporation, as aforesaid, a maximum amount at the rate of 10.000 cubic feet per second; such grants to be made and continued only with due regard to the rights of the State of New York and its grantees in said waters of said river, and so that no monopoly shall be thereby ci-eateil or continued: And provided further. That the quantity of electrical power which may by permits be allowed to be trans; 'tted from the Dominion of Canada into the Fnited States may and shall be 'i'.ny and all of the i.ower by said treaty authorized to be developed within the Province of Ontario from said waters of said river that shall not be used or be required for use in the Dominion of Canada. And may I ask also to put in a statement by Mr. Philip P. Barton and Mr. Egbert, w^hich is substantially a svnnmary.of the principal points contained in Senate Dwument Xo. 105 and House Docinnent No, 246 — a sununaiy for convenience — and ask that it be printed and made a part of the record ? The Chairman. Let it be printed. >Ir. Brown. And this is drawn uj) by Mr. Francis Lynde Stetson, of New York, a director and stockholder of this company. Some time ago he wrote these five or six pages, which show the righteous- ness of some of these provisions just suggested. Might I ask that they be put in the record? The Chairman. Yes: it will be printed. Mr. Brown. Mr. Brown. And, Mr. Cliairman, may I ask this: If I think of anything else, may I put it in writing and send it in and have it made part of my statement in the printed record ? PRESERVATION OF NIAGARA FALLS. 67 The Chairman. Yes. The papers — Barton, Egbert. Stetson— ottered and received into the record next follow : Summary or Reports Published in Senate Document Xo. 105, Sixty-second Congress. First Session, and in House Document No. 246, Sixty-second Congress, Second Session. (By .A[r. I'. P. Bartox.) (!) So f:ir as practical effect iiiion the scenery and navigability of Niagara River is concerned, the qnestion now l)efore Congress, when ju'operly stated, is shown by these reports to be small and insignificant. The question divides itself into two parts: (1) Shall restrictions on transmission of power from Canada into the United States be removed? (2) Shall limitation of diversion of water on the American side of the river be extended from 15,600 cubic feet per second to 20.000 cubic feet per second? So far as permanent effect upon the river is concerned, it is obviously im- material whether Congress answers the first question in the aflirmative or in the negative. By the terms of the treaty 36,000 cubic feet per second may be diverted on the Canadian side of the rivei', and very soon that amount will be there diverted. Congress can not prevent this. Canada not only permits it, but by Government aid encourages and promotes it. All that Congress can do by restricting importation is to deprive American citizens of the beneficial use of power generated in Canada, which, if not utilized promptly in the United States, will be forever withdrawn by Canada. Five years ago it was estimates in.=approximatelv ui of an inch, KKIOO and at the Canadian end of the Horseshoe Falls a lowering not more than "^10000 ^^^•^^■'^'^ ft. = 1.42.56 in., or less than It'^ in. In Senate Document No. 105. page .51, the lowering at the head of the river (Lake Erie) is stated to be four one-hundredths foot for each 10,000 cubic feet per second diverted from above the upper cascade. A diversion of 4,400 cubic feet per second, therefore, would produce at Lake Erie a lowering of - ' i^.,v ~ =0.0176 ft.=0.21]2 in., or approximately h of an inch. 68 PRESERVATION OF NIAGARA FALLS. Recapitulatinj?, we find that a diversion of 4.4.">0 cubic feet per second is stated to lower the level of Lake Erie seven one-hundredths of a foot or about four-fifths of 1 inch. (S. Doc. No. 105, p. 12.) Maj. Keller states categorically that this diversion " will not injure r.or interfere with the navigable capacity of the Niagara River." (S. Doc. No. 105, p. 12.) The effect upon the navigable capacity of the river of further diversions is stated on page 51 in a table showing the effect of each 10.000 cubic feet per second additional diverted from this pool. Tlie effect at Lake Eric for each 10,000 cubic feet ])er second diverted is stated to be four one-hundredths of a foot. The niaxinu-m divers-ion now i)roposed from the Chippawa-<;r;iss Island pool is about 32,000 cubic feet per second (20.000 on the American side of the river and 12.000 by the Ontario Power Co.) : that is to say, 12,750 cubic feet per second in addition to the amount stated in the report as the anumnt now permissible. This additional 12,750 cubic feet per second, therefore, will cause a loA'ering of Lake Erie of five one-h\mdreths of a foot, or about three- fifths of 1 inch. These predicted lowerings at the head of the river measured in fractions of an inch are quite negligible in coniparison with the variations of lake level due to nature, which swing through a range of 14 feet. (S. Doc. No. 105, p. 24.) The regulating device, which it is undeistood will be recommended by the Inter- national Waterways Commission to prevent the recurrence of low-water stages of Lake Erie due to naturi'. will obviously counteract completely any possible lowering of Lake Erie or of the navigable part of the river due to «liversions at Niagara. (S. Doc. No. 105. p. 52. Int. Waterways Com.. 7th progress rept., pp. 7-8.) 3. Effect vpox tiu; l.MiiiUiiv or Proper Voi.r.Mi-. oi Nia(;.vha Uiver as a BorNDARY Stream. The reports make it quite clear (S. Doc. No. 105. p. 13) that no diversions that have ever been pro|xisei-esents in confusing quantities uifaNurtMueiils. de- ductions, diagrams, and photograi)hs designed to show not merely the cffwts of power diversions but also the far more dominant effects of other agencies upon the appearance of the Falls. Statements of fact are interspersed with statements of opinion. It is easy for a cursory rea) that out of a total lowering of 2(» inches at the Canadian end of tlie lloi-.seshoe Fall reported for 1911. more than 6 inches is due to natural recession at the apex of the Horseshoe since 19(K'»; aliout N inciies is due to power diversions, and over 5 inches is due to defici(Micy in rainfall in tlie waterslied sup])lying Lake Erie. Tlie scenic effects of tb.esc aggregated causes are described as (1) "An appreciable decrease in the volume of flow;" (2) "Interference with the continuity and length of crest line uuiiuestionably marring the natural beauty of this cataract." The statement is tlien made that " Natural causes have been chiefly instrumental in effecting these changes," but that artificial diversions of the i)ower companies "have materially added to the 'injury or interference with the scenic grandeur of Niagara Falls.' " The report thus states cate- gorically that the changes alleged to have occurred in the aiipearauce of the Falls are mainly due to natural causes. It appears to be exceedingly doubtful wliether in the absence of natural causes the eftects due to iiower diversions alone would be sensible "even to the eye of a trained engineer." although it is claimed that they are susceptible of measurement, and it is certain tliat nature herself is the dominating agency " marring the natural beauty of this cataract." 70 PRESERVATION OF NIAGARA FALLS. 5. Cebtaix Statk.mkxts Compauku. (See t.ilmliition •• Exliihit B.") TliHif si'onis t(» l»o sonic (lisci-t'inimy betwtvii the ivsults predicted in 190S ami those repented in 1911. wiiieh the (Juvernnient enjrineers probably could explain. In Senate Document lor». pa.io there was an extremely low stage of Lake Erie, due to deticiency of precipitation, which condition, it is stated, " is sure to recur." A very exact i)redietion is then made of the conditions that will exist at the crest of the Falls with such a low stage of Lalce J]rie. It is stated that at Terrapin Point there will be a h)wering of 5^ inches, due to deficiency of jinfipitation. which, addetl to 24 inches attribntetl to jtower diversion, will make a total lowering at Terrapin I'oint of S inches. At \hv west i^m\ of tlic Horseshoe Fall there is prt'dictefl a lowering of 14 inches, due to natural lowering of the lake, which, added to S.O inches attributed to i)ower diversions, will make a total of 22.1) inches (stated as "nearly 2 feet"). l<'rom the tal)ulation herewith, marked Exhibit A. it will be seen that the monthly mean levels of Lake Erie during the cur- rent year 1911 have approximated very closely those of 1895. In some mouths they have been lower than in 1895, the average of the monthly means for the year being very slightly liigher than in 1S95. It appears, therefore, that the predicted causes have materialized, but the results do not seem to correspond with those predicted : thus, in House Document 246. page 13, the figures of lowering reported at Terrapin I'oint for 1911 are only 5.48 inches, as against over 8 inches predicte inches, attributetl to rece.ssion <»f the apex of the Horseshoe since 1990. The 190S prediction was that under file 1911 conditions ''many shallow jilaces at both ends of the Horseshoe Fall will l)ecome dry." The changes " will result in a mutilated Niagara — one shorn of nearly half its flow and of nnich more than one-half its natural beauty, since many i)laces now overflowed will be made l)are. the crest line broken, and unify of effect will l)e seriously disturbed." ( S. Doc. 105. p. 13.) The language used in the 1911 report to describe the actual results conveys an Imitresslon (juite different from that created l>y the prediction. (H. R. Doc. 246, ]). 13.) It is safe to say that spin-tators of Niagara Falls during the year 1!>11 would l)e (piite unable to difterent late between the spectacle in-esented in 1911 and that presented in any other period of corresi)onding lake levels, except that the recession of the apex of the Horseshoe and the diminution of the thin streams at Terrapin Point, due to that natural cause, might possibly be noted. (5. Direct rcfcmicc i of the existing jdant of the Niagara Falls Power Co. m.ay reach a total of over 12,000 cubic feet per second and tiial ".in increase to the limit of the capacity of the existing tailrace tuiuiel may be regardent Xo. lo.'i. Sixty-socond Confri'pss. first session.] He further states that, in his opinion, the damage already done and that which may be anticipated from further diversions and from lower stages in Lake Erie niay be largel.v. if not entirely, remeilied by a submerged dam placed in the bed of the river immediately above Horse.shoe Fall, with the ob.iect of PRESERVATION OP NIAGARA FALLS. 71 diverting a portiou of the gi'eat volume passing over the center or apex of the Horseshoe, so as to increase tlie streams feeding the depleted ends of that fall, and. incidentally, diminishing the rate of recession of the apex (p. S). The interests of justice seem to demand the further statement that, in my opinion, the damage already done, and that which may be anticipated from further diversions and from the impending fall in tlie level of Lake Erie, may be largely, if not entirely, remedied by a submerged dam placed in the bed of the river immediately above the Horseshoe Fall. The dam, if properly planned, would .serve tt> change the direction of flow, so as to increase the streams that feed the Falls at Terrapin Point and at the Canadian shore. The decrease in the mighty volume that overflows the center or apex of the Horseshoe would not be noticeable. * * * a very direct result of tlie construction of this submerged dam would be a diminution in the rate of recession of the apex of the Horseshoe. This in itself is extremely desiralile (p. W). It is possible, however, that Congress may deem just and desirable some addi- tional concession to the power companies, and the following is suggested as a basis for discussion : It is understood that the intention of Congress, as expressed in the act of June 29, 1906, was to preserve to the various i)ower companies rights which had already accrued through the investment of capital and the construction of fixed plant. It is jiossible then that the di\ersions needed for a niaxiinum profltable use of the existing plant of the Niagara Falls Power Co. may reach a total of over 12,000 cubic feet per second. * * * An inci-ease to the limit of the capacity of the existing tailrace tunnel may be regarded as a simple act of justice (p. 16). If the submerged dam above the Horseshoe Fall, previously referred to, be built, then additional concessions may probably safely be made to the three Canadian companies (p. 17). At Buffalo, in westerly gales, the water sometimes rises 8 feet, and in easterly gales sometimes falls 6 feet, giving a range of 14 feet ( p. 24). It would be unjust to charge the power companies with a lowering of the river or lake that might be due to improvements for navigation or to some other cause. That these seasonable variations in the river regimen are present is also sutticient reason why conclusions drawn from cursory and incomplete river examinations might he viewed with suspicion (p. 25). So far as effects on Lake Erie and the river above the rapids or on the American Fall are concerned, the diversions of the Electrical Development Co. or of the Canadian Niagara Falls Power Co. have no bearing (p. 39). While the measurements of the Lake Survey have shown with certainty that changes in outflow of the Niagara River have had no appreciable effect toward lowering Lake Erie in the past 10 years, it is equally certain that Lake Erie has already been lowered 3 to 4 inches by reason of the diversion of water tributary to the Niagara River, through the Chicago, Welland, and Erie Canals. In discussing the injurious effects of diversions at the Falls on Lake Erie and on the Niagara River as navigable waters of the United States and upon the scenic grandeur of Niagara Falls, other diversions of the water of the Great Lakes naturally tributary to the Niagara River need consideration also, as the rtual injurious effect is the summatiim of :ill ( i). 49). If, however, compensating works are established and a surplus of water accumulated against dry seasons, no such .serious lowerings will occur. The navigable capacity of the Niagara River is shown by the above cita- tions to be not seriously injured by such vohunes of diversion as will fully supply the existing installations at Niagara Falls, except when the lowering is snijerimposed on the losses of depth coming from other diversions, and from periodic, seasonal, or tem))orary low water, as in time of storms. The determination of the eftects of water diversion at Niagara Falls on the catai-acts themselves and on the rapids approaching them is not so exact a& are the effects on the navigable river and the lake (p. 52). While th.it se<.-tion of the Horseshoe Fall on the American side of the inter- national boundary toward Coat Island shows scant flow and is partially un- watei'ed. a restoration of as nnich flow as is desirable does not appear a diffi- cult engineering undertaking. Submerged concrete piers at the head of the rajiids would effectually thi-ow the current to this section of the rapids and Falls (p. 53). Any increase of volume of flow over the Falls is .-ilways jiccomiKinied by a corresponding loss of height in the Falls (p. 55). 72 PRESERVATION OF NIAGARA FALLS. The continued recession of the apex of the Horseshoe Fall should tend to further shoal this area, and heavier diversions by the Canadian companies will doubtless leave it diy at times. These photographs, and the effects on the American fall shown in the equivalent river heights derived from long series of gauge readings, cori'obo- rated by the testimony of the actual shutdown of July-August, 1008. tirmly establish the fact that the American fall is in no danger of unwatering from diversions through the existing canal of the hydraulic company, the present tunnel of the power company, or the already constructed penstocks of the Ontario Co., even in conjunction with such considerable diversions in the Great Lakes above the head of the Niagara River as have been discussed, and with the lessened flow of seasons abnormally low in surplus supply. The Horseshoe Fall, on the other hand, as shown by equivalent river heights and confirmed by the shutdown, appears in serious danger of an unwatered crest line at each end, due to all present and anticipated diversions above it, and augmented by the upstream recession of the apex. It has converted into a spectacle the strength of 5,000,000 horses (p. 56). Even in dimensions it can not be said that a third of the grandeur has departed when a third of the flow is absent, because the length of the crest line may be little shortened, and the height of fall is even greater when the river flow is small than when it is large. It is only fair to state, because of some erroneous views held concerning the injury already wrought on the Falls by diversions, that during the past decade, 1899 to 1908. for the months June to October, inclusive, the Falls have had a fullness of volume and consequent grandeur barelv less than that of tlie prior decade, 1889 to 1898 (p. 57). While this report has dealt with injurious effects on the Itapids and Falls of the Niagara River and with interferences with navigable ways in river and lake, and has shown tliese up in their limiting, hurtful amounts, it seems proper to suggest certain remedial measures that may serve to harmonize the preser- vation inviolate of the scenic grandeur with the useful application of the splendid power of the Falls. Both of these things are eminently desirable and feasible. A volume of 210,000 cubic feet per second with a descent betwo;>n the " dead line" and the Upper Gorge of 220 feet lias a potential of over 5.000.000 horse- power. This is the power of 15.0t)0,000 strong draft horses, each limited to an eight-hour day. If it takes 10 able-bodied men to do the work of one of these draft liorses. the work potential in this fall is that of 1.">(>.(K»().(i(Ki men. nearly twice our population of men, women, and children. The great companies at the Falls have created in good faith power plants to lessen the hardships of human labor, to aid transportation, to illuminate the night hours, and to add to the wealth of two nations. The power houses for the most part are architecturally excellent, harmonizing with the scenic sur- roundings, and the mechanical wonders wrought in solving the engineering problems of the utilization of this great head and volume of water rival as a spectacle the scenic grandeur of the Falls and add to the attractiveness of the region. It therefore aiJijears proper to permit and foster such ultimate develoi)ments In addition to those already in force as are comimtihle with the perpetuation of the scenic grandeur appreciably undiminished. Provided there be no large increase in uplake div(M-sions, the possibilities of continued and extended use of power at the l-'alis are conditionetl upon the construction of regulating Avorks in the Niagara River to avoid the wasteful outflow ol the water of I-ake Eri<'. The injury to the scenic giandeur of the Falls and the interference with the navigable wat(>rs of the Niagara River and Lake Erie, due to uj'lake diversions, and the injuiy and interference coming from i)eriods of drought would be largely obviated by impounding in the lakes a portion the winter outflow. During tlie months of l>ecenil)er to April, in- clusive, enough water may be saved to hold the lakes to a proper and economical level to the betterment of navigation and yield a surjtlusage to partially offset diversions at the Falls. This is a practicable engineering oroposition. but as the power companies are beneficiaries they should pay a fair sliare of the cost of the work (p. 75). The desirability, as well as the justice, of amending the Kurton Act so as to permit the Niagara Falls Power Co. to divert water to the full capacity of its tailrace tunnel are plain. In view of the intimate bearing of this investigation upon the interests of the company, and as an acknowledgment of the helpful cooperation of tiu> company. PRESERVATION OF NIAGARA FALLS. 73 it is believed to be advisable to furuish the company witli a copy of this repon, aud permissiou to do so is requested (p. 139). Lllouse Document Xo. 24G. Sixly-second Con{,'i-e.ss, second session.] As to the effects of diversions, to the extent at present authorized, on the in- tegrity and proper volume of the Niagara River as a boundary stream, it is not apparent that the river through these diversions has suffered. The upper and lower river still continue to discharge approximately the same volume of water, the diminished flow being only over the cataracts and the rapids imme- diately above. Over this portion the stream, while appreciably decreased, still maintains sufficient width and depth to effectively delimit the boundary. More- over, it remains impassable and continues to discharge immensely more than many of the smaller International boundary streams and has considerably more than double the flow of the St. Marys River. It is determined that the total authorized diversion of the American com- panies, together with the present consumption of the Ontario company, will lower the depth on the American Fall about five-eighths inch aud decrease the volume of flow about 5 iiev cent. As the lowering will result in uuwatering little, if any, of the crest line, and as the decreased flow will be scarcely appreciable, it may be considered that the changes on the American Fall are unimportant (p. 12). In so far as the inspections disclose, the several companies diverting water in the United States from the Niagara River or receiving electrical power in the United States transmitted from Canada have at all times complied with the provisions of their permits (p. 15). In conclusion, it is due to the several companies and their officers to express appreciation of their generous cooperation in making supervision easy and effective and of their courtesy in acceding to everj' suggestion or request from this office (p. 16). No clause bearing upon scenic conditions was incorporated in the transmission permit of the Niagara Falls Power Co. (p. 18). Exhibit A. Monthly mean levels of Lake Erie referred to mean sea level at New York. Year. Jan. 1895... 571.79 1907... 573. 18 1908*. . . 572. 98 1910... 571.33 1911... 571. 36 Feb. Mar. Apr. May. 571.10 571.02 571.23 571.58 572.57 572.281 572.74' 572.83 572. 46 572. 73 573. 28' 573. 52 571. 04I 571.62 571.92 572.48 571.051 571.081 571.201 571.78 June. July. Aug. Sept 571.681 571.66 571.52! 571.54 573.11! 573.26 572.951 572.81 573.49, 573.35 573.14 572.67 572.45! 572.37 572.171 571.90 571.891 571.90 571.87, 571.30 Oct. 571.30 572. 67 572. OS 571.98 571.33 Nov. Dec. 1 Yearly [ mean. 570.81 571.071 571.36 572.60 572.57, 572.80 572.13 571.91 572.81 571.84] 571.68' 571.90 571. 87ii571. 67 1571.5a ' Assuming that December, 1911, will be about 0.2 below November, as has been the case in 1908 and 1910, the average mean level for 1911 \\i\\ be 571.52, as given above. Mean level of Lake Erie, 1860-1875, 572.8. Mean level of Lake Erie, 1860-1895, 572. 6. Mean level of Lake Erie, 1895-1910, inclusive, 572. 13. Exhibit B. Loucring at crest of Horseshoe Fall with Lake Erie at level existing in 1911, Terrapin Point. West End. Predicted in 1908. Reported In 1911. Predicted in 1908. Reported in 1911. Attributed to deficiency in precipitation Inches. \ 5.5 ! 2.5 Inches. 2.00 3.48 Inches. 14.0 8.6 Inches. 5.0 Attributed to power diversions 8.6 Total 8.0 , 5.48 122.6 13.6 Attributed to recession at apex of Horseshoe since 1906. 6.0 ! i ' Stated as "nearly 2 feet." 74 PRESERVATION OF NIAGARA FALLS. Notes Re Reports Published ix Senate Document 105, Sixty- second Congress, First Session, and in House Document Xo. 246, Sixty-second Congress, Second Session. (By Mr. C. C. Egbert.) The actual facts relating to the effects of the diversions of water by the iiower compauies at Niagara Falls upon navigation and the scenery are somewhat confused and hidden by statements in regard to the effect of diversions from the .i;i,i;arii water from tlie Auierican Falls has [utjved absolutely iiiajiprecialjle to the naked eye of the disinterested observer. As to the Niagara Falls PcAvcr Co. it has Iteen found that the computation of the waterways commission of b.GOO cubic feet per second was insufficient to fur- nish the flow of water actually in operation at the time that the waterways commission was in session, and also is unequal to the production of the 100,000 horsepower which the waterways conniussion intended to allow. It is unnecesisiary to amplify this memorandum by references to the testimony but the printed report of the hearings before the Committee on Rivers and Harbors in I'JOG (II. K. 18024) will fully sustain this proposition. It being understood then that by the allowance of 8,600 cubic feet per second it was intended to provide for the existing requirements of 100,000 horsepower in use by the Niagara Falls Power Co., serious and unintended injustice has resulted to that company by the limitation of 8,000 cubic feet. Actual demon- stration showed that the amount would yield only about 82,000 horsepower and that to produce the 100,000 horsepower intended for the Niagara Falls Power Co. it was necessary for that company to have 10,500 cubic feet per second. In other words, an increase of 1,900 cubic feet per second. This being added to \ln) aggregate amount of 15,(!00 feet allowed upon the American side, would make a total of 17,500 feet. / Recognizing also the other necessities of the other companies on the American side the treaty raised the maximum limit to "a daily diversion at the rate of 20,000 cubic feet per second," which can not be diminished without inflicting serious injury upon the American conqtanies and a \ isions of that act authorized a larger importation than would be jKissible under the treaty if the Canadian use be subtracteermits of the Secretary of War in i)ursuance thereof, shall be limited only so that the total diversion within tlie State of New York of the waters of said river above the Falls of Niagara for power purposes shall not exceed in the aggregate a daily diversion at the rate of 20.000 cubic feet of water per second, and that the Secretary of War shall have authority from time to time to grant revocable permits for such daily diversion in several amounts not exceeding in the ag- gregate said 20,000 cubic feet per second, nor to any one individual company or corporation as aforesaid a maximum amount at the rate of 10,000 cubic feet per second ; such grants to be made and continued only with due regard to the rights of the State of New York and its grantees in said waters of said river, and so that no monopoly shall be thereby created or continued: And provided further, That the quantity of electrical power which may by permits be al- lowed to be transmitted from the Dominion of Canada into the United States may and shall be any and all of the power by said treaty authorized to be de- veloped within the Province of Ontario from said waters of said river that shall not be used or be required for use in the Dominion of Canada." Committee on Foreign Affairs, House of Representatives, Thtirsday, January 18, 1912. The committee met pursuant to adjournment at 10 o'clock a. m. The Chairman. The committee will hear Gen. Francis V. Greene this morning. Francis V. Greene. I am president of the Niagara, Lockport & Ontario Power Co., a corporation of the State of New York, and vice president of the Ontario Power Co., of Niagara Falls, a Canadian corporation. I appear on behalf of those corporations. I think it will facilitate the deliberations of the committee if they have certain maps and statements before them. I have here a set of maps, one for each member of the committee, showing the locations of the power plants at the Falls, and the locations of the transmission lines by Avhich the power is distributed. Mr. Garner. Will it interfere with you now to ask you some ques- tions that you can keep in mind as you go on with your argument? Gen. Greene. I was going to speak not more than a few minutes and then let the committee ask questions. I have also a copy of the Burton law and a map of the Falls made in 1876. These photographs show the conditions of the Falls. That long photograph was taken in 1906 when the Burton law was passed. These photographs were taken last summer. T have also prepared a written statement con- 28305—12 6 78 PRESERVATION OF NIAGARA FALLS. tainiiiff facts which answer a great many of the questions that Avere asked the other day. The statement is too long to read this morning, and I ask the chairman if it can be incori^orated in the proceedings.' If the members of the connnittee will glance it over it might suggest certain questions. Now. with the chairman's consent. I will have these documents placed at each member's desk. Xow, as I understand it. Mr. Chairman, the interest of the United States in this matter is really to in-eserve Niagara Falls. The Burton law is entitled '"An act to control and regulate the waters of Niagara River, preserve Niagara Falls, and for other purposes."" The tluee things which are mentioned in the P>urton law as bearing upon the question were: "Whether navigation was interfered with, whether the integrity of the Niagara liiver as a boundary stream was injured, and Avhether the scenic grandeur of Niagara P'alls was injured. The United States engineers have had these subjects under investigation for nearly six years, and have made their elaborate reports, and in substance they report that there is no' injury to navigation, tliat the integrity of the river as a boundary stream is not affected, that the scenic grandeur of the American Falls is in no way affected ; but- the}^ think that owing to the lowering of the thickness of the Avaters on the Canadian side the Canadian Falls are affected. Now, as to the engineering questions, you will notice that there is no injury. Gen. Bixby. the Chief of Kngineers, testified explicitly, as I under- stand it, on Tuesday that the slight loAvering of Lake P2rie had no effect on navigation on Lake Erie. Now, as to the grandeur, the opinion of other people than engineers is just as valuable as engineers* opinions. The engineers have endeavored to show that the Horse- shoe Falls have nine inches less water going o\er tliem in consequence of the diversion of water for power ))ur|)oses. That is a very com- ]:)licated scientific computation — a very comj)licated measurement of gauges. Whether it is entirely accurate or not. the fact is not dis- puted : but the o))inion that the scenic beauty is affected is disputed. I think that the committee can best satisfy itself as to the scenic grandeur of the Falls by a visit to the Falls. Failing that, I have brought these photographs for the purpose of shoAving that the Falls are, so far as the ordinary observer can detect, as handsome noAv as they ever Avei-e: that the scenic grandeur has not been injured. Mr. Flood. How could avc tell that bv a visit if av(> have ncAcr seen the Falls ? (Jen. Greene. You Avould lune to compare that with the l)est ])ho- tographs. Mr. Kendall. Does the floAV of the Falls vary Avith the lake levels? Gen. Greene. The levels \ ary from day to day and from month to month. Mr. Kendall. So that photographs Avould not be a valuable crite- rion ahvays? (len. Greene. You Avill ahva^'s find that the pliotographers took the photographs under the best conditions, so that the old photo- graphs are taken to show the best conditi(ms of the Falls; and Avhat you .see noAv is comparefl Avith the best conditions before there Avas any power plant there. The east wind will diminish the flow of ' rrinfpd on p. — . PEESERVATION OF NIAGAEA FALLS. 79 water over the Falls by an amount much greater than the total diver- sions under the treaty. Mr. Garner. Would it divert you for nie to ask the ({uestions now? Gen. Greene. No, sir. Mr. Garner. Assumino; that this committee will frame legislation under this treaty, I would like to ask you to tell the committee what reason, if any, there should be for the American side to utilize the 4,400 feet remaining; and in that connection, to utilize all that, why all plans and all propositions with reference to construction should not be placed in the hands of the Chief of Engineers or the Secretary of War? Gen. Greene. The first part of vour question was whether the 4,400 feet should be used ? Mr. Garner. Yes. Gen. Ctreene. I see no reason why it should not be used. Mr. Garner. Now, being one of the parties interested, what objec- tion would you have — and is there an}'^ obstacle in laAv to prevent it — to placing the entire consideration of plants for the use of power under the Secretary of War. that the greatest amount of poAver may be obtained from the use of that water? (Jen. (treene. As a matter of fact, I do not suppose a layman's opinion would be of any value. I do not know where j^ou could find anything in the Constitution to permit that, provided the in- vested capital there is not destroyed ]VIr. Garner. Well, you must presume that the Secretary of War would not undertake to destroy any kind of enterprise. Gen. Greene. I do so presume, and therefore I see no practical objection. A ^Ie:siber. Have you any suggestions in respect of that? Gen. Greene. Well, I think the State of New York will claim the control. Mr. Flood. What do you say to turning this control over to New York? Gen. Greene. I may say that I am not interested in this 4,400 feet financially, because the power house in which I am interested is on the Canadian side, but I think that it ought to be used to get the greatest amount of power out of it. Niagara water has become very precious, and I think there is no den34ng that statement. Mr. Flood. What suggestion have you to make to accomplish that result? Gen. (ireene. I think the Secretary of War should take up that in conjunction with the State of N-ew York. Mr. Cooper. The up-State public utilities commission would not undertake to divert that. Gen. Greene. No. Here is the present public-service law. It is a controlling law as to price, and it is absolute. As to the issue of securities, they have ample power, but no power is given to them in regard to rivers or diversion of water. Mr. Cooper. And they would not take up the (question of price except ui)on petition? Gen. (treene. The laAv is mandatory that upon petition of a small number of citizens that the price of electricity is unreasonable they shall investigate it. Mr. Cooper. Only upon petition? 80 PRESERVATION OF NIAGARA FALLS. Gen. Greene. Onlj^ upon petition. Mr. Cooper. They can not act upon their own initiative? Gen. Greene. If they act upon their own initiative they never could get through with the business. It is all they can do to hear complaints now. jNlr. Garner. Is it not a fact that this commission has so much work to do that it is next to impossible for an individual who claims to be paying too much for gas and electricity to get his complaints before it? Gen. Greene. Xo, sir; the commission is hearing such complaints every day in the Aveek. Mr. Garner. I was told that the city of Buffalo had now arranged a fund of $35,000 for submitting cases to that commission. If it takes that much to submit a case to that commission of Ncav York, I do not see how private citizens can submit their cases intelligently. Gen. Greene. I understand that is for getting expert testimony to convince the commission. Mr. Garner. Then, if it is necessary for the city of Buffalo to get expert testimony for the purpose of convincing the commission. Avould it not also be necessary for the ordinarj^ citizen to get expert testi- mony to convince the commission? Gen. Greene. I did not suppose a private citizen could expect the commission to take his word alone. Mr. Kendall. General, is there any competition between the com- panies in the charge for electrical current? Gen. Greene. The power companies are scattered in different ter- ritories. The decision of the public-service commission in New York is that they will not permit a competition. Mr. Kendall. Don't you think that is wrong? Gen. Greene. No, sir; I think it is absolutely right, because they have the power to regulate the price. Now, 10 years ago ^Ir. Difenderfer. That commission has the right to fix the price? Gen. Greene. Yes, sir. ISIr. Difenderfer. They do fix the price? jen. Greene. They do. Now, 10 years ago the gas and electric v^wmpanies were competing in nearly every town. The result of that was the duplication of capital. There was a w^ir between the com- panies, and prices were slaughtered. Then the companies got to- gether and the price went up and the public paid the bill. IVIr. Difenderfer. As usual. Gen. Greene. Now, the public-service commission of New York, in two or three decisions, has declined to permit two competing com- panies, but has fixed the standard of price and quality of gas and electricity. Mr. Difenderfer. Why should they discriminate? What price is Lockport paying for horsepower? Gen. Greene. $16 per horsepower. Mr. Difenderfer. What is the price paid in Buffalo? Gen. Greene. I do not know. INIr. Difenderfer. The difference is about 6 miles in favor of Lockport ? Gen. Greene. Yes. Mr. Difenderfer. Now, you are selling electricity at $16 per horse- power. Is it not a fact that it is sold in Buffalo at $29 ? Gen. Greene. I do not know, sir. PRESERVATION OF NIAGARA FALJ.S. 81 Mr, DiFENDERFER. "V^Hio clo joii think could tell us? Gen. GfiEENE. Some representative of the company which sells in Buffalo. Mr. Dirp^NDERFER. Then, General, I propose to go back to Mr. Garner's (|uestion. If an individual were to go before the State com- mission and enter a protest against the price charged for electricitj^, Avould it be possible for that company complained against to penalize the individual? Gen. (treene. No, sir. Mr. DiFE>'DERFER. Absolutely? Gen. Greene. Absolutely. Mr. DiFENDERFER. You loiow of uo casc where this happened? Gen. Greene. I can not say that I Imow of such a case, because I do not know the business of the company distributing power in Buffalo; but I say that can not happen, because the public-service law provides a remedy for that. yir. DiFENDERFER. Ycs ; but if a man is not permitted to take his case before th.e commission, the State can not act? Gen. Greene. The law says that the commission shall investigate if 100 citizens make the protest; but in a population of 450,000 people is it your idea that one individual can make his statement and that can be accepted ? Mr. DiFENDERFER. Xo ; but it should be. Gen. Greene. Well, then, if there are not 100 people to say the prices are unreasonable, it is quite evident that there is no unreason- ableness. Mr. DiFENDERFER. Then it is a fact that the city of Buffalo has to raise a fund to protect that right ? Gen. Greene. Yes, sir. Mr. DiFENDERFER. You are an expert in power development ? Gen. Greene. Yes. Mr. DiFENDERFER. A\liat mcthods are followed in order to get the highest efficiency from the present diversion on the American side? Gen. Greene. Well, the methods which are followed there, I should say, are completely up to date. I am not sure that I know what methods you wish me to describe. Mr. DiFENDERFER. Ycs ; I would like to have 3^011 Gen. Greene. The Hydraulic Manufacturing Co. has a canal which goes through the city of Niagara Falls and takes the w^ater at a point above the river about a mile below the Falls with a very small loss of head — a few feet ; it then drops the water through machinery into the lower river. Mr. DiFENDERFER. The hydroelectric commission of Ontario is a distributing company? Gen. Greene. Yes, sir. Mr. DiFENDERFER. Do you sell it elettricity? Gen. Greene. Yes, sir. Mr. DiFENDERFER. At wliat price? Gen. Greene. At $9.40 per horsepower. Mr. DiFENDERFER. How uiuch powcr does your company sell to this commission ? Gen. Greene. About 20,000 horsepower. Mr. DiFENDERFER. Have you any limit as to the amount you are to sell to this companv^ ? 82 PRESER\ATION OF >.'1AGAEA FALLS. Gen. Green p:. 100,000 horsepower. Mr. DiFENDERFER. Now. wliat is the price that the cities and vil- lages ah)ng the frontier of Canada pay to this company? Gen. Greene. Akmg the lines of the h3'droelectric commission? Mr. DiFENDERFER. Yes. Gen. Greene. They pay actual cost without profit; and the law says that the actual cost shall be figured at the price paid to the Ontario Power Co. for power, plus operating expenses, plus sinking fund and interest on the bonds, plus maintenance and depreciation, and they divide that among the cities in p'roportion to distance of transmission. I think the lowest price named is $1(>, and as far as 120 miles away at London, my recolection is, the price is $24. They are talking of going to Windsor on the Detroit Kiver, and I think the price there is $80. Mr. DiFENDERFER. Do you think there is a possible prospect of their ever doing it? Gen. Greene. Possible. Mr. DiFENDERFER. Is it probable? Gen. Greene. I should say not probable, on account of the distance. Mr. DiFENDERFER. So that the Detroit people are not very likely to be accommodated from this source? Gen. Greene. That is a matter of opinion. Mr. DiFENDERFER. Now, then, your company has built on Dominion land owned by the park commission? (ien. (treene. Yes, sir. Mr. DiFENDERFER. You pay rental? Gen. Greene. It is $1.50 for the first 20,000, $1 for the next 10,000, 75 cents for the next, and 50 cents for every horsepower over that. Mr. DiFENDERFER. Now, I am speaking of the Canadian side of this proposition. These rentals are used for the building of boule- vards? Gen. Greene. They Avere used for buildings at the park, and now it is for a boulevard. Mr. Dii'-enderfer. And this money Avas to be used for that purpose? Gen. Greene. They are using it for that. Mr. DiFENDERFER. Is there any such boulevard on the American side? Gen. Greene. No ; I think not. Mr. DiFENDERiEH. Havc you any reason to give Avhy that proposi- tion should not be made for the American side? Gen. (jREENE. It is the difference of who owns the huul. The Canadian Province owns the land on their side. Mr. DiFENDEKi^R. You kuow that this proposition has been sug- gested for 30 years? Gen. Greene. I did not know- that. Mr. DiFENDERFER. I belicve that is a fact. Now, does the company make a profit on the power sold to the hydroelectric commission? Gen. Greene. Well, until the l)ooks close in a year or two. I would not be sure about it. Mr. DiFKNDEiJFEU. Well. I don't like to be side-stepped on that. I want a different answer. Gen. (treene. 1 think we are going to make a slight i)rofit. but T am not sure of it. Mr. DiFENDERFER. And you make a slight profit? PRESEEVATION OF NIAGAEA F^VLLS. 83 Gen. Greene. Nine forty. Mr. DiFENDEKFER. That is for the necessaries? (ien. Greene. It is 50 cents tax for 40,000 horsepower. Mr. Du'T.NDERFER. What is tiie cost of the transmission of power from the Canadian side to the American side ? (ien. (iREENE. It depenils upon the distance. You mean just to the boundary line or to Syracuse, ICO miles away? Mr. DiFENDERFER. Xo ; just to the boundary line. (Jen. (jREENE. The cost of transforming and transmitting to the boundary line is something like $2 — between two and tw'o and a half. Ml-. DiFENDERFER. Xow, supposiug your company to have come into the city of Buifalo and not skirted the boundary of Buffalo as has been stated here, at what price could j'ou have furnished electric poAA'er to the people of Buffalo? Gen. Greene. We are furnishing the suburbs at twenty to twenty- four dollars. Mr. DiFENDERFER. Somc years ago there was a proposition to enter the city of Buffalo — your company? Gen. Greene. Yes, sir. Mr. DiFENDERFER. AMiat were the circumstances under which you were to secure that franchise? Gen. Greene. AVe were required to put every wire under ground. Mr. Difenderfj^r. What else? (len. Greene. That was enough to bankrupt us. ;Mr. DiFENDERFER. Did you not require that you be permitted to have the same terms granted you that were granted to the original company ? Gen. Greene. Xo, sir; there was no use of coming into competi- tion with them unless we Avere on an equal basis. Mr. DiFENDERFER. But you came in later; so that there was a vast improvement in the production of electricity that would have given you an advantage? Gen. Greene. Xot very great. Mr. DiFENDERFER. Is it uot a fact that you did not care to compete with the Buffalo people? Gen. Greene. We would have been very glad to compete with them on equal terms. Mr. DiFENDERFER. Could they compete with you on equal terms at Lockport or any of the towns skirting the city of Buffalo? Gen. Greene. I do not see why they have not. Mr. Difenderier cent of the Falls is on Canadian ter-ritory. Mr, Sharp, That is AAdiat I thought. Gen. Greene. The boundary line is not in the center of the stream. but runs through the-thin Avater near Goat Island, and the report of the engineers is that only 5 per cent goes over the American Falls and perhaps 2 or 3 per cent over the American side of the Canadian Falls; so that less than 10 per cent of the Avater of Niagara Falls is on the territory of the United States. ^Ir, Kendall. "Where do you say that boundary line is? Gen. Greene. At Terrapin Point. Mr. Sharp. Another reason I heard is that the supposed loss of the drainage canal at Chicago PKESEJ{VAT10N OF NIAGARA FALLS. 89 Gen. Greene. Oh, that always appears ; 10,000 feet at Chicago. Mr. Sharp. Are you acquainted with the operations of the She- winnegan Power Co.? Gen. Greene. I visited it once. Mr. Sharp. Do you know what rate they are getting for their power ? Gen. Greene. No; I do not. Mr. Difenderfer. General, the Ontario Power Co. is a corpora- tion ? Gen. Greene. Yes, sir. Mr. Difenderfer. And it is a power-distributing company? Gen. Greene. Yes, sir. Mr. Difenderfer. And you are the vice president? Gen. Greene. Yes, sir. Mr. Difenderfer. So that your association with the Ontario Power Co. would be very intimate? Gen. Greene. Yes, sir. Mr. Difenderfer. Now, the Niagara, Lockport & Ontario Power Co. is the company that distributes the power created by the Ontario Power Co. ? Gen. Greene. Yes, sir. Mr. Difenderfer. It is the distributing company? Gen. Greene. Yes, sir, Mr. Difenderfer. And you take this product at the center of the river ? Gen. Greene. Yes, sir. Mr. Difenderfer. Then, you must have information as to what it costs to deliver it to the center of the Niagara Eiver? Gen. Greene, I have previously answered that question, Mr. Difenderfer. And you say that the MacKenzie-Mann Co., w^hich is the Electrical Development Co., could not afford to bring it into the United States? Gen. Greene. I have made that statement. Mr, Difenderfer, How do you dovetail the two — that you can afford as a member of these companies to bring this power to this side and distribute it to Rochester, and so on, and yet you say the Mac- Kenzie-Mann Co. can not bring it here to Buffalo ? Gen. Greene. I did not say anything about Buffalo. Of course, if there are any representatives of the MacKenzie-Mann interests here they can speak better than I can, but if they are not, I would say that I would not ask capitalists to put seven or eight million dollars into a second transmission company to use their power in New York, because it would not produce any return, Mr. Difenderfer. Now, then, it would be practically impossible to expect that company to deliver any electricity in Detroit under those circumstances, would it not? Gen. Greene. The MacKenzie-Mann Co.? Mr, Difenderfer. Yes. Gen, Greene. I don't understand Mr. Difenderfer. I am just taking a hypothesis. Gen. Greene. I should not expect to make any money by going to Detroit. Mr. Difenderfer. And you rather an acute business man; you have the reputation of being a rather acute business man ? 9 PRESERVATTOX OF NIAGARA FALLS. Gen. Grep:ne. Yes. sir. [Laughter.] Mr. DiraNDERFER. Now, the MacKenzie-Mann Co. is Gen. Greene. They are rather acute, too. Mr. DiFENDERFER. If thev are not able to do it. it is quite evident that no other company will ever, within our lifetime, supply Detroit. or even Windsor? Gen. Greene. Now. when you talk about your lifetime. I don't know your expectation of life Mr. DiFENDERFER. About three or four years. [Laughter.] Gen. Greene. But what is possible in electricity in 15 years that DO man can say. It was about 15 years ago that they said we could not take the power to Buffalo; now we run cars by it in Oswego. Mr. DiFENDERFER. "What do you sell it for in Oswego? Gen. Greene. The Syracuse lines run from Syracuse to Oswego. Detroit is about 225 miles away. Before the hydroelectric-power commission was formed avc considered the idea of going to Detroit, but we could not agree with the jicople of Detroit on the price: we could not see, from the price they were willing to pay. that it would be a successful commercial venture. Now. the hydroelectric commis- sion distributing at cost is another proposition. They have figured the distance to Buffalo to be 225 miles. Now. I don't want to take up the time of this committee, but this matter of transmission de- pends on the transmission of voltage: and voltage, in electricity, is practically synonymous with pressure. Now. when the Niagara Falls Co. took their power to Buffalo some 10 or 12 years ago the highest voltage they could get was 11,000: that was in 189(i, 16 years ago. I think there was a great deal of doubt whether it w'as going to be a success, and it Avas a success. AVe came along in 1006 and we went to 60.000. The hydro- electric power conunission is using 110,000. Now. as I understand it. the distance you can take it is approximately proportionate to the pressure, and that depends ui^on getting an insulator which will hold the cui'rent. ^Ir. Fix)OD. With 110.000, hoAv far can you carry the current? Gen. Greene. I should say 200 miles, or even more, but there is a loss, and the steam plants are every year improving in efficiency. Mr. Cooper, (xeneral. do you know anything about the develop- ment of crude oil — that there are a great many manufacturers wdio claim to-dav that thev can make power cheaper than vou can fell it? ■ ' Gen. Greene. Yes: I know they claim it. but at Avhat price? Mr. Cooper. That is. the price which you sell it at. We claim that we can make power with our oil engines cheai)er than we could buy it from you if you were located in Buffalo. Gen. Greene. I don't doubt that, because there has been a very remarkable development in crude-oil engines. Mr. Dii't:nderfer. Now. at a distance far remote from your plant. T Avould state that at the Pardee mine they have an immense amount of power that can be used (and I am not informed that they are unable to suj)ply it) a great deal more cheaply than the peo])le ai-e selling it to-day. Gen. Greene. I understand that a hydroelectric plant is being constructed at Scranton PRESERVATION- OF NIAGARA FALLS. -91 Mr. DiFENDERFER. Tliis is the Pardee-Areo plant that I am talk- ing about, and they claim that for the next oO years they can supply electricity without any perceptible decrease. Gen. (tf.eene. New York is not blessed Avith culm banks. Mr. Di I'TiNnERFER. No; but I say they are getting their culm as chea]) as you are getting your water. (Jen. Greene. Yes. A Member. Ts there any other company that transmits jiower into this country except your company? Gen. (treene. Xot beyond Butfalo. A Mem HER. The P^lectrical Development Co. is not a transmission company? Gen. Greene. The,y have no transmission lines in the United States. Mr. Garner. If Congress, acting for the United States, should decide that to use the 4,400 feet additional would not aifect the scenic beauty of the Falls, and that it was advisable to permit Canada to import power into the United States, would not the whole (jucstion l)e solved as to the construction of the works and the charges, if we should provide that everything should be done under the Secretary of War? (len. (treene. What are the limits of his supervision? Mr. Garner. Limits as to the conditions precedent and the estab- lishment of plants in the T'nited States and the ])rices to be charged for the i^ower imported. (ien. Greene. I do not know about the machinery. Mr. Garner. Well. Congress could furnish him with machinery, and it is supposed that the engineering department is the best body to determine the cost of production. Gen. Greene. I was an officer of engineers for 20 years; I would not dispute that statement. Mr. Garner. Yes; but I am saying that the Engineer Depart- ment is the best organization to determine the price. Gen. Greene. I do not think that the cost or price is a matter that has often come to them as engineers. As to the commercial questions as to what returns are fair on an investment of capital, I do not think they are experts. Mr. Cooper. Genei'al. in answer to a question I asked you, you gave as your answer, did you not, that the up-State public utilities commission would claim that it woidd be an infringement of their rights in New York if Congress undertook to fix the rates? Gen. Greene. Well, I would say that there would be two bodies with the same ])owers; but what action the State of New York would take under those circumstances it is not for me to say. I say that here is a connnission that for five years has done that work and done it very ^-atisfactorily. Now, if you create a United States agency to do that work you have two bodies doing the same thing in the State of New York. Mr. Cooper. You agi'ee to \\hat seems to be Mr. Garner's idea (and it is mine, too) that Congress should delegate to the Engineer Department the means by which this power is to be diverted? That is. that they should get the maximum results? Gen. Greene. Yes, sir: there is no one who can determine better than thev how the works should be constructed. 92 PRESERVATION OF NIAGARA FALLS. Mr. DiFENDERFER. Then they have the power to discriminate in the prices — the Xew York Public Service Commission? Have they the right to discriminate as between localities? Gen. Greene. They have the right to discriminate between locali- ties, certainly. The price is not the same between 10 miles away and 200 miles away. j\Ir. DiFENDERFER. Then do you not think they have discriminated in the prices charged at Buffalo and at Lockport? Gen. Greene. They have never investigated it, but they are going to do it now. Mr. DiFENDERFER. Here you have something like sixty or sixty tw^o million dollars of invested capital. The law says that if 100 people think the prices are unreasonable the commission shall investigate and determine the fact. That acts something like the recall, does it not? Gen, Greene. Yes. sir. [Laughter.] I say I do not think you can ask that one man should luive the power to say anything involving such large interests Mr. DiFENDERFER. Oiie man should have that power. One man should be permitted to set a precedent for the rest in a decision from that board. Gen. Greene. You will have to fight that out with the Legislature of New York. Mr. DiFFENDERFER. Mv Contention is that the public-service com- mission of Xew York is not doing its duty to the city of Buffalo. Gen. Greene. I have never heard any complaint from the people of Xew York. The people that you are desiring to protect are per- fectly satisfied. Mr. Kendall. The rates in Buffalo are perfectly uniform with the rates in Xew York, and if one man has a grievance his neighbors ought to have it also. Gen. (iREENE. There would be a hundred. Mr. Kendall. I think it is not unreasonable at all that a hundred should be required to join. Gen. Greene. In half a million people? Mr. DiFENDERFER. Yes ; but if that single complaint is brought, that complaint is public, and I contend that in the citj'^ of Buffalo the party making that complaint has been penalized by the company. Gen. Greene. Mr. Difenderfer, if you are dissatisfied with the price of a railroad ticket from here to Philadelphia, do you claim that you have the right to demand of the Interstate Commerce Commission that that price shall be reduced? Mr. DiFENDERFER. If the railroad company is breaking the law. I have that right. Gen. Greene. But we are not breaking the law. We are comply- ing with the law. A Member. The difference is this : Any single citizen can complain about a discrimination, but he can not get the general schedule rates changed under the law of the city. The Chairisian. General, in order to simplify the matter as much as possible, let me ask you a few questions. We have a treaty with Great Britain, and under article 5 of that treaty Canada has the right to divert 36,000 cubic feet of water per second and the United States has the right to divert 20,000 cubic PRESERVATTON OK NIAGARA FALLS. 93 feet of water pei- seccHid for power |)iirposes. If there is no k\<>isiii- tioii in this matter tlie treaty is self-acting-, is it not? Gen. Gree>'i-:. Yes, sir. The Chairman. And the United States could then lake tlie 20,000 feet for power purposes and Canada could take .'i().000 feet ]ipr sec- ond for power purposes? Gen. Greene. Yes. As to the transmission of power from Canada, there is no reason why you should leo;islate. Prior to the 20th day of June, 190C). it was perfecth' lawful to do what we were then doing — bringing power from Cana(hi to the United States: on the 30th day of June, 190G, it was a crime to bring power into the United States from Canada unless we had the written, permit of the Secretary of War. Ml'. Kendall. Under the Burton Act. Gen. Greene. Under the Burton Act what was lawful on the 29th of June was a crime punishable by fine and imprisomnent on the oOth day of June, and that was tlie ojjject of this legislation. Therefore I answer your question as to the transmission of power from Can- ada — there is no reason for you to legislate at all. The Chairman. The Burton law expires on the 1st of March of this year? Gen. Greene. Yes. sir. The C^AIR:^rAN. The treaty is the supreme laAV of the land. There being no legislation, the people of the United States can take the 20,000 cubic feet per second and Canada can take 36.000 cubic feet per second, and the power can come in. from Canada. Gen. Greene. As to the transmission, you should not legislate. As to the diversion of water, I think you will have to legislate as to who shall have this 4.400 feet; to whom it shall go and how. I supposed when I read that treaty that it was a matter the commission should decide. I understand now that the commission can not do anv- thing with it. The War Department can not do anything with it. Apparently it is necessarj" to legislate as to who shall get this 4,400 feet. Mr. Sharp. General, what proportion is that to the whole water that goes over the Falls — all the water? Gen. Greene. The average How, as certified by the United States engineers, is 211.000 feet per second. The permissible diversion is about 5G,000. Mr. Sharp. I imagined that the How was a areat deal more than that. Gen. Greene. How many tons do you think that will be an hour? Two and a half million tons an hour. Mr. Sharp. It seems to me that there is something in the claim that to diminish the flow would destroy to a certain extent the scenic beauty. It is large enough to make us go with caution. Mr. Kendall. It is a little more than one-fourth. Gen. Greene. That question was asked me in the last hearing, six years ago: A^^iat proportion of the water could be diverted Avithout interfering perceptibly with the flow of the Falls? I answered: "About 40 per cent." I adhere to that opinion, and I have watched the Falls very carefully ever since. That would be 80,000 cubic feet instead of 56,000 feet. There are a great many other people who are very familiar with the Falls who have the same opinion that I have — 28305—12 7 94 PRESERVATION OF NIAGARA FALLS, that the eii'ect would not be noticeable until you get to 40 per cent. Under Mr. Burton's law the 100,000 horsepower that he allows to come in would be somewhere between 14 and 15 per cent. Mr. Sharp. About half. Gen. Greene. A little over half. Tlie (^iiAiK.MAX. Now, (leneral, to j^roceed. with whom do you think the power should be lodged regarding this additional 4,400 cubic feet of water? Gen. Greene. I think with the War Department, through the co- operation of the State of New York. Mr. DiFENDERTER. Now, to Avhom shall it be given? Gen. Greene. I should say to that company which will satisfy the War Department that it will give the most power. Mr. Difenderfer. The Alexander bill provided that it would give it to two companies. I want to Iniow whether, in your judgment, that would be just? Gen. Greene. The Alexander bill followed Burton's bill in naming certain companies, but that bill is dead. Mr. Difenderitir. T understand ; but wouW it be fair to give that to both companies? Mr. Kendall. That is an ethical question ; on that one man's judg- ment would be just as good as another's. The Chairman. General, I understand you to say that the right to grant the permit for the additional power should be lodged with the Secretary of War, and the right to say who shall have it and fix the charges should be lodged with the public-service commission of New York. Gen. Greene. Yes, sir. The Chairman. That is all the legislation required, in your judg- ment? Gen. Greene. Yes, sir. The Chairman. Then the people of the United States could buy power either from the American companies or from the Canadian companies? Gen. Greene. Yes, sir. Mr. Legare. General, do you know how many visitors are at the Falls in a year ? Gen. Greene. Our record book shows about 5,000. I do not know precisely about the other companies, but I think they are fully as large: and they go through the works. That, however, is not the total number of people who go to the Falls. Mr. Legare. But how many people have the pleasure of seeing the Falls? Gen. Greene. I was just asking if the president of the Gorge Railroad was here; but I think about 150,000. A Voice. A million and a half. Gen. Greene. Well, I should not like to say. Mr. Legare. About a mi]limoinit less than that i)ermitt(Hl by the treaty? ( c) If the amount ;nith(n'izentirely owned by the Niajrara Falls Power Co.. so that the niimbiM- of in.'ii>ppnrtent companies is four. PEESERVATION OF NIAGAKA FALLS. 97 On the Anioricaii sido: Horsepower. Niagara Falls Power Co 1 85, 000 Hydraulic Power Co 120,000 Total 205,000 On the Cauadian side : Ontario Power Co 180,000 Canadian Niagara Power Co 110,000 Electrical Development Co. (Ltd.) 125,000 Total 415. 000 Total on both sides 620,000 The works of all of these companies at all five of the power houses were in various stages of progi'ess, but all of them had been undertaken on plans calling for construction of the size above named, and all of them, ns above stated, in compliance with the laws, ordinances, and franchises which had hitherto been granted by competent authority. In tlie autumn of T.tOf) the slateuieut was made in various jiapers that Niagara Falls had been partially ruined and soon would be completely desti-oyed by the power companies, and legislation was sought to preserve the Falls from this alleged danger. A bill for this purpose was introduced by Mr. Burton, then a Representative from Ohio and chairman of the Rivers and Harbors Committee, and after elaborate hearings during the session of six years ago this bill finally became a law on June 29, 1906. This law made it a misdemeanor, pun- ishable by fine and imprisonment, to do certain things which up to the day before had been perfectly lawful. The things thus forbidden were : (d) To divert any water from the Niagara River. (h) To transmit any power from the Dominion of Canada into the United States without the written permit of the Secretary of War; and in granting such pei'mits the Secretary of War was authorized to grant them for diversion of water on the American side only "to individuals, compnnies. or corporations which are now actually producing power from the waters of said river or its tributaries, in the State of New York, or from the Erie Canal," and to an amount in the aggregate not exceeding ir>.(;()0 cubic feet per second: and he was further limited in the matter of granting ]iermits for the transmission of power into the United States by the provision " that the quantity of electrical p<^)wer which may by ])ermits be allowed to be transmitted from the Dominion of Canada into the United St;ites shall be 100.000 horsepower." The title of the law approved .Tune 29, 190G, reads as follows: "An act for the control and regulation of the waters of Niagara River, for the preservation of Niagara Falls, and for other purposes." In the hearings before the Rivers and Harbors Committee i)rior to the enact- ment of this law some question had been raised as to the right of Congress to control the waters of the Niagara River for any other ))uri)oses than that of navigation, and some doubt had been raised as to what i)artifular clause of tlie Constitution gave to the Congress of the Ignited States the right to enact legis- lation for the preservation of Niagara Falls. Therefore the fourth section of the law requested the President of the United States to negotiate with the Gov- ernmeut of Great Britain " for the i)urpose of providing by suitable treaty with said Government for such regulation and control of the waters of Niagara River and its tributaries as will preserve the scenic grandeur of Niagara Falls and of the rapids in said river." These negotiations were promiitiy undertaken, and resulted in the treaty which was signed, ratifitnl. and pro<-lainied on the dates above named. As the act of June 20. liKKJ. was intended only to take care of the sitnati«m until the treaty should be negotiated and ratified, section 5 of the law enacted that the "provisions of this act shall remain in force for three years from and after the date of its passage." When the three years exiiired the treaty, although signed, had not been ratified by both jtarties. and therefore the pro- visions of the law were extended for two years, or until June 2!), 1911. In the last session of the Sixty-first Congress resolutious were introduced for extend- ing rhe P.nrton law. and bills were introduced for giving effect to the fifth article of the treaty. I)ut none of them passed, and thus the Burton law expired on June 29, 1911. 98 PRESERVATION OF NIAGARA FALLS. 4 On the last day of the special session, namely, August 22, 1911, a joint reso- lution w:is ado])tO(l revivins. reenacting. and extending the provisions of the :ict of 11KJ6 to March 1, 1012. One of the provisions of the Kurton law of 1906 authorized the Secretary of War, in his discretion, to grant revocable permits for the diversion of water in excess of l.'^.COO cubic feet ])er second " to such amount, if any, as, in connection with the jnnount diverted on the Canadian side, shall not injure or interfere witli the navigable caiiacity of said river or its integrity and proper volume as a boundary stream, or the scenic grandeur of Niagara Falls." In order that the Secretary of War might be advised as to the probable effect of these diver- sions and could intelligently exercise his discretion as to granting such re- vocable permits for additional diversions, instructions were sent e.irly in 1907 to the otiicer in charge of the lake survey directing him to make observations and to report from time to time the result of such observations and measure- ments, so as to show tlie effect of such diversions upon : (o) The navigable capacity of said river. (&) Its integrity and proper volume as a boundary stream, (c) The scenic grandeur of Niagara Falls. The reports made in compliance with these instructions have been transmitted to Congress and are embodied in Senate Document No. 10.5 and House Document No. 246. of tlie present Congress. Briefly, the reports of the engineers are to the following effect: (a) As to the navigable capacity, they say (Doc. No. 246. p. ^2). that the diversions referred to : "Will not injure or interfere with tlie navigable capacity of the Ni.igara River." (6) As to the integrity and proper volume as a boundary stream they say (same page) : " It is not apparent that the river through these diversions has suftereil."' (c) As to scenic grandeur (same page) : " It may be considered that the changes on the American Fall are unim- portant." In other words, the effect of the diversions does not interfere with the navi- gation of the Niagara River, does not injure its integrity and proi)er volume as a boundary stream, and does not injure the American Fall. Tlie engineers, however, report (H. Doc. No. 240. p. 13) thiit the effect of these diversions is to cause a lowering of Lake Ph-ie which, though slight, in their opinion " Can not be considered negligil)le." and they also find that there Las been a lowering at the eastern and western ends of the Canadian Fall, as to which they say : " While natural causes have been chiefly instrumental in effecting thes(> changes, it appears indisputable that tlie artificial diversions of the power com- panies have materially added to the ' injury or interfy tlie treaty now in force. As to scenic grandeur, that is not a question of eugineerlng. Engineers have reported that while there is [iractically no rliaugo on ihe American Fail, there have beeu changes on the Canadian Fall amounting to a lowering of 1.") inches at the Canadian end and 3A inches at the (Joat Island end of that fall (H. Doc. No. 246, p. 13). Of this they attribute appr'oxiniiitely two-thirds to the diver- sions of water and one-third to the brejiking away of the ai)ex of the Horse- shoe Fall. They say that this has resulted in (H. Doc. No. 246, p. 13) "a mai-ked interference with the ct)ntinuity and length of crest line, umiuestiou- ably marring the natural beauty of this cataract." The facts here stated, namely, a total lowering of 15 inches, are not disputed, although it should be noted that the gauge readings from which these facts are deduced show a variation of as much as 5 feet in the course of the yeai' and as much as 3 to 4 feet in as many successive days. It jirobably will require a longer series of observations to determine with absolute certainty the i)recise extent, in inches, of the decrease in depth at the crest of the Falls due to the diversion of water for power purposes. INIeanwhile. the determinations above quoted are the best we have and are not disputed. As to the opinion formed by the engineers from a fonsideration of these facts, there is, however, a very wide difference. The Falls vary from day to day, according to the wind and the weather. An east wind will diminish the volume of the Falls by an amount greater than all tlie diversions of water for power purposes which are jHissible under the treaty. The bright sunshine in summer will bring forth that marvelous emerald tint at the i»oint of greatest depth in the Horseshoe Fall concerning which so much has been written, and at the same time will show in dazzling white the purity of the American Fall. Cloudy days, rainy days, snowy days, all have their diff'erent effects, and fre(iuently, in times of extreme low temjierature at the close of a loni; winter, with much ice coming out of the lake, the American Fall is absolutely dried up. and people have walked across the I)ed of the river between Coat Island and the main shore. There is a well-aulhentii-ated case of this r)0 or (".0 years ago, befoi-e diversion of watei- foi- ])ower puiposes was ever thought tif. Now. the point that I would like to impress upon your minds is this: Tluit the Falls vary in appearance from day to day and month to month and year to year: yet under similar circumstances of wind and weather there lias been no change in their appearance which can be detected by the eye. excel »t at the apex or point of the Horseshoe. At that ]>oint the crest is receding .-it the rate of over f) feet per annum (S. Doc. No. 105. ]i. 32), and those of us who first saw the Falls 40 years ago can detect the change in the shape of the crest. It is more i»ointed now tlian it was then: but no other change is percei)til>le under the same conditions of wind and weather. It is the constant remark of visitors who come to the Falls that the ai.tpearance of the Falls is Just what it W.MS wlien they saw them years ago: or, l)y those who see them fw the first time, the remark is one of surpi'isi^ tbat the Falls ai'e so l)eautiful in view of the statements scattered broadcjisl that they had been practicall.v ruined. Sev- eral western governors recently visited the Falls and gave expression to these o])inioiis. Scenic grandeur appeals to the imagination, to the emotions: it appeals dif- ferently to different iieople. You wili tind all kinds and varieties of opinions concerning it. and vou will also find many shailes and v.irieties of oiiinions as 100 PRESERVATION OF NIAGARA FALLS. to whether sceuic grandeur should be allowed to interfere witli tlie industries and prosperity of citizens of the T'nited States. Lord Kelvin, several years ago. as I am told, expresseci the opinion that if these Falls were needed for the benefit of mankind, all of their potential energy should be so utilized; and on the other extreniy the park commissioners, and the power com])anies provide that, if reiinired in Canada, on-half of the power genarated at these power houses shall be reserved for the use of Canadians. The other half can be exported to the T'nited States. > The opposing considorati«>iis as lielwcon nlilit.v and scenic grandeur are fairly well Ptnled b.v the engineers in the I'ollownig language tS. Doc. No. 105. p. 73) : •'The' great comiiaiiies at the F;ills have created in goad faith power plants to lessen the hardships of Inimau l.-ihor. (o aid transportation, to illnminat<' the night hours, and to add to the we.-ilth of two .Nations. The power houses for the most i>art are archi- tecturall.v excellent, harmonizing with the scenic surroundings, and the niech.-mical wonders' wronglit in solving the engineering prohlems of the utilization of this ureat head and volume of watei' rival as a spectacle the scenic grandeur of the Falls and add to the attractiven(>ss of the region. '■ It therefore appears proper to permit and foster such ultimate developments in addi- tion to those alread.v in force as are conip.-ititile with the perpetuation of the scenic grandeur appreciably' undiminish(>d." PRESERVATION OF NIAGARA FALLS. 101 The cli.irter of tbe Ontario Power Co. granted by the Dominion of Canada coutahis an express provision that its power may be transmitted into tlie United States, and this interpretation of the charter right has been explicity stated in a decision of the snpreme conrt of Canada bearing on this subject. This nnlimited right to take the power to the United States, however, has been diminished to the right to transmit one-half of the power (instead of the whole) by the agreement with the park commissioners above referred to. Now, the plans have been ai)proved by the park cnnnnissioners for the con- struction of works of the following capacity : Horsepower. Ontario Power Co 180,000 Canadian Niagara Power Co 110.000 Electrical Develoinnent Co. (Ltd.) 125,000 Total 415. 000 and, while none of the power houses is completed to that ultimate capacity yet, each of them is about two-thirds completed, and work is at the present moment progressing on the remaining one-third. One-half of the total amount is 207,500 horsepower. In a little more than five years Canada has absorbed practically 90,000 horsepower of this. Un- doubtedly it will absorb the remaining 11T,50<1 horsepower. The amount which can be taken into the United States under the provisions of the contracts witli the park commissioners is the remaining one-half, to wit, 207,500 horsepow'er. The Burton Act allows the transmission of 160,000 horsepower, so that all that is in question, if you remove every restriction in regard to the transmission of power into the I'nited States, is 47,500 horsepower. In 1906-7, after elaborate hearings, the Secretary of War, Mr. Taft (now President of the LTnited States) allotted, under the provisions of the Burton Act, the 160.0(X) horsepower allowable to be transmitted into tlie United States as follows: Horsepower. Ontario Power Co 60,000 Canadian Niagara Power Co 52, .500 Electrical Development Co 46,000 International Railway Co 1,500 Total : . 160. 000 The amount actually transniitled at present is as follows: Horsepower. Ontario Power Co 57,000 Canadian Niagara Power Co 52. 500 Electrical Development Co ^ Total 109. 500 The load of the Ontario Power Co. fluctuates from^day to day and on any day may go to 60,000 horsepower, the full amount of tlie permit. The Canadian Niagara Power Co., having plants on each side of the river which are inter- connected, is enabled to so ojierate them as to keep a steady load on its Canadian plant practically at the full amount of its permit. It is pi-ohal)]e that a representative of the Electrical Development Co. will be present to give the reascms why the i>erniit granted to that company has not been utilized. So far as ihe Ontario Power Co. in Canada and the Niagara. Lockport & Ontario Power Co. in New York State are concerned the situation is as follows: We are now taking into New York 60.000 horsepower and distributing il among a population of more than 1.000,000 i)eop]e. extending from Syracuse and Oswego on the east, through Auburn, Iiochet>ter, Batavia, Lockport, the suburbs of Buffalo, to Dunkirk on the west. If the restrictions on the transmission of power from tlie Canadian side are removed, we shall be able to increase the amount of power distributed through these various cities by one-half; that is. to 90,000 horsepower. If these restrictions are not removed this additional 30.000 horsei)ower will speedily be sold in Canada. Referring then to the questions which I understand you are considering, which were enumerated at the beginning, and for convenience, may now be repeated as follows: («) Is any legislation needed or is the treaty self-acting? 102 PEESERVATION OF NIAGARA FALLS. (&) If legislation is needed, shall such legislation permit the diversion on the American side of all the water iiennittiHl by the treaty, or shall it restrict the diversion on the American side to the amount now diverted or to some other amount less than that permitted by the treaty? (c) If the amount authorized by the treaty to be divertetl on the American side, which is ■1.4C»0 cubic feet i)er second more than is authorized there to be diverteower. and therefore they decided not to build their own PRESERVATION OF NIAGARA FALLS. 103 power i)laiit, but to make the contract above referred to. Ilaviu;; made this contract, the conunisslon proceeded to borrow, on the credit of the Province, nearly $4,000,000, and it sold its 4 per cent bonds at 1024. It entered into conU-acts with nearly 30 munici])alities for varyinji; amounts of iK)\ver. and it is stipulated in each contract that the price whic-li the municipality is to pay for the power is the sum total of the price paid by the commission to the Ontario Power Co., jilus actual exjienses of oiieratinj; the transmission lines, interest on the bonds, sinlvin,u; fund, maintenance, and dei»reciation. but without any profit whatsoever to the conuinssiou. The $4.(KX),0(iO i-ealized from the sale of the bonds was use0 miles of transnu.ssion lines in western New York, covering the territory between Syracuse and Oswego on the east and Dunkirk on the west, as above stated. In the purchase of land and the construction of stations and transmission lines, the Niagara. Lockport & Ontario Power Co. has invested nearly $9.O0O,0fM). Its bonds bear interest at 5 per cent and they had to be sold at a considerable discount. I trust that I have made it clear that the conditions on the two sides of the Niagara River are entirely unlike. On the one side is a Government commis- sion owning the transmission facilities, which have been constructed on the credit of the Province of Ontario and on a basis of less than 4 per cent, and in pursuance of a law the fundamental principle of which is that there shall be no profit. On the American side is a commercial corporation covering nearly twice as much territory, whose ti'ansmission lines have been constructed with money co.sting practicilly G per cent. 1 am sure that this committee will not deny to the owners of the Niagara, Lockpoi-t & Ontario Power Co. a reasonable return upon their investment. The company has as yet paid no dividends on its stock. The interest on its bonds has been promptly iiaid. but the large eiiuity in the property over and above the proceeds of the bonds has yet had no return whatsoever. This. I think, might be considered as one ]troof that its charges were not exorbitant. Another proof, perhaiis equally convincing, is that while this New York corporation operates the trolleys on nearly .jOO miles of railroad and supplies the current for lighting and other miscellaneous public uses in many cities throughout western New York, no comjjlaint has ever been made that its charges were not .iust. fair, and reasonable. Now, I venture to suggest for the consideration of your committee that it is no part of the business of the T'nited States to regulate prices on electricity within the different States. That is a sub.1et:-t wliich belongs to the States themselves, and the St.ite of New York in particular has fully met the case by apiirojiriate legislation. The first and most important act of (iov. Hughes's administration when he became governor of New Y'ork in January. 1907. was the creation of two public-service conmussions. one for the city . that the jiublic-service conmiissions have full and complete power to regulate, fix. and establish the i)rices at which eleeti"icity sh.-ill be sold within the limits of The State of New York. If any municipality or any reasonable number of citizens are dissatisfied with the ju-ice at which electricity is sold, they can comjilain to the iiublic-service ccnnndssion, and it is then manda- tory upon the comnussion to hear such complaint, to make a finding of fact, and if the finding be that the prices are unreasonable, then they are to \i\ a reasonable iirice. and the corporation which does not comply with their order is subject to heavy penalties. Ami>le provision is given in the law to enable the conunission to carry its orders into effect. The ;iublic-si'rvi((> comnnssiou of the .second district. State of New Yoi-k, has complete Jurisdiction at every point in the State wliere Niagara power is at present being used or to which it cm be transmitted. This l.sw has been 104 PRESERVATION OF NIAGARA FALLS. in operatinit now for nearly tivp yenrs. It has j;ivcn ^Mitirf satisfaction, not only to the consumers of power and li^lit. l»nt. so far as the second district at least is concerned, to all the coniorations whicli are under the jurisdiction of the coiuniissiou. In short, then, the State of New York has provided a tribunal with anijile jurisdiction over the matter referred to in the provisions of Mr. Smith's bill. This tribunal is fully established. It is in operation. It has the confidence of the community of all clas.ses, and incidentally, I may say it is now considerinsr a complaint from the city of Buffalo that the prices at which electricity is sold in that city are unreasonable. No other complaint has been lodged with thorn from any other conmiunity which uses Niagara power. If such complaint should be lodged, they would immediately proceed, as they are required to do by the law. to hear it and to provide the remetly if on the hearing the com- plaint is sustained. It will thus be seen that the State of New York has already enacted complete legislation for controlling the prices of electricity. It has established proper tribunals, clothed them with jjower to enforce their decrees, and established an administrative system which is now in fiill working order with satisfactory results to all concerned. Fr.vxcis \'. Ckkene. Januaky is. 1912. STATEMENT OF EDWARD T. WILLIAMS. Mr. AViLLLv.ALs. 1 am from Niagara Prills. I represent the city of Niagara Fal].<. I am here simply to say upon the authority of the mayor of Niagara Falls that we living at Niagara P'alls and along the Niagara River regard ourselves as the most jealous guardians of the scenic beaiitj^ of this great cataract and that, having seen this power development from its inception, I am of the opinion that there has been no appreciable effect upon the flow of the river or upon the beauty of the falls. The attitude of the city of Niagara Falls is that it believes tiiat water can be diverted up to the' limits proposed or incorporated in the treaty without having an}* appreciable effect upon the flow of the river or upon the beauty of the falls. Mr. Clhairman. that is practically all T have to say. The CiLvimLVN. I would like to ask you a couple of questions. The people of Niagara Falls, as I understand it, have no objection to the Government giving this additional 4.400 feet? ]Mr. ^^'ILLIA3^s. That is their position, as I understand it. The Chaholvx. And they would like to have the restriction re- garding the importation from Canada removed? ^Ir. WiLLLv.Ms. Yes, sir. The Chairman, You doubtless have looked over holh bills before this committee. Which bill do you prefer? ]Mr. ^A'iLMA.>Ls. Why, I have not reached any conclusion in the matter. I am simply here to say on behalf of that city that we desire the treaty to be fulfilled. Mr. Lkoark. One of your principal duties is to bring conventions to Niagara Falls to see the place? Mr. Williams. No, sir: no, sir; to encourage industry. Mr. Cooper. Tt is a matter of industrial and commercial develop- ment, is it ^ ]Mr. Williams, Yes, sir. The ClIAIR.^rAN. There is more or less typhoid fever at Niagara Falls, is there not? Mr. Williams. There has been some. PRESERVATION OP NIAGARA FALLS. 105 The CnAiR.-\[AN. And that is on account of the pollution of the waters? Mr. Williams. Yes, sir. Tlie Chairman. How, in your judgment, could that best be stopped? Mr. WiLLiA^is. I would say that the city has now installed a new water works and filtration plant which has had some good effect and will have more. The CiiAiR:\rAN. Do you think it would be a good idea for Con- gress to confer upon the National Waterways Commission the right to do everything in its power to stop the pollution of the waters be- tween Canada and tlie Ignited States? Mr. Willta:\is. I am in favor of stopping not only the pollution of the waters between Canada and the United States, but also the waters of Lake Erie. The Chairman. And that is very important? Mr. Williams. Yes, sir. The Chairman. If you have any views upon that subject. Ave would like to have you give tliem to the committee. Mr. WiLLiA.MS. I think — I have been here before to confer with the Sni'geon General of the Arm}' Mr. Cooper. For what purpose ? Mr. WiLLiAJis. For the stoppage of the pollution of the waters. The Chairman. And the consequence is that in Erie. Pa., foi" in- stance, the people have epidemics of typhoid? Mr. Williams. Yes, sir; we think that is an uncivilized way to dis- pose of scAA age. Air. Cooper. Berlin derives large revenue from its sewage system. Mr. Williams. Yes. sir. STATEMENT OF MR. MORRIS COHN. Mr. CoHN. I represent the Hydraulic Power Co., of Niagara P'alls, as counsel. That compaii}'^ is the owner of the Hydraulic Canal, which was constructed in al)out the year 18()3, and has for nearly 60 years — this company and its predecessors — for nearly 50 years it has been conducting power works under a claim of riparian rights with- out criticism, and the State of New York, claiming as a riparian owner, made some objection to the use of water without its permit, and, as it has been stated, gave by grant to the Hydraulic Power Co. the right to take such water as would be necessary for the canal. jNIr. Cooper. You have not been generating electric power all the time during those 50 years ? Mr. CoHN. No, sir."^ Mr. Cooper. What was it before that ? ]\Ir. CoHN. Just mill rights — hydraulic power and a mill race. This company is the oldest company along the Niagara River. It has the greatest equities and interests in this legislation, and it has the strongest legal rights. Therefore, I think it is quite proper that it shall have the least to say. In 1902 the National Waterways Commission was authorized to in- vestigate the subject of Niagara River power development. In 1906, as the forerunner of the Burton Act, the National Waterways Com- mission made a report in which it recommended that the Secretary of 106 PKE8ERVATI0N OF NIAGARA FALLS. War be authorized to grant permits for the diversion of 28,500 cubic feet of water per second and no more from the waters naturally tribu- tary to Niagara Falls, 10,000 cubic feet for the Chicago Drainage Canal, etc. I^ was recommended in that report that 18,500 cubic feet per second be allowed at Xiagarji Falls, as that could be diverted without injuring the scenic beauty of the Falls. It also stated that 36^000 cubic feet could be diverted upon the Canadian side. The matter coming before the Rivers and Harbors Committee of this House, they made a report in which they recommended that instead of this 18.500 feet, 15,000 feet be so diverted. The result of it was that the Niagara company got 8,600 feet, and that this company, in- stead of getting 9,500 feet, only received 0,000. In a report which accompanied the bill it was stated that the final settlement of the matter uuist rest until the result of diplomatic negotiations be em- bodied in a treaty: that it was, however, necessary that legislation bo enacted to furnish the basis for diplomatic action. That was all that the Burton Act was intended to cover— to hold the matter in status quo until the respective countries could get together and confer upon a treaty. Section 4 of the Burton Act says: That the President of the t'liiUnl States is respectfiilly requesteit to open negotiations with the (ioveninient of (Jreat Britain for the purpose of effectually providing, l>y suitable treaty witli said (Jovernnient, for such regulation and control of the waters of Niagara Kiver and its triltutaries as will preserve the scenic grandeur of Niagara Falls and of rapids in said river. Negotiations have ripened into a treaty, and the Burton law still remains, and thus we think it is unfair that this act shoidd remain on the statute book after the purpose it was intended to serve has been accomplished. The act provided particularly that it should be in effect for the term of three years, and then it was continued for two years more. So that it was never the purpose of the law that we should be forever deprived of the right to apply for additonal water. The temporary reason for the act having gone b3% the Congress shoidd discontinue it. Mr. Cooper. Hoav much water did your companj^ divert 20 or 25 years ago ? Mr. CoiTN. Oh, a very much less amount. It was not until after the electrical development that the diversions became large. I don't know ; I won't say exactly how much. Mr. Cooper. Before the State of New York took action, were you at any time using as much as you are using now? Mr. CoHN. Oh, no ! The growth of electrical development has in- creased the use of water. iSIr. Cooper. How far above the precipice do you divert the water? ]Mr. CoiiN. Port Day, throe-quarters or one mile above the Falls. Now. we say we submit the whole matter to Congress. Passing the question of whether we have the legal right, which has been argued here so forcibly — and. I think, well — because we have for years di- verted water as riparian owners, and that was a corjioreal heredita- ment which was like a rock or a tree, we say that Congress should give to some tribunal the right to grant permits to the amount of 20,000 cubic feet per second. Mr. Cooper. What competition is your company getting on the American side with any other company? PRESERVATION OF NIAGARA FALLS. 107 Mr. CoHN. We are in direct competition with the Niagara Falls Power Co. We have attracted other companies thei'e. Mr. Cooper. Both use the water? Mr. CoHN. Yes, sir. Mr. Cooper. Is there any competition as to the vohnne of business or as to the rate charged ? Mr. CoHN. I think both. I think the people who come to Niagara Falls go first to one company and then to the other. Mr. Cooper. Is there any identity on the board of directors? Mr. CoiiN. No; not the slightest. Mr. Cooper. There is a competition ? Mr. CoHN. Well, competition as competition goes in the matter. Mr. Cooper. You would not call it real, fierce, cutthroat competi- tion? [Laughter.] Mr. CoHN. I don't think there is anything like that. I think it would be absurd when they make contracts for 20 or 25 years. People might go into cutthroat competition for 20 days, though. Mr. Cooper. Have these companies been prosperous financially? Mr. CoHX. Very. Mr. Cooper. So that you don't need the additional water to enable you to succeed financially? Mr. CoHX. No, sir: I don't say that. I say we can not do without it; that the people need it. ]\Ir. Cooper. And at the same time vou sav it would not hurt the Falls? Mr. CoHN. The 4,400 feet, let me explain, comes from the same place that an}- diversions would come from on the Canadian side, and it is perfectly absurd to allow the Canadians to develop 36.000 feet and say that the Americans shall not take their 20,000 feet. A Member. That is the point I am glad you brought out. Mr. CoHX. It all practically comes from the Canadian side. There is no report of any engineer that says that any diversion on the Canadian side affects the xVmerican side. Now, the apex of the Falls is only 18 feet deep. Who could look at it and tell whether it was 10 feet deep or 8 feet deep ? Mr. Cooper. There is a black rock Mr. CoHX. That has always been there. Mr. Cooper. The point is, how far can you go; the only question is, how far can you go? Mr. CoHX. That is the point; the people of Niagara Falls are just as anxious to preserve the scenic beauty of the Falls as anybody else. There are mam^ people who are depending on the traffic caused by the tourists coming. I have in mind the Gorge Railroad. There is no one here, who understands the situation, who says the Falls are going to be ruined if this extra 4,400 feet is permitted to be diverted. The Chairman. Yet you do appreciate the caution ? Mr. CoHX. I think that is very proper. This matter has been be- fore Congress for a number of years, and I think they have been very cautious. Mr. Difexderfer. To whom do you furnish this power? Do you sell any of it directly to the consumer in the city of Buffalo ? Mr. CoHx. No, sir. We do not transmit any of it outside of Ni- agara Falls. It is only for the immediate market. 108 PRESERVATION OF NIAGARA FALLS. Mr. DiFENDEiiFEK. You (lo iiot fuiTiish any power to any other trans- mitting company ? Mr. CoHN. Not in the city of IJutl'ah); just in (!ie city of Niagjwa Falls. We just sell it to distributing companies in that city. Mr. Legare. I see here article 5 of the treaty goes on to say : It is the (Ifsiiv of bctli jnu-tics to actdiiiplish lliis object with tlio lejist possible injury to iiivestin«-iiis wliieli have iilrendy l)eeii made in the constnictioii of power iilniits on the Auieritan side of tlie v'lvvv :ind on tlie CaiiadiMn side of the river and in the I'rovinoe of Ontario. Have A'ou given any thought to that pixvi of the treaty — -as to an}^ legislation we may pass as to limitation of impoi'tation of power from Canada into tlie United States^ Do you catch my idea? Mr. CoHN. I do not. Mr. Garner. I understand that the law of Canada is to the effect that you can only import one-half of the power created over there, so that tliey have already made laws protecting their interests? Mr. CoiiN. Yes, sir. Mr. Legare. Yes: but suppose we should pass some law prohibit- ing that, would it not be in conflict with this treaty, which says: It is tlie desire of both iiartios to acr-'ininlish this objet-t without the least jiossible injury lei investments whic-li have already been made. etc. Mr. CoHN. Your contention is that if we continue this prohibition we are running contrary to the treaty? Mr. Legare. That seems so to me. Mr. CoiTN. You will excuse me from talking about prohibition. That is for the other felloAvs to talk about. I am not interested in the question of importation from Canada, because the more that is imported the more it comes into competition with us. I am not quite through. I just Avant to say that in Gen, Greene's satement here, on ])age 8, he gives the result on the Canadian side, and possibly the result of the development on the American side. On the Ameri- can side he gives the actual development and on the Canadian side he gives the authorized development ; that the Niagara Falls Power Co. and the Hj^draulic Power Co. developed 205,000 horsepower, but that statement is not just exactly as I understand the facts to be. In the State «tf New York there w^as planned the other da}' Gen. Greene. That was what I understood you to create. That was 120,000 to 130,000 horsepower. That is the impression I intended to convey. Possibly I have conveyed a wrong impression. That is what you have produced. Mr. CoiiN. You will find that any request that has been made by the Government officers or the scenic preservation committee has been prompth' and satisfactorily honored. Mr. Cooper. What is the plan of the establishments using j'^our power ? Mr. CoHN. Oh, we sell power to the William A. Rogers Co. and the Carter-Graham Co.. which makes check books, and the Electro- Metallurgical Co., Avhich makes batteries^oh, there are about 60 companies. Mr. Cooper. How many of those companies are 24-hour companies ? IVfr. CoHN, Practically all of them. All the large users are 24-hour companies. If they can use the power 24 hours a day, that makes it PRESKRVATIOX OF XIAGAEA FALLS. 109 more economical. Some of those plants conld nevci- have been estab- lished without the 24-honr plan. NoAV, as to this point about the peak of the load: The language of the treaty, which is in the Smith bill, is intended to cover between the hours of 6 and 7 in the evening — but Mr. P. P. Barton can speak better than I can on that. Mr. DiFEXDERFF.R. What is the minimum charge to the 24:-hour using plant ? jNIr. CoTTN. I don't know as I am fully acquainted with that, but I have drawn some contracts in late years. It varies according to the manner of the use. Take, for instance, our contract with the T'^^nited States Light & Heat Co. They take our charge to be certain of getting a lessened. rate, and if they take on the kilowatt- hour basis that is one rate. If they take it for 10 years, that is another rate; and if it is in horsepower quantities, that is another rate. Now, the Public Service Commission of the State of New York had a meeting the other day at Albany, in which it was decided that the electrical companies shall file rates. Mr. DiFEXDERFER. Could vou give us the minimum charge on a horsepower basis? Mr. CoHN. About $16. Mr. DiFENDERFER. Then there is a maximum rate? Mr. CoHX. I don't think we sell any higher than $17 or $18. Per- haps I had better be entireh^ frank and say that there is one com- pany that had a substantially lower rate, but now the commission is going to compel us to file rates the same as a railroad company. Mr. Garxer. The power companies, then, are entirely satisfied with the commission and with its workings up to date? Mr. CoHx. They have got to be. [Laughter.] Mr. DiFEXDERFER, And you are entirely satisfied with the rates laid down? Mr. CoHX. Well, we are not kicking about it. Those who are in favor of bankrupt corporations have a different view from what we have. The Chairmax". Mr. Colin, if you have any data that you desire to submit as a part of your remarks, you may submit it. Mr, Coiix. Not at all. We want some legislation, and that is all. The Chairmax. In regard to the disposition of the 4,400 feet of additional water, do you think the right to dispose of it should be lodged in the Secretary of War, or in the Public Service Commission of the State of New York? INfr. CoHx. I think that we ought to have it. [Laughter.] The Chairmax, Yes; but who should dispose of it? Mr. CoHX. I haven't any choice or any views. We think we ought to have it anyway. A Member. You would not ask Congress to legislate that you have it? Mr. CoHX. I don't think that, I stated a 3'ear ago that we should have it. The Chairmax. But if you can not have it you are willing that somebody else should? 2R.S05— 1 2 s 110 PRESERVATION OF NIAGARA FALLS, Mr. CoHN. I say it Avoiild be very unfair on the part of Congress to k'gislato in defense or for the benefit of scenic beiinty. takinir awa}' from ns what is ours in common hiw. Mr. CDoper. Do you think a commission shouhl be created to establish rates? • Mr. Coiix. Well, we have one in Xew York. Mr. Cooper. .Do you think it is a good idea to sell lo a 20.000 horsepower consumer at a less rate? Mr. CoiiN. Yes, sir. Mr. DiFEXDERFER. AVliv. he coidd manufacture his gas for less. Mr. Coiix. I don't think there is any competition in that business. Mr. DiFEXDERFER. Xot there. That's one of the reasons. That is exactly what was the trouble with railroad rebate-. | Laughter."] That the great big fellow drives the other fellow out of business at any time he wants to. Mr. Coiix. That certainly is rectified for the few by the public- service commission of the State of Xew York: but if a man comes tc us and says, "Here. I want to buy power." it has been a (piestion of individual bargaining. The CriAiR>F\x. Thanlv you. Mr. Cohn. AVe will now hear Mr. Morrison. STATEMENT OF MR. A. C. MORRISON. Mr. MoRRisox. I represent the Union Carbide Co., of Xiagara Falls. I am neither engineer nor lawyer, but my company is a user of the power at the Falls and has been a rapidly developing^ user of power there. I can not speak for the electric-furnace industry as a whole, but I think it is fair that I be allowed to bring before this conunittee a general picture of the electric-furnace industry, espe- cially as I believe that my company is the largest user of ])ower at X^iagara Falls, which is the center of electric-furnace development in this country. We have developed in the last few years very rap- idl}'', from a very small beginning to our present status. I think it is fair to state that our power requirements are increasing several thousand horsc^Dowcr pev annum. The problem of securing that addi- tional power is a grievous one. Water power seems to be more theo- retical than practical. Water power, located advantageously, as is the case at Xiagara Falls, where vast quantities of raw materials can be economically assembled and distribution of finished products easily accomplished, is an essential strategic advantage to the very heavy and important electric-furnace indu.stry — at Xiagara Falls especially, because of the opportunity which their superb development gives the American manufacturers to meet foreign competition and develop exports. The electric-furnace industry was born of the last verv few years, and it has grown from a crude beginning to a very powerful factor in the advance of American manufactures, and is essential in some lines to American commercial success. Its development is continu- ally increasing, and new uses for the products of the electric furnace are being discovered almost daily. My company's product has be- come a Aery widely distributed necessity — so wide, indeed, that there IS hardly a town in the country that does not use carbide of calcium. AAHien I state to you gentlemen that millions of peo])le besides those pni«i:riVATioN of Niagara fall.s. Ill near the Falls are being- benefited by the beneficent use of this water power; that 200,000 country homes, several thousand hotels, and over 300 villages are illuminated by calcium carbide made at Niagara Falls ; and that it is really bringing the educational and economic in- fluence of a brilliant and beautiful illuminant into the farm home and country village, the dark depths of the mine, the buoys and bea- cons of our coast line, and the lights of onr engines and our auto- mobiles, you will understand that perhaps the benefit is not confined to the limited circle of 2,000,000 people who draw light or power directly from Niagara Falls. So. to sum up : This question of power has become extremely difii- oult. We have reached the limit of securing large units of power at Niagara Falls, and if a limitation is placed upon the waters of Niagara Falls which may be diverted we shall have to seek else- where, and the search for American poAver properly located to meet commercial conditions is a strenucms one. The most advantageous thing we can do is to establish a plant across the river, where we can keep our management, assembly, and distribution intact. I am au- thorized by my company to say that, provided the limitation fixed by the Burton law is not taken olT, or provided that Ave can not get power from Canada, we will be forced to become a Canadian insti- tution. Mr. Cooper. Is vour institution i-onnected with the carbide in- dustry of the "Soo*'? Mr. Morrison. Yes, sir. Mr. Cooper. Are you using all your resources? Mr. MoRRisox. Owing to the riparian-rights question, lake-level regulations, and the disputes oA'er it — the suits and a multitude of legal tangles which have held development there in check — instead of getting the 20,000 horsepoAver contracted for Ave haA'e been cut doAvn so that 7,500 horsepoAver is our full average from that otherAvise splendid source of poAver. The Avater has been and is still running to Avaste instead of building towns and feeding thousands of human beings. Mr. Cooper. How much poAver Avould you get if you had the full amount ? Mr. Morrison. Our contract calls for 20,000 horsepoAver, but avc could get 40,000 if it was developed, but AA-e haA'e never been able to get more than about 7,500. The ramifications of this electric-furnace industiy are enormous. We all knoAv some of the man}' varied uses of electricity, but there are greater developments coming. There is the use of electricity in the steel industry, neAV metals Avhich add to the Avearing power of rails and thus facilitate transportation, so that these industries are being born Avithin industries, and new uses are in process of being born, and many of them have already de- veloped into substantial and permanent entities. There is one aa'oii- derful thing, a child of the electric furnace, and that is that the 7ii- trate industry — that is, getting nitrate from the air and putting it into the form of fertilizers, Avliich in European countries is already very large; indeed, it has de\'eloped very rapidly in this country, so that in five years contracts abroad liaA^e aggregated 200,000 horse- poAver, and this vast amount of poAver is now being used for the bene- fit of agriculture, and thus the Avhole people. The Cliilean niters are limited. This country in its Avater poAver has the solution of the 112 PRESERVATION OY NIAGARA FALLS. nitrate problem, the problem of preserving the fertility of our soil. We are told that we are importing more tlian ever. As soon as the soil becomes exliausted the nitrates become necessary, and it is prac- tically settled that the electrical industry must solve the nitrate ques- tion. This vast need must be met. Niagara Falls has a growth that is as much beyond European dreams as the Falls themselves surpass European imagination. Mr. DiFENDERFER. From whom do you get this power? Mr. Morrison. The Niagara Falls Power Co. Mr. DiFENDERFER. Are any of your stockholders interested in the Niagara Falls Power Co.? Mr. Morrison. I think not. I believe it is a correct statement to say that they are not connected with it in any Avay. Mr. DiFENDERFER. Would you be prepared to state what you pay for your power? Mr. Morrison. I would hesitate to do so. I assume that could be easily ascertained. Some of the power companies could tell you. Mr. Cooper. Mr. Morrison, this may be a little foreign to the matter before us, but what do you think of the water development in the great gorges of the West ? Mr. MoRRisox. It is true there is great theoretical possibility there, but I desire to refer back to my general statement that the utilization of water power is more theoretical than practical. Freight and water transportation and nearness to markets is sometimes — al- most alwavs, in fact — the necessaril}^ deciding factors in the ultimate question of the utilization of water power. For illustration : In Nor- way and Sweden — especialh' in Norway. Avhere much nitrate carbide and steel is manufactured — -the water power comes right down from the top of the mountains to the sea and the ships dock in deep water right there at the foot of the mountain, where the works are located. Water power is so cheap there that I believe I can state that rates are $8 to $10 per horsepower year as against the very much higher rates American power can be developed for. It requires a good loca- tion and xVmerican genius to exist against such amazing competition. Mr. Cooper. And you have been employing American labor all the time ? Mr. Morrison. Yes, sir. I wish to emphasize one thing, and that is this, that if the embargo against the importation of Canadian power is not lifted we will be obliged to use Canadian power in Canada, and thus, in part at least, become a Canadian institution em- ploying Canadian labor; so that we are decidedly in favor of re- moving that embargo as we are good Americans. The Chairman. Is there any reason why Congress should not re- fer this to some commission to fix the rates ? Mr. Morrison. Well, we have no objection whatever to any regu- lation of rates that is fair and equitable. We are buyers of power and users of power. The Chairman. The committee will now hear Mr. Millard F. Bowen, of Buffalo, N. Y. PRESERVATION OF NIAGARA FALLS. 113 STATEMENT OF MILLARD F. BOWEN. Mr. BowEN. I am from Buffalo, N. Y. I represent the Erie (!i Ontario Sanitary Canal Co., a corporation of New York State. I Avoiild ask the consideration by the members of the committee of the course of the canal pictured on this map, which is taken from the Government sheets. I am the organizer and president of the com- pany that is to accomplish this work, Mr. Cooper. What company is it? Mr. BowEN. The Erie & Ontario Sanitary Canal Co., organized two years ago last fall. Mr. Garnek. For what purpose? Mr. BowEN. The purposes mentioned in the charter are very broad. Mr. Cooper. The general purpose. Can you state what the pur- pose of your company is without stating what is in the company charter ? Mr. BowEX. Not only to provide a canal for sanitation and navi- gation, but also that the water shall be used for power, the right of way for warehouses along the line of the canal, or any business pur- pose under the laws of New York, Mr. DiFENDERFER. What is your capital stock? Mr. BowEN. One hundred thousand dollars, unwatered. Mr. Cooper. You propose getting some of that water power that is now used by some outside consumers? Mr. BoAVEN. All of the water used under the treaty is what would be necessary to make this a commercial success. The 4,400 feet allowed for power under the treaty can be added to by a provision of the treaty that I will read, so that there can be no misappfeciation of the scope of this. Mr. Cooper. Would that abridge the vested rights of those riparian owners if you get the surplus? The statement was made this morn- ing that the companies already existing have the right of riparian owners. Mr. BowEN. As riparian owners they can take any amount op- posite their own holdings. We will turn backward all the streams that run into Niagara River, at or near Buffalo, and stop all of the floods; we shall make the waters of Niagara River as ]nTre as nature intended them to be. Mr. Cooper. IIow much is the capital to be? Mr. BowEN. Thirty million dollars, to be raised by sale of bonds. Mr. Garner. You mean to say, then, that your corporation gets permits from the Government and then sells its rights to somebody else? Mr. BowEN. Not at all. We will serve the public free with this canal for the purpose of sanitation, giving to all the people on the Niagara frontier free sewage disposal and free flood abatement, and also Ave Avill give Buffalo City a thousand feet of dockage, and a maximum kiloAvatt-hour rate Avhich Avill be on the same basis as the Ontario rate — 4^ cents per kiloAvatt-hour. Mr. Garner. A very laudable ambition indeed. But you don't pro- pose to do all of this with a capital of $100,000? Mr, BoAVEN, My dear sir, in Albany the other day a trolley com- pany agreed to issue bonds for the full extent of its construction. The income proved by that trolley company was so sufficient to pay 114 J'KKSKHVATIUN OF >'IAGAU.V lAiJ.S for tlie chai'<>es that the public service commission gave theiu the right to go ahead and issue the bonds for the full amount. Our finances are to be obtained for this enterprise from the sale of lx)nds. The stock necessai'v to be sold is only necessaiy for the })roinotion of the business. Mr. Cooper. Is all this stock paid for? Mr. BowEN. It is not; it is only being sold as necessity arises. Mr. Cooper. But you anticipate it will take all that amount? Mr. BowEX. Yes. sir; 170.000 hoursepower of electricity can be developed from the 312 feet of fall that Ave obtain. The same amount that we ask for, if used b}^ another company, would not come within a very suiall percentage of Avhat we can generate. By reason of the extraordinary conditions of the frontier Ave can use this water three times oA'er, and obtain 28 horsepower from eveiy cubic foot of water. Mr. Garner. In jour navigation feature Avouldn't yon be in com- petition Avith Montreal? ]Mr. BoAVEx. No: because the United States has passed on five dif- ferent studies for a ship canal between Lakes Erie and Ontario and has turned them doAvn on the ground that it Avould help Montreal more than XeAv York. Therefore navigation in this canal Avould stop at the barge canal, and would take the barge traffic and Avould send those barges through to Ncav York without going doAvn the Niagara River, and vice A^ersa, save passing up the riA^er fr(mi Tonawanda, Avhere the current is SAvift. No proAnsion for an inner canal has been made by the State, and the river has to be used for that purpose. Mr. T.1E0ARE. How much Avater do you propose to use? Mr. BoAVEX. Six thousand. In order to make it a success it is necessary to take 1,000 feet per second in addition to the 4.400 feet, that being especialh^ for sanitation and navigation, which is less than the percentage that has been allowed for dilution at Chicago. This study has been a study for years Avith me, and I have taken up all the data I have obtained since I organized the Manufacturers' Club .of Buffalo. Many manufacturers came to Buffalo, and Avere turned aAvay because there was not enough poAver. and because the l)rices Avere excessive, and because factory sites with both rail and Avater connections are scarce and expensive. Mr. DiFEXDERFER. How long is this canal? Mr. BoAVEx. Forty-two miles. Mr. DiFEXDERFER. Then you would discharge into Lake Ontario? Mr. BoAVEx. After the scAvage is taken aAvay from the Avater. Mr. DiFEXDERFER. AVliat is your proposition for the disposition of the scAvage? Mr. BoAVEX. That is similar to the proposition of the drainage canal of Chicago. The drainage canal there has been in operation for 12 years. Mr. DiFEXDERFER. You would tlieu drain the pure Avater into Lake Ontario? Mr. BoAVEX. Without any appreciable contamination. The effect of the expei'ience of the Chicago Drainage Canal has been that in all of their years of o])eration the contamination is never appreci- able—that all of the seAvage matter disappears in the form of gas. The chemists Avho have examined the Avator there find that at Lock- port, Avhich is 32 miles from Lake Michigan, half of the scAvage mat- PUESKRVATION OF NIAGARA FALLS, 115 tei' has disappeiuvd, and no trace remains 48 miles from Lake ^Michigan. In our canal, with a oreater dilution of water, and with a less amount of sewage to drain into it, the flow of 42 miles will natu- rally, for man}' years to come, purify the water coming into it. Be- tween Lockport and Lake Ontario there will be two large reservoirs for the dams below Lockport. If the State of Xew York finds that there is an}' contamination we will be compelled by the Health De- partment of the United States and the State board of health to treat the Avater in such a way as to satisfy them that there is no contami- nation. Ml'. Legaim:. Tender what clause of the treaty? Mr. BowEN. In article 4 of the treaty, and in article 5, the last clause. The Chairman. >Mr. Bowen. in that connection, do you think it w^ould be advisable to give the International Boundary Commission authority to prevent the pollution of the waters? Mr. BowKN. They say they will have to get that authority. They don't want to take up the authority even in such a matter as this until you give them the points upon which to pass. In other words, they will be in the attitude of agreeing to the proposition that will be sent up by you or any department of the Cxovernment. Xow, in article 8 you Avill find a very strong argument in favor of this plan. The third clause begins this way: The foUowiiij: oitk'r of iir('ce»l(M)ce shall ho cbserved .iinoug the various nscs enmiierated hercinafrov for liiese waters, and no use shall be permitted which tends materially to confllet with or rtstiaiu any other use whi^-h is iciven pref- t'reuee o\er it in this order (;f preference: (1) life for d(>niestic and sanitary purposes; (2) Uses for navigation, i.ncluding the service of canals for the purjH)ses of navigation; (3) T'ses for power and for iirigation purpose?. (leorge Clinton told me that he was told t(v make this treaty broad and comprehensiw and to take aAvay technicalities, so that there slionld be the broadest interi)retation of the treaty for both sides of the boundary. So far they have not ])assed upon the rules, but the International Joint Commission, established under the treaty, are still uncertain of their powers, but I think when they get into the matter their powers Avill develop, XoA\ , in oi'der that I may have something to talk on, from a view- })oint of the bills that are before this committee. I have certain sug- gestions to make in regard to the wording of the preamble of both bills. First, in the bill (H. R. 7()94) introduced by Mr, Simmons, why not strike out "" fifth article of the " and leave it, " to give effect to the treaty."' and not confine it to a simple interpretation of one article? That article is limited. Now, in line 8 of the Simmons bill I would insert, after the word '" from." the words " Lake Krie in Erie County, Xew York, or,'' It was asked me by Chairman TaAvney the other day "whether this water talcer, from the head of the river could be construed as water taken from the river under this treaty, I interpreted it this way, Right at the head of the river there enter into the river an average of '2"20,0()0 cubic feet ])er second. If we take part of that away, it is taking water from Xiagara River, although technically it might be at the head of the rivei". Xow. from the sanitary point of view, lib PRESEEVATIOX OF NIAGARA FALLS. right there, half of the G.OOO feet ought not to go into Kiagara River or Lake Erie. A year ago tlie marine hospital sent Dr. McLaughlin 10 make an examination. Dr. McLaughlin has been called before your connnittce, and he may explain his report. It says that 160,- 000,000 gallons of water a day flow back into the river, polluted, from ButTalo alone. The CiiAiE>[Ais. I want to say that Dr. McLaughlin was here, but he could not wait, so he will come before the committee next Tuesday. Mr. BowEN. Let me point out some of the principal points, then, and he Avill go into the details. That 160,000,000 feet ought never to go back into the river polluted. That does not include stream waters rhat are jjolluted, so that polluted stream waters, together with other polluted waters that flow back to Niagara River can be said to be more than 3,000 cubic feet per second. The Chaikma>,-. To give this authority to the Liternational Bound- ary Commission we Avould have to put in a new bill. Mr. BowEN. I think that they would accept your putting into this bill '" the use of 1.600 feet for sanitary purposes." That is the pro- vision of article 4. The commission sa}' that it only needs some action on the part of Congress. The CiiAiiiJiAx. Then you desire to have that in the pending bill? Mr. BowEX. Yes, sir: so that the sanitary feature of this bill can be passed upon by the international commission. Xow, then, all that we are asking for, practically, is 3,000 cubic feet to dilute the sewage of the frontier, in addition to the 3,000 cubic feet that ought never to enter the lake and river in a polluted condition. The Chairman. How far would that extend west? You say that it Avould be suflicient to ])revent the pollution of the waters between Canada and the United States? Mr. BowEN. Yes, sir. The east end of Lake Erie and Niagara River. This report sh(!ws that the sewage of Cleveland. Erie, and even of Dunkirk, is taken care of in the waters of Lake Erie, so that the dangers are very remote at Buffalo, as Dr. McLaughlin says. Therefore, taking all the streams south of Lackawanna, and even Hamburg, turning back all the streams at and near Buffalo into this canal is very comprehensive. I have given instructions to the engineers that they shall construct the sanitary canal and nu\ke it comprehensive (as Jim Hill said), so comprehensive that engineers aO years hence Avill not be able to greatly improve it. Mr. Legare. Mr. Bowen, it seems to me you are wrong in your proposition to use more than is allowed in the treaty. For instance, at the foot of clause 5 you are unquestionably given the right to use this water for use of canals and domestic uses, or for the purposes of navigation. Now, under that vou could use vour 1,600 in addition to the 56,000. Mr. BoAVEN. "What we ask for is l.-lOO cubic feet per second for power and 1,()00 cubic feet per second additional, under the last clause of Article V of the treaty for sanitation and navigation. Mr. Lagare. That is why I don't think your scheme is practical. Under that clause vou have the right to use that in addition to 56,000, but you go further and say you want to use it for water-power purposes. You say that your scheme also includes power purposes. Now, arti(?le 8, that you niejilioned here, seems to me to confine itself PKESEKVATION OF NIAGARA FALLS. 117 clearly to the 50,000 feet mentioned in the treaty. It says " these waters " only. It says " these waters," meaning these waters that are mentioned back here. Mr. BoAVEN. If you take that viewpoint, then Ave are entitled to the diversion we ask for, on the grounds that we use it for conserva- tion of both health and power. The Government is pledged to stop pollution of international Avaters. Mr. Legare. But you are asking for 6,000. Mr. BoAVEX. We are asking for the Avliole diA'ersion for both con- servation of" health and poAver. Mr. Garner. The only difference betAveen Mr. Legare and Mr. r>0Aven seems to be the difference betAveen 6,000 feet and the -1:,400 feet. Mr. BoAVEN. Yes, sir. The Hydraulic Co., Avith 6,500 cubic feet, and the Niagara Falls Power Co., Avith 8,600 cubic feet at the falls, are generating less poAver than we Avill generate Avith 6,000 feet. Mr. Garner. But could you utilize this — unless you had enough to make a business of it Mr. BoAVEN. We need the full 6,000 cubic feet to make a com- mercial success. Yes, sir. STATEMENT OF OSCAR E. FLEMING. Mr. Fleming. I am from Windsor, Ontario. I am a barrister at law, counsel for the Electrical Distributing Co. of Ontario. They contemplate getting from the Hydro-Electric Commission, of On- tario, electric power from Niagara Falls to furnish Detroit, and in that AAay Ave are interested. I might remark in the first place that a great deal of Avhat I had to say has been coA^ered by the previous speakers. But I think it might be interesting to outline to you the scheme of the Hydro-Electric Commission of Ontario. It is a (rovernment scheme originating Avith the municipalities to get for the people of Ontario electric power at cost. That is, the government luakes nothing on the scheme and the people get it at actual cost. NoAv, they have a contract Avith the Ontario company for 20,000 liorsepoAver. At the present time they are using 20,000 hcrsepoAver, and they are serving as far north as Toronto. It is about 180 miles from "Niagara Falls to London and about 100 miles to Toronto. That is Avhat they thought at first, but as the art of the uses for generation and distribution have developed they have found that they can send the poAver profitably 250 or 300 miles. NoAv, the present nninicipalities in the scheuie uuuiber about 20, and the thing has Avorked out A'ery successfully. At our municipal elections on the 3d of January, 34 municipalities voted to buy poAver from the Hydro-Electric Commission AAith Avhich to supply their people. In our district, betAveen Londcm and Windsor, on the De- troit River. 17 have A'oted to come Avith us. The Hydro-Electric Commission has made its (igui-es. and the present consumption in that district Avould amount to five or six thousand horsepoAver. The cost of distribution in that district would be considerable, probably tAA'o million or tAvo aiul a half milliou, which, added to the cost of the power at Niagara Falls and London. Avould make the price too high to serve this territory. So some parties — the people of Windsor and the Detroiters^ — conceived the idea of taking from the commis- sion part of the surplus to deliA'cr in Detroit. It hel])S out the AA-hole 118 PIIKSKHVATIOX OF ^'IAGAUA FALLS. scheme to cheapen power. It enables the people in 'the district in which I live to get it at $30. That jilan has been submitted to these numicipalities and they have no objection to Detroit getting this lienefit. As I understand it, there is an investment for distribution of .several million dollars, and the more power that goes along the line cheapens the power for the consumers. The contract Avas signed between our company and the commis- sioners, and at that time our company put up a guaranteed fund of $250,000. and we have all the rights that we require, so far as On- tario and the Dominion of Canada are concerned. The only bar to our getting to Detroit is the Burton Act. We had in mind that the Burton xVct was a temporary affair, to last until the treaty came into effect. Under that treaty we realized that we could do business — that is. if there was no limitation put upon the export of power by that commission. Xoav. the commissioners are ready to go on with their work, and we take from the Government at Windsor 25,000 horsepower for Detroit use. Mr. CooPEK. Do the Canadian municipalities get it at cost? Mr. Fleming, Yes, sir. ^Fr. CooPEK. Detroit would not get it at cost ( Mr. Fleming. Xo; because they charge us 10 per cent of our cost, because we are not interested locally. The Federal Power Co., of Detroit, is an organization associated Avith the Electrical Distrib- uting Co.. and we take the ])ower and distribute it. The people are the same in the two companies, and it has got to be organized that way so as to distribute it in the tAvo countries. They take the power thei-e and sell it to the people in Detroit. The Chairman. Hoav long is this contract for? Mr. Fleming. For the full term of the contract with the Ontario PoAver Co. It expires in 1080. The Chairman. Hoav long, in your oi)inion. do you think it would take to exhaust the poAver you are entitled to under the provisions of the treaty ? Mr. FLE:\nN(;. That is a difficult question. In taking this up AAdiat I Avant to say to the connnittee is this : It might get to a point Avliere we could get the poAver from Detroit. The Chairman. That is Avhy I asked you that questi(m. There is great industrial development in loAver Canada? Mr. Fleming. Yes. sir. The Chairman. And it is only a (juestion of a very short time Avhen the peo])le of Canada Avill use all the Avater they are entitled to? ^fr. Fle:ming. T don't think there is any doubt about that. The CiTAHoiAN. Would it be a year or tAvo. or three years? Mr. Fi.EMiN(i. I Avouldn't like to venture an opinion, but it is going to be pretty near that. The CHAiR:>rAN. You are using now Mr. Garner. The Canadian side is using 11.000 and the American side is using 15,()00 cubic feet. Mr. DiFKNOERFER. A little over 13.000. ]\Ir. Garner. The Chairaian. You are using less than the American side? Mr. Fleming. Yes, sir; at the ])resent moment. Xoav. as T said, Ave have all our plans made, but subject to the right to get into Deti-oil. I Avas about lo say that in the ordinance the comi)any Avas to sell the power at 20 per cent loss. PRESKRVATION OF Jv^IAGARA FALLS. 119 Mr. . What you want is the limitation taken off ^ Mr. Fleming. Yes, sir. Mr. Cooper. Why should Canada, if it can not use that which is there, be anxious to have the restriction taken off? Mr. Fleming. It helps out the scheme of giving the people in Detroit the cheap power; but we have other water power — the Niagara River and the Ottawa River — ^in the north country, so that we can well afford to give to Detroit that amount of power, and every man, woman, and child gets cheaper power. Mr. DiFENDERTER. There is no contract between the city of Detroit and the Hydro-Electric Commission, is there ? Mr. Fleming. Yes, sir; it is signed. Mr. Difenderfer. You put up a bonus of $250,000 in cash? Mr. Flejiing. Yes, sir; and that is subject only to the permit to get it across the river, and if it is not given we get our money back. Mr. Watrous. As I understand it, 110,000 horsepower is being used out of 160,000 authorized to be used ? Mr. Fleming. Under the Burton Act. Mr. Watrous. Then why can't you use twenty-five of the fifty thousand that is unused? Mr. Fleming. All of that is taken up by the Burton Act. Mr. Watrous. But not used? Mr. Garner. They have a permit from the War Department. Mr. Watrous. It is apparent that there is a permit for some 1,400 feet which is not being used. Mr. Cooper. What is it held up for? Mr. Watrous. That is what I want to know. Just merely because the permit has been given, it is a very simple matter Mr. Cooper. Have you applied to the Secretary of War? Mr. Fleming. Yes, sir; and the permits have taken up all the water used. The Chairman. They use it at any time? Mr. Fleming. Yes, sir. Mr. Garner. The explanation has been made this afternoon that they were contemplating using all that power soon. Mr. Cooper. How long have they had those permits I Mr. Fleming. Since the Burton Act was passed. Mr. Garner. How^ long before we thought they were using it ? Mr. Fleming. I don't know anything about their internal arrange- ments. Mr. Levy. When were you first refused by the Secretary of War? Mr. Fleming. I think it was over a year ago. Mr. Levy. What reason was given for the denial ? Mr. Fleming. That the limit under the act was being taken up. They had no authority to grant anv more permits under the Burton Act. Mr. Levy. In these permits is there no limitation as to the time? Do thev give a permit to a company to sit down and hold that as long as it pleases? Mr. Fleming. I am not in a position to say. Gen. Greene. I have a copy of the permit here. The Secretary of War held two hearings, one in the summer of 1000. He granted permits so that we would not all go to jail, because the acts done on the ;)0th of June were illegal, and then he investi- 120 PRESERVATION OF NIAGARA FALLS. gated and found out, what their plans were, and then held another hearing; then he issued permits for the quantities I stated this morn- ing — 50,000 to the Ontario company, 52,500 to the Niagara Falls com- pany, -JrCSOO to the electrical company, and the balance was reserved for the use of a railway in Canada. Xow, those jiermits are in force to-day. A Member. In August. 1907? Mr. Cooper. Can these corporations wait in their discretion to use that? Gen. Greene. There is no time limit in the permit, but the Burton law says that it can be revoked. Mr. Garner. "\A'Tiat company has failed to use 'the full i)ower? Gen. Greene. The P^lectrical Development Co. (Ltd.). of Ontario. Mr. Legare. They have not used any at all? Gen. Greene. "Well. I understand they have sold a part of what they are authorized to export to Mr. Barton's company. Mr. Garner. In other words, they have a permit for a certain amount of power and they sell it to somebody else at a profit? Gen. Greene. Yes, sir. Mr. Barton, Sold 10,000 to the distributing company and it was not used because the company needed its entire generating capacity to supply the Canadian customers. ]\Ir. Garner. Now. that is the most interesting statement I have heard so far. If I understand it. the Secretary of War allows a permit to continue in existence that is not being used because all the power it can generate is being used in Canada. At the same time he allows the permit to stand and refuses your company the I'ight to bring power into Detroit for the benefit of the people of the United States? (iren. Greene. Here is the document, an order for permits. To the International Railwav Co.. 1.500; to the Ontario Power Co., 00,000; to the Canadian Niagara Co., 52,500; and to the Electrical Development Co.. 46.000 horsepower. This is signed " William H. Taft. Secretary of War.'' Mr. Barton. That was the order for the i)ermits? Gen. Greene. The permits were simultaneous. Mr. Garner. Is there anyone here representing the Electrical De- velopment Co. ? Gen. Greene. I answered that question this morning. Mr. DiFEXDEREER. Did you not state this morning that the Mac- Kenzie-Mann interests were shipping no power into the United States? Gen. Greene. I said I did not know. Now, there w^as a public record; a contract with the Niagara Falls Co. Mr. Barton. No; that was with the distributing company, and that has terminated now. Mr. DiFENDERFER. So that they are entitled to ship 46.000 horse- poAver, and have not done so? Gen. Greene. I heard a rumor that they renewed it. But nobody has ever claimed that they ever shi]:)ped more than 10,000 horsepower. Mr. Garner. The fact remains still that we are entitled under the ]5urton Act to 46.000 horsepower, and that we are not now getting. This permit has been in existence since 1907; other parties seeking to use this power have applied to the Secretary of War, and he PRESERVATION OF NIAGARA FALLS. 121 has refused them permits. Possibly the Secretary of War can give us some information. Gen. Greene. Incidentally, I may say that in the year 1909 I ap- plied to the Secretary of War for additional power and was refused. The Chairman. If the Province of Ontario grants the license for the water on the Canadian side, why should not the State of New York grant the permit on the American side ? Gen. Greene. I see no reason why it should not. The Chairman. It seems to me that it would be a matter of greater convenience than the present way, through the Secretary of War. Gen. Greene. Eminent lawyers have given me the statement that when the United States has exhausted its power it is then with the State of New York to say who gets the power, and fix the limita- tions, Mr. Brown. I agree with Gen. Greene on the law proposition. Mr. Sharp. The concrete question before us is this : The Secretaiy of War has this authorit}^ conferred upon him by Congress and he has granted permits to parties, some of whom have availed them- selves of it and some of them have not. Then the Secretary of War ought to grant that permit to someone who shall use it. Mr. Garner, And if j^ou should turn that entirely over to the State of New York, Michigan might not be agreeable to that. Mr. Cooper. This is the language of clause 7 : The Secretary of War reserves the right to modify the form of this permit, to change the method or plan of measurement herein prescribed, or to substi- tute other modes of judgement, etc. Is that an absolutely unqualified right ? Gen. Greene. Section 5 of the Burton law reads this way : The provisions of this act shall remain in force for three years from and after date of its passage, at the expiration of which time all permits granted hereunder by the Secretary of War shall terminate, imless sooner revoked. and the Secretary of War is hereby authorized to revoke any or all permits granted by him by authority of this act, and nothing herein contained shall be held to confirm, establish, or confer anj' rights heretofore claimed or exer- cised in the diversian of water or transmission of power. And I apologize for breaking in again. Mr. Fleming. The reason for the passing of the Burton Act has already been presented to this committee. It was a temporary measure. The duties it was to perform have been performed and it should expire. We on our side of the river had reason to believe that the treaty would be the supreme law of the land, and we can not appreciate why Congress should trv to restrict us in the use of our 36.000 feet. The Chairman. I am in favor of the people of New York buying power wherever they can buy it the cheapest. Mr. Fleming. How would you like us to say : " You can't have this. We will impose a duty on every horsepower that goes out of Ontario"? That woidd not be just. That is like the Burton Act. Mr. Brown, Mr, Fleming, is it not true, from an engineer's and a lawyer's standpoint, that the final permanent use of this power, authorized to be created upon the Canadian side, is to be enjoyed by that country who first preempted it, and if America does not get the use of it Canada will, and the final use will be where it was pre- empted ? 122 PRESFRVATTOX OF ^'IAG.\RA FALLS. Mr. Flkmixg. Ye«. sir. Mr. Brown. Then the question in this ease on the Canadian side depends upon whether the embargo is raised ? The Chairman. Mr. Brown has asked you a question and he de- sires an answer. Mv. S-MrrH of New York. I wanted to ask you what kind of a reguLntion there is in Canada outside of the regidation phiced on the power sokl by the l*rovincial (lovernment itself ? Mv. Fleming. There is none. Nothing but a commercial compe- tition, and of course the competition is giving place to the hydro- electric power, which is so cheap. Mr. Cooper. Do you think that if these restrictions were removed it would be advantageous for the United States? Mr. Ff.eming. Yes., sir. ^Ir. Cooper. Well. why. as a Canadian, should you desire the United States to get that? You are having an eye on Windsor? Mr. Fleajinc;. Yes. sir; I am interested in AVindsor getting cheap poAver. It cheapens the rate of power all along the line from London to AVindsor. and that is where we get a large benefit. The Chairman. In other words, you are in favor of Detroit get- ling this pov.er, incidentally because Detroit is going to help you get this power for AA^indsor? Mr. Fleming. Yes. sir. ^Ir. Richard B. AA'^atroi s. I am the secretary of the American Civic Association. I sym])athize with the difficulties of Detroit that wants some cheaj) light. If the obstacle which stands in your way is removed, aren't you satisfied that you get that 25,000 horse- powei- ? Mr. Fleming. Yes, sir; that is all I am asking for, but that is outside of the question of policy that I have discussed here, whether you should come in and restrict importation into the United States. The Chairman. Now, is there any gentleman from BujQfalo or Niagara Falls or the State of New York who desires to be heard briefly, and who wants to leave to-night? ^Ir. Bowen, how long do you think it Avill take to conclude your argimient? Mr. Bowen. I wish to speak of one thing. The Chairman. Major, do you desire to say anything in regard to the statement made by the gentleman from Canada ? Maj. AA^ B. Ladue. Just a few words. STATEMENT OF MAJ. W. B. LADUE. Maj. Ladle. I am in the Corps of Engineers, from the office of the Chief of Engineers. There is very little that I would care to say on this subject unless I am asked for more information. The request for this permit has been made to the Secretary of AA^ar, but, so far as I know, it has not been coupled with any request I hat the permit of the Electrical Development Co. be revoked or modified in anyway. I say this because that has been touched upon in the argument. So far as I know the question of the revocation or modification of that permit, or taking away water and giving it to somebod}' else, has not been raised. I don't know what the Secre- tary Avould do on that subject. 1 PEESEJI\'ATI()X OF NIAGARA FALLS. 123 Mr. Legare. You do kno^v that his attention lias not been called to the fact^ Maj. Ladue. So far as I know there has been no complaint made to him that they are not using- their permit. Now, there is a provi- sion in the Burton hnv Avhich gives the Secretary of War the right to grant additional permits over and above IGO.OOO horsepower, and this Detroit company has been informed of this ])rovision. and of the conditions under wh.ich additional permits can be granted. They have submitted certain statements which are now under consideration by the Secretary of AVar; so this Detroit company is not altogether cut out of getting a permit because of the fact that there is an existing ])ermit. I clon't come here Avith any instructions touching this permit, because nobody in our office knew the matter was going to be brought np. The CriAiKMAx. The Secretary, in granting these jDcrmits. did not charge anything for them? They were given gratis? Maj. Ladle. Yes, sir; free. The Ciia]r:\l\n. If the Secretary of AVar should grant the permit for the additional 4.400 feet lie Avould give it gratis? Maj. Ladle. Yes, sir; I presume so. The CuAiRMAx. But the State of New York avouIcI charge for it? ]Maj. Ladue. That I don't knoAV. The CiiAiRJiAx. But the State of NeAv York does charge for per- mits, doesn't it? They bring in a revenue to the State? Maj. Ladue. I don't knoAv. sir. The Chairman. I Avonld like to have you state the position of the War Department, so that Ave Avill know Avhether to giA'e the power to the State or continue to lodge it in the hands of the Secretary of War. Mr. Garner. It ought to be stated that under the Burton laAv the Secretary of ^\nv would not have any right to charge for the permit. But if Congress should lodge this power in the Secretary of War, and Congress did not require any payment for it, he Avould not be alloAved to charge for the permit. Whereas if he Avas allowed a fee. then the Secretary of War could charge that fee. NoAv. I rememijer about the pei'mit question. We had a special session last summer Avhen the matter of the extension of the Burton Act Avas before this committee, but on account of the time limit and the unknoAvn merits of the case, Ave decided to report a bill extending it until March 1. At that time this identical question of power be- ing furnished to Detroit Avas before this conmiittee and some state- ments made about it. That is my recollection. The Chair ALVN. That is right. Mr. (lARNER. I Avas someAvhat surprised to learn that the Secretary of AVar's attention had not 1)een called to the fact that this contpany was only using a small portion of its permit, and another company clamoring for an opportunity to enter the I^iited States Avith this poAver. AAlien you made the statement to-day that his attention had not been called to it and that the matter had not been touched upon it Avas a surprise to m^e. Maj. Ladi'e. AVha/ I intended to say, Mr. (nirner. Avas that, so far as our office knoAvs. i* has not been attacked. That is. no papers have come to us: but wlirtt has happened in the Secretary's office I don't 124 PRESERVATION OV XTAGAHA FALLS. knoAv. There i?- one other inattor I Avoukl like to comment on at the same time The Ciiair:han. A little later. Major. 3Ir. Bowen. how long do you think it "syill take you to conclude? Mr. Bowen. I have some information in regard to electrical con- tracts that you have sought for and also some suggestions as to what action has been taken before in similar applications. The Chairm\n. AVe Avill go on until 5 o'clock. Mr. BowEN. In addition to the change in the title of the bill (Mr. Bowen refers to the Simmons bill). I liave a correction where it says " above the Falls of Niagara within the State of New York for power purposes." Now, my suggestion is to change that to read : " For all purposes mentioned in the treaty." Furthermore, in line 8 of the Simmons bill, after the words " such diversions," I would suggest inserting these words: '"And who shall conserve the useful- ness of the water, to its fullest extent." Now, furthermore, to cover the point of the additional 1.600 feet, after the word " nine " in line 12, insert "to Avit : Twenty thousand cubic feet per second for power and one thousand six hundred cubic feet per second for sanitation and navigation," covering the point that I have explained. Then, on page 2 of the Simmons bill, lines 3 and 4, strike out " commissioners on the part of the United States in the," leaving it to read : " That no such permit shall be granted allowing diver- sions of water exceeding in the aggregate fifteen thousand six hundred cubic feet per second without the consent of the State of New York and of the international joint commission provided for by said treaty;" and adding at that point, in line 5: "And all further diversions shall be governed by the rules of prece- dence and preference made in the treaty, and shall be limited to such amounts as shall not injure or interfere with the navigable capacity of Niagara Kiver, or its integrity and proper volume as a boundary stream, or the scenic grandeur of Niagara Falls," leaving it in the discretion of the Secretary of War to decide whether any application shall come within the terms of the treaty. I think, with those corrections, there is no objection to the Simmons bill, and almost the same corrections could be inserted in the Smith bill. The Chairman. Have you made the corrections in both bills? Mr. Bowen. Yes, sir. I started to refer to a part of the case as presented in a case before the Rivers and Harbors Committee on the Alexander bill on January 6. 1911. There we showed our case very completely in its essential points. To further illustrate the points, I have here a signed statement issued by Mr. Isham Randolph, of Chicago, stating the reasons why the grants should be made to the Erie & Ontario Sanitary Canal Co. : Reasons why Congress and the International Joint Commission shoitld grant to the Erie <£• Ontario Sanitgrg Canal Co. the right to divert from Lake Erie and use 6,000 Clinic feet of water per second. In presenting an argument to Congress and the International Joint Couiinis- sion on l)eliiilf of the Erie & Ontario Sanitary Canal, the following points shonld be brought out : First. Buffalo is discharging its sewage in a raw state into the Niagara River and the waters of sjiid river are thereby polluted and rendered unfit for potable use. PEESERVATION OF NIAGARA FALLS. 125 This liver is the natural source of supply for cities ami villages on botli sides of its cliannei, and the inhabiiants of said cities and villages have learned by sickness and death, which medical science has truly traced to the water supjily, that the water of Niagara River was unwholesome and laden with pathogenic germs. To secure relief from this deplorable condition, resort has been made to arti- ficial means of purifying the water taken from the river for potable use, with results not always satisfactorj^ but always expensive. This condition will con-t tinue to aflect the inhabitants of the Niagara frontier just as long as the uu- purifieo per cent of the total difference in level between Lakes Erie and Ontario. The Erie & Ontario Sanitary Canal Co. proposes to operate under a head of 312 feet, or 95.58 per cent of the total difference in level between Lakes Erie and Ontario. As a further comparison of the useful work at each of the power sites named, it may be stated that one cubic f10, published as H. Doc. No. 779. 01 si Cong.) An alternative treatment which will semre tlio regulation of depth in Lake Erie is that suggest(>d by >rr. J. Edward Thebaud and illustrated on page 619 of House DcKunient No. 200SS, Sixty-tirst Congress, second session. As an engineering laoblem there is and can be no doubt of a successful BOlution which will bring about the regulation of Lake Erie for an expenditure wliich will be within reasonable limits. We now iKiss on to the Niagara River. The abstraction of water from the Niagara River diminishes the volume of flow over the American and Canadian Falls and tends to lessen the grandeur and beauty of that wonderful work of the Great Creator. The consensus of opinion of the members evidenced by the report of the International Waterways Commission is that the flow over the Falls ni.i.v he reduced niipi^'^^vimately 60.tH)0 cniiic feet per second without ma- terially (leiracling from the beiiuiy and sublimity of the spectacle. In our .iiidgnieut it is within the scope of engineering accomplishment to construct such diffrisi(>n works above the Horseshoe Falls as will increase the beauty of the Falls and a.dmit tif a still greater diversion of tl'.e water for commercial uses. The contour of the Falls changes steadily. The escari)ment is being worn away year by year to an extent w'liich attracts the iitteution of any close observer wlio has the privilege of seeing the Falls constantly or even at long intervals. PRESERVATION OF NIAGARA FALLS. 127 The Horseshoe Fjills has lost the form whioh gave it that familiar designa- tion, and it is .sjradnally assuniins a V shape. At the apex of this V the water is of fireat deptli and its destructive force is 5;i.i;antic. The approach to the apex of the V is throuf^li a deep channel, and the way to arrest the rapid erosion which is goiny on is to choke tliis deep channel or thalweg, until the waters are forced to flow in greater deiitli over the entire rim of the Falls. The writer has developed a project for doing what lie here suggests. He explained it to President Taft in 1909 and received his approval as a layman, not as an engineer. In February of the present year Mr. Taft gave the writer a letter of introduction to Mr. Fielding, minister of finance. Dominion of Canada, bringing the writer's proposition to his attention. This letter was presented to Mr. FieJding in Ottawa on February 13 last. Mr. Fielding introduced the writer to Dr. Pugsley, minister of public works of the Dominion, and to him and to his engineering ,'uivisers. Mr. Louis Coste and Mr. A. .St. Laurent, he explained the methods of creating diffusion works which would tend to arrest the rapid recession of the three Horseshoe Falls, and diffuse the volume of water evenly over the crest of the Falls and add greatly to the beauty of the cataract and permit a more liberal use of the water for conuuercial purposes. The creation of tliis diffusion work must be accomplished under a treaty between the United States and Canada, and it should be created as an international work. • ISHAM RaWDOLPII. Chicago, Aufjust 2, 1911. A Member. Is he in favor of this proposition? Mr. BowEN. Yes; he is otir chief engineer. I woiJd say right here that the bonded indebtedness of the city of Buffalo is so great that they are unable to do this as a public improvement. The Chairman. Does that finish your statement? Mr. BowEN. The city of Buffalo asked the Secretary of War to do this thing two years ago, and in their resolutions asking the Sec- retar}' of War to investigate, if he decided we should have the grant, they asked that certain promises that we make should be incorporated in the grant as a condition precedent. The terms of our proposal were: This thousand feet of dockage, and the right not only to the city, but to all other municipalities and individuals on the Niagara frontier to drain into this canal as long as the grant will last; in addition to that, we will voluntarily put in this provision that although now- the rate charged in Buffalo is not to exceed 9 cents per kilowatt-hour, it shall not exceed 4^ cents per kilowatt-hour; and furthermore, that the city in consideration, shall give its aid in the promotion of this enterprise, and use of such sewage, and the right and permission to use the streets for conduits under terms not more onerous than those given to the other companies in Buffalo. And this contract goes into the record. The Chairman. Very well; have you finished? Mr. BowEN. I have some few remarks. CONTRACT FORM WITH MUNICIPALITIES. This agreement, made this — day of , 191- between the Erie & On- tario Sanitary Canal Co., a cori)oration of the State of New York, party of the first i)art, and the city of Buffalo, a municipal corpori«^ion of the State of New York, by , its mayor, with the concurrence of the common council of said city, party of the second part, witnesseth : Whereas said party of the first part has obtained or expects to obtain the consent of the Secretary of War to talie water from Lake Erie for the use of the proposed canal, extending from Lake Erie to Lake Ontario; and is to con- struct and operate said canal for the purpose, among others, of furnishing power to industries operating along the line of said canal, and to such munici- palities adjacent thereto as may desire to take advantage of the opportunities 128 PEESERYATIOX OF NIAGARA rAIj:.S. afforded by said canal: of receivinj; and disposiug of in a sanitary manner the sewage of such municipalities and industries; of abating the periodical floods caused by the ovei'tlow of Bufl'alo liiver and Cazenovia Creek; aud of aftordiug means for reversing the How of streams and sewers now emiJtying into Lake Erie and Niagara Kiver, thereby purifying the water supply of the Niagara Frontier: and of serving as a branch of the barge canal now in process of construction by the State of New York, aud affording dockage facilities for private and, if need be, for municipal uses. Whereas said party of the first part desires the cooperation of said party of the second part in the promotion of said enterprises, and said city of Buffalo has manifested its willingness to cooperate by joining said party of the first part in its api)lication for the consent of the Secretary of War, by the following resolution duly adopted by the common council of said city aud apiirovetl by the mayor, viz : "That the city of Buffalo.- by its common council and mayor, hereby com- mends to the favorable consideration of the Secretary of War the memorial of the Erie & Ontario Sanitary Canal Co.. and believing that the entei'- prise, if feasible at all, and if established and conducted with due regard to the public welfare, will inure to the immeasurable benefit of sanitary and industrial interests of national scope and iufiuence, urges the Stn-retary of War to grant the prayer of the petition of said Erie & Ontario Sanitary Canal Co., provided that upon investigation he is convinced that the (•<»nipany's plans are i)racticable from a legal and engineering point of view, and provided further that such grant be made exi)ressly subject to the following conditions precedent. (1) That prior to the commencement of the work of excavating and con- structing said canal, or of proceedings for the appropriation of lands therefor, said company shall enter into written contracts with the city of Buffalo, and such other municipal corporations along the line of the proposed canal as may desire such arrangements, securing to the said city of Buffalo and other municipal cor[)orations, in the interest of the public health, the perpetual right to the free and unlimited use of said canal for the delivery of sewage and drainage (hereto at the most sanitary and convenient points, without charge to any of said municipal corporations for such use and itrivilege; securing like privileges to individuals and private corporations occupying the territory adjacent to the canal, and affording such assurances as may bo re(piired that such sewage and drainage shall be disposed of in a sanitary manner ; (2) That prior to the commencement of work or of proceedings for the acquisition of lands for said canal, said Erie & Ontario Sanitary Canal Co. shall also stipulate by contract Avith the said municipl corporations, or such of them as desire it, to furnish to all persons and corporations power and light for mimicipal, industrial, business, or domestic purposes on terms which shjill be just and ecpial to all consumers, admitting of no discriminations among consumers similarly situateil, excepting in favor of municipal corporations as contrasted with private industrial or business corporations or individuals; (3) Such other conditions calculated to promote the public interests as said Secietary of War may in his judgment deem advisable to itreseribe." Now. therefore, in consideration of the exchange of mutual benefits as afore- said, and of the sum of one dollar paid by each of the parties hereto to the other. re<-eipt whereof is hereby confessed and aekuowledge<\, the pai'ties hereto agree as follows: Said parly of the first part hereby grants to the party of the secimd part the perpetual right to constr\ict sewers and drains from such points in the city of Buffalo as may be determined upon by said city, to and into the said canal of the party of the first part, and to empty therefrom into said canal its sewerage and drainage that is not prohibited by law; and thai- no charge whatever of any kind or nature shall be made by said i)arty of the first part to sjiid city of B.uffalo of the stK-ond part for such ust» and privilege, other than the cooperation of s:iid ci'y mentioned in the foregoing resolutions: the party of the first jiart shall riH'eiv(> and dispose of said ajiproved sewage and drain- age in a thoroughly sMuitary manner, subject to the api)roval of the State and local ermit to be deliveretl improjier or objectionable sewage or drainage, and not otherwise, the party of the first iiart shall also gnint freely and witiiout charge, like i)riv- PRESERVATION OF NIAGARA FALLS. 129 ileges of sewage and draiuatre to individuals and i»rivate corporations occupy- infj lands adjacent to said canal. In measure projiorliona'e lo its otlier sinnlar oblisj'tions to other numicipali- ties and other patrons, said party of tlje first part shall also furnish to said city of Buffalo sutticicMit current for power and lisht for municipal purposes, upon the demand of said municipality, and at such prices (not to exceed 4* cents per K.W.II.) and on such terms as shall he hereafter mutually agreed upon, hi no case to be higher or more burdensome to said city of Buffalo than to other municipal corjiorations. or to any individuals or industrial corporations similarly situated along the line of said canal. Said party of the tirst part further agrees to furnish to individuals and business and industrial corpora- tions within the city of Buffalo, on terms which shall be just and equal to all consumers similarly situated, sufficient curreui for power and light for indus- trial, business, or domestic purposes, at prices not to excetnl 4i cents ]ier K.W.H. Said party of the tirst )iart also agrees to provide for the use of said city of Buffalo, at some convenient point, a frontage along its canal of not less than 1,000 continuous feet for dockage purposes, provirled. however, that said city of Buffalo shall exercise its option in this regard at some time within five years from tlie time of the opening and operation of said canal for navi- gation, and immediately after the exercise of such oiition shall eonunenee con- struciion of docks for the benefit of said municipal corporation and its inhabit- ants; the privilege hereby granted to be upon such reasonable terms as shall be agreed upon by the parties hereto. Said party of the first part further agrees to save said city of Buffalo harm- less from all costs, charges, damages, and rights of action accruing or arising from the construction or operation of said canal, or from insanitary conditions, if any, that may result from the exercise by the ixirty of the second part of any of the privileges hereinbefore granted. Said party of the second part, in consideration of the foregoing, agrees to cooi>erate with the party of the first part in securing such privileges from the Government of the United States and from the State of New York as may be necessary to the snt-cessful construe ion and o^ieration of said canal, provided, however, that such cooperation shall not entail upon said party of the second part any pecuniary loss or cost: and said city of Buffalo grants to the party of the first i)art such sewage and drainage and the right, permit, and license to use and occupy and cross o^■er or under any and all streets, alleys, and waters of said city during the life of this contract, for any and all electric distribut- ing lines, conduits, and cables that it may find necessary for distributing cur- rent throughout the present or future limits of said city upon as advantageous terms and with not more expensive construction than are or may hereafter be enjoyed by or permitted or gr.-inted to any other company under similar con- ditions. This agreement shall be binding upon and shall inure to the advantage of the successors and assigns of the parties hereto. In witness whereof, the parties hereto have caused these presents to be duly signed and sealed the day and year first above written. The Chair:v[ax. If yoii have anything else relevant to the subject- matter to put in the record yon may give it to the reporter. Mr. BowEN. Yes, sir; for instance, the rates in Niagara Falls. Mr, Cooper. ^Yhat about the rates right noAv? I thought you could give a summary. Mr. BowEN. In Niagara Falls, Ontario, it is 4^ cents per kilowatt horsepoAver — in Buffalo it is not to exceed cents. The power rates in Niagara Falls, Ontario, are. for power delivered at commercial volt- age, $2?) ])er horsej^ower. less $?> if paid before the end of the month. In Biiti'alo the average for all ])tirposes is Avithin a fcAv cents of $35 per horsepower per year. There is no competition, because the com- panies tJiere are both subsidiary companies of the Niagara Falls rower Co. .V list of all these comjxinies and their directors and their securities is in a pamphlet Avhich. if it is of any interest to the com- mittee, is at your service. The Chair^ian. Leave that with the committee. Just give the name of it to the reporter to identify- it. 130 PRESERVATION OF NL\GARA FALLS. Mr. BowEx. '• Statistics of local and miscellaneous securities, by J. C. Dann & Co./' published in December, 1909. I would like to state that a similar grant to that we ask you for was made in 1905 to the Mississippi liiver Power Co., at Keokuk, Iowa. I have a copy of the grant made to them, and it was on condi- tion only that they should give the free use of enough electric power to operate the lock, and they should build the dam, lock, and dry dock at their own expense. They will be generating 200,000 horse- power next 3' ear, and thej' are an example of good faith. The Chairman. You may get up all these things and give them to the reporter. We will now adjourn until to-morrow morning. Whereupon at 5 o'clock p. m. the committee adjourned until Friday morning at 10 o'clock, this hearing being adjourned until 2 o'clock. The following are the changes in the Sniitli bill suggested by Mr. Bowen : In the preamble strike out " tiftli article of the"; strike out " Canada " and insert "Great Hritain " ; after "nine" add "and for other purix)ses." Page 1, line 3, after " diverted from " add " Lake Erie in Erie County, New York, or from." Page 1, line 5, strike out " power purix)ses " and add " all purposes mentioned in Siiid treaty." Page ], lino 10, after "nine," insert " to wit: 20,000 cubic feet per second for IK)wer. and 1,(J00 cubic feet per second for sanitation and navigation." Page 1, line lO; after above insertion, add "such individuals, companies, or corporations only as shall conser\e the usefulness of the water to its fullest extent shall be given permits." Page 2. line 10, strike out " made to " and add "given with the consent of." Page 2. lines 11. 12, and 1.3. strike out "with full ix)wer and authority to said State to make such grant or grants of the use thereof as it may determine to be for the public interest," and add "and shall be governed by the rules of precedence and preference made in Siiid treaty ; and shall be limited to such amounts as shall not injure or interfere witli the navigable capacity of Niagara River or its proper volume as a boundary stream, or the scenic grandeur of Niagara Falls." PETITION TO CONGRESS AND TO THE INTKRN.VTIONAL JOINT COMMISSION IN BEHALF OF EKIE & ONTARIO SANITARY CANAL CO. Whereas it is stipulated in Article \' of the treaty between the United States and Great Britain, signed .January 11, I'.HKt, commonly known as the waterways treaty, that the United States may authorize and permit the diversion within tlie State of New York of the waters of Niagara Itiver above the Falls for power purposes, not exceeding in the aggregate a daily diversion at the rate of 20,000 cubic feet per second, provided the level of I^ake Erie and the fJow of Niagara River sliall not bo appreciably lowered: Whereas the prohibition of Article V does not apply to the diversion of water for sanitary and domestic pnritoses. .-md for the service of canals for the pur- pose of navigation, and it is stipulated in Article IV that the boundary waters shall not be polluted on either side to the injury of health or property on the other : Whereas the cities bordering on the Niagara River and situate in the district contiguous thereto are subjected to ei)idemics of typhoid fever, caused by tlie polluted water taken from Niagara River, and considerations of public health demand the ai)atement of these dangers without delay: Whereas the Erie & Ontario Sanitary Canal Co. has been organized under the laws of the State of New York to construct without State or Federal aid a can;il between I^akes-Erie and Ontario, lieginniug at a i)oint at or near Smokes Creek in the city of Lackawanna, tbent-e to a I'oint at or near tlie nioutli of Eighteen Mile Creek on Lake Ontario and laterals thereto; Whereas the li.-irge-canal law of Nt>w York State ( sec. o. eh. 147. Laws 100r>) makes no provision for tlio use of the Erie Canal from the (Juanl Lock at P.lack PRESERVATIOiSI OF NIAGARA FALLS. 131 Rock. I'.iiff;ilo, to ToHiiwaiKl;!, and said lOrie & Ontario Sanita.r.v Canal Co. offers to ve to the satisfaction of the Secretary of War that it will produce more electrical horsepower from every cubic foot of water l^er second to he ustnl l»y it under such jirant than can be produced by any other company. The foregoing preamble and request was read, considered, and adopted at a regular meeting of the Central Council of Business Men. Taxpayers, and Resi- dents" Assoi-iation of Buffalo, representing upward of 3,000 members, this 11th of September, lim. Willis H. Tf.nxaxt, Srcrctary. Adopteil also l)y city of Lackawanna, city of Lockport, county supervisors of I'rie (^ounty, N. Y. ; village of Williamsville, village of Kenmore. village of Lasalle, village of Youngstown, city of Buffalo. ERIK iV ONT.MUO S.\MT.\KY CAX.M. CO. WA.NTS A SlMU.Al! l.CAXT TO THIS. I I'unLu; — No. 05. | AN ACT CJrantiny; to the Keokuk ;inid Hamilton Water Power Comjiany shall build, coincidentally with the construction of the said dam and appurtenances, at locations api>roved by the .Secretary of War, a lock and dry dock with their aiipurtenances; the said lock shall be of such a kind and size and .shall have such .appurtenances and equipment as shall conveniently and safely acconuuodatc the present and prosi)ective connnerce of the Mississii«i)i River: the said dry dock and its appurtenances shall be such as to give space, facilities, and conveniences for the repair of vessels at least equal to those afforded by the existing Govern- nieut dry dock and .shops at the Des Moines Rapids Canal : And jirovided further. That the said dam and ai)purten.int works sh.ill be so designed, located, constructed, maintained, and operated, and the said lock and dry dock, with their appurtenances, shall be so designed, located, constructed, and equip]>ed. as to permit at all times during the season of navigation, and at any .stage of water, the safe and convenient navigation of steambo.-its and other vessels, or of rafts and barges, throngh the portion of the Mississii>iii River now occupied by the Des ^Moines Rapids, as well as through the entire length of the pool formed by the said dam: And provided further. That detailed plans for the construction and operation of the said dam, lock, dry dock, and aitpurte- iumt works, shall be submitted to and approved I>y the Secretary of War before the connnencement of any jiortion of the said works: and the said works shall be constructwl under tb.e supervision of some engineer officer of the Army designated for that jmriHise. and that after the apjiroval of the said plans no deviation therefrom shall be made with()Ut the prior approval of the Secre- tary of War of any such deviation: .1//*/ providid further. That compensation shall be made by the said Keokuk and Ilannltori Water Power Comp.any to all I>erson.s, firms, ov corporations whose lands or other property may be taken, overflowed, or otherwise damaged by the construction, maintenance, and opera- tion of the said works in accordance with the laws of the State where such lands or other pro]ierty may be situated; but the United States shall not be lield to have incurred any liability for such damages by the passage of this PltESERVATIOX Ul' .MAtiAUA FALLS. 133 act: And provided further, That wlieu tlie said dam, lock, dry dock, aud appurteuiiut works shall have beeu completed to the satisfaction of the Secre- tary of War, the United States shall have the ownership and control of the .said lock, dry dock, and their appurtenances, and operate and maintain the same. Sec. 2. That the withdrawal of water from the Mississippi Kiver and the discharge of water into the said river, for the purpose of operating the said power stations aud a])purtenant works, shall be under the direction and con- trol of the Secretary of Wiw, aud shall at no time be such as to impede or interfere with the safe and convenient navigation of the said river by means of steamboats oi- other vessels, or by rafts or barges: Provided. That the said company .shall construct such suitable fislnvays as may be required from time to time by the Secretary of Connnerce and Labor. Sec. 3. That, except as provided for below in this section, the Keokuk and Hamilton Water Power Company shall bear the entire cost of locating, con- structing, maintaining, and operating the structures aud appurteu.-inces pro- vided for in this act: Provided. That the United States shall bear the co.st of the supervision of tlie work by an engineer otticer of the Army as provided for in section one of this act. and also the cost of maintaining and operating the lock and dry dock with their appurtenances, after their completion and due acceptance by the Secretary of AVar on behalf of the United States: And pro- vided further. That the Keokuk and Hamilton Water Power Company shall provide, in connection with such lock, dry dock, and appurtenances, a suitable power plant for operating and lighting the same, according to plans and speci- fications submitted to and ai)proved by the Secretary of War. Sec 4. That the act entitled '"An act granting to the Keokuk and Hamilton Water Power Company right to construct and maintain wing dam, canal, and l)Ower station in the Mississippi River in Hancock County, Illinois."' approved February eighth, nineteen hundred aud one. is liereby repealed. Sec. 5. Tliat this act shall be null and void if actual construction of the works herein authorized be not commenced within five years and completed within ten years from tlie date hereof. Sec 6. That the right to alter, ameud or repeal this act is hereby expressly reserved. Approved, February !», 190o. PROPOSKD BILL FOR CONGRESS. A KILL To jxivf ctTcct to llio tivatv Ix-lw.vn Hip Tnited Stalos and Oi-eat Britain sijjned January 11, 1909. Whereas it is stipulated in Article A' of a treaty between the t'nited States and Great Britain signed January 11. 1909, commonly known as the water- ways treaty, that the United States may authorize and permit the diversion witliin the State of New York of the waters of the Niagara River above the Falls for power purposes, not exceeding in the aggregate a <.iaily diversion at the rate of twenty thousand cubic feet per second, provided the level of Lake ICrie aiul the flow of the Niagara River shall not be apjueciably lowered: and Whereas the prohibitions of Article A' do not apply to the diversion of water for sanitary and domestic purpt)ses and for the service of canals for the purpose of navigation : and AA'hereas it is stipulated in Article lA' of said treaty that the boundary waters shall not be iH)I]uted on either sid(> to the iujiny of health or property on the other ; and AVhereas the cities bordering upon the Niagara IMver and situate in the district contiguous thereto are subjected to epidemics of typhoid fever caused by the polluted water taken from Niagara River, aud considerations of public- health (lemaud the a,l»atement of these dangers without delay: and Whereas the Erie & Ontario Sanitary Canal Co. has been organized under the laws of the State of New York to construct, without State or Federal aid. a canal between Lake Erie ane Niagara Hivei-. iiolluting the water thereof, to the great injury to the health of the i)ersons living along the said Niagara frontier: and Whereas the said canal will be of sufficient depth and width to enable boat^. barges, and other water craft of large tonnange to navigate the same fnmi its beginning on Lake Erie to a point intercepting the Er:e Canal at or near the city of I.ockport. in the State of New York, thereby increasing the efficiency and the value to the public of said Erie Canal; and Whereas the level of Lake Erie w'U not be lowered by the building of said canal so as to interfere with or affect its na\ igability ; and the waters flowing within the Niagara Kiver. now imder the conti-ol of the War Department, shall not be diverteci so as to affect the beauty and grandein- of the volume thereof flowing over Niagara Falls: Therefore, to carry out conservation of health and power. Be it rnnctcd hy the Scnair mid Hnuxc of Rcpresentativs of Ihc United States of Auicrica in Coiit/rcss a-ssemhled. That the Erie & Ontario Sanitary Canal Co., a coriKtration or.ganized under the laws of the State of New York. be. and the same is hereby, authorized to take six thousand (6.000) cubic feet of water per second from Lake Erie and Nia.gara River for sanitary purposes and canal navi- gation and power four thousand four huudreil cubic feet thereof being the remaining part of the twenty thousand cubic feet allowed for power on the American side under said treaty and one thousand six hundred cubic feet thereof being an allowance under said treaty especially for sanitation and navigation, which volume of water shall be taken through three channels desig uated as Buffalo River. Smokes Creek, and Black Rock Harbor. Sec. 2. That the company within two years after the passage of this act shall begin the construction of the aforesaid canal without seeking from State or Nation other aid than that afforded by such cooperation as may properly be effected between Fedenil and State authorities; and the said company shall thereafter with due diligence prosecute the work to completion. Sec. ;'). That in consider.-ition of the aforesaid grant said company shall give to the cities of Lackawanna. Buffalo. T'onawanda, North Tonawanda. Niagara Falls, Lockport, and all other municipalities, public and private corporations and individuals situate or living in what is known as the Niagara frontier, the free usr and perj)etiial right to use the said canal for sewage-dispo.sal purposes and for the carrying off of flood waters caused by storms. Sec. 4. That in consideration of the facilities which it will afford to the com- munities, nuinicipalities. corporations, and individuals enumerated in section three of this act the company shall have and forever enjoy the right to and possession of all the water power which it is possil)le to develop from the volume of water whicii this act permits it to withdraw from Lake Erie and cause to flow through its proposed channels into Lake Ontario. Sec. ."). That the company shall have the right, when Buffalo Itiver shall have been sufficiently deepenetl and enlarged to a junction with the proposinl canal, to make a i)roper connection of said river with said canal, and thereafter cause the w-aters of Lake Erie to flow through s:iid Buffalo River into the said canal. And further, that the said company may make such changes and improve- ments in Smokes Creek, Ellicott Creek, and other streams in Erie and Niagara Counties as will permit water to enter tlie said streams from Lake Erie, and through them into the canal of the said company, and through the same into Lake Ontario. And furthei*, that the said company may build and maintain at the mouths of Smokes Creek and Ei.ghteen Mile Creek such jn-otecting piers and docks as may l)e n«>cess:iry to carry out the purposes and operations of the company, all of whicli construction affecting navigation shall be done under the direction of the War Department. Sec <■>. That (he provisions of this law shall cease to be operative should it be judicially now intornalional treaty doclaivs that waters " shall not l)e polluted on either side to the injury of health or property on the other." The canal company will spend $:!0.0(>O.OnO of its own nx.nev in <-nnstruction and build- ings and will give the use of the canal perpetujtllv to all the people of the Niagara frontier free, without taxation, for sewage disposal and (lood abatement. Niagara River water can then be bad pure without filtration and zvmotie diseases will he decreased over 50 per c<'nt, as has been proved in Chicago. BKIKF OF Mir.I.ARD F. nOWEN. FOR FRIE & ONT.VUIO SANITARY CANAL CO. All of intei-natioual treaty sliould be coveretl in the bill and not Article V only. Jnrisdiction of disposal of water should be retained by Congress absolutely, for purposes of stopping pollution of international waters, as well as for navigation. A precetleut for such a special grant as is asked for by us is that given to the Keokuk & Hamilton Water Power Co., February 9, 1905. A national board of health should be formetl to take full jurisdiction of interstate and international streams and lakes. Conservation of both public health and power should be insisted upon. This particular company that, without appropriations, will stop pollution by turning streams and sewers l)ack from lake and river, should be given a grant equal to the exi.'-ting permits, or at least to the extent of 0,000 cubic feet. The hearing on January G^ 1911, on 11. R. 266SS, before the Committee on Kivers and IIarl)or.s, present our ease quite fully. If tlie Niagara Falls I'ower Co.'s 8.600 cubic feet were producing power at an efficiency of 80 per cent, at the rate of 15.4 gross horsepower per cubic foot, their production would be 105.952 horsepower. With 0,000 feet we will produce 170.100 horsepower. Independent competition should be insisted ui)on. As a conservator of life and health, this company stands 100 per cent above any competitor. New York State is interested from the standpoint that barge canal terminal facilities will be greatly increased, without appropriations. Buffalo is interested because floods will be abated and sewage disposed of, without apin-opriations. Other municipalities on the Niagara frontier petition for these things. The status quo as to the other two companies will be maintained, and they testify that they are prosperous. Medical societies and health officers of the frontier are clamoring for relief. tieu. Bixby testities that the use of the balance of the 20.000 cubic feet on the American side will not unfavorably affect scenic beauty. Industri.-il development to the fullest practicable extent is carried out by this plan. AFTER RECESS. The committee reassembled at 2 o'clock p. m. The Chairman. The committee will hear from Mr. Monahan. STATEMENT OF GEORGE F. MONAHAN, OF DETROIT, MICH. The Chairman. Will you be good enouoh to give the reporter your full name? 'Sir. Monahan. George F. Monahan, Detroit, Mich., representing the Electrical Distributing Co., and the Federal Electric Light Sc Power Co. I might say, by way of prelude, that the Federal Electric Light & Power Co. and the Electrical Distributing Co. are practically, for all practical purposes, identical corporations. In other words, the Elec- trical Distributing Co. is a company organized under the laAvs of the Dominion of Canada, with a permit from the Canadian Government 136 PliKSKIiVATIOX OF NIAGARA FALLS. • to export power from the Canadian side to the Detroit side of the river. The Federal Electric Liofht & Power Co. is a company orufan- ized under the laws of the State of ^Michioan. It is, in a sense, a SLibsidiar}' company, orcanized for the purpose of fulfilling that part of the law Avhich. as we interpreted it. required the formation of a company on this side of the river in order that there might be a per- mit granted by the Secretary of War to a company upon this side to receive as well as a company on the other side to transmit. We are asking that the situation as presently extant be so arranged as to permit the transmission of power from Niagara Falls to the city of Detroit. Perhaps it might not be amiss for me to give to the committee a brief resume of the facts leading up to our attempt to secure Canadian poAver for the city of Detroit. I assume that the committee is more or less familiar with the situation upon theCana- dian side relative to the distribution of power. I need not enter into the activities upon the part of the Civic Federation, so-called, back in 190.5 directed toward the preservation of Niagara Falls. Power companies had already at that date been established, and subsequent to their establishment the Canadian Government, possibly realizing the possibilities of the situation from the standpoint of theii- own citizenship, determined to embark in the enteri)rise of su])plying to the Canadian people power at a cheap rate. As a result of their activities the so-called liydroelectric commission Avas formed, consist- ing of tAvo members of the cabinet and one member of parliament, which commission has been continually in existence up to the present time. That commission contracted with the Ontario Power Co. for delivery to the commission — Avhich represented the Dominion of Canada or rater the Province of Ontario and in a sense the Dominion, as I understand it — certain of the poAver Avhich the Ontario Power Co. Avas then developing. Contracts were made for the deliAery to the hydroelectric commission l)y this company of one-half of the amount of power that Avas then being generated. The manner in which the hydroelectric commission operates, briefly, is this: It procures estimates as to the cost of building transmission lines from the Falls to a particular municipalitA' Avhich desires to have the ]iower extended to that municipality from the P'alls. The municipality itself votes upon tlie proposition as to Avhether or not it desires Niagara Falls poAvei'. Estimates are had as to Avhat the cost Avill be. The actual cost to the Government of the transmission is based upon the municijjality in the Avay of a charge, and the mu- nicipality itself has, as its particular business, to establish trans- mission lines through the municipality itself, and transforming sta- tions. The power is given to the city at cost. As a result of these activities many of the cities in Canada Avere supplied iuul are at present being supplied Avith Niagara power. The reduction in cost, according to statistic^, with which I have somewhat familiarized my- self, is varied, according to the distance of the city itself from Niag- ara FalN. I am credibly informed that in one of the municipalities the reduction amounted to over (U) per cent. Detroit parties became interested about tAvo years ago for the purpose of securing from the Dominion Government authority to export and for the purjiose of procui-ing a contract Avith the hydrot^lectric counnission for the delivery of ]ioAver in the city of Detroit. PRESERVATION OF NIAGARA FALLS. 137 Mr. Cooper. By reduction, do you nietin as compared Avith the power generated by the use of coal? Mr. MoNAHAN. I do ; yes, sir. The contract was finally entered into, but after very energetic work displayed upon the part of the citizens of the city of Detroit who were especially interested. As an indication of the probability of this idea becoming reflected in reduced cost of electricity to the citizenship of Detroit, the company then operating in the city of Detroit used every means within its pov,'er and com- mand, both in the nmnicipality of Windsor, in the Ontario Govern- ment, and in the Dominion Government itself, to prevent any contract being made, or any export permits being granted for the purpose of bringing that power from the Dominion of Canada into the city of Detroit. However, the hydroelectric poAver commission finally en- tered into a contract Avitli our people whereby we were to receive poAver from them as soon as Ave could complete the formalities on this side of the river. That contract is noAv signed and has been in exist- ence for some ])eriod of time, awaiting its completion until the diffi- culties involved in the Burton bill had been obA'iated. Mr. Foster. Are you getting electricity yet ? Mr. MoNAHAN. No, sir. One of the provisions of that contract, and upon Avhich by contract Ave have already obligated ourselves, is that we shall deposit a half million dollars as a guarantee AA^ith the hydroelectric commission, and the amount of $250,000, the first amount required under the contract, Avas deposited. It was deposited on faith of the treaty. The treaty relations Avhich have been in existence betAveen this GoA'ernment and the Dominion of Canada, ratified, I believe, in 11)10, and further brought into efi'ective existence by the appointment of a connnission upon both sides of the riA^er Aviihin the past year. Ivelying upon the treaty and believing that the treaty Avas, as we still believe it to be. the supreme hiAA- of the land, this contract Avas entered into and moneys deposited. XoAv, Ave ask at the present time that the limitations contained in the Burton Act with reference to restricting the importation of poAver into the United States from Canada be removed. We are relying in that request not only upon the fact of the treaty itself, Avhich should be the supreme hnv of the land, but upon the further fact, as has, I think, been satisfactorily demonstrated to the connnittee. that the transmission of poAver from the Dominion of Canada into the United States is not going to interfere Avith navigation and is not going to interfere with the beaut}' of Niagara Falls. AVe are not concerned, 1 may say, at this time in the least Avith the question of Avhether or not on the American side the present restrictions of the Burton Act should be lifted. In other Avords, it makes no ditference to usAvhether the amount at jiresent alloAved — lo.tiOO cubic feet per second — on the American side is restored to 20,000 cubic feet per second, as named in the treaty, or not, because our poAver is to come from the Canadian .side. I^et iue insist, however, that not only in its spirit is the treaty broken by the restricting of importation from Canada into the United States, but it appears to me to be a fact that Ave are doing something Avhich is restrictive ui)()n the best interests of the people of the United States who have an opjiort unity to get this poAver cheaper. We liaA'e tentatively i)laced ourselves upon lecord in the city of Detroit by 138 PRESERVATIOX OF NIAGARA FALLS. papers filed with (lie common council of that cit}', guaranteeing at the very outset of the importation of this power the reduction of the present prevailing i-ate. which is fixed by ordinance, by 20 per cent. Mr. DiFi-:xL)ERFER. What is that agi-eement you have entered into for a rate? Mr. MoxAiiAX. The records themselves of the city of Detroit fix the rate at which power may be sold in the municipality by the cor- porations which are doing business. Mr. DiFENDEKFER. The price per horsepower? Mr. MoNAHAN. The price per horsepower, according to my recollec- tion, is $88 per h.orsepower for power purposes and $113 per horse- power for lighting. That is what commonly goes into the hands of the companies. Now, as to the absolute accuracy of the figiires that I give on that subject, I am not prepared to speak, but it is approxi- matel}^ that. At all events our contract is that whatever rate is estab- lished in the city of Detroit at the present time, according to the records of the city of Detroit for the sale of power by the corporation now doing business in the city of Detroit, our figure is to be 20 per cent less than that. Is that definite? Mr. DiFEXDERFER. Yes. Mr. Cooper. If that contract is accepted would the city ever have an opportunity to lower the rate? Mr. MoNAHAN. Yes. sir; not only that, but it has put those words into our tentative arrangement upon which we proposed to be bound, that the municipality at any time desiring to obtain the rights of dis- tribution belonging to the resident company, which I represent here, may purchase whatever rights that company has at a figure to be fixed by arbitration, and establish municipal ownership. So that we are to an extent under the control of the city itself, and we are per- fectly Avilling to be. The point I desire to insist upon is that by restricting the importation of this power into the United States an injustice is done to the citizens of the United States who ha^-e an opportunity to get this poAver. and the injustice is done, furthermore, without any right reason for it. because different experts have stated here that the importation of this power into the United States is not going to interfere either with navigation or Avith the natural beauty of Niagara Falls. Further than that Congress, of course, as we all know, has abso- lutely no jurisdiction over what the Canadians will do Avith the 36.000 cubic feet 'per second. They can use all or none of it and Ave have no authority to say nay. The deA^elopment of the matter during the past year in the Dominion Government itself has been such as to indicate very clearly, as has alroady been stated by Gen. Bixby before this committee, that Avithin a ])eriod of three or four years the C'ana- dian GoA'ernment. or rather on the Canadian side, every particle of poAA-er which is available under the treaty Avill be used by Canada. Now. it appears to me to be an elementary proposition that if some of the people of the Ignited States have a chance to be benefited bv this poAver at this time, they should be alloAved to receiA-e that benefir instead of tlie benefit going to the Canadians themseh^es. They have more than Ave have by Avay of right to take from the falls for the purpose of generating poAver, and this is the only Avay Ave haA-e an opportunity to get some of what some might consider to be Avhat PEESERVATION OF NIAGARA FALLS. 139 the United States might be justiiied in receiving b}^ reason of the fact of their connection ^vith the falls themselves. Mr. Sharp. Assuming tliat this restriction is removed, is it your understanding that you will then be able to get power from the Cana- dian side Avithout increasing the limitation at present fixed upon -their rights? Mr. ]\Ioxaiiax. The question is not very clear to me. Mr. Sharp. Suppose that the amount of power now taken by the Canadian Power Co. remains where it is, but the restriction as to im- porting that power over here is removed, do I understand that the city of Detroit could still get power without increasing the amount that the Canadians now get i That is. is there any left for them to receive ? Mr. Moxahax. Xoav? Mr. Sharp. Yes, sir. Mr. Moxahax. Under present conditions? ]Mr. Sharp. Yes, sir ; with the restriction off of importation. Mr. Moxahax. Xot as fixed in the Burton bill,' according to my understunding of the situation. Mr. Sharp. Then your contention would be that what you ask is not onl}^ that the restriction be removed but also the full limitation allowed under the treaty? Mr. MoxAiiAX. Exactly, so far as importation is concerned. In other words, I go this far Mr. FosTKR. You do not understand Mr. ^loxAHAX. Perhaps I do not; but I ansAver according to my own light. ?dr. Foster. He wants to know if you ask for anything more than the removal of the embargo upon the importation of electricity? Mr. MoNAHAX. That is what we ask. Mr. Foster. And he wants to know, if the embargo is removed and no further authority is given to Canada to take power from the falls, whether Canada vrould still have some excess electricity still to sell to you ? Mr. MoNAHAN. Oh, unquestionabh'. Mr. Foster. That is your question ? Mr. Sharp. Yes, sir. Mr. Monahan. Unquestionably ; there is no doubt about that Avhat- ever. In fact, Canada has not used anywhere near the full capacity of its limit under the treaty at the present time. Mr. FosrER. Mr. Chairi'nan, for Mr. Sharp's benefit I would like to ask one question. The amount that Canada can take at the Falls is limited by the treaty agreement, just as the amount we can take? Mr. MoxAHAX. Exactly. There is no doubt about that Avhatever. Now, then, the fact that we can supply our citizenship in the city of Detroit with power at a less figure than is noAv fixed, supplies to my mind an irrefutable argument, in view of the statements Avith regard to not destroying the Falls, and the further statement of our not being able to draAv on the Canadians' 36.000 cubic feet per second. Avhy the embargo should be remoA^ed and Ave be permitted to proceed along the lines of our contracts. Some suggestion has been made Avith reference to the impractica- bility of bringing poAver that distance. I Avould not for a single moment offer my individual opinion in opposition to the opinions 140 PKESEEVATIOX OF XIAGAEA FALLS. given by experts upon this subject, because I do not pretend to be an ex].-)ert upon electricity or electrical power or its transmission, but the furthest that anyone has gone thus far in that connection is to say that it is a possibility but not a probability. On that score our own experts, whose decision upon the subject 1 voice, have declared that it is entirely jjossible and entireh' feasible; and the best demon-, stration of the fact that it is not only possible but feasible is that the Canadian Government is read}' now to build its transmission lines from London, Ontario, to Windsor, Canada, for the purpose of sup- plying- Windsor with light: and if the Canadian govennnent and the Canadian electrical experts conversant with this situation are willing to do that, then T think we can fairly well take a chance on it. Furtheruioiv. ^^e are willing to take our stand upon the decision of our experts coupled with the Canadian experts, and if it fails the only persons to lose are ourselves, Mr. Shakp. To whom would you distribute this power: to what class of purchasers or customers? Mr. MoxAiiAN. -To all classes. Mv. Sharp. Consisting largely of manufacturers? Mr. MoNAiiAx. Oh, we should distribute to manufacturers and customers generally in the city of Detroit, for lighting purposes in residences and hoPiies as Avell as to manufacturing institutions. Mr. Sharp. AVould it go to the city itself for lighting? Mr. MoxAiiAx. The city has at the present time a municipal light- ing plant with which it does its own lighting, but it is entirely within the possibility of things that the city might want to take our light at the reduced cost at which we could deliver it within the confines of the city of Detroit. Mr. Sharp. There is a separate company organized, T snj)pose. under the ^lichigan laAvs, at least in Detroit, to handle this power that yoii get from the Canadian side in the event this goes through? Mr. MoxATiAX. Yes. sir: the Federal Electric Light & Power Co. This, gentlemen, is very briefly an outline of the situation that I desire to suggest and present to your committee. I had in mind to discuss the matter rather more extensively than I have presented it. but I find upon listening to the subject made by Gen. Bixby and by (len. (Jreen and others that many of the features that I thought might be necessary to be covered for the purpose of clearness have already been fully developed and conclusively covered by them. I will there- fore say in conclusion, insisting upon the fact that the treaty should be the law of the land and insisting further upon the fact that we are only asking to be allowed to take this power Avhile we have a chance to get it, Avhile in three or four or five years that chance may have passed and our ])eople have been deprived of the chance to use the power fnwn the Canadian side. In view of those circumstances, it Avould be, in our opinion, incumbent upon the committee to advise that the restrictions upon the importation of power at this time be removed. Tf thei-e are any further questions, I shall l^e glad to answer them. Mr. Sharp. How long is this contract for? Mr. ]MoxAiiAx. We have the contract during the term of tlie exist- ence of the Ontario Power Co. — approximately 30 years. Mr. Cooper. Tf this ])OAver goes to Detroit, of course it will go to Windsor. Canada, also? PRESERVATIOISr OF NIAGARA FALLS. 141 Mr. MoNAHAN. Yes. Mr. Cooper. And when the power reaches that city the munici- pality of Windsor will distribute it? Mr. MoNAHAN. No, sir: it will distribute it to its own people, but it will not distribute it to us. Mr. Cooper. That is what I mean. I understand that, but the municipality of Windsor and not a corporation formed for the pur- pose of disti-ibuting electricity will distribute this power to con- sumers in that city of Windsor? Mr. MoNAHAx. Yes. sir. Mr. Cooper. And at cost ? Mr. MoNAHAN. Yes, sir. Mr. Cooper. With no profit? Mr. MoNAHAN. Yes, sir. Mr. Cooper. And therefore at a less cost than it will be distributed to consumers in Detroit ? Mr. MoNAHAN. Yes, sir. Mr. Cooper. So no effort will be made in the city of Detroit to have the municipal council enter into a contract by which it could directly secure this power ? Mr. MoNAHAN. I have no knowledge of anj^ such effort made by the council of the city of Detroit. In fact, I can definitely state that no effort has been made by the municipal authorities themselves. Mr. Cooper. If you do secure the contract with the Ontario people, 3'ou could not get it anyway ? Mr. MoNAHAN, That is true, but at the same time we do not pre- clude the city from doing it if they see fit to do it. We saw the situa- tion and took advantage of it. If the municipality had seen fit to do it, I do not suppose the citizens would have made any effort in that regard. Mr. Cooper. It is only recently, Mr. Monahan, isn't it, that the generation, the insulation, and the carrying of the electric current for so long a distance as 220 miles has been considered feasible practically and profitably? Mr. MoxAiiAN. I think that what you state is in a sense true. Mr. Cooper. So the city could not be justly charged with laches because it did not get hold of this as quickly as you did? I do not mean, of course, that you were not perfectly justified in what you did. Mr. Monahan. Certainly; I did not intend to charge neglect on the part of the authorities of the municipality of Detroit at all. Mr. Harrison. Have you given any study to the legal proposition as to whether or not Ave have legal jurisdiction over the transmission of power from Canada into the United States, or whether or not that is a matter coming within the jurisdiction of the States? Air. MoNAiiAN. I have given the subject some study and I think that, in so far as the importation of current from the Dominion of Canada into the United .States would constitute an interference with navigation, possibly under that construction the United States might have some jurisdiction. Mr. Harrison. Over the regulation of rates that would be charged by ])0wer companies? 28305—12 10 142 PRESERVATION OF NIAGARA FALLS. Mr. MoxAHAx. I doubt that very seriously. I would say in further answer to the question, a certain bill has been presented by Congressman Smith, covering this subject and maintaining that we -should be obliged, on the American side, both at Buftalo and at the city of Detroit, to sell our power at the same price that it is sold for in Canada. I do not intend to waste much time before the committee on any such proposition, but merely advert to it. The Canadian Government builds its own transmission lines, it sell^ to its own people at cost. We can not. by any possibility, compete Avith anv such proposition as that announced in that bill. AVe would have to sell for more than it sold for in Canada in any event, because we are farther distant than Canada, and in the second place, we have got to pay to the Dominion commission at the city of Detroit, for poAver, 10 per cent more than the city of Windsor pays for it. So it is absolutely impossible that that can be done; and furthermore, as a matter of argument, I would say that the fact that we can not possibly do it is no argument against our doing the best we can and getting it at a very substantial reduction anyhow, over the price we are forced at the present time to pay companies which generate electricity from some power other than water power. Mr. DiFENDERi'-ER. Mr. Monahan, you have presented this case, in my judgment, very clearly, and that has prompted me to ask this question : AVhether, in your judgment, it would be feasible to have this matter in charge of the Interstate Commerce Commission, and charge the Interstate Commerce Commission with the distribution and regulation of this electricity. Mr. MoNAiiAN. The question is a new one to me as to whether or not it would involve further enabling legislation in order to put the matter at all under the jurisdiction of the Interstate Commerce Commission is a question that I would not care, at the present time, to offer an}' opinion upon which would be of any substantial value to this committee; but I do say this: That so far as we are con- cerned, from a more practical standpoint, if this committee, after full deliberation of the subject, comes to the conclusion that it has such jurisdiction over the importation of power to the United States from Canada, we are perfectly willing to be placed under any rea- sonable regulation in that regard, which, in the judgment of this eonnnittee. is requisite and desirable in order to preserve the rights of the citizenship of our toAvn. Mr. DiFJ^NDERFER. The reason I asked that question is this: I am a representative of Pennsylvania. A certain portion of our State is quite close to where this power is transmitted. NeAv York has its commissi(m; Pennsylvania has none: Ohio has no commission, nor has Michigan, as I understand it. Mr. MoNAHAN. ISIichigan.has a commission. Mr. Sharp. Would you claim. Mr. Monahan. later on. after you had this contract, that it was a question of vested rights, and that therefore Congress had no poAver to intervene, as the riparian holders noA\^ claim: that it is a A'ested right that aac can not interfere with? Mr. MoNAiiAN. I can not ansAver for the future in that regard. Mr. Sharp. AVhat Avould be the temptation? Mr. Monahan. I thiidv the tiMuptation Avould he xevy great. Mr. Cooper. Your present opinion is that you Avould yield to it? PRESERVATION OB^ NIAGARA FALLS. 143 ]\fr. MoxAiiAX. If you are asking me for my individual opinion, and what I would do, I think I would yield to that temptation; j'es, sir; but I can not tell whether or not the company itself would feel more generous. Mr. DiFENDERFER. It would be well enough to safeguard it from the beginning? Mr. MoNAiiAN. On the part of the (lovernment ? Mr. DiFEXDERFER. Yes, sir. ]Mr. MoNAHAx. I think that would be judicious; yes, sir. ]Mr. DiFEXDERFER. You are very frank in your statements. Mr. MoxAHAx. If I should say anything else, I know the commit- tee would know I was not representing the facts. If there is not anything further, gentlemen, I thank you for your time. The Chairmax. AVe will now hear from Mr. Scovell. You can proceed, Mr. Scovell. STATEMENT OF J. BOARDMAN SCOVELL, OF BUFFALO, N. Y. The Chairman. Whom do you represent, Mr. Scovell ? Mr. Sco^-ELL. Simply myself, as a citizen of the State of New York and a resident of the Niagara frontier. Mr. CuRLEY. Do you represent any of the companies that are oper- ating in that vicinity ? Mr. Scovell. I do not. For nearly six years the Kooseveltian Ke- publican policy of standpat has applied to the Niagara pov.er situa- tion in the Burton legislation, and therefore I come before you to- day with the immense relief that we have a committee with a chair- man and majority in favor of a policy by reason of their political views, which coincides with that of the State of New York, or the officials of the State of New York who are pledged to see the utmost made available at the earliest possible time of our natural resources, I feel that it is necessary for me to revieAv somewhat the history of the position of the State of New York, in the past, no\v, and what it should be, with relation to the Niagara Falls park, both from the standpoint of scenic beauty and of Niagara Falls power development, and these things necessarily touch upon, what has been done on the Canadian side. As long ago as 1884 I remember with gTeat pleasure having attended the opening of the New York State Park, purchased at great expense by the State of New York, and placed under the control of a commission in order that the public — not merely the ]:)ublic of New York State, but of the entire United States and of the whole world — might have access to the beauties of Niagara free of cost. They removed all things which could be considered an eyesore in the district included by the park. Mills, which formerly stood on Bath Island, now called Green Island, after Commissioner Green, and anything within the territory which tended to affect or injure the scenic beauty were removed. This park extends up Niagara River to what is called Port Bay, or the entrance to the canal of the Hydraulic Power Co. It extends out into the Niagara River to the international boundary line. It extends down, follow- ing the international boundary line, to the properties at the outlet of the Hydraulic PoAver Co.'s canal. New York State itself being the riparian owner, as I understand, between the intake and the outlet of the Hvdraulic Power Co.'s canal. 144 PRESERVATION OF NIAGARA FALLS. If you will take the time to glance at a little circular Avhich Gen. Green has furnished to each member of your committee, on the first page you will see a picture of ^siagara Falls. If you have this before 3'ou it Avill enable you to understand the toiDographj' somewhat bet- ter than you otherwise would, the important factor being that the State park, which includes the islands which separate the American channel from the Horseshoe channel — the line of breakers comes below the head of Goat Island, and the State park extends above the line of breakers approximately half a mile. On the Canadian side you will see, near the crease in the center, one power plant at the right hand and another at the left. The one at the right is the Canadian and Niagara Falls Power Co.'s plant; the one at the left is the Electrical Developrxient Co.'s plant, both up there below the line of breakers. It is apparent that it is a physical impossibility for the water taken by those two companies in anywise to affect the flow of water over the American Fall. The State of New York in creating the XeAv York State Reservation of Niagara specifically pro- vided in the act that no Avater should be diverted inside the park limits for power purposes, and so it came about that no water is now diverted by the companies taking ])ower. nor have any rights been given under other charters to other companies to take water from Niagara River above the Falls, except at points above the New York State reservation. The Chairman. How many acres are there in the Niagara Park? Mr. ScoATELL. I could not estimate it. I should say that up the river it varies from a width of 300 feet to perhaps COO feet, lower down, including the bed of the stream and the islands in the stream to the international boundary line. The result has been, however, that on the American side the power companies taking Avater for power purposes take it from what is known, as you will find in the report here, as the Grass Island Pool. Consequently they divert from a point sufficiently far up the river and from the two channels in proportion to the relative flow from cither. In the report of the engineers. Avhich is before you. you are informed that there are practically 10,000 cubic feet per second going over the American Falls, and the balance of 205,000 cubic feet per second is going over the Horseshoe Falls. Mr. Sharp. How much over the American Falls, did you say? Mr. ScovKLL. Ten thousand cubic feet per second. Three years after we opened our park on the American side the Ontario government, in celebration of Her Majesty's Jubilee, created on the Canadian side a park system, opened it to the public, and gave to a commission appointed by it supreme power over that park. I was employed as counsel in the case of the Queen v. Colt, in which were developed the rights of the park commission with respect to the wliirlpool and the rights of the Dominion Government of Canada, as compared Avith those of the Ontario government, to control the bank of Niagara and the waters, it being determined in those pro- ceedings that they lay in the Province of Ontario. After the crea- tion of these State parks — the State park on the American and the Provincial park on the Canadian side — there arose an agitation for the harnessing of Niagara, and the State of New York granted in the neighborhood of 12 different chartei^s to take Avater from Niagara, all of Avhich have been repealed Avith the exception of 3 — 1, the PRESERVATION OF NIAGARA FALLS. l45 Hj^draiilic Power Co.'s rigflits are not by charter from the State, they being an organization under the stock corporation law, whose rights as riparian owners have been given by legishitive act rather than by charter rights from the State. The first of these charters was granted to citizens of the city of Niagara Falls in the year 1886. And the compan}^ was known as the Niagara River Hydraulic Power, Tunnel, & Sewer Co., and by several acts mandatory of that we now have under that original act the Niagara Falls PoAver Co., the pioneer company in the development of electric power from Niagara waters, the Hj^draulic Power Co. having been there for many years and having diverted water from Niagara River, not for the purpose of generating power or for the production of hydraulic power, their rights to the production of electric power having followed those of the Niagara Falls Power Co. In the 3^ear 1891 certain residents of the village of Lewiston acquired a charter known as the Niagara County Irrigation & AVater Supply Co. for the purpose of bringing water by a public waterway from the upper river to the lower river in order to supply pure water to villages and in order to generate power. In 1894, three years later, residents of the city of Lockport applied to the legislature and acquired a charter to take water from Niagara River, via Lockport to Lake Ontario, and that charter is still unrepealed, but they did not comply with the requirements with respect to canal construction and that charter is now the Niagara, Lockport & Ontario Power Co., which distributes for the Ontario Power Co. of Canada through western New York and which Gen. Green represents before you as its president. It was the policy of the State at that time to grant the rights for the production of power because of the agitation for the harnessing if Niagara. This Avas accomplished, as I said, by the Niagara Falls Power Co.. the initial installation being something like 15,000 horse- power, their charter rights being for 200.000 horsepoAver, 100,000 by a tunnel, and a like amount, if they subsequently so decided, by another tunnel. Later still, in 1896, the hydraulic company obtained from the State of New York, by a vote, two-tliirds being present and voting, con- firmation of its right to take Avater. All of the other charters, granted to all of the other companies, had been granted, three-fifths l>eing present. In 1895 I was retained by the Niagara Irrigation & Water Supply Co., and for 11 years Avas its attorney. I wish to cor- rect Mr. Bowen's assertion of yesterday that I am its attorney ; I was its attorney. Since the 1st of July, after the passage of the Burton bill — 9th of June. 1906 — I have not represented that company, but for 11| years I did represent it. and thereby became familiar Avith the conditions at Niagara. My home being at LeAviston, on the Niagara, and my laAv practice in Buffalo, I have become familiar and kept so as to the conditions surrounding the development. Prior to the enactment of the Burton bill, except for the restriction of 200.000 horsepoAver for the Niagara Falls Power Co. and except for the re- striction of the size of the canal for the hydraulic company, which made it possible for them to take 95,000 cubic feet, there Avas no re- striction, both the Lockjyort and the Lewiston companies having no restriction placed upon the amount they might take. When the agitation came for the preservation of the Falls all the outstanding 146 PEESERVATIOX OF NIAGARA FALLS. charters except those mentioned were canceled by act of the legishi- ture. Negotiations for the construction of the canal from the upper to the lower river had been comi)leted to the extent of the under- writing of the securities in March. 1906, and about $325,000 had been expended at that time. The passage of the Burton bill held up, and is still holding up, any ])Ossible development under that charter. You will find the hearing before the Kivers and Harbors Couimittee on the Burton bill in 190G, pages 15 to 45. the position of that com- mittee at that time. \Mien the Burton bill was passed it recited its purposes as they have been brought before you at this session and the several condi- tions as to the navigation of the river; its effect on the (ireat Lakes; its effect upon the boinidary and upon the scenic beauty have all been fully reported upon to you in the report of the War Department, as was required by the terms of the act itself. But there are certain things in connection with that act which I feel it is important to call to your attention, and one of the first is this : That in the grant of the right to take 15,000 cubic feet of water from Niagara Eiver for power purposes to the companies then actually producing power, that was conditioned in two different ways. The first was, '' But permits for diversion shall be issued only to corporations as aforesaid and only to amounts now actually in tise or contracted to be used in fac- tories the buildings for which are now in process of construction." That restriction made it impossible, until there should be a change in the Burton law, for the use in the United States of any more power generated on the American side than was then either actually pro- duced or under contract. So that from that time until now, if that was truly carried out at that time, there woidd have l)een no oppor- tunity for an industry to come to Niagara to purchase Niagara Falls power as a nevN- proposition. It was only power that was previously contracted for Avhich coidd be generated. They went on with their power development for the purpose of completing it and fulfilling the contracts previously made. We have, therefore, been limited to the importation of power from the Canadian side under the permits gi'anted by the Secretary of War up to 100,000 horsepoAver for the development of new industries. There is another factor, however, of the Burton bill of still greater importance, and that was this additional limitation that we heard nothing about in all the discussion here: No revocable permits shall be issuetl by the said Secretary under the i»ro- visions hereafter set forth for the diversions of additional auionnts of water from said river or its tributaries until the approximate amount for which i>ei'- mits may be issued as above, to wit. 10.200 cubic feet per second, shall for a p<.>riod of not less than six months have been diverted from the waters of said river or its tributaries. There was no intention at the time of the passage of the Bin-ton bill to stop the development of power froui Niagara water. An oppor- tunity was given to the couipanies then actually producing i)ower to actually divert 10,600 cubic feet, to have that condition continue for a period of six months and then the Secretary, having determined by his observations Avhether or not the scenic beauty of Niagara had been damaged, could go further and grant additional i)ermits either to those couipanies or to any other companies which had the right to TEESEKVATIOi^ OF JS'IAGAEA FALLS. 147 take AvattT from Niagara Kiver for power purposes under authority given to them previously by the State of Xew York. ]Mr. CooPKK. That seems to me one of the most striking things that lias been disclosed in this whole discussion and one of the most vitally important. Now, let us see if I interpret that correctly. If they did not use up to the maxinuim what the}^ were allowed under that act, there was no way for the Secretary of War to issue a permit to anybody else, was there? Mr. ScovELL. There Avas not. Mr. Cooper. And all they had to do to block him was to go not quite up to the maximum? Mr. ScovELL. They have not A^et reached the maximum, and nearly six years have elapsed, although at that time the whole output up to that maximum must necessarily have been contracted, and they have not made other contracts. Mr. Cooper. Exactly ; that is Avhy yesterday I thought that there was something the matter with the discussion about the failure to issue permits. If they did not use all they Avere entitled to use under that permit, the maximum amount for six months Mr. ScoA'ELL. That Avas on the Canadian side. Mr. Cooper. Well, say on this side — and the Secretary of War, then, Avould have no opportunity to see Avhat the effect on the Falls Avas, up to that maximum, would he? Mr. ScovELL. No. Mr. Cooper. And therefore he could not issue any new permit? Mr. ScovELL. No ; and he has issued no neAv permits. Mr. Cooper. He could not. All they had to do to stop it Avas to not use the amount they Avere entitled to use. ^Ir. Watrous. Do you think there is a maximum clause that applies to the Canadian side? Mr. ScovELL. I do not knoAv anything about that; I could not say. Suffice it to say, under the provision of the Burton Act up to such time as a treaty should be reached there was no reason Avhy up to that time additional grants of poAver might not haA'e been made. Mr. Sharp. Hoav much Avas that of the maximum amounts? Mr. ScovELL. I could not say exactly; it is in the reports here. It is very near. Do you knoAv, ISir. BroAvn? Mr. Broavx. I can not say exactly. We have been using all of our water. Mr. DiFEXDERFER. Ma^ recoUectiou is it is 13,800 cubic feet per second, and they are permitted to use a total of 15,600. My recollec- tion is it is 13,800 at the present time. ^Ir. Broavx. May I ask a question? If the maximum in any one second Avere 15,600, we Avill say, then as a nuitter of practical opera- tion, if a company or combined companies were prohibited from using as a maxinuun in any one second a quantity beA'ond 15,600, as a matter of practical operati(m could you expect that for a period of six months you Avould find an operation that would average anything except something less than 15,600? jSIr. ScovELL. I think the interpretation would be put on that, at the rate of — such as you desire to put into the ncAv act. Mr. Broavx. AVe can arrange the ncAv act all right. But is it not a fact that tlie engineers have construed the present act to be the maxi- mum in anv one second? 148 PRESERVATION OF NIAGARA FALLS. Mr. ScovELL. 1 think rhat is true, Mr. Brown, but at the same time there remains undeveloped water of the hydraulic company under the terms of their contract. ]\Ir. DiFENDERFER. This difference remains, between 13,800 and 15,600 ? Mr. ScovELL. That is the difference. There has never come a time when they have had 15,600 cubic feet of water diverted for the genera- tion of electric power for any period of time sufficient to enable the provisions of that portion of the act to be applied and their company to appl}' for more power or any other companj' to apply to the Secre- tary of War for poAver. The purpose of the act itself as recited in the fourth paraaraph was that the President of the United States be requested to open negotiations with the Government of Great Britain for the purpose of efl'ectually providing for such regulation of the water of Niagara Elver and its tributaries as will preserve the scenic beauty of that river, and it was because of that provision in section 4 that the company I then represented did not attempt to contest the constitu- tionality of the Burton Act. It would take longer to contest that successfully than it would to negotiate a treat}', and a treaty being the supreme law of the land we would be bound by it, and so our efforts were directed toward the wording of the treaty, and, as I understand, the two companies' efforts which were taking water from Niagara River, instead of being directed toward the testing of the Burton Act, were also directed toward the wording of the treaty, there never having been any test of the constitu.tionality of the Bur- ton Act. It Avas continued from time to time until the present time, and it will continu.e until the 1st of March next. Personally I think the United States Supreme Court's decisions, by reason of the wording of the title, would probabl}^ result in the upholding of the act, although the intention was manifestly without tlie scope of the power of Congress. Mr. Sharp. Did these two companies then frame up this treaty? Mr. ScovEMi. I am reaching that. The next paragraph, however, of the Bui-ton bill must be considered, and that is section 5: '"The provisions of this act shall remain in force for three years from and after the date of its passage '' — and that has been extended — " at the expiration of which time all permits granted hereunder by the Secre- tary of War shall terminate unless sooner revoked by the Secretary of War, and nothing herein contained shall be held to confirm, or estab- lish, any rights heretofore exercised.'' Because of the continuation of that act in that form, the Presi- dent of the United States said to me that if Congress should ad- journ — this was last spring — without having extended the Burton Act he would by P^xecutive order permit the companies now taking water to continue to take water pending the action of Congress. So you can not allow the Burton bill to die and do nothing. The wording of the fifth paragraph of the treaty itself says that the United States may authorize and permit the diversion. The United States in authorizing and permitting does so under an act of Congress, and until there is congressional action there is no right to divert, and the present diversi(m exists only by reason of the ex- istence of the Burton bill. With the death of that all permits are PRESERVATION OF NIAGARA FALLS. 149 revoked that are outstanding. It is therefore necessary that some legislation be had between now and the 1st day of March, either an- thorizing the continuance of the present conditions or determining on a policy and following that, and I am here V)efore you to-day, more particularly for the purpose of making some suggestions along the line of such legislation as your committee should see is passed in Congress under the fifth clause of the treaty. The Chairman. In that connection, suppose the Burton law had not been extended by resolution of Congress what would be the consequence ? Mr. Scov'ELL. The terms of the treaty specifically provided in sec- tion 5, " so long as this treaty shall remain in force, no diversion of the waters of the Niagara Eiver above the Falls from the natural course of the stream shall lie permitted except for the purposes and to the extent hereinafter provided." The treaty contained an abso- lute prohibition, and after the Burton bill expired, and after the per- mits threby ipso facto were revoked, the treaty coming into effect, no one had a right to take water from the river pending congres- sional action, except as the President stated. The Chairman. The Burton law expired last June, did it not? Mr. ScovELL. It did. The CHAiR3k[AN. And Congress took no action regarding its ex- tension until last August? Mr. ScovELL. Quite true. The Chairman. Had all these permits expired during that time? Mr. ScovELL. Except as they were renewed by the continuation of the Burton bill. Mr. Garner. Let me get your cfmclusioiis, if I may. Your j)osi- tion is that if nothing is done until the 1st of March, the permits will all be revoked? Mr. ScovELL. It is so provided in the Burt(m Act itself. Mr. Garner. That applies to the Canadian as well as the Ameri- can permits? Mr. Scovell. Permits to import. Mr. Garner. Does that apply to American permits to take water from the Niagara River? Mr. Scovell. It does. Mr. Garner. Now, you say that in case Congress did not take any action and the Burton law expired, the President would issue an edict? Mr. Scovell. To hold things in statu quo until Congress acted. Mr. Garner. Has the President that power under our Constitu- tion? Mr. Scovell. I do not think so. Imt I think that is the wise way to do it. Mr. Garner. If that is true we might just as well adjourn and let the President settle the matters to suit his convenience. The Chairman. Is it your contention, as a legal proposition, that the rights under these permits nil expired last June when the Bur- ton Act lapsed? Mr. Scovell. At that time no one wished to contest the question; no one wished to stop the power. There was too much at stake. Mr. Green. The Burton law expired on the 21)th of June. We heard nothing from Washington and we went on with our business 150 PRESEEVATION OF NIAGAEA FALLS. as usual. On the 21st or 2'2d of August the Burton bill was revived to the 1st of March. A few days after we received from the Secre- tary of War, without application, new permits reading exactly like the old ones. Mr. Cuoi'EK. General, that would imply that the department ex- tended the law just as -Mr. Scovell said; new permits were issued? Mr. Green. When the Burton law was revived. Mr. Scovell. There was nothing done, because in that case there was no question raised. 'Mr. Cooper. Exactly. Mr. Greex. I simply bring this matter before you as a conunitte to emphasize the importance of definite action on your part rather than allow things to go on and let the treaty be the supreme law of the land. Maj. Ladue. Mr. Chairman. T can add a little to what Mr. Green has just said, \^^len the Burton Act expired on June 29 we notified the officer in charge of the lake survey to stop his supervision of the operati(ms of the power companies under their permits. Up until the 29th of June we had hoped that Congress would take some action, but no action having been taken we were not entirely clear in our own minds as to what we shoidd do next. We proceeded to take the question under advisement to consider what should be our next step; the Burton x\ct being apparently dead, and the permits granted under its provisions being apparently dead. Before we had resolved upon the proper course to take, Mr. Chairman, Con- gress unexpectedly reenacted the Burton Act, whereupon we recom- mended to the Secretary of War that, the act being restored, the permits be innnediately reissued under the old terms, to continue as long as the restored or revived Burton Act continued in force; that is. until the 1st of March. Mr. Cooper. Major, did you consult, Avhen the Burton Act expired, with any legal officer as to the effect that had on the permits? Or did you take it for granted that ipso facto they expired also? Maj. Ladue. I presume the Secretary of War consulted with the Judge Advocate General: T think he did, sir. Of course, the chief of engineers did not take this action u])on his oAvn responsibility. He recommended it to the Secretary of War. Mr. Cooper. And you consulted in your bureau with the Judge Advocate General? Maj. Ladue. I think the Secretary of War consulted with him. Mr. Cooper. The Secretary of War: and then you were in- formed Maj. Tvadi E. That our recommendation Avas approved. Mr! Cooper (c(mtinuing). That when the Burton Act expired the permits expired also, and so you issued new ]:)ermits when the Burton was revived? Maj. Ladi E. Thas was. essentiallv. the action taken. Mr! Cooper. You looked u]i()n the law as ]\fr. Scovell has here stated it? Maj. Ladue. AVe understood it so. Mr. Scovell. During tlie time that the treaty was under considera- tion, at the suggestion of the then mayor of Buffalo T came to Wash- ing in oi^position to the treaty, and I also was in comnnmication with the Ontai'io Government in opposition to the treaty. The at- PRESERVATION OF NIAGARA FALLS. 151 titude of the cit_y of Buffalo at that time being one in which they de- sired an opportunity to get power at better rates. They were caUed " the electric city." but we are not getting the advantage of being the electric city b}- reason of the fact that the power was sold at Niagara Falls by the Niagara Falls Power Co., to the Cataract & Conduit Co., which transmitted it from Niagara Falls to Buffalo^ and sold it at Buffalo to the Buffalo General Electric Co., which distributed it from the conduits to the city, and there being neces- sarily three profits, of course the cost to the consumer in Buffalo was somewhat higher than Buffalo has expected. The opposition to the treaty was twofold, but the principle was that the limitation of 20,000 cubic feet on the American side was too small. IIow that was reached has been explained to you here by reason of the reports of the engineers as to the amounts allowable to the full capacity of the plants of the two companies then actual !}• producing power. At the hearing a year ago this month I made the assertion that the Niagara Falls Power Co. wanted 1,400 cubic feet more in order to complete its' planned 100,000 horsepower develop- ment, and that the Schoelkopf ( ? ) Co. wanted 3,000 additional feet in order to bring it from 6,500 to 9,500, the amount of water which a channel the size allowed by the act permitting it to take power would carry ; and that those facts determined wlw the fact that 4,400 addi- tional cubic feet of water was increased on the xVmerican side under the treaty. That was not admitted at that time, and I was therefore surprised and pleased that my guess, if such it was, of a year ago was repeated yesterday by my friend Mr. Brown. The additional 4.400 can be developed in that way between the two existing com- panies at Niagara Falls, and a question of riparian rights as between them has evidently been reached. The Niagara Falls Power Co. develops from 136 to 138 feet of head, obtaining approximately 10 horsepower per cubic foot. They have installed two wheel pits in each of which they have genei'ators for the generation of 5,000 horse- power. They have installed 21 of such generators, making a total of 105,000 horsepower, one generator being held in reserve, as we are informed, for the purpose of switching in in case of trouble. The plant is considered and is called a 100,000 horsepower plant, but on the basis of 10,000 horsepower per cubic foot being produced and the limitation contained in the Burton Act to get the full capacity, 1,400 cubic feet more are necessary. Mr. DiFENDERFER. If that 4,400 cubic feet a second were granted, would Buft'alo receive any benefit in rates? Mr. ScovELL. From that particular compan}'? ]Mr. DiFEXDEFER. YcS. Air. ScovELL. I think not. unless some regulations were passed here or at Albany in regard to it. Mr. Ci'RLEY. You say you were engaged by tiie city of Buft'alo? Mr. ScovELL. I say I was requested to come by the mayor. Mr. Ctrley. And you also communicated with the authorities of Ontario? Mr. ScovELL. Yes. Mr. CcRLEY. Can you give the committee some comparison of prices to consumers at both places — Canada and the United States? Mr. ScovET.L. Yes; I will reach that presentl}^ 152 PRESERVATION OF NIAGARA FALLS. You will find from the report of the engineers that the Hy- draulic Power Co.. which was allotted 0.500 cubic feet of Neater under the Burton Act. if its canal is used to its full capacity can take 9,500, which is 3,000 more than the company now has author- ity to take, and that 3.000 at 1.400 makes the "^4,400 which is in dispute at this time. That 4,400 was the increase given over the Burton bill by the terms of the treaty when the treaty was drafted between the two countries, apparently shutting off any other com- panies than the companies then producing power. That conclu- sion was fortified, in my opinion, when after the ratification of the treaty the so-called Alexander bill was introduced, definitel}' giving this 4,400 additional cubic feet of water to the companies then actuall}' producing power. Mr. Sharp. If these two companies did participate in putting the provision in the treaty, why shouldn't thej' shut off the power? Mr. ScovELL. Certainly; why shouldn't they? We are coming to the position the State of New York should take at the present time. Of course, those things were comparatively easy of accomplishment at that time, I think. The Ontario Gov- ernment wanted power to distribute in Ontario by its hydroelec- tric power commission. It was difficult to obtain it. The Niagara Falls Co. had a capital cost of $160 per horsepower, and was in no position to compete with imported power, which could be sold, and is sold now, at $9.40, as you were informed by Gen. Green. It is- therefore important from the standpoint of an American com- pany that a treaty should contain new provisions in regard to the importation of power, and I came here, as I said, at the request of the mayor of Buffalo to insist upon the insertion into the treaty of some provisions allowing power to be imported into the United States from Canada Avithout question. The assurance was finally given by the Dominion Government gind the Ontario Government that an export dutj" would be imposed upon power to be shipped out of Canada unless power was sold in Canada to the hydroelectric power commission at reasonable rates. Their opposition, there- fore, was withdrawn to the treaty, and so we have a treaty to-day in which there are no regulations as to the importation of power, we being limited as it stands to-day to the pledge of the Gov- ernment of Canada to the power companies of permission to export half of their power to the United States, which, however, Canada having a parliamentary form of government, is subject to change. I was connected with a company which exported natural gas from Canada to supply the city of Buffalo. The Dominion Government required us to pipe from our field to Niagara Falls, Ontario, at an expense of an assessment of 150 per cent, which woukl be considered confiscatory here. And after that had continued for two years absolutely, it forbade us fulfilling our contracts in the city of Buf- falo and required us to sell it all in Canada, which is one of the advantages Avhich a government under parliamentary law, which is not obliged to recognize the obligation of contracts, has over a constitutional government. Mr. LiNTTncr.M. Does Buffalo get gas from Canada now? Mr. ScovELL. No. Mr. LiNTHicuM. How long has that l)een? PRESERVATION OF NIAGARA FALLS. 153 Mr. ScovELL. Two years. Tlie power company, ixs was told you day before yesterday by Mr. "Wieks, has ne^■er needed funds. It has been in the position to in- stall the best that could be had. It has the best engineers and the best all along the line. Its financial position — with John Jacob Astor and B. O. Mills on its board — gave it a financial position which is unquestioned. Its political position was assured with Mr.. Mills, son-in-law of ]Mr. Ueid, and with Senator Depew ]Mr. Cooper. Ambassador Reid? Mr. ScovELL. Yes; he A^as son-in-law of the then president. The political position of the company and the financial position of the company made it possible for it to have as strong a position as Niagara Falls itself has in hydraulic [laughter], so that the treaty as we have it limited the United States to 20,000 cubic feet per second. We have got the 20,000 cubic feet, and there are no strings on it. The question now comes, what shall we do with it? The Alexander bill was introduced to provide that it should be given to these two old companies to be divided as they saw fit — and their riparian interests having been adjusted, they saw fit. [Laughter.] The introduction of the Alexander bill resulted in Mr. Alexander's retirement and Mr. Smith's coming from Buffalo to Washington in his place, and you have before 3^ou a bill introduced in Congress by Mr. Smith at the present time to consider. Mr. Foster. I always thought that Buffalo supposed Mr. Smith was a superior man to Mr. Alexander. [Laughter.] The Chairman. You would not have us infer that the introduc- tion of a bill by Mr. Smith will keep him home? Mr. ScovELL. I do not think it will keep him home. It will help some. The hearing on the so-called Alexander bill w^as fixed for the 6th of January of last yesLV. I had previously seen our newly elected go\ernor and on the same day as his message went to the legislature this resolution was introduced, and before they adjourned for the appointment of committees it was unanimously passed by both houses: F.y Senator Burton: Tliat the clerk of the senate be directed to coninnuu- cate with the proper committee of the house of representatives, through its chairman, and request that no final action be taken by its committee on the proposed bill now before it known as the Alexander electric power bill, until the New Yoi-k State anthorilies liave an opportunity to examine its provisions and to be heard thereon. On January 4 that was adopted in the senate. That was on the 4th day of January. On the 5th I obtained a certified copy of that resolution, and on the 6th I appeared before the committee on Rivers and Harbors, which was considering the Alexander bill, but deferred action as requested by the legislature at that hearing in relation to the constitution. Suffice it to say that the committee did not act at that time with respect to the Alexander bill, but deferred action as requested by the legislature of the State of XeAv York. ^fr. Foster. Do you now favor the Smith bill ? Mr. ScovELL. I won't say as to that as yet. Mr. Foster. I thought not. Mr. ScovELL. On February 17 Gov. John A. Dix sent to the Legis- lature of the State of New York a communication with respect to 154 PEESERVATION OF >:iAGARA FALLS. both the Niagara Falls matter and the Lono; Soo. I had drafted a joint resolution to make that eft'ective. and on February' 20. three days later, the senate unanimously adopted the joint resolution in question. The followinjr day. Fel)ruary 21. the same resolution was adopted by a vote of 82 to 47. Mr. Cooper. That was in the other house — the assembly? Mr. ScovELL. In the assembly. It states so fully the position which the State of New York wished to take with respect to the Alexander biH, which disposed of the 4.400 cubic feet of water, that I believe your committee should understand the position of the legislature at that time with respect to that pending bill as an assistance to you with respect to the drafting of suitable legislation at this time. By Senator Burton : Whereas the Coumiittee ou Rivers ;nid Harbors of the House of nepresoiitatives of the I'nited States, in coniiiliiince with the request contained in a joint resolution adopted in Assembly of the State of New York. February 21. 1911. has deferred tinal action on the proposed bill before it known as the Alexander Electric Power bill, j^ending an examination into its provisions by the authorities of the State of New York, and Whereas a coniniunication has this day been received from His Excellency the Governor of the State of New Y'ork in the diversion of water from the Niagara River, which snirsestions should be embodied in the form of amend- ments to the said bill, Resolveil. That the assenibly agree that the legislators respectively request the representatives to use their best endeavors at the present session to effect the amendment of .said bill. First. Which are now actually producing power from the waters of said river or its tributaries be eliminated. That was to prevent the restriction contained in the Alexander bill. Avhereby it ga^•e it to those companies only. In other words, to use the words of my friend. Mr. Brown, the legislature desired that the act of Congress should be more elastic. [Laughter.] Second. So that any permits hereafter granted for the diversion of water from the said river or its tributaries in addition to this — 15,G(X) already recog- nizetl or i.ssued — shall be granted and issued by the governor, having in mind especially such individuals, companies, and corporations as shall be able to satisfy him of ability to develop the maximum quantity of electrical iiower from such limited additional diversion of water. If you will allow me to divert right there, we all know Mr. . of the State .senate, and when he was advocating that provision he said : There is only one argument against tliat provision, and that is ready money, cash in hand. And when the^' voted on it they got unanimous action as a neces- sarj' result. And that such permits shall be issued for such limited i»eriods of time and upon such compensation to the State of New Yoi'k as shall be reasonable and just. That second paragraph announces the policy of the State of New York with respect to those additional 4,400 cubic feet. Third. So that the limitation contained in this act, entitled "An act for the control and regulation of the waters of the Niagara River " — that is. the Burton bill— where by not to exceed was permitted to be granted to any one individual or corporation, shall be restricted in said bill and continued in effect thereunder. The limitation which allowed only cubic feet of water to go to the Niagara Falls Power Co., developed under only 136 feet of PKESEKVATION OF XIAGAKA FALLS. 155 head, was taken out of the Alexander bill, and the State of Xew York says: '" AVe want that i)ut back in, because otherwise a company nii^ht get some additional water which would not be used under the most elective head.*" Fourth. So tbat no privilege arising under any perniil heretofore or hereafter granted shall be without the approval of the iSecretary of War, and no such ap|)roval shall be given until consent thereto by the State of New York shall have tirst been obtained. The object of that provision was to prevent the possibility of a monopoly by dealing!: in i)ernuts. Fifth. So that no electric itower produced by hydraulic power used und<'r any permit granted under this bill shall be transndtted to any point without the State of New York, except with the consent of said State. Sixth. So that the granting of permits shall not be deemed to be required to cover the use of the surplus water of the Erie Canal for hydraulic power pur- poses, but the disposition of such waters shall be and remain tmder the sole jurisdiction of the State of New Y'ork. That is due to the fact that at the city of Lockport the Secretary of War has issued a permit for the takino; of nOO cubic feet of water, which is drawn from the Niagara Eiver, to Lockport through the Erie Canal. It is Erie Canal water which by the terms of the treaty is not subject to its provisions. It is used at Lockport between the upper level of the locks and the lower lever of the locks, and the State of Xew York believes that that oOO cubic feet of water should not be included in the limitation of 20.000 cubic feet per second, or in the minimum limitation of 4,400 cubic feet per second, but that there should be 4,900 cubic feet per second available. On the Canadian side of the Niagara RiA'er and connecting Lake Erie with Lake Ontario is the so-called Welland Canal, which on two diiferent occasions since its original construction has been changed in its line of route, passing through the old city of St. Cath- erines, another through Merritton, and another through Thorold. The waters are taken from Lake Erie, except such as are needed for navigation, and to that extent depletes the floAv through Niagara River, but you will notice that in the wording of tiie treaty no refer- ence is made to the diversion of water from Lake Erie. It is only diversion of water from Niagara River. Along the line of the old canal 1,000 cubic feet of water is used for power purposes. At Falls (me of the finest little electric ])owers in Canada is installed, j^t the several levels of the old canals the Avater is used for the generation of poAver to light the city of St. Catherines, to run the carbide plant — I do not see the gentle- man here Avho spoke yesterday for the Ihiion Carbide Co. — but to furnish the electricity for Mr. Thomas L. AVilson's carbide plant in Canada. Mr. AVilson has a plant at Merritton, and he uses two levels of the Welland Canal poAver for the generation of electric poAver for his use. The State of New York feels that it is quite as much entitled to surplus canal waters as the Province of Ontario or th(» Dominion of Canada, and it has taken the position that in dealing Avith this matter Congress should recognize the right of the State to dominate its own canal and its own surplus Avaters. You therefore ha\'e in that joint resolution the substance of the position taken bv the legislature of the State of New York as recentlv as Februaiv last. 156 PBESERVATION OF NIAGARA FALLS. Mr. Sharp. Are you going, in the course of your remarks later on to suggest something Mr. ScovELL. Yes; unless you ask me to stop before that. Mr. Sharp. I was going to ask you to do it now, if you were not going to do it later- Mr. Cooper. You were going to say something also about the relative costs. Mr. ScovELL. Congressman Alexander telegraphed me on "\^''a.sh- ington's Birthday, the day after the adoption of this joint resolution, that it was then too late in the session to accomplish anything. I came to Washington and had a conference with him. I brought a letter to Senator Burton from the governor, had a conference Avith Mr. Hoot, ])laced in his hands the bill which would embody the amendnionls suggested by the legislature of the State of Xew York, conferred with the Congressman from my own district here, and found that the opinion of all was that it was too late to do anything to extend the Burton bill. I felt that it was desirable that some- thing be done if we could, and I saAv the ranking Democratic mem- ber of the Rivers and Harbors Committee, Mr. Sparkman, of Florida, and he arranged for me to meet the President. Of course. Mr. Taft, as Secretary of War, originally gi'unted the several permits under the Burton act which are in existence. He held hearings at Niagara Falls and is absoluteh'^ the most familiar with the situation of any one of the officials in the executive department of the Government. So that in going to him in regard to the matter I knew that what I had to say would be fully understood and appreciated at once, and as the result of my conference with him he made an appointment for Senator Root, Senator Burton, and Mr. Alexander to meet me at the President's office on the following ^Monday. That da}' the attitude of Senator Burton in favor of Dreserving the scenic beauty by holding us doAvn to 15,G00 cubic feet of water per second on the ximerican side and not allowing power to be imported from Canada Avas still the block in the Avay, and Ave finally agreed to adjourn until 5 o'clock Avhen Ave Avould submit in Avriting statements to each other as to Avhat Ave Avanted. Mr. Shap.p. What Avcre Mi. P)urt()n's reasons for opposing the im- portatijiaoara falls. 157 out being seiil to the joint commission provided for by such treaty. 1 met liim in the Vice President's room, jind I said to him. " In the first place, the joint high commission is cumpc.sed of Canadians as well as Americans, and the treaty has already determined that we are entitled to 20,000 cnbic feet, so the Canadians should not have anything to say about the division of any part of that 20.000 cubic feet. It should be the American members of that joint high com- mission." He said, " I recognize that that is better." I said further, " It should read, ' without the consent of the State of New York and the iVmerican members of the joint high commission.'" He said, "That is the best politics and tlie best law that has been suggested since this matter started." He saw the n:iembers of the conference committee, and I personally went to Mr. Siilzer and Mr. Driscoll and arranged through them so that I met Mr. Tawney and Mr. Fitz- gerald, of Brooklyn, with the result that it was finally agreed that the sundry civil bill as reported out should contain this specific provision. The question of amendment came up in the Senate, as you know, the Burton interests controlled and there was nothing done at the special session which follo^^'^d before the expiration of the Burton law in June. Mr, Root introduced a bill in the Senate and Mr. Simmons in the House. Mr. Simmons's bill being now before you. containing the exact words of the suggestion made. It reads now: No such permit shall be granted allowing diversions of water exceeding in the aggregate 15,600 cubic feet per second without the consent of the State of New York and of the commissioners on the part of the United States in the international joint commission provided for by such treaty. That is the bill, one of the two bills, which you now have before you. The other bill is the Smith bill, which was also introduced at the special session, but neither was allowed to go through because you were considering special matters at that session. The Chairman. Which of the two bills, the Smith bill or the Simmons bill, do you prefer? Mr. ScovELL. I am going to dissect both of tlienL and ask you to develop a bill of your own. [Laughter.] The Chairman. I suppose that is what the committee will have to do. Mr. ScovELL. The attitude of the executive of the State of New York has been communicated by him to lioth of the Senators in this letter : State of New York, Executive Chambkr, Albany, N. Y.' To Hon. Elihu Koot and Hon. James A. O'Gorman. Gentlemen : Permit me to call your attention to the importance of preserving the control of the State of New York over the waters of the Niagara River, authorized to be appropriated by the treaty between the United States and Great Britain on the boundary waters between the TInite an expensive matter to get these details of the cost and, of course, I do not wish to spend the money myself unless this would be received favorably. Of cx)urse, if the gentlemen here feel unfavor- able Ave will dro]) this matter right where it is. INIr. Fos'reR. It seems to me we would have to get a new treaty. Mr. Eells. I do not see what it has to do Avith the treaty. This is unseen altogether. This is all behind the Falls. None of my works are in view. Mr. Foster. I mean with regard to building that wall. Mr. Eells. I do not ask you to spend the money. I will supply the money : I or my associates. Mr. IlARRisdx. How will you be reimbursed for your expendi- tures? Mr. Eells. By the electric i)ower. It will be something like 2,000,000 horsepoAver. AVe propose to use it all : that is, Avhen it is wanted. It Avould not affect the Avater beloAv the Falls. The CiiAiR^MAN. Have you made application to the commission in Canada? PEESERVATION OF ^^lAGARA FALLS. 169 Mr. Eells. I have been over to Canada and they seem very enthu- siastic. You see, the}' charge so much per horsepower for the water which is used, and they see an opportunity of getting more revenue. The Chair3ian. They have most of the Falls. Don't you think it would be a good idea to get their permission first? Mr. Foster. I think you will find us just as enthusiastic as Canada, but I think, perhaps, as the chairman has suggested, that Canada should take the lead. Canada turned us down on reciprocit}' you know. The Chairsean. We will hear Mr. Watrous, the secretary of the American Civic Association. STATEMENT OF RICHARD B. WATROUS, SECRETARY. AMERICAN CIVIC ASSOCIATION, WASHINGTON, D. C. The Chairman. Mr. Watrous, will you give the reporter you name and whom you represent? Mr. Watrous. Richard B. Watrous, representing the Ameiican Civic Association, of Avhich I am secretary. Mr. Chairman, in taking some time at this late hour of the day, I want to say that we had hoped very much that the president of the association might be here this week, for he has been before similar hearings and discussed this subject and is known as an authority upon the subjects we represent, particularly on all matters concerning Niagara Falls — Mr. J. Horace McFarland. At this time I desire to say that he will pi-obably be here next Tuesday, and we shall need, and I presume we can have, additional time to present the case as we see it. The Chairman. We shall be glad to hear Mr. McFarland. Mr. Watrous. In my position, gentlemen. T am reminded some- what of a certain meeting where a revival had been in progress for some time and the minister had asked all those who wanted to go to heaven to stand. The entire congi-egation arose. He had just pro- pounded the question whether there was anyone who wanted to go to the other place when a wayfarer walked in, followed an uneven course down to the front where he stood unsteadily. The minister said, " Are you the only one that wants to go to hell? " He replied, " Well, parson, you seem to be all alone, so I am willing to go with you." I have had a feeling in the presence of this august audience composed of president, attorneys, and engineer experts of the power companies, that I Avas almost alone. But I am not alone, Mr. Chair- man, because I have back of me the hundreds of thousands and millions of peojile of this country who believe that scenic glories such as Niagara Falls are things that have more than a commercial asset. In this connection, may I be permitted to say just a little about the American Civic Association, w^hich has been somewhat maligned in one or two cities represented here to-day, because it has spoken plainly concerning the falls. It is composed of thousands of repre- sentative men and women of this country, including some hundreds of affiliated societies which represent hundreds of thousands of indi- viduals. There is numbered among the members of this association the President of the United States, who joined voluntarily when he was Secretary of War. There are other members in the Cabinet. 170 PRESERVATION OF NIAGARA FALLS. There are influential men and Avomen of all the States. They have been heard from on several former occasions when this matter was to be fought out. You, as Congressmen, and the gentlemen in the Senate, know that you have heard from them in letters and in tele- grams, and they have come from everj^ section of the country. The association represents the consolidation of State and interstate so- cieties organized for specific purposes which are mentioned in the circular which I hold in my hand. I am going to read from that the objects of the association, so that you may know what they are : The cultivation of higher ideals of civic life and beauty in America, and the promotion of city, town, and neighborhood improvement, the cultivation and development of landscape, and the advancement of outdoor art. I am going to ask the chairman for permission to hand that to the reporter to be included in the report of this hearing. The circular referred to is appended, marked "A." I am very glad to be an officer of that association. I also want to state that I am very glad to have had some years of contact with a distinctly business organization, so that I appreciate the value of business organizations — I mean aggregations of capital — and the important service they render to the country. I have never been con- sidered as one who is out continually with a hammer against such organizations. I desire to say — and I know I speak the sentiment of the president of the organization — that it is not because of ill- feeling toward the power companies that we have contended for the preservation of the falls, but for the larger devotion to the people of this country and of the world who appreciate the beauty of a scenic wonder such as Niagara Falls. I have felt this afternoon that we have gotten away from the thought of scenic beauty. We can not forget that all these hearings and the hearings before the Com- mittee on Rivers and Harbors and a large part of the hearings which resulted in the treaty are due exclusively to the idea that Niagara is a scenic wonder and ought to be preserved as such. Difi'erent phases of the question have been presented at length by attornej^s and by engineers, but I believe I am the first one so far to speak of the value of the Falls as an asset to all the people from the standpoint of its scenic glory. I do not want to try to discuss or enter into an argument as to the statement made yesterday concerning the vested rights of the power companies. I am reminded, however, that possibly there is a prior right to the falls, prior to those acquired by the companies there, as possibly illustrated by the photographs we have submitted of pictures made more than 100 years ago — a right of the people to the beauty of the Falls, a right which existed and was used long before we thought of using the water as a source of power. The Chairman. Have you any official records of the erosion of the Falls? Mr. AVatkous. I have not. The CiiAiioiAN. Could you get that? Mr. Spencer. I can get a statement of that and give it to you when I come to speak. The Chairman. We would like to have that go in the record. Mr. Watrous. Mr. Spencer, who has just spoken, is a recognized authority on the Falls. My "bible, however, is the reports, or reports combined into one, of the War Department, particularly of the Corps of Enginers. PRESERVATION OF NIAGARA FALLS. 171 Mr. Foster. Would it interrupt you to ask a question rif>'ht there? 1 think 1 should understand wliat you are saying a irood deal better if I knew Avhat you want to have us to do. Apparently the two Governments have adopted a policy with reference to using a certain amount of water there and have entered into a treaty regarding it. Now, if you could tell us in a word just what you want to have us do, then I could adapt what 3'ou have to say to that statement and go along a little more intelligently. Mr. Watrous. I can tell you. I think, in a few words. I am only going to impose upon you for just a few minutes longer. I want to dwell just a moment on this matter of recognition of scenic beauty as a material asset, and I am going to submit here, to be filed and recorded, a decision in the circuit court of the Ignited States rendered within the past vear or two in Colorado concerning a case between The Cascade Town Co. and The Empire Water & Tower Co. The opinion referred to is appended, marked '' B." Mr. Flood. Mr. Foster did not desire to cut you off. . His idea was for yon to state what you proposed that we should do with reference to this 4.400 culiic feet of water and importing any nu)re \\ ater. Mr. Watrous. I should be very glad to state that. Mr. Cooper. Perhaps Mr. Watrous has his remarks arranged and desires to put them in fn logical order to make them as effective as possible. Mr. Watrous. Briefly, Mr. Chairman, we stand just where we have been standing since we took up the consideration of the preser- vation of Niagara Falls. We stand for the limitations as prescribed by the Burton bill, both as to diversion on the American side, namely, 15.600 cubic feet per second, and the importation of power from Canada, namely. 160.000 horsepower. Our stand is confirmed by the latest reports which have been issued from the War Department, concerning which I shall have something to say. I am going to ask that I may return to the introductory part of my remarks and say that the American Civic Association, in this striving for a preservation of the falls, has had the approval and cooperation not only of individuals but of many of the very repre- sentative business organizations of the countr}', and I want to submit for record a telegram which was sent on the 17th of last February by The Merchants' Association of New York urging in strong terms that the provisions of the Burton bill be extended. The telegram referred to is appended, marked " C.'' With regard to the desire of the city of Detroit to import cheap power, I want to submit to you a letter quoting letters that were sent to Senator Burton and to members of the Senate committee by Mr. J. L. Hudson, of that city, the proprietor of the largest retail store in the city, director of several banks, and a vice president of the board of commerce of that city. The letter referred to is appended, marked "D." I should also like to submit a very strong editorial from the Detroit Times of July 3, 1911. entitled,' "Every pound of power from Niagara is a pound added to the people's load." The editorial referred to is appended, marked " E," Right here let me say that the power companies themselves may thank the American Civic Association for having been very zealous to secure the reenactment of the terms of the Burton bill. For some reason or other it seemed to have been overlooked that with the expiration 172 PRESEEVATIOX OF NIAGARA lALLS. of that bill there would bo no license for the iis^e of water or im- portation of power. At the time T appeared before 3^011. in June. T submitted, as the best evidence of that action, a letter, written on the 27th of June by the Secretary of War to the Speaker of the House of Repsentatives. stating the exact situation and telling what would happen with the expiration of the bill. I submit that letter again. The letter referred to is appended, marked " F." I believe that all of us are agreed that legislative action is neces- sary. I certainly am convinced — because I know of its efficiency and because I have a natural affection for the Army — -that the War De- partment should be the de])artment to have control, but there can be no difference of opinion as to the necessit}" for such action. As I said, my Bible, so far as figures and recommendations concerning the diversions of water are concerned, must be the reports of the Board of Army Engineers. We have had presented to us in printed form within the past week or two Senate Document Xo. 105, which con- tains the report of a distinguished Army engineer, Maj. Keller, which was completed. I believe, in the fall of 1908. T at times con- fess to a doubt, Mr. Chairman, that that report, which undoubtedly was called for for the express use of the commission in preparing the treaty, was ever brought to the attention of that commission. For some reason or other its publication has been delayed for more than two years, and we who have been following that question have not had the benefit of the observations and conclusions of the Army en- gineers. Mr. Brown. It is a fact that the conmiission had the use of all those things? Mr. Watrous. They should have had them, but some of us who made a zealous hunt for this particular report could not find them. It has been laid away somewhere for some reason which I can not understand. Mr. Cooper. Gen. Bixby said that that was given by the Secretary of War to the President on the 19th of last August, and published on the 29th or the ;^lst. At any rate, it was handed bv the Secretary of War to the President two clays before it was published, and two years and seven months after it was made. Mr. Watkous. I should say that, in the letter of the Secretary of War, it is stated that, for executive purposes, its publication was withheld, and I can understand that in negotiating a treaty there are things that must be held confidential. I am impressed with the statements made by this Army engineer and his recommendations. I want to read again, as was read the other day by ^Mr. Cooper, the conclusion of this Army officer's report, to whom was assigned specifi- cally the consideration of this question from the standpoint of scenic beauty. He says: Accord inply, 1 eainostly recouiinend that (unless the reinediul works just suggested be built) the niiuiinum limits of diversion authorized on the Amer- ican side, namely, 15,100 cubic feet per second, be reenacted. and that no greater amount of energy be permitted to be imported into the United States from Canada than 160,000 horsepower. ^Fr. Flood. What is that vou are reading? PRESERVATION OF NIAGARA FALLS. 173 Mr. "Watiiois. Page lo, of Senate DocMiment 105, given to us a Aveek ago. Those are specific recommendations making allowance for a plan proposed by an assistant engineer who suggested a sub- merged dam at some point in the Niagara Eiver which might have the effect of spreading the water. That I am not prepared to con- sider ; it is one of those problematical things. However, that report is very definite and yet notwithstanding that fact, the treaty allows an increase of 4,400 cubic feet and has not set any limitations as to the importation. Bear in mind, howe\'er, that the treaty says there "may be'' a diversion of 20,000 cubic feet; it is not mandatory, and it is evidently left to Congress to decide what it shall be. It should be borne in mind also that as has been shown in the reports or state- ments made during the past two or three days, that not all of the water that might be permitted to be used has been used and that the damage to the Falls which is mentioned as having been done was done as the result of taking not 15,000 cubic feet, but 13.000 cubic feet in round numbers. Therefore to extend the amount now by 4.400 cubic feet, we think, vrould be a very large increase. Coupled with that is the very important presentation as to the waste that goes on Avith some of the companies, notably one com- pany which is mentioned by name, where the waste is reported as 33^ per cent, to which I had the pleasure of calling your attention at your session on Tuesday — a waste of more than 2,500 cubic feet, which if transferred to water power, using the highest estimate, would mean .something like 50,000 horsepower in round numbers. That shows that by a management Avhich utilized what was given them there would be available a great increase of horsepower. I had the pleasure yesterday of bringing out also, as I thought, the fact that there does not seem to be any very urgent need ju=;t now for increased importation wdien it is recalled that out of the 160,000 horsepower which might be used, but 110,000 has been used, or ]30S- sibly 115.000. T am using the statement of Gen. Greene at the hear- ing a year ago for the 110.000. There is also a permit existing to a company which for some reason has never used it, and which it ■would seem to me might be transferred to some company that would use it, and it would take care of the request of Detroit for 25,000 horsepov.er and still leave 25,000 iiorsepower. Xow, it has been shown that most of the damage to the Falls on the Canadian side is due to the fact that much of the Avater that is drawn off on the American side comes from the Canadian side of the river. Wlien the Burton bill was originally draAvn it Avas, of course, realized that it Avas impossible to say to Canada Avhat they could or could not divert, and Ave had to resort to a method of protection by indirection, and believing that Congi'ess had poAver to act. tliat clause Avas incorporated in the Burton bill which provided for the limita- tion of the amount of power that could be imported, namely, 160,000 horsepoAver. In the face of the very disastrous possibilities to the Falls, Avhich we think existed at that liuie and AAdiich AA-e still think exists, as' shoAvn by the reports of the Army engineers, we insist that the limi- tation should be kept up noAv and under the treaty. The statement has been made that if we do not alloAv our people to import up to the limit of the development over there, there is going to be a very large 28305—12 12 I 74 PEESEEVATIOX OF NIAGARA FALLS. Canadian development. That does not worry lis greatly — and T think we are practical: I certainly want to be practical. There is a principle at stake, and it is a principle which is comino- to be recognized more and more. You gentlemen, as members of a committee of Congress, know that Congress is not legislating for Buffalo, or for Niagara, or for Detroit: you are legislating for the Nation. The Nation believes that in Niagara Falls it has a heritage which contributes to recreation, to pleasure, and to good health. The courts are coming to recognize, and we believe will recognize more and more as the years go by. the rights of the people to those things which contribute to recreation, and to pleasure, and to good health. The case which I have cited is a direct case, and under the jurisdiction of one of the United States courts. With this waste, showing what might be utilized, we are convinced that there is no practical need for increasing the amount on the American side. "We are particularly impressed Avith the idea that because of the danger to the Falls on the Canadian side, which wo all ktiow is greater than on the American side, we must continue, by indirection at least, to prevent that ruin to the Falls by kee})ing u]) tlie limitation (m the importation. Briefly, as Mr. Foster requested, our belief is now as it was last June when we labored to get the bill extended before the time might expire, and when just by a stroke of good fortune we Avere able to get it reenacted in the closing days of Congress — we believe now more than ever that the original terms of the Burton bill are the ones to be adhered to. The CiiAiioiAN. In that connection let me ask if your association has ever appealed to the Dominion of Canada, or the Province of Ontario, not to take ar,y more water for power p!!ri)oses? Mr. Watkoi s. I know that an appeal has been made, not by myself directly but by other officers of the association, some years ago. It is reported that in a conversation between our president, Mr. ]Mc- Farland, and Ambassador Bryce that the ambassador said if he could have his own way he would be glad to have a party in arousing Canadian recognition to beauty in the Falls. Up to the present time we have not discovered that "Ontario has paid any particular atten- tion to the scenic value of Niagara, although we are informed that one of the leading newspa]5ers of Toronto is an enthusiastic defender of the preservation of Niagara from the beauty standpoint. The CiiAiKMAN. Do you or do you not believe that Canada under the provisions of the treaty Avill use all the water she is entitled to use? Mr. Wairous. I Avish you would make that a little more definite. I do not think they will use it within the next two or three years. The CuAiioiAN. AVhenever they want to use water? Mr. Watkois. Eventually they may, but I do not believe tliat in- side of two or three years there is going to rise up a lot of new cities that will use power. The Chairman. In other words, you have no doubt that Canada will take advantage of the terms of the treaty and use whenever she wants to use it the entire 3(5,000 cubic feet of water? Mr. Watrot's. From the physical and structural stand])oint T have a good deal of doubt of any such immediate utilization. The Chair:man. "When they Avant to use it. they Avill use it? IVIr. Watroivs. Possibly. Mr. Flood. If thev do it Avill be some time in the future. Avon't it? PRESERVATION OF NIAGARA FALLS. 175 Mr. Watrous. Yes, sir ; I have not allowed the Canadian situation to be very much of a bugaboo in my own mind. The Chairman. You are requesting the committee to stop the im- portation of power from Canada to the extent that it is now restricted under the terms of the Burton Act, and also to prevent this additional 4,400 cubic feet of water being utilized on this side? Mr. Watrous. Yes, sir. The Chairman. That is your position? Mr. Watrous. Yes, sir; and it is the position I take based on the reports of the Army engineers. The Chairman. If the people on the American side use the amount of v.ater they are allowed under the treaty of 20,000 cubic feet a second, do you believe, from your knowledge and investigation, that it will injure the scenic beauty of the Falls'^ Mr. Watrous. I believe it is based on the report of the Army engineers. The Chairman. Gen. Bixby said the other day that it would be unappreciable. Mr. Watrous. I doubt if I could discover it with the naked eye, but the investigations and the observations are to the eifect that there has been an appreciable withdraAval of Avater from the Falls. It has been unfortunate, in the opinion of most of us, that there has been any. The Chairman. Do j^ou believe the erosion going on injures the scenic beauty of the Falls ? Mr. Watrous. Yes, sir. The Chairman. That it has something to do with it ? We can not change natural laws. Mr. Watrous. We can not really interfere with the operations of Mother Nature. The Chairinian. Quite true. The question is whether taking this small amount of Avater injures the scenic effect of the Falls, or whether the injury to the Falls is not on acount of geological action and beyond our control ? Mr. Watrous. Not according to the reports that are made. The water taken away has had the effect of reducing the amount going over the crest of the Falls. That is a different proposition from the receding of the brink of the Falls. Mr. Flood. There was a gentleman here just now with a proposi- tion to stop that. Mr. Watrous. I have not read his complete statement. The Chair:man. It will be in the record. Mr. Watrous. I read this letter of Mr. Hudson, Mr. Chairman, as the expression of a business man for whose ability I have the great- est admiration. He writes to Senator Burton under date of May 6. Bear in mind, this is Detroit, where it is alleged they are so keen to get cheaper electricity. liy the way, seriously speaking, have we discovered that these cheap things ever amount to an^^thing? When there is one company that has an established rate, does it often hap- pen that another companj' comes in and gives us anything cheaper? Mr. Hudson writes : I am exceediugly interested in Niagara Falls. For 40 years I have been in tlie habit of going there. I have never seen aujthing tliat compares with the Falls in grandenr. and I have been utterly opposed to diverthig tlie wat<>rs from their natural course. 176 PRESERVATION OF NIAGARA FALLS. I think we made a mistake in giving the power Cdmpanies any rights there at all. Tliey now use 34.000 cubic feet per second and want 56.000. I feel very earnestly that their request should be denied. The enormous amount of water that went over the Falls before any of it was diverted was none too much, and now hi many places the decrease is noticeable. A pretty good statement from a recognized business man. You can not say it is sentiment. The other day we were alleged to be suffering from neurasthenia. I hope not; but the sentiment of the people as it has come to us, as it came lo use in 190G when we first took up this matter, and as it has been renewed, caused us to lead in the eli'ort to get the Burton bill renewed. Mr. Flood. Is it a fact that thev are using ;^4.000 feet? Mr. Watbous. He says 34,000 f I should think it would be 26,000. He may have stretched that a little. AVhatever they are using, it has been sufficient to do more or less damage to the Falls. Mr. Flood. Less than half what they proposed to use? Mr. AVatkous (reading) : I am forced to state that existing diversions have already seriously inter- fered with and injured the scenic grandeur of Niagara Falls at the Horseshoe, and that this injury and interference will probably be soon emphasized by the effects due to the prevalence of lower stages on Lake Erie and the upper lakes. The Chairman. Who made that report? Mr. AA^vTROus. The Chief of the Army Engineers. The Chairman. AA^hat is his name? Mr. AA^'atrous. I am not sure. I think at that time the Chief of Engineers was Gen. Marshall. It was that statement that led us to make such an urgent appeal for the renewal of the terms of the Burton bill a year ago, and last June and last August. That is the statement of an expert. I believe in the service of experts. Un- derstand, we are carrying on a wide range of good work, we think. We are urging cities to do comprehensive city planning; we are proposing a bureau for our national parks, and we believe in the service of experts. In the handling of Niagara Falls we believe in experts, and believe we have those experts in our regular department of the Army. If you want someone to whom you could put more detailed ques- tions, I ask you to await the appearance of Mr. McFarland, who is in a position to answer tho.se more adequately than I can hope to. I know and you know, gentlemen, because you have had expressions from them, that the sentiment of the people at hirge is growing more and more in favor of recognizing the vahie of tliese scenic wonders and particularly of Niagara Falls. There are other ways of getting iM)wer that I can cite you if you do not know of them already. There is the wonderful power de- velo]mient going on in North Carolina where they are developing power from small mountain streams without working any great injury to any number of people from the scenic standpoint. Do not think that we are attacking all ])o\ver propositions. AA> are not. AYe have been standing steadfastly for the preservation of Niagara Falls, notwith.standiug the demands of the.se great companies who wish to make uioney froui them. Only recently we were urged to lend a hand to the preservation of certain falls down in Georgia. It did not seem to us that it was a national undertaking of sufficient iui])oi'tan('e to enlist our attention. AA> have realized that Niagara PEESERVATION OF NIAGAEA FALLS. 177 is the one great thing. You do not need to be told by me that the people of foreign countries know only of Niagara Falls when they think of scenic wonders in the Unitect States. The Chairman. Did j^our civic association oppose the ratification of the treaty when it was under consideration? Mr. Watrous. AA'e were in consultation — I was not; it was not my good fortune to be secretary at that time — with the Secretary of State and with the ambassador. We were called upon for our views, and we were given to understand that the treaty would very fully recognize the demands of the people for the preservation of the beautiful. I. am going to tell you frankly that I am not well sat- isfied with the treaty. I do not think the treat}' comes up to the demands at all. Mr. Chair^ian. It is the sui)reme law of the land, is it not? Mr. "Watrous. I believe that it is. Tlie Chairmax. AVe ought to carry out the treaty. Mr. AVatrous. We can do it. There is nothing mandatory about the water that may be taken from the American side. It says there may be a diversion of 20,000 cubic feet a second, and Congress cer- tainly has the power to decide how much of that may be used. Mr. Flood. That is a right that is given to American citizens which we need or need not exercise as we choose, as we see fit. The Chairman. You are firmly of the opinion that the diversion of the water is injuring the Falls? ]Mr. NA'atrous. Yes, sir; I am firmly convinced of that. Mr. Cooper. New York is preserving the Palisades, is it not simply as a matter of scenic beauty? Mr. Watrous. Yes, sir. Mr. Cooper. They were blasting them down to secure stone for ]>aving purposes. Mr. FiA)0D. Do you think the diversion of "20,000 feet of water has already injured the scenic beauty of the Falls? I understand that at this time they are diverting 26,000 cubic feet a second; 15,000 <;r more on tliis side and 11,000 on the Canadian side. Do you think that has already injured the scenic beauty of the Falls? Mr. Wa TROT'S. I do; ves, sir. :Mr. Flood. Tlien to divert 56,000 Mr. Watrous. Wou.ld be, I think, very, very injurious. I think there is only one way to stoj^ it on the Canadian side. We can not tell them what they can do, but we can say that there shall be a limit on the importation. Mr. Flood. They raised the vested rights question six years ago, did they? Mr. Watrots. The (juestion as propounded by jNIr. Brown as to the vested rights of the companies was very, very thoroughly con- sidered. I am told, by the waterways commission and the others who drew up the Burton bill, and it has always seemed to us that if the companies, believing they had such a vested right, were so thor- oughly convinced of it they ought to have put it to the test right then and there. They might have saved themselves a great deal of money — surely nnich peace of mind and relief from the attacks on them. Now, for their peace of mind, whv don't thev put it to the test? Mr. Brown. Those rights were recognized not only by the Bur- ton law but b}' the treat3\ 178 PEESEEVATION OF NIAGAEA FALLS. ]\Ir. Watrous. It should be borne in mind. Mr. Chnirmun. that when the Burton bill was draAvn it was recognized that tliei-e were existing power companies that had put up large amounts of money for their plants, and it was for that reason that we mentioned in the Burton bill who was to receive the permits. I am going to read a paragraph written by our president. ]\rr. Flood. What is the extent of the life of a power company? Mr. Watrois. It is a perpetual charter, as far as the companies are concerned. The life of the treaty was to be five years. Mr. ScovELL. The law of the State of Xew York provides for corporate existence by allowing certain certificates 'whether j'ou are chartered by act of the legislature or incorporated under State law. Mr. "Watrous. I am not prepared, Mr. Chairman, to speak very definitely of the Xew York phase of this proposition. It does (.ccur to me, though, that as between the States and the Xation we have the old-fashioned idea that when the Federal Ciovernment is back of a proposition it is back of it a little stronger than when it is backed by a State. I presume now that I am getting otf onto questions of law that I have not a right to talk on. You know how our State policies change. They are likely to be changed very often. I do not see any particular reason why Congress should give up that jurisdiction. You would have the question of juris- diction always before you. Mr. Brown. ISIr. Watrous. on what do j'ou base this right of Federal control to protect scenic beauty ? Mr. "Watrous. They have got the right up there; it is a navi- gable stream, and it is a boundary line. Let me read this extract from the decision which is cited in that Colorado case : We s;iy that the creiition of a summer resort is a beneficial use. Is it no benefit to tbe public to spend money in making a beautiful place in nature visible anrl enjoyable? Is it not in line with public healtb. rest. aname extent as this Nbav York end of the Horseshoe, but the southern half: that is. the half next to Goat Island, is only G feet 10 inches deep, so that the southern end of the Ajnerican Falls is only a little better off than — this portion of the Horseshoe is better off because the Avater is com- ing more from the Horseshoe than it is from the American channel. NoAv. Avith regard to the subject of the lower rapids. 182 PRESERVATION OF NIAGARA FA U.S. The siiliject of the lower rapids has been mentioned. One of them has a lieicht of 51 feet. They are part of the falls of Niagara and are visited by just as many people. Tn mairniticence neither these nor the rapids above the Falls are inferior to the fallinir sheet of Avater. You can not cut off an arm and a lesr of a man and leave him intact. But here is another point, if you divert the water from the i:)Ool below the Falls you lower its level, which increases the rate of recession of the main Falls themselves. The question of the inter- national relationship of this water I shall not discuss. The mean level of Lake Erie durins: the whole of li>ll was 74 inches below the level of the precedino- '20 years. A part of this at least Avas due to the diversion of the waters. Three of the companies take their water from the basin above the rapids, and in doing so increase the size of the outlets of this basin. For the large ships each inch of cargo, I am told, represents $100 in freight. Gentlemen, I am not hostile to the power companies asking for more Avater. Let me say that had it not been for the persistent re- fusal of the Ontario government I believe that the quantity alloAved on that side, under the treaty Avould have been greatly curtailed, and as you knoAV two of the poAver companies there belong to Ameri- cans. Avho through the Ontario governmer.t haA'e obtained greater privileges than those located in Ncav York. While not hostile to these companies nor to the Buffalo Drainage Canal, which could obtain nearly 3G gross horsepoAver per foot, yet I think that the people have a right to a presentation of their side of the question, and I have offered you facts Avhich you may take in consideration with the subject. If I may be allowed to cite a British anecdote. The Earl of Kimberley Avas secretary for the colonies. He took the draft of the treaty, after the first Boer War, to Queen Victoria. She said, " May I ask you to reconsider, for this will be a fatal mistake." He returned; again she pleaded for another reconsideration. He re- plied, " It is settled. It is the Avill of the people." She replied. " Then I shall sign. But you Avill live to see the day AA'hen Britain will regret it." Kimberley said, " We have learned to regret it. Her Majesty Avas right." Now, gentlemen, let me say that under the full diversion of Avater as granted by the treaty, the main cataract will haA'e been been reduced to one-half of its breadth, as also one-half of the American Falls. The treaty permits a diversion of 28 per cent foK mean dis- charge, or 33 per cent, including the Chicago canal. This rises to 40 per cent during months of low Avater. The extreme disturbance on account of wind lasts for only a fcAv hours or a day and may be rejected from consideration. IIoAveA'er. for a week in February, 1909. during Ioav Avater the floAv of the Avater Avas suspended from the American Falls and 800 feet of the main cataract, next to Goat Island, a forerunner of future conditions. Gentlemen, it is for you to consider the facts as related to the Avhole people on the one hand, and on the other Avhether it is the advantage to turn Niagara into alluminum carbide, etc.. for the other general manufacturing uses do not consume an inordinate demand for poAver. The Allumi- num Co.. according to the report. Avas foi- years Avorking on a capital of $3,200,000. Two or three years ago they were able to i)ay a stock bonus of TjOO i)er cent, thus l)ringing the c:ij)ital up to $10.- PEESEEVATION OF NIAGARA FAT.LS. 183 000,000. Tt do^s not ap])oar that tlie American })<'ople received any bonus for their Avater. Mr. Kendall. Hoav is that hist statement true? Mr. Spkxcer. Under the treaty. Mr. Kexdall. I heard that, but what did vou sav about 40 per cent? Mr. Spexcer. When the water is at a low stage, I mean. Mr. Kendall. Tlie full discharge of the Falls will be 40 per cent? Mr. Spencer. At the low stage of the water, lasting for a month or more, and as any variation as to that lasts only for a few hours it is not worth considering one way or the other. It might be enough to stop the works for a few hours. I can show you a photograph of this which you can pass around showing the stability of the flow [passing photographs around the committee room]. Mr. Kendall. But that is a photograph illustrating the situation ihere during that week in February, is it? Mr. Spencer. Yes; that is prophetic of what is going to happen with a full outturn of the power. Mr. Kendall. AYell, it is descriptive of what has happened under those conditions. Mr. Spencer. It has happened under those conditions. It has been diminished on two other occasions, but never a stoppage of the water on the American Falls occurred until February. Subsecjuent to that, the year after, the American Falls were broken up into four parts, but I did not get photographs of that. These photographs were my own. That is a determination of the water on our New York side of the Horseshoe [illustrating]. This also shows the retaining wall by which 415 feet are permanently diverted. Mr. Cooper. Do you mean that 400 feet out from the Canadian side there was a wall erected wdiich prevents the w^ater from flowing? Mr. Spencer. Absolutely, for 415 feet, and the wall is shown in that picture. Now. I Avill not presume to suggest anything. I sim- ply brought these facts to j^ou for your consideration. Mr. Foster. Will it interrupt you if I ask you the purpose of this I'etaining wall ? Mr. Spencer. I will state, as you w'ere told by the Chief of Engi- neers, that the greatest efl'ect was on the Canadian side; where it is (» inches on the Goat Island side it is 9 inches on the Canadian side. When the first poAver plants were established they drew" the greatest portion of their water not from the Xew York channel — that is, the Ilorseshoe channel — but drcAv the greater part of the Cana- dian channel, the result Avas the water floAving l)ack, and before they began their Avork, about 1001 — I can not give you the exact date — they l)uilt this retaining Avail and filled in Avith earth behind it, and it runs along 415 feet at the end of the Falls, so no matter Avhat the condition of the rainfall is that has been destroyed to that extent, Mr. Foster. By the Canadian GoAernment? Mr. Spencer. If you draAv me into the question of the Canadian GoA^ernment — it Avas done for a simple purj^ose. Prior to that the Avater Avas usually draAvn off from the Canadian side. This Avail Avas I)uilt to block the water, and to send it back to the poAver house. Mr. Broavn. That was done as a part of the park system— to enable spectators on the Canadian side a better vieAv of tiie Falls? 184 PRESEEVATION OF NIAGAEA FALLS. Ml". SrENCER. Xot at all. I was at Niagara Falls practically all tlie time this was being coiistructed. and when it was thrown open. Now to come to the question Mr. Kendall. Before yoii leave that question — the effect of estab- lishing that retaining wall was to destroy 415 feet of the Falls, was it ? Mr. Spencer. Four hundred and fifteen feet of the main Horseshoe Falls on the Canadian end of the Horseshoe. Mr. Kendall. But there had been a flow of 415 feet of Avatcr over that until that time? Mr. Spencer. Yes; prior to that time. It took about one and a half years before it was completed. Mr. Kendall. That was diversion of the water that had ])rcviously gone over that wall toward the center of the wall? Mr. Spencer. Yes: high water has been lowered by the diversion of that water, and it got to be very shoaly. Now. it is a question whether it is pleasing to destroy the Falls or to exploit the carbide works and those other great consumers of power, the aluminum company: and I will mention here, i)erhaps some you do not know, according to their report they have been working with a capital of only $-200,000. but three years ago they Avere able to ])ay a stock bonus of 500 per cent, but the American peo])le did not get any part of that bonus. The Canadians now charge rental for that water: the American people receive none, nor do they receive duty. In an editorial of the organ of the Ontario government. January 18. it was stated that early in li)ll the margin of possible exports has a long way to go before being exhausted, and that the removal. of restrictions would .seem to be somewhat superfluous. It is stated that the consumption in Ontario is comparatively limited, and that the C^anadian Govern- ment can impose an export duty. Mr. Kendall. Noav, that means. I take it, that there is plenty of water there that may be exported if it is not utilized there. Mr. Spexceh. There is plenty of water available under the present agreement, and it would be superfluous to give permission to pass any more. I should have brought that clipping 1 received only a few minutes before I came here, but 1 forgot to bring it down. Now, of course, the Canadian (jovernment has the i)ower to apply an export duty, as the statement mentions. ^Ir. Bkoavn. May I ask you this question: The Canadian power com})anies have to reserve one-half of their power for sale on the Canadian Government ? Mr. Spencer. Yes. Mr. Brown. And tliey can only export the otlier half of each coni- ])any. not to the aggregate sums of all the companies, so that if the Canadian Power Co. is given the privilege to export one-half of its power and the Ontario Co. one-half of its power then there could be no export unless there was some other company ready to develop two for every one that Avas exported. Mr. Spencer. These tAvo companies could increase their i)(>wer of production, and by that means they could exjiort more. I Avish to say one Avord in regard to the Avork of the International Avater-making machine. I have had something to do Avith that. It Ava,*^ originated bv the late Andrew H. (xreen. of New York. That, PRESERVATION OF NIAGARA FALLS. 185 was for the special purpose of saving tlie Falls from spoliation. I had the honor on several occasions to assist the late Secretary Hay and also the late Senator Piatt, so that I am thoroughly informed with regard to the methods of that International water-making machine. Gentlemen. I thank you for your attention. Mr. Kendall. Do you represent some civic association? Mr. Spencer. I am a member of a civic association. If you wish to know how I got in connection with this I will give it to ^^ou in a few minutes. Mr. Kendall. The only purpose I had was to ascertain the reason for your being here this afternoon, which is a very proper one alto- gether. Mr. Spencer. The reason is this: I began as a young man to study the situation at Niagara Falls; later I began to publish for the Ni- agara Falls Park Commission. I published a lengthy report. I began in 1902, or about that, my association Avith Mr. Greene, and on account of this previous association and the fact that I was connected with the Avork and other matters relating to Niagara Falls it was thought but right that I should have an opportunity to carry on scientific investigations. Although an American citizen, I was asked by the geological survey of Canada to make a full report upon the P^alls. I did not have Ihc facilities that the engineers had in some directions. I had more facilities in some other directions. The result of that was I published a work of 500 pages on the scientific history' of the Falls, a part of Avhich is included in the statistics which I have been giving you. I have kept up with the information which has been supplied by the engineers department, until the present time, consequently I am familiar — there may be some details I do not know— but I am familiar with almost ever^'thing of a scientific nature concerning the Falls of Niagara. ^Ir. Kendall. I am glad you made this subsequent statement. I think it is valuable. The Chairman. Mr. Spencer, will you put into the record ,your statement with regard to the recession of the Falls b}' reason of the erosion ? Mr. Spencer. I shall be very glad to do so, and I therefore hand you a copy of my paper on that subject, which, together with what I have previously stated, covers the whole question. I I'.iill^'tin of tlip (;oiil<)iric;\l Socictv of Vrnpi-icii. NCI. U!. ii. N7-44S. pi. .'.i'-:;-] An- lo. I.XTKRRX'PTION IN THK Fl.OW OF THE FALLS OF XlAtiAK.V IX I-'KUKIAUV, VMU. (By J. W. .Spencer. Read before the society Dec. 20, 19(»9. ) Previous Flucttjations. Since I be year isyo, tlie meau level of Lake Erie li.is fallen al)()Ut I foot ' 'aud the liasin above Goat Island about a foot and a lialf. From that year until the end of 3905, the menu annual fluctuations varied scnrcely more than T foot, while in one case the mean monthly variation reached nearly 2 feet; but during the progress of storms, wlien the Avind has changed to the o])i)osite direction, the tluctuations have been found to reach 5 or even U feet. ' .T. \V. Spt'iiccr : Kvohition of tlio Falls of Xin'-'ara. Ccolo-ii-al Survey of Caiiad.-). [). 186 PRESERVATIOISr OF NIAGARA FALLS. FLrCTUATIONS OF ]90'J. During January and the early part of February, 1LMJ9, the hike level was below that of the mean, but on February 10 Lake Erie rose nearly 3 feet above the mean annual average height (1SS9-1905, inclusive), while in the following and succeeding days it fell with a northerly wind to 4 feet below the mean (as shown by the records of the gauges as furnished the Fnited States Lake Survey*. This was on February 14. At this time the weather was very cold. On account of the reduced depth of the wiiter on the upper raiilds, as the ice was forming, it remained anchored to the projecting rocks and was not carried over the falls; so that the New York channel and the main cliannel to about GUO feet outside of Goat Ishind were frozen over, except one small lead, which scarcely showed any current where ordinarily it is a rushing torrent. It must be emphasized that the ice was not an accumulation of blocks carried down from Lake Erie, as often occurs, like in the jam of the following April As the blizzard continued, with its falling snow, the lake level fell to the lowest on February 14, and almost all of the water beneath the ice was withdrawn so that the American Falls of 1,000 feet in breadth were drained, except four or hve insignificant streamlets, as shown in plate 'VI. The eastern side of the main falls, adjacent to (Joat Island, was drained for S<^iO feet, as may be seen in plate 3o, figure 1. The end of the ice-covered rock rim of the first cascade of the upper rapids, with the frozen river in front of Goat Island, is shown in plate 34, ligure 1. On the Canadian side, the main falls, which have already been curtailed by 415 feet, due to iiower diversion, was further drained by about 200 feet, as illustrated in plate 33, figure 2. Another photograph, not reproduced, shows that in the middle of the main cataract the rocks almost reached the surface; but without allowing for these thinly covered masses, the total shrinkage of the main falls amounted to a rettuction of the crest line from 2.950 feet (in 1901) to 1,000, and the diameter was shortened from 1.200 feet to less than 800. From the foregoing it may be' understood that the cause of Niagara ''run- ning dry," as expressed by the newspapers, was due to the recent lowering of the river level (partly owing to power diversion), thus permitting the forma- tion of the ice barriers, which cut off the reduced supply of water during a strong northerly wind, in very cold weather, at a time of the low stages of Lake Erie. This condition continued for nenrly a week. Had there been uo ice, the extreme effect of the wind would have lasted for only :i day, even if the volume of water had been below the normal amount. Tb.e Whirlpool Rapids were lowered by many feet, so that the usunl rushing, boiling, pitching, torrents seemed tamed, as may be seen in plate 34, figure 2. Similar Occurrences. Within the historic record the only other times when similar phenomena have been seen were the following: On March 29, 1.S4S. the ice from Lake Erie blocked the river for one day, as described by the Hon. Feter A. Porter; on March 22, 1893, a partial stoppage occurred which also appe.'.red to have been due to the blockade of lake ice; and on February 29, 1890, there was another shrinkage of the falls. None of these cases were comparable to thnt of 1909, when the phenomena lastetl for nearly a week from February 14. With the continued draining of the falls, a repetition of these features should be ex- pected. In part, they represent what will become a permanent condition, owing to power diversion. The above is from my personal observations, and the photographs are of my taking or those of Mr. E. Deming Smith, of Niagara Falls, who accompanied me. Note —In Mnrcli. 1!M0, owinu' to tlio slio:\lin^' (if tin- w.h.ms i.n ilu- iii)i).-r nipids, the Ice was ciuifflit and so barricaded tlie New York el,aniicl that ilu' American Kails were again damaged, being broken into fonr parts. Mr. CooPEU. Do you intend to liave these pliotogniphs i)nt in hi.': statement? 'J'he Cii.MhMAX. Xo; they will not be jirinted. l)ut yon \\\\\i\\i leav!' those photographs here. Mr. Spencer. Mr. Spencer. They are in the rejiort of (he Enoineers. I I'HKSliKVATIOX OF NIAGARA FALLS. 187 I laid on the table the other day a copy of this pamphlet, and if you will look at it at this place in here you will see the lines marked showing- what has been cut off and the future effect on the Falls. liKFKKKNUUJt LEAGUE OF ErIE COUNTY, Buffalo, X. ).. Jduuiiry IH, /!II2. To tlie lion. Wm. Sulzek, ChdiriiHin of the Committee on Foreign Affairs, House of Rcijresentatives, Washington, D. C. Deak Sik: The city of Biiffnlo in November, lfl05, voted to establisU :i ninnioi- pal electric-lighting and power plant for the benefit of the city and its inli.-ibitants. In order to get the electric currerit for its municipal distributing j)lant at a reasonable price, Bulfalo must get electrical power from Niagara Falls by and through a State generating and transmission plant. Any further grant by the United States Government of the unused 4,4(K) cubic feet of water i)er .«ocond, which, under the present treaty, is ])ermi(ted t(.i be diverled on the American side of Niagara Falls, should be granted by the General Government to the State of New York. Electricity can be produced at Niagara Falls using the imblic waters at a cost not to exceed $6 for horsepower per year, and is actur.lly sold to the Ontario (JovernmeiU for less than $10 per horsepower jier year. Power poduced at the Falls and tansmitted to a much greater distance from the Falls than Buffalo is sold for less than the prices charged for like amounts of power in Buffalo. The distributing company in Buffalo charges the small consumer at the rate of .$600 per horsepower per annum, as against the $6 per horsepower, cost of pro- iluction at the Falls. The several companies which produce, transmit, and distribute electricity either liave a community of interest or unite in a policy adverse to the small consumer. The Niag.-iva Falls Power Co. sells 450.000,000 kilowatts per annum for one and a (pia.rter millicnis of dollars. The Ciitaract Power & Conduit Co. sells one-third of this amount for fj-l .000.000. .\nd the Buffalo ({ener;il Electric Co. sells one-twentieth of the first amount for .^LOOO.OOO. The city of BntTalo can be lighted and heated at night, both publicly and jirivjitely. by less than 200.000 horsepower. The scenic beauty of Niagara Falls need not be considered at night, and 1,000.000 horsepower could be gen- erated on the American side alone, at night. It is suggested that sutiicient horser)ower foi- heat and power uses in Buffalo can be generated and trans- mitted at night and stored by modern methods for day use hi Buffalo. This org.-inization. comr.osed of over 5.000 citizens of Buffalo, and speaking for the small Cdiisumer of Buffalo, to whom light and heat at reasonable prices are necessaries, respectfully asks that action be taken to modify the existing treaty so that the full .-uiionnt of water at Niagara Falls can be used at night ; that the same be grant<>d by the General Government to the State on condition that it be used for a State generating and transmitting plant, or controlled by the Sfale in the interest of the general public or the small consumer. It is sug- gested that even if the State of New York will not establish a State hydro- electric, generation, and transmission plant tliat all future grants of power lie made by the United States Government to the State of New York alone, upon the exjiress condition that prices shall not be charged by the producing comi>anies greater than prices now charged to the (Jovernment of Ontario, and lh:it prices charged by transmission and distributing companies shall be fair and reasonable to the small consumer, based on the actual cost of the power to these comiiauies and the actual cost of transmiss!(>n and distribution, with ;'; fair profit added tliereto. .\ll of whicli is respectfully submitted. iiEEERENnuM Leaoue OF Eru: CorxTY, Lewis Stockton, President. Frank C. Perkins, (UmsuUiun bhiiiiuccr 160 PRESERVATION OF XIAG.^A FALLS. The following tiible was prepared by an American tirui of nuuiiifacturers on making investigations for a Canadian location. Estimate is based on smallest business possible. Gas is the largest saving in Welland's favor, as our busine.-^s requires much heat for forging; but for large users of iwwer, that would be the greater factor. As your business increases, so, proportionately, do the ad\antages of Welland. Comparative statement on stated quantities. Localities. Cost of 100 horsepower per year. "Welland Niagara Falls Hamilton Brantford Guelph Toronto »$15.00 1 15.00 1 22.50 1 22.50 « 1.000.00 30.00 • 25.00 Natural gas, or equiva- lent (15,000 feet per day). Site cost. Cents. 12 ' 15 I 20 20 ' («) (') 87.500 7.000 (») 10,000 Freight rate, steel, Pittsburgh (20 cars). Cents. 15 16i 16J 17.1 Soft coal (50 tons). Hard coal (50 tons). 3.50 3.35 Per ton. Per ton. $2.50 »4.50 2.60 4.60 3.00 5.15 3.35 5.20 5.50 C.OO Taxes (10 years). 3. So, 000 (•) MOO (») (*) 250 I.,ocalitios. Water (5,000 gal- lons per dav). Ccnti. Welland j 6 Niagara S'alls ; 10 Hamilton I 7J Brantford 7i Guelph 20" Toronto Switching charges (40 cars). i)osal. but T wish it to be remembered that 1 am not in hos- PRESERVATION OF NIAGARA FALLS. 189 tility to the vested ii<>hts of anyone, but some of the vested rights beh^ng to the people. The CiiAiiniAN. Are there any other gentlemen present who de- sire to be heard this afternoon? Mr. Broavx. One question ^Ir. Spencer knows about I might ask hiuL The Chairman. Yes. Mr. Brown. Mr. Spencer, is it not true, or do you understand it to be true, that the unwatering of the Canadian end of the crest from the Horseshoe Falls prior to the time any diversions for power were made upon tlie Canadian side, had piogressed so far that in 1902 the Canadian Park Commisioners caused 250 feet of the former crest, lying at tliat time unwatered. to be filled in for the purpose of improving the scenic elfect of that part of the park ? Mr. Spencer. I will say that the diversion of the water by the Xew York compaines had a fleeted the water on the Canadian side — that is, two Xew York companies had so diverted, deflected the Avater from the Canadian side that the Avater had receded and they Avere compelled to fill that in. But before that the earlier photo- graphs shoAv it. and tliis diversion AA-as done on account of the con- tinued increase of the loAAerinsf of the Avater on the Canadian side. Mr. Broavn. Just a moment. Before 1902 tliere had been no sub- stantial diversions upon the Canadian side? Mr. Spencer. The loAver end of the water at that time had risen from the diversion by the Xew York power companies. Mr. Broavn. But prior to 1902 — I am speaking as to back in those times — the erosion from the Falls causing a recession of the crest of the Falls? Mr. Spencer. It AAas the diversion of the Avater. A great deal of the Avater on the uj^per rapids is noAv very thin. I haA'e seen the time Avhen during extremely Ioav Avater one-fourth of the upper rapids haA'e been bare. Mr. Broavn. I Avas trying to compare your statement with this one made in the Canadian reports of the American engineers. That is all. The Chairman. Is there a gentleman present Avho desires to be heard noAv in this matter? Mr. Difenderfer. I suggest, Mr. Chairman, that you call Mr. Barton, if he is here. Mr. Broavn. Let me say, Mr. Chairman, Mr. Barton Avent back to Niagara Falls last night. If you Avould like to hear from him I Avill ask him to come here and appear before your committee Tuesday. Mr. Difenderfer. He is manager for the Hydraulic Co., is he not? Mr. Broavn. Yes: for the Xiagara Falls Co. Mr. Barton can give you any information you desire. Mr. Difenderfer. I Avould like to (juestion ^Ir. Barton on some points T have in vieAV, but I hardly think I Avill re(|uest his coming here. Mr. Brown. Without any request, upon the statement of tlie com- mitteeman, I Avill see that he is here. I am only too anxious to give them any figures. 28305—12 53 190 PRESERVATION OF NIAGARA FALLS. The CiiAiL'.AiAX. We will now be pleased to hear from Maj. AA'il- liam B. Ladue, Corps of P^njjiiieers, War Dei)artment, Washinff- (oiu I). C. Afaj. Laduk. There are only one or two matters that I wish to say anything about. The whole subject has been pretty thoroughly covered. In the first place let nie say, as was said the other day, that the War Department is not in the attitude of urging that it be" given charge of the supervision of these permits; but, if the War Depart- ment is to supervise the permits it will have to have an appropria- tion for that purpose. The Burton Act made an appropriation of $50,000 for the necessary expenses for carrying out its provisions. When the Burton Act expires, without further renewal, of course we will not have any mone}^ available; and foi- any further operations which we may be called upon to undertake we will need money. Mr. Garner. You had better tell us. Major, how much you will need to provide any >^u!)ervision that the AVar Department desires to undertake. Afaj. Laih-k. I am not prepared at present to give definite figures; but I would suggest that the unexpended balance of the appropriation made by the Burton Act be reappropriated and made available for expenditure, in connection with any legislation Avhich this committer maj^ have in view. The Chairman. How much is that unexpended balance ? Maj. Ladue. About $22,200. as it stands now. In connection Avith the operations under the Burton Act the Secretary of War caused numerous iuA-estigations to be made and held a number of hearings in regard to the issuance of these permits. There is in these reports a good deal of matter which is of value, and which I think will be of value to the committee, which may possibly not be before the com- mittee; and I would propose to leave here, for the information of the committee, copies of these various reports, including the decision ren- dered by the Secretary of War in 1907, fixing the conditions and limits of the original permits. I will simpW lay this on the table. The Chairman. Have you got that decision, Major? Maj. Ladue. Yes. The Chairjian. Well, I think we had better put the decision in the record. We will put it in the record if there is no objection. Maj. Ladue. I will put a copy in the record. The Chairman. Now, if there is anything that you have that is not too voluminous that you think ought to go in the record, Major, we would be glad to have you put it in the record as a part of 3^our remarks. Maj. Ladue. I will add this paper. The other papers I have here I will simply leave on the committee's table for their information. I will also present this set of blue prints showing the variations in the levels of the Great Lakes for a number of years. Gen. Bixby desired me to present to the committee this data as part of the information on the subject, which will be of value to anyone interested in that branch of the subject, in connection with the operations under the Burton Act. Mr. Cooper. One moment. Would not this be very valuable, this literature, for the record? The Chairman. Very well ; put it in. PHKSEKVATION OF NIA(iAKA FALLS. 191 War Department, Washington, .January 18, 1907. In the matter of aiiplicatious umlor the Burton Act for the issue of permits to divert water for power from the Niagara Falls on the American side and to transmit electrical current, developed from water power on the Cana- dian side, into the United States. OPINION BY THE SECRETARY OF WAR. Ten or more applications have been filed in this department for the issuing of permits by the Secretary of War, part of them for the diversion of water for power from Niagara Falls on the American side, and the remainder for the transmission of electrical currents, developed from water diverted from the Falls on the Canadian side, into the United States. These applications are filed under what is known as the Burton Act. passed June 29, 1906. and entitled *'An act for the control and regulation of the waters of the Niagara River, for the preservation of Niagara Falls, and for other purposes." The first section of the act forbids the diversion of water from the Niagara River, or its tributaries in the State of New York, except with the consent of the Secretary of War, as authorized in section 2, with a proviso, the meaning of which is not here important. The second, fourth, and fifth sections of the act I set out in full as follows: " Sec. 2. That the Secretary of War is hereby authorized to grant permits for the diversion of water in the United States from said Niagara River or its tributaries for the creation of power to individuals, comiianies, or corporations which are now actually producing power from the waters of said river, or its tributaries, in the State of New York, or from the Erie Canal; also permits for the transmission of power from the Dominion of Canada into the United States, to companies legally authorized therefor, both for diversion and trans- mission, as hereinafter stated, but itennits for diversion shall bf issued only to the individuals, companies, or corporations as aforesaid, and only to the amount now actually in use or contracted to be used in factories the buildings for which are now in process of construction, not exceeding to any one individual, com- pany or corporation as aforesaid, a maximum amount of eight thousand six hun- dred cubic feet per second, and not exceeding to all individuals, companies, or corporations as aforesaid an aggregate amount of fifteen thousand six hundred cubic feet per second; but no revocable permits shall be issued by the said Sec- retary Tuider the provisions hereafter set forth for the diversion of additional amounts of water from the said river or its tributaries until the appoximate amount tor which iiermits may be issued as above, to wit, fifteen thousand six hundred cubic feet per second, shall for a period of not less than six months have been diverted from the waters of said river or its tributaries, in the State of New Y'ork : Provided, That the said Secretaiy, subject to the provisions of section five of this act, under the limitations relating to time above set forth is hereby outliorized to grant revocable permits, from time to time, to such individutils, companies or corporations, or their assigns, for the diversion of additional amounts of water from the said river or its tributaries to such amount, if any, as in connection with the amount diverted on the Canadian sid«>, shall not injure or interfere with the navigable capacity of said river, or its integrity and proper volume as a boundary stream, or the scenic grandeur of Niagj'.ra Falls; and that the quantity of electrical power which my by permits be allowed to be transmitted from the Dominion of Canada into the United States shall be one hundred and sixty thousand horsepower: Provided further. That the said Secretary, subject to the provisions of section five of this act, may issue revocable permits for the transmission of additional electrical power so generated in Canada, but in no event shall the amount included in such permits, together with the said one hundred and sixty thousand horsepower and the amount generated and used in Canada, exceed three hundred and fifty thousand horsepower: Provided always. That the provisions herein permitting diversions and fixing the aggregate horsepower herein permitted to be trans- mitted into the T'nited States, as aforesaid, are intended as a limitation on the authority of the Secretary of War, and shall in no wise be construed as a direction to said Secretary to issue permits, and the Secretary of War shall make regulations preventing or limiting the diversion of water and the admis- sion of electrical power as herein stated; and the permits for the transmission of electrical power issued by the Secretary of War may specify the persons, 192 PRESKKVATION OF NIAGARA FALLS, fonipauies, or corporations l-.y whom the same shall he transmitted, and the per- sons, companies, or coritorations to whom the same shall he delivered. " Si:c. 4. That the I'resiilent of the United States is respectfnllv reqnestml to open negotiations with the (Jovernnient of Great Britain for the purpose of effectnally providing, hj- suitahle treaty with said (iovernment. for snch regu- lation and control of the waters of Niagara lUver and its tributaries as will preserve the scenic grandeur of Niagara Falls and of the rapids in said river. " Sec. 5. That the provisions <»f this Act shall remain in force for three years from and after date of its passiige. at the expiration of which time all permits granted hereunder l)y the Secretary of War shall terminate unless sooner re- voked, and the Secretary of War is liereby authorized to revoke anv or all I»ermits granted by him i>y .inthority of this act. and nothing herein contained shall be held to confirm, establish, or confer any rights heretofore claimed or exercised in the diversion of water or the transmission of i»ower." The third section provides a i)unishment for violations of the act. and the method of enforcing it. The idain ])ui'pose of the act is to restrict, as far :is lies in the i)ower of the Congress, the diversion of the water from the Niagar.i Itiver above tin- Falls in such a way as to reduce the volume of the water going over the Falls, and the plan of Congre.ss in so doing is to effect this purpo.se of directly prohii)itinf? the diversion of water on the American side, and by taking away the motive for diverting water (m the Canadian side. l)y denying a m;irk<'t for electrical power generated on tlie Canadian side in the United States. The prohibition in the act is not absolute. h<»wever. It is clear that Congress wished, so far as it could, to accomi>lish its purpose with as little sacritice of the i)ecuniary intej-ests of those who had actually made investments, im tlie faith of the >(»ntinued unrestri<'ted diversion of water on the American side, or the con- tinued uiu-estricted transmission of electrical power from Canada into the United States, as was consistent with the preservation of the inti-grity and volume of the Niagara River jiassing over the I'alls. Tlie Internal ion.il Waterw.-iys Commission, a body ajipointed under a si.-itute of the United Slates to ccmfer with a similar body apiiointed under a statute of Canada to make rectmnnendations with reference to the control and government of tlie waters of the Great Lakes and the valley of the St. Lawrence, have looked into the question of the amount of waler which could be withdrawn on the American and the Canadian side of the Niagara Rivei without substantial in- jury to the cataract as one of the great natural beauties of the world, and after a most careful examination they have reported, recognizing fully the necessity of preserx ing intact the scenic grandeur of the Niagara Falls, that it would be wise to restrict diversion to 28.000 cubic feet a second on the American side of the Niagjira River (this to incliule Ki.OOO cubic second feet for the Chicago Drainage Canal), and to restrict the diversion on the Canadian side to ;^(>.0()0 cubic feet a second. This report was in answer to a resolution of Congress calling for an expression of opinion, and tliereupon Congress jirovided that the Secretary of War should be i)ermitted, hut not recpiired. to issue permits in the first instance for the diversion of l.j.tJOO cubic feet on the American side of Niagara River and the Erie Canal to persons or corjiorations actually en- gaged in the diversion of water and its use for power on that side for six niouflis, with leave to increase the same after six months shall have shown the effect of such diversion, if it will not .affect tlie scenic grandeur of the Falls. Congress furtlier pro\ ideil in the act. with reference to tlie power generated on the Canadian side, that the Secretary of War should be authorized, hut not required, to issue permits for the transmission of 100,000 liorsejiower from the (^anadian side to the markets of the I'nited States, .ind then provided that he might issue revocable jiennits for the transmission of a larger amount. lU'ovided that the total amount transmitted, together with that generated and used on the Canadian side, should nol exceed :!."0.0(H» horsejiower. or the eipiivaleut of the diversion from the falls of about 28,(M)() cubic feet of water. I liave already siyid that the object of tlie act is to preserve Niagara Falls. It is curious, liowever. tliat this purjiose as a limitation upon granting of per- mits b.T tlie Secretary of War is only specifically recited in reference to his gniuting of permits for diversions of additional amounts of water over lo.GlK) cubic feet on the American side. whi<'h are to be limited to " such amount, if any, as, in connection with the amount diverted from the Canadian side, shall not interfere with the navigable capacity of said river or its integrity and proper volume as a boundary stream or the scenic grandeur <«f Niagara Falls." This peculiarity in the act is significant of the tentative opinion of Congress PRESERVATION OF NIAGARA FALLS. 198 that 15,(JUU tubie I'cH't of water mi.ylu bv ilivorlcd on tUe Aniericau side and 100,(>00 electrical borsejiower uiijrbt he trausiuittcd from the Canadian side without substantial diminution of the scenic f^randeur of the Falls. T'n- doubtedly Couirress left it to the Secretary to reduce this total thus indicated in the matter of permits if he differed with this intimation of the congressional view. Acting, however, upon the same evidence wliich Congress had. and upon the additional statement made to me tit the hearing by Dr. John M. Clark, State geologist of New York, who seems to have been one of those engaged from the beginning in the whole movement for the preservation of Niagara Falls, and wlio has given close scientific attention to the matter. I have reached the couelusiou that with the diversion of 15,(j00 cubic feet on the Americjin side, and the tnuismission of 1G0,CHJU horse})ower from the Canadian side, the S(ienic grandeur of the Falls will not be affected substantially or perceptibly to the eye. With respect to the American Falls, this is an increase of but 2.5(X» cubic feet a second of what is now being diverted, and has been diverted for many years, and has not affected the Falls as a scenic wonder. With respect to the Canadian side, the water is drawn from the rivt>r in such a way as not to affect the American Falls at all, because the point from which it is drawn is considerably below the level of the water at the point where the waters separate above (ioat Island, and the waterways commission and Dr. Clark agree that the taking of lo.lKK) cubic feet from the Canadian side will not in any way affect or reduce the water going over the Anieric.in Falls. The water going over the Falls on the Can.idian side of Go.it Island is about five times the volume of that which goes over the American Falls, or, counting the total as 220.000 cubic feet a second, the volume of the Horse- shoe Falls would be about 180,000 cubic feet. If the amount withdrawn on the Canadian side for Canadian use were 5,000 cubic feet a second, which ii is not likely to be during the three years' life of these permits, the total to be withdra\^^l would not exceed 10 per cent of the volume of the stream, and considering the immense quantity which goes over the Horseshoe Falls the diminution would not be perceptible to the ej^e. I have given full hearing to the American Civic Association and to others interested in the preservation of the Falls, but nothing has been brought for- ward that really has any evidential force to aft'ect the soundness of these con- clusions. I'.y my direction, Capt. Charles W. Kutz, of the Corps of Engineers, United States Ai-my, made an investigation into the circumstances of each corporation applying for permits for diversion or transmission. The subjects upon which Capt. Kutz was ordered to report are describetl in my memorandum opinion of July 14, 190G, as follows : "It is necessary that the Secretary of War should know, before final action is taken by him, in the matter of permits for transmission, the capital already inve.sted in the Canadian companies; the degree of completion of the plant; the amount lilvely to be sold on the Canadian side of the current; the time when the plant shall be ready for operation ; the amou.nt now actually pro- duced; the amount now actually transmitted to the United States; the amount invested not only in the production of the current but in the plant and ma- chinery for its transmission, including the poles and wives, and all the details; and also the capital invested by the American companies who are to receive in the first instance the current thus iiroduced; the form in which tliat capital is. and the contracts into which they have entered, both witli the Canadian companies and with the comi)anies or persons to whom they expect to sell the current ; the dates of these contracts, and all the circumstances tending to show the extent of the injury that a refusal to grant the permits requested would cause to the investment of capital, together with the question of when the contracts were made upon the claims for the use of current are based, with a view to determining the good faith with which these contracts were entered into; and whether the threatened passage of law induced their uvdking." Capt. Kutz has made a reiwrt both with respect to the companies applying for permits on the American side and those applying for permits on the Canadian side, and I wish to express my great satisfaction at tlie tliorough- ness and spirit of judicial fairness with which Capt. Kutz and those wlio are associated with him have done their work. Taking up first the applications for permits for diversion on the American side, there is no room for discussion or difference. The Niagara Falls Power Co. is now using about .S,()00 cubic feet of water a second and producing 194 PRESERVATION OF NIAGARA FALL?. about 7G,G30 liorsepower. TJiere is some question as to the necessity of using some water for sluicing. This must be obtained from the 8,UO0 cubic feet permitted, and the use of the water for other i)urposes wlien sluicing is being done must be diminished. The Niagara Falls Hydraulic Power & >L'uiufa indin^ct t>ffeot upon the level of the lake, the permit should recite that this does not confer any right upon a consumer of the water to take the water from the canal without auhority and subject to the conditions in\poseil by the canal authorities, liut that it is intended to operate, and its operation is limited to confer, so far as the Federal Government is concerned, and the Secretary of War is authorized, the right to take the water and to claim immunity from any jtrosecution or legal objection under the fifth section of the P.urton Act. T shall refer the form of the permit v:\th these directions to the International Waterways Com- mission to pre])are it. I come now to the question of the permits to be granted to the applicants for the right to transmit electrical current from plants generating it on the Canadian side from the Niagara River. The applicants are four: The International Railway Co., which applies for a permit for S.OOO horsepower: the Niagar;!. Lockport & Ontario Co.. s])eak- ing in its own interest and that of the Ontario Power Co., for 90,000 horse- power; the Electric Transmission Co., speaking for itself and the Electrical Development Co., for G2,500 horsepower; and the Niagara Falls Power Co., speaking for the Canadian Niagara Power Co., for 121 ..')00 horsepower. Capt. Kutz recommended that the International Railway Co. be not granted anv permit, but that out of the KiO.OOO horsepower 2.r)(i',t l>e reserved in order that it might be granted to the International Railway Co. when that company shall have otbained ]ierniission from the conunissioners of the Queen Vict(H'ia Niagara Park to transmit the current through the park. The question of the company's right is pending before the r)ominion Government. Some years prior to 1001 this railway company, which owns all the railways in Buffalo and neighboring cities and towns, bought :i Canadian electric rail- way rtuniing from Chippewa to Queenstown. togethei' with a )ridge just be- low the Falls, and one at Lewiston. so as to make a loop with the railways on the American side. For this Canadian railway the applicant paid .$1,333,000. PEESERVATION OF NIAGARA FALLS. 195 It had a small power plant located in tlio Queen ^■iel(n•ia I'aik. and under its charter it could only use power genei-atod Iherefroni to run the ('anaiiiaii railway. In I'JOl this charter was amended so as to permit the use of elec- tricity for Its railroads on hoth sides, and the plant has heeu develoiKMl by the expenditure of $265,000, so that now it can ,i,'enerate 3,600 hoisepower. ' The effective head is OS feet, so that it takes about twice as nuich water to de- velop this power per horsepower as in the great plants I shall hereafter describe. It Is quite clear that the original investment in the purchase of the railway was not made to secure the transmission of electric i»ower across the boundary, because there was no power to do so under the charter. The subsequent investment of $205,000 can perhaps be said to have been made with this in view. Capt. Kutz recommended that 2.500 horsepower be re- served for this company. The commissioners of Queen Victoria Park refxised to approve the plans of this company for a transmitting line to ihe boundary, so that it can not now use the electricity except on the Canadian line, where it uses 1.200 horsepower. It generates now 3,000 horsepower. The permit of 2,500 horsepower would effect a saving of $30,000 a year. The investment for transnussion to the United States does not exceed $265,000. All that can be reasonably expectetl from the outlay under the circunisiauces is not to exceed 7 per cent on the remainder, or about .$1^,000. 'i'he permit should not. therefore, issue for more than three-lifths of 2.500 horseitower. or 1,500 horsepower. The fact that it may generate 8,000 horsepower by the expendi- ture of $150,000 I do not regard as important, and I cai'ry out the ))urpose of Congress in taking away any motive for making such an investment. The amount of 1.500 horsepower will be reserved to await the decision of the Dominion Government in the controversy between the International Kaihvay Co. and the commissioners of Queen Victoria Park. This leaves out of the 160.000 horsepower 15S.500 horsepower to be distributed to the other three companies. I^et us consider tlieir financial status and prospects. The Ontario Power Co. was ini-<)rjiorated in ISST. and theie was no limita- tion in its charter upon the amount of power wliich it might generate. Its plans, however, were sultject to ihe approval of ihe commissioners of Queen Victoria Park, and plans for its works have been iipynoved for 180.000 horse- power. The head works for this amount have been constructed and located above the first line of rapids. It was necessary under the plans to construct three conduits through the park. Only one of these conduits has been con- structed, and it has a capacity to supply six generating units, three for 10.000 horsepower each and three for 12,000 each, or 66,000 horsepower in all. The cost to complete ihe six units and thus produce 66.000 is $6,500,000. The amount required to complete the plant to the projected size, producing ISO.OOO horsepower, would be $6,500,000 additional ; and the amount required to pro- duce 120.000 horsepower woull be about $3,200,000. In addition to this, the Ontario Transmission Company, an ancillary company to the main i)ower com- pany, has expended about $1,000,000 in transmission, riglit of way and plant, and the power company has entered into contracts for the fui-nishing of 6.01X) horsepower, witli an op; ion by the purchasers to increase this to 13,000 for Canadian consumption. The Niagara. Lockport & Ontario Co. of New York is affiliated wtih the Ontario Power Co., and has constructed a very elaborate transmission plant from the internatiou;',! boundary to Lockport, from Lock- port to Pifffalo. and from Lockport by way of Kochester to Syracuse. It has expended $2,785,000. of which $1,200,000 was for right of way and $1,162,000 for construction. lis capacity for transmission from the international boundary to liOckport is (iO.OOO horsepf»wer. and there is the same capacity from Lock- port to Buffalo: from Lockport to Syracuse it has a capacity of 10.000 horse- power, and a second line of greater capacity is under construciion. It claims that its investment will amount, when its transmission lines are completed, to upward of $4,000,000. and certainly the expend! ure will reach $3,000,000. The Electrical Development Co. leceived a charter. 5 Edward VII. and was authorized to take 125.f>00 horsepower, or S.ooo cubic feet a second. The head- works, wheel iiit. and tail race have been comiileted for 11 units of 12.500 horse- l)Ower each. The junver house has been comjileted for seven units, but the ma- chinery installeil and contracted for is only for four units. The completion of the four units will involve the expenditure of .$6,300,000. and it may be in- creased to 11 units, or 132,000 liorsei>owor, by the expenditure of $1,750,000. This comi)auy has erected a tiansmission j^lant to Tonmto which will convey 20.0iX> horseiiower and that will involve an expe.iditure when completed of $2,610,000. The demands for Canadian consumjiiion which this company will satisfy are about .30,fW¥> horsepower. There is an electrical transmission com- 196 PKKSKKVATIOX OF XIAGAKA FALLfi. j>;in.v of Aiimricjiii niiu'iii and cliart*'!' attilijitrd witli this L\on towns and cities, but the enterprise is larjroly inclioate and the investment is in prosjject rather than actual. The Canadian Niajiara I'ower Co. was orsjanized in lSwer companies on the Anierii-an side. It is not limited in tlie quantity of power which it is to use. and its plans are suliject to the ai)proval of the com- n\issionei"s f)f the Queen's Park. Plans have been approved for 120.tK)<) horse- power, which means 11 units of ll,(i(H» horsepower, with one of these as a "spare.'' which makes its normal ca]iaci'y IIO.(MX). Its headworks. wheel pits, and tailrace tunnel are Cfimpleted for the full development. Five uiiits have already been installe.r»nO.(KK». and to make 11 miits would cost $1.2riO.(M)<) nioiv. It has an underuround conduit connectinj: tiie (^anadian planr witii the American jilant of the Xia.sava L'alls Power Co.. with a capacity of 12S.(MHi horsepower ti-ansmission, witli cables in it of the capaci y of o2.000. It lias a separate Iraiisniission line K; miles alonj; the Niagara River to Fort Erie, with towers to cany the lines .icross the rivt'r. all of which transmis.sion ])lant cost $484,.( I' Ml. which will produce 6(»,tM"M» horsepower: tJiat it and its attiliated companies have expended Sl.r^KMMiO for transmission in Canada.' and about $;'>.<>( m).<((K) for transmission in the rnite0<). and perha|is .'j;8()ll.U0t» in transmission lines in the I'nited States. That the Canadian .Niagara Power Co. lias invested $ri.3o0.00(). which will l)roduce ."l."*,* M M t horseixiw er. and .'iJ.'")< M (.000 in vran.sniission lines in the Uniteauies. But nK)re than all, it has expended $0,000,000 in a transmission line from the international boundary to Rochester, S.vracuse, I.ockport. and Rutt'alo. This investmenet i.s almost wholly dependent for use and profit on the importation of electricity from Canada. Capt. Kutz reports tliat 00.(X)0 horsepower will t-nable the company to secure a reasonable r<'turn on the transmission investment after paying a iiroper amount for the liower at the boundary, riiis would leave to be dividetl between the other two conii)anies 90,000 horsepower, and objection is made to this discrimination against them in favor of the Ontario Power Co. iiecauso their plants are so arranged that by the expenditure of a million and a quarter the Niagara Co. could increa.se iis outinit to 110.000 horsepower, and by the expenditure of a million and a half the Development Co. could increase its output to 130.000 luirsei)ower. whereas the Ontario Co. must ex])end $0.r>(X),OCM) more to reach its full capacity of 180,000 horsepower, or abcnit $:5.2(X>,(MW) to reach a capacity of 130,000 horsepower. While this circumstance is entitled to some weight against jtroportiiming the allowances to the capital actually expended on the power plants or the horsepower now produced from the present installations, still I thing the considerations already suggested. es])ecially the special expendi- tJire for long distance transmission, really outweigh everything else in requiring that if possible a sufficient amount be allowed to pay a reasonable jiroht on tlnit investment, which is wholly dependent on transmission. Connng now to the division between the Niagara Falls Co. and the develop- ment company, the conclusion is not so easy. The development company has invested about three-quarters of a million more on its power plant than the Niagara Co., but under its jiresent installation it can not i>roduce as nmch horsepower bv 5,000. It has ex])ended $2,500,000 to carry 20,000 horsepower to PKESEKVATION OF XIAGAHA FALLS. 197 Toronto and has contracts for 10,000 more. The Canadian bushiess does not i)a.v as well as the American business, especially that of the Niaj^ara Co.. which is quite profiiab^e imder its existing contracts. Considerini; these con- tracts, it seems to me thar witli its slight cost of transmission and the advanta- geous situation that it enjoys in respect to its affiliated American company, an allowance of r)2..5W horsepower for the Niagara Co. will enable it to fulfill all its probable demands at a good i)rofit. The works across the river in-oduce TtJ.oOO liorsepower, and adding n2..'")00 horsepower malies 128,800 horsepower The American company now eanis per cent on its stock of ip4,000,000 nnd intere.st on a bonded indebtedness of .$10,000,000. It lias contracts requiring a maximum of 102.000 hor.sepower. but the call on its caiiacity lias never excemled 8.5.000 horsepower, because the calls do not coincide. On the capital invested, there is no likelihood tiiat the Niagaia Co. will suffer a loss. It will not make as much as it would have made had it been allowed to transmit its full capacity after building the contemplatcKl additions to its installation, but the act only intended to save tlie investors from losses on tlie plant actually invested, not to compensate tliem for prospective gain. This leaves for the Electrical Development Co. 46,000 horsepower to transmit to the United States after producing 80,000 horsepower and transmitting it to Toronto and elsewhere. This would justify the company in increasing the number of units in its installation if it could secure transmission to the United States. It is probable that the amount is not enough to justify the elaborate outlay required for transmission to American customers, and this reduces the value of the permit; but I can not think that it will not be able to arrange for the disposition of transmissible current at the boundary at such figures as to be profitable, even if the amount it makes per horsepower be less than that which the two American comiianies realize, because of their greater facility for reaching customers, the one through the Rochester transmission plant and the other through the American Niagara Co.'s plant and good will. Under this arrangement and allotment the Canadian Co. becomes the onl.v one which, assuming a demand for its American delivery, will .be justified in increasing the capacity of its power plant by installing more units. The demand in Canada for tl)e i)roduct of the Ontario and Niagara companies ma.v grow .some, but not very nuich, so that they are likel.v to be confined t<> their present installation. I'efore closing I ought to notice a claim of the Niagara Co. that it lias by its charter a jn-eferential right over the other two companies, so that it ought to be allowed its full 110,000 horsepower for transmission before the other two companies receive permits to transmit any current at all. The preference claimed is really only a priority in taking water from the river, and can not be reasonably extended to apply to rights to transmit current where there is no lack of water for all. The Niagara Falls Power Co. and its Canadian other self ask tliat the two permits to them sliall contain a provision b.v wliich in case of a reduction of the amount of water diverted on tlie American side below the permitted limit. a corresjionding increase beyond the limit permitted on the Canadian side may be authorized. This privilege must be denied. The American diversion and the Canadian transmission must be kept separate in the permits and should be absolute and not variable. It would form an uncomfortable precedent in other cases. It has been asserted by persons who profess to have information that the three companies here seeking permits are looking forward to an amalgamation of interests or a combination for the purpose of keeping up the prices of elec- trical power by avoiding competition that will deny to the public the benefit it is entitled to enjoy from the natural water power that these companies use at comparatively small benefit to any one of tlie (Tovernments whicli au- thorize its use. This is denied by the applicants. ,Tust what effect the exist- ence of such a combination ought to have to require a revocation or modification of these permits is a matter of grave doubt, but should evidence in proiier form of the existence of such combination be l)i-ought to me as a ground for the modification of the action now taken, it will be given careful consideration. The order for permits will, therefore, be for — The International Ky. Co 1..")00 The Ontario Power Co _ 00,000 The Canadian Niagara Falls Power Co .".2,500 The Electrical Pevelopinent Co 46.000 198 PRESERVATION OF NIAGARA FALLS. The Chief of Engineers and Cnpt. Kntz will prepare the i)erniits after con- sultation with counsel for the respective companies. An order should also be entered detailing Capt. Kutz to report a plan for the supervision of the opera- tion of these companies under the permits, with a view to secure strict conipli- anr'o with their terms. W. H. Taft. Secret n IV of War. .Tanvary is. 1907. A BILL For the control ;ind rcnulat ion of tlu- wnlcrs of Ni:i;r:ii;i Kivor. for Iho pri-sor- vnrion of Niagara Falls, and for other purposes. Be it enacted hy the Senate and House of Representatives of the United States of America in Congress assembled, That the diversion of water from Niagara River or its tributaries, in the State of New York, is hereby prohibited, except with the consent of the Secretary of War as hereinafter authorized in section two of this Act : Provided, That this prohibition shall not be inter- preted as forbidding the diversion of tlie vratevs of the (Jreat Lakes or of Niagara River for sanitary or domestic purposes, or for navigation, the amount of which may be fixed from time to time by the Congress of the T'nited States or by the Secretary of War of the United States under its direction. Sec. 2. That tlie Secretary of War is hereby authorized to grant permits for the diversioTi of water in the United States from said Niagara River or its tributaries for Ihe creation of power to individuals, companies, or corporations wliich are now actuall.v producing power from the waters of said river, or its tributaries, in the State of New York, or from the Erie Canal: also iiermits for the transmission of power from the Dominion of Canada into the United Slates, to companies legally authorized therefor, both for diversion and transmission, as hereinafter stated, but permits for divei'sion shall be issued only to the individuals, companies, or corporations as aforesaid, and only to the amount now actually in use or conti-acted to be used in factories the buildings for which are now in process of construction, not exceeding to any one individual, company or corporation as aforesaid a maximnm amount of eight thousand six hundred cubic feet per second, and not exceeding to all individuals, companies or corporations as aforesaid an aggregate amount of fifteen thousand six hun- dred cubic feet per second : but no revocable permits shall be issued by the said Secretary under the pi-ovisions hereafter set forth for the diversion of addi- tional amounts of water from the said river or its tributaries until the approxi- jnate amount for which permits may be issued as above, to wit. fifteen thousand six hundred cubic feet per second, shall for a period of not less than six months have been diverted from the waters of said river or its tributaries, in the State of New York: Vrorided, That the said Secretai-y. subject to the provisions of section five of this Act, under the limitations relating to time above set forth is hereby authorized to grant revocable permits, from time to time, to such indi- viduals, companies, or corporations, or their assigns, for the diversion of addi- tional amounts of water from the said river or its tributaries to such amount, if any, as. in connection witli the amount diverted on the Canadian side, shall not injure or intwfere with the navigable capacity of said river, or its integrity and proper volume as a boundary stream, or the scenic grandeur of Niagara Falls; and that the quantity of electrical power which may by jiermits bd allowed to be transmitted from the Dominion of Canada into the United States, shall be one hundred and sixty thousand horsepower: Provided further. That the said Secretary, subject to the provisions of section five of this act. may issue revocable i)ermits for the transmission of additional electrical jiower so generated in Canada, but in no event shall the amount included in such permits, together with the said one hundred and sixty thonsjind horsepower and the amount generated and used in Canada, exceed three hundred and fifty thou- sand horsepower : Providing ahrayx. That the ])rovisions herein pei'mitting diver- sions and fixing the aggregate horsei)ower herein permitted to be transmitted into the T'nited Stales, as afores:iid. are intended as a limitation on the author- ity of the Seci-etary of War, and shall in no wise be construed as a direction to said Secretary to issu(> i)ermits. and the Secretar.v of W.-ir shall make regula- tions preventing ov limiting the diversion of water and the admission of elec- trical power as herein stated; and the permits for the transmission of elec- trical i>ower issued by the Secretary of War may specify the persons, com- jtanies. or corporations by whom the same shall be transmitted, and the i)er- sons, companies, or cori>orations to whom the same shall be delivered. PRESERVATION OF NIAGARA FALLS. 199 Sec. 3. That any person, company, or corporation diverting water from the said Niagara Kiver or its tributaries, or transmittinj^ electrical power into the United States from Canada, except as herein stated, or violating any of tlie provisions of this act. shall be deemed ^lilty of a misdemeanor, and on con- viction thereof shall be punished Ity a fine not exceeding two thousand live liundred dollars nor less than tive hundred dollars, or by imprisonment (in the case of a natural person^ not exceeding one year, or l)y both such i)unishments. in the disciotion of the court. And, further, the removal of any structures or parts of structures erected in violaticm of this act, or any construction incidental to or used for such diversion of water or transmission of power as is herein prohil)ited. as well as any diversion of water or transmission of power in vio- lation liere<^)f, may be enforced or enjoined at the suit of the United States by any circuit court having jurisdiction in any district in which the same may be located, and proper proceedings to this end may be instituted under the direc- tion of the Attorney General of the United States. Sec. 4. That the President of the United States is respectfully requested to open negotiations with the Government of Great Britain for the purpose of effectually providing, by suitable treaty with said Government, for such regu- lation and control of the waters of Niagara Kiver and its tributaries as will preserve the scenic grandeur of Niagara Falls and of the rapids in said river. Sec. 5. That the provisions of this act shall remain in force for three years from and after date of its passage, at the expiration of which time all permits granted hereunder b.y the Secretary of War shall terminate unless sooner re- voked, and the Secretary of War is hereby authorized to revoke any or all permits granted by him by authority of this act, and nothing herein contained shall be held to confirm, establish, or confer any rights heretofore claimed or exercised in the diversion of water or the transmission of power. Sec. 6. That for accomplishing the purposes detailed in this act the sum of ' fifty thousand dollars, or so much thereof as may be necessary, is hereby ap- ])ropriated from any moneys in the Treasury not otherwise appropriated. Sec 7. That the right to alter, amend, or repeal this act is hereby expressly reserved. Approved, June 29, 1906. Maj. Ladue. There is another matter that I feel some hesitancy in touching on, since it affects only the scenic beauty of the Falls and \dcinity, which is a subject not altogether in my line. In granting these permits in 1907 the Secretary of War incorporated in them certain conditions as to the restoration of the scenic beauty of the Falls and the Gorge. I may say that these conditions have l)een fully and wholly lived up to by the power companies. They haA'e done everything that the War Department has asked them to do in this matter. To assist him in deciding what these conditions should be and what the companies should do, the Secretary of War engaged the services of several eminent artists and others under the designa- tion of the Niagara Falls committee. The report of that committee is in this document (H. Doc. No. 246). It appears to me desirable, although I haA^e no instructions from the Secretary of War to this effect, that in the legislation that is adopted there should be some pro- vision which will justify continuing this committee in existence, or at least that it be so drawn as to not legislate the conmiittee out of existence. The Chairman. Are these commissioners paid by the Government now ? ]Maj. Ladle. There have been some fees paid to certain of the meui- bers of the committee for particular services. Their service on this committee is a work of love to a certain extent, and on account of the fact that they are very much interested in this subject, the fees that they are satisfied to receive are very much less than the fees they would receive for any such services in other employments, but they do receive small fees for their attendance on the committee. 200 PRESERVATION OF NIAGARA FALLS. Mr. Kendall. About how many. Major, constitute this committee? Maj. Ladle. I believe there are four! Mr. (Jarneh. That is not the National Waterways Committee, is it? ^laj. Ladue. No, sir. Mr. Foster. AVhat are their names? Maj. Ladle. Their names are: Mr. Frank I). Millet. Mr, Frederick Law Olmstead. Maj. .John S. Sewell. and Maj. Charles Keller. Maj. Keller was ai)pointed in ])lace of Mr. McKiuL Avho died. Mr. (tarner. Could you estimate. Major, how much thi- couHuitteo has o^otten up to date? ]Maj. Ladle. The total expenditure on account of the committee, including expenses of every kind, from 1907 to date, has been $3,627.80. The Chairman, Major, will you be ffood enough to be liere next Tuesday morning? Maj. Ladue, Yes, sir. I shall be pleased to do so. Mr. Garner. Major, with the permission of the chairman. I want to say I believe it was yesterday, or the day before, there was some discussion about a permit that has not been utilized. Have you any additional information about that matter that you could give to the committee? Afaj. Ladlte. T know nothing further than I knew the other night. In what particular? jMr, Garner, Well, if I could. I would like to have some reason given to the committee why a permit has been in existence for five years, and the company to which the permit was given has not utilized it to bring power into the LTnited States. The permit has only been utilized by other companies to the extent of 10.000 or 12.000 horsepoAver. whereas it a])peared from the statements of the gentlemen from AVindsor. Ontario, that applications are now on file with the War Department asking for 25,000 horsepower to go into Detroit, Mich., and that application had been refused on the ground that the full extent of the permit had been already granted. !Maj. Ladl'e. The Burton law^ was limited by its terms to three years. It authorized the Secretary of AVar to grant permits for certain things — for the diversion of a certain amount of water and for the importation of a certain amount of power. In addition to these specified amounts, it authorized the Secretary of A\'ar. under certain specific conditions, to grant additional revocable permits for importation of additional power, I was not connected with this work at the time, but I presume that it has been generally considered that these permits, which were granted after a Aery thorough in- vestigation and consideration of the claims of the various compa- nies, were intended to remain in force as long as the Burton law remained in force, unless there should be some very good and com- pelling reason for their revocation. As I say. I give that as my view of the matter, but as far as I know the question has not been raised until this hearing. The Burt(m law has been extended two or three times, until now it has been over four years since these permit.s were originally granted, but I presume the same thought has been in the minds of those who have had to do with this matter, that it Avas the probable intent of the Burton laAA', as Avell as the intent of the per- mits given under that laAV. that these permits should last as long as the Burton law lasted, unless some good reason for their re\'oca- PEESEEVATION OF ^'IAGAKA FALL&. 201 tion should appear. So far as I know, there has been no question as to this permit of the Electrical Development Co. until recently. Last 3'ear, in 1911, this Detroit company applied Jor a permit to transmit additional power into the United States at Detroit. They were told that the full an)ount of the 1G0,000 horsepower authorized by the Burton law was covered b}'^ existing permits. They were also told that there was a provision in the Burton law by which addi- tional revocable permits mig'ht be granted under certain conditions specified. Those conditions were, as we informed the company, iirst, thai such permits must be granted to companies legally aMthoiized to do the business ^^hich ped the matter at ilie time. Recently, however, tliey have renewed their application for a permit for transmission of this additional power. With this new applica- tion they have given u> the information that we asked for. They have shown us that they are legally authorized to do the business. They have .shown us copies o^' (heir charter and contracts for the power. They have given us figures, which are verified by our records, showing that the o^O.OOO horsepower limit of the Burton Act will not be exceeded. They have also given us figures, which are verified by our recoids. bhowing that the diversion will not exceed the legal limit iii Canada. The matter now becomes one of policy. Legall}^ the permit can be gi anted, I'he question of policy rests with the Secretary of War, and is under consideration now. Ml. Garnkk. Has any other company applied for a ]>ennit to bring power in from Canada'^ Maj. Ladue. I recall no recent application from any other com- pany. Some years ago there were some applications, but as J recall the matter none of thein came to the point of being formally acted u])on by the Seci-etary of W^ar. Mr. Garner. In construing the Burton act as giving a permit per- manency during its life, if it v»ere shown to you and to the War Department that the company that had the permit was not using it, would you still think that the Burton act contemplated, because you issued that permit,. that you must keep it in existence during the life of that law to the exclusion of others? Maj. Ladie. Not at all. I consider that if such a matter were formally presented it would be a question for consideration: and if the case were strong enough, if a proper case were made out, I would consider that under the law the permit might be revoked. There is no doubt that the permit is subject to revocation at any time under the act. It simply becomes a question of policy. 202 PEESERVATION OF NIAGARA FALLS. Mr. Garner. And then it resolves itself into a question of whether it would be proper policy for the Government to revoke a permit and f^rant it to someone else? Maj. Ladtk. That is as I understand the matter. Mr. Garner. There is one company to Avhich a permit was granted five years ago that has never utilized this permit as to selling its power, but another company has been im]:)orting it into the United States. Maj. Ladue. There is one which is not now utilizing its j^ermit. Mr. Cooper. ^Vhat company is that ? Mr. Ladie. The Electrical Development Co. Mr. Cooper. Where did it get its charter? Maj. Ladue. The Electrical Development Co. is a Canadian cor- poration Avhich develops power. Of course, the j^ermit is not granted to the Electrical Development Co.. but to its associates on this side. Mr. Cooper. 'NMio are they? Maj. Ladue. The Cataract Power & Conduit Co. of Niagara Falls and to the Niagara Falls Electrical Transmission Co.. and to such other distributing agents as the Electrical Development Co. may designate. Mr. Harrison. Their charter was granted in 1908? Maj. Ladi'e. Investigations before the permit was given showed that the company on the American side had gone to some expense to prepare its plant for the utilization of the i)ower. and that at that time they were as much entitled to it as anybody else. Why they have not utilized it I do not know. Mr. Garner. ]Major, do you know the officers and members of tliat company? Have you a record of them? Maj. Ladue. We can certainly get it if we have not got it. Mr. Kendall. Gen. Greene, do you know who they are? Gen. Greene. The permit gives the right to the Electrical Develop- ment Co. and to all the companies to whom they see fit to sell it. That is in the re])orts of the War Department, is it not? The permit reads as follows: August 17, 1907. To the Niiicjiia Falls Electrical 'I'miisiiiission Co.. and to the Cataract Power & Conduit Co.. and to such othor distributins ajrents of companies in the United States as the Electrical Develoiunent Co. of Ontario (Ltd.) may designate to HH-eive from the said Electrical Dovelo)mient Co. of Ontario (Ltd.) at the international boundary line and to transndl into the United States 4G.000 elec- trical horsei)ower, provided that a part of such electrical power may be received by the Cataract I'ower & Transmission Co.. at the international boundary over the power transmission lines of the Canadian Niagara Power Co., and that the remaining part of such electrical power may be transmitted into the United States over transmission circuits thereafter to be approved by the Chief of Engineers, and may be received by the said Niagara Falls Electrical Trans- mission Co., or such distributing agents or companies in the United States as the said The Electrical Development Co. of Ontario (Ltd.) may designate. Mr. Garner. I believe you have purchased some power from this company that had the permit ? Gen. Greene. Never: except one or two hours in the winter when our manufacturing load was a little more than our powerhouse could take care of. Mr. Garner. ^Yho did purchase this power? Do you know? Gen. Greene. Well, it is common report that the Cataract Power & Conduit Co., of Buffalo, is purchasing power from them. That PRESERVATION OF NIAGARA FALLS. 208 contract was made public in reports of the Canadian park commis- sioners. It ran, as 1 recall, for three years, from 1907 to 1910, and was for one unit or such part of it as the Cataract Power & Conduit Co., of Buffalo, might Avish to use, the maximum power of the unit being about 12,000 horsepower. Mr. Garner. Do you remember anything, General, about what price the contract for that power called for? You stated that the contract was made public? (ien. Greene. I was not strictly accurate. xV reference to the con- tract was made public. T never saw the price and I do not know^ what it was. Mr. Garner. You do not know Avhere we could get information as to the price they paid for this power? Gen. Gkeene. I do not know except from the officers of the Cat- aract Power & Conduit Co., or the officers of the Buffalo Electrical Development Co. JNIr. Garner. 1 was speaking about any one in this city? (tcu. Greene. I do not think the War Department has it. You asked me, I think, as to the officers. The report further says: The Electrical Development Co., under a contract which expired June 20, 1911. formerly transmitted power to Terminal B station at Buffalo in par- allel with the Canadian Niagara Power Co. The load was continuous, being the peaks for short periods of the day only. These peaks reached a maximum of 9,000 to 10.000 horsepower. .Since the expiration of the contract no power has been exported from the plant of the Electrical Development Co. Xo contract has been made with the Electrical Development Co. since the expiration of this contract. You asked me as to officers of this company; they live in Toronto, Canada, and are as follows: Mr. Robert J. Fleming is the general manager; I think Sir William McKenzie is president, but am not perfectly sure; he is the principal owner. Mr. Goodwin. It is ascertained that after a life of 50 years one of these leases had expired and was renewed for 999 years; now is that correct ? Gen. Greene. I think it is a little in error, sir. I think it said that the charter of a New York corporation which originally ran for oO years had been extended to 999 j^ears. Was not that it? Mr. Goodwin. Well, possibly it was in that form. Well, now, is that charter irrevocable if it should be ascertained, if we could ascertain the quantity of water that would flow from the cataract? Gen. Greene. I do not knoAv as to the company ; I can tell you as to the charters of the companies I am connected with. The con- tracts with the Park Commissioners, including the right to occup)'^ their land and use the water going past their lands, in which they are riparian owners, run for 50 years beginning with 1900, together with three renewals of 20 years each, at a price to be agreed upon in each case, or settled by arbitration. The price for the first fiscal year is fixed. Mr. Goodwin. It seems to me it would be contrary to public policy to make a renewal of such extended length as practically 1,000 years. Gen. Greene. That is the charter, the right to do business; but the contract I speak of, or the right to take the water on the Canadian side, is 50 years, with the privilege of three renewals of 20 years each. Mr. Goodwin. What is it on the American side? 204 PRESERVATION OF NIAGARA FAI/LS. Gen. (tKeene. On the American >icle tlie eharter is perpetual, but the>' claim the right of ownership in the riparian rights to the waters of Niagara Falls, just the same as in the ownership of their land. Mr. Brown. That is covered under the New York laws. The Chairman, You can proceed, Maj. Ladue. Maj. Ladue. I have nothing more to say. unless the committee de- sires to ask me any ({uestions. Mr. Garner. Major, have we any way, if 1 understand (ren. (ireene's and your statements, of ascertaining the compensation that this electrical company that had the permit to import the power, received for transferring this permit to some other company? Maj. Ladue. L think we have no record in the A>'ar Department of any such matters. I do not tmderstand that thev transferred their permit. Mr. (tar>;er. Well, if I understand it. they did not i)roduce power and import it, but they sold power. (iren. (iReene. Yes: they produced the ))ower and sold it to the Cataract Power & Conduit Co., of Buti'alo, as this long contract I gave yoti gave them the right to do: but what price they got I do not know. I suppose you can summon the officers of the Cataract Power & Conduit Co. here and they will tell you. Mr. Garner. I was trying to get at Avhat profit this company that had the permit to import the power into the United States and did not utilize that permit, made out of the ))ermit. That is what T wanted to get at. if possible. Maj. Ladi'e. I am unable to give any information on that subject. I do not think we have any source of such information. Mr. Cooper. AVheii do ycai expect that report. House Keport Xo. 246, to be printed 'i Maj. Ladie. We heard from the Government Piinting Office that it was likely to be out this afternoon. The CiiAHoiAN. T called up the Government Pi-inting Office and the Public Printer told me they were rushing the work. We will have it here before the hearings close. Mr. Harrison. T ask for information. ILas the report of the In- ternational Waterways Conmiissitm been made a part of this record? The Chairman. It has not been. Mr. ILarrison. It appears to me it ou^ht to be made a part of this record. I have read that report and it is very interesting. I find it in the hearings before the Committee on Rivers and Harbors in 1006. The Chairman. Have you got it, Mr. Harrison? Mr. Harrison. Yes; it is in this book here. The Chairman. How many pages? Mr. IIarrison. It is not very long. About eight pages. The Chairman. If there is no objection, that report can be incor- porated in the record of these proceedings, and it is so ordered. PRESERVATION OF NIAGARA FALLS. 205 [Senate Document No. 242, Fifty-ninth Congress, first session.] Rei'ort of the American Members of the International Waterways Com- 5IISSI0N, WITH Letters from the Secretary of State and the Secretary OF War Including Memoranda Regarding the Preservation of Niagara Falls. To the Senate and House of Representatioes : I submit to you herewith the report of the American members of the Interna- tional AVaterways Commission regarding the preservation of Niagara Falls. I also submit to you certain letters from the Secretary of State and the Secretary of War, including memoranda showing what has been attempted by the De- partment of State in (he effort to secure the preservation of the falls by treaty. I earnestly recommend that Congress enact into law the suggestions of the- American members of the International Waterways Commission for the preser- vation of Niagara Falls, without waiting for the negotiation of a treaty. The law can be i)nt in such form that it will lapse, sa.y in three years, provided that during that time no international agreement has been reached. But in any event I hope that this Nation will make it evident that it is doing all in its power to preserve the great scenic wonder, the existence of which, unharmed^ should J)e a matter of pride to every dweller on this continent. Theodore Roosevelt. The White House, March 21, 1i>06. Department of State. Washington, March 24, 1906. Dear Mr. President : I return the letter of the Secretary of War with the report of the American members of the International Waterways Commission, regarding the preservation of Niagai'a Falls. I think the legislation recommended by the commission would be very useful. Faithfully, yours, Blihu Root. War Department. Washington, March 20, 1906. "My Dear Mr. President: I herewith transmit, for submission by you to Congress, the reiiort of the American members of the International Waterways Commission, made by them in accordance with the joint resolution approved March 15, 1906, and set out in their report. The recommendations of the com- mission of legislation necessary and desirable to prevent the further depletion of water flowing over the Niagara Falls suggests the question whether such legislation is within the limitations of the legislative power of Congress, when applied to nonnavig.-ible parts of a stream which is within the borders of a State and which i,s only partly navigable, if the use of the water to be inhibited does not affect navigation in the navigable part of the stream below. It would seem that the treaty power exercised by the President and Senate with respect to a stream which forms the boundary between this country and another would be subject to less limitation in this regard than the legislative power of Congress, and therefore that it might be more advisable to" effect the result sought by Congress through a treaty than through a statute. Vevy respectfully. W. H. Taft, Secretary of Wan The President. REPORT or rilE AMERICAN MEMBERS OF THE INTI:RNATI0NAL WATERWAYS COMMIS- sion regarding the preservation of niagara falls. International AVaterways Commission, Office of Chairman American Section. Washington, D. C. March 19, 1906. Sir: 1. The American members of the International Waterways Commission have the lnnuir to submit for transmittal to Congress this report, in compliance- with the following joint resolution approved March 15. 1906: "Resolved hi/ the Senate and House of Representatives of the United States of America in Congress a.ssemhled. That the members representing the United 28305—12 14 206 PBESERVATION OF XTAOARA FALLS, States upon tho Intcrnatioual (Commission creiitod by section four of the river and harbor ace of June thirteenth, nineteen hundred and two. be requested to report to Congress at an ei.rly liay what action is in their .ludgment necessary and desirable to prevent the further depletion of water tlowinjr over Niagara Palls: and the said members are also requested and directed to exert, in con- .luncticn with the members of said connnission representinsi the Dominion of Canada, if iiractieaiiie. iill [lossible efforts for the preservation of the said Niagara Falls in tiieir natural condition." 2. The suriilus waters of Lake Erie are discharge-d through ilie Niagara Kiver into Lake Ontario, the mean level of I>ake Erie being r>72.S(i fet-t and that of Lake Ontario being 240.GI feet above the sea. Leaving I>ake Erie at Buffalo, the ri\er is navigable and flows with a moderate sjope to a short distance below Welland Jiiver. or (Miiiiiiewa Creek, about 10 miles, in which distance it has a fall of .^bout 14 feet. The slope here is suddenly increased and (he river ceases to be niivigaltle In the next hnlf mile it has a fall of about 50 feet, forming the rapids above the falls. It is divided by Cloat Island into two arm.s of unequal size, that on the Canadian side carrying tdtout seven times the volume of water carried bj-. that on the American side. At the foot of Goat Island the waters of both arms plunge over a vertical precipice, con- stituting Niagara Falls jnoper. that on the Can- dian side being usually known as the Horseshoe Fall, and that on the American side as the American Fall. The height of the Horseshoe Fall is about 1(51 feet and that of the American Fall 105 feet. Immediately below the falls the river is again navigable for a short distance, and then assumes the character of rapids as far as Lewiston. 7 miles from lake Ontario, where it again becomes navigable and remains so luitil it enters the lake. '^. The volume of water flowing varies with the level of Lake Erie, which level is sub.ieet to variations of several feet, dejiending u.pon the rainfall, barometric pressure, and direction and force of the wind. At the mean level of the lake (elevation 572.88) the volume of discharge is 222.400 cubic feet per second. At a very low stage (elevation 571) the volume is ISO.SUO. (See Annual KL-pnrt. Chief of Engineers. V. S. Army, for 1000. p. r»3(il.) For short periods in mid- winter, or with prolonged adverse winds, it has sometimes be'ii even les.s. 4. It is the great volume of water in the falls themselves and in the raiiids which makes tlie jilace unique. The tremendous disi)lay of power in wild lurbn- lence fascinates the mind, and gives to the question of Niagara's preservation a national interest. "). The local authorities on both sides of the river have rei-ognizcil their responsibilities in this matter, but have taken somewhat different ^iews .is vo what these responsibilities are. As long ago as 18S3 the State of New York pro- vided for the acquisition of the lauds in that State ad.loining the Falls, with a view to creating a jiublic iiark, and in 18S5 it de-laved that these lauds •'shall forever be reserved by the State for the purpose of rest(n-ing the seeueiy of the Falls of Niagara to and preserving it in its natural (-ondilion; they shall forever be kei)t open and free of access to all mankind without fee. charge, or expense to any person for entering upon or passing to or o\er any part thereof." A coui- lyission of five was <-reated to carry out the purposes of the act. The State reservation now includes 412 acres, part of which is under water, and an annual appropriation of some ^2r).()00 is made for its care and maintena.nce. The com- mission has no jurisdiction beyond the limits of the reservation, but it has never throughout its existence failed to protest and bring all its intiue-.ice to liear ;!gain.r on. 0. Soon- after the creation of the New York State reservation a publit- park >vas I re ited on the Canadian side, called the Queen Mcforia Niagara Falls Park, and was placed under the control of five connnissioners. This park now ex- tends pr: (tically the whole length of the Niagara Kivcr from Lake i:rie to Lake Ontario, antl embraces an area of about 734 acres. P.y an act of the Onta.rio Legislature ((;2 Victoria, chap. 11), it was enacted that "The said connnis- sioners. with the api)roval of the lieuten.ant governor in council, may enter into iiu agreement or agreements with any persi^n or person-^, eojupany or c.imiianies, to take water from the Niagara Kiver or from the Niagara or Weil.iud Itivers at certain points wittiin or without the said park for the jturpose of enabling such person or persons, comiiany or conn>anies to generate within or without the park electricity, or pneumatic, hydraulic or other power, conducting or discharg- PRESERVATION OF NIAGARA FALLS. 207 iiijr said water tliroii.i^h and a<-ross the said park or otherwise in such maimer, for such rentals, and uiion sucli terms and conditions as may he enihor«'paring to furinsh electricity for ciunmerclal p>v,ri)Oses obtained from the water iiower. two of them locateany had no right to increase the capacity of its canal, that it had no right to divert any water from the river, and that a diversion of water sufficient to diminish the flow over the falls was a nuisance and -could be restrained. The New York Legislature thereui)on passed an act (chap. ^68. Laws of 189fi). in which the right of the company " to take, draw, use, and lease and sell to others to use the waters of Niagara River for domestic, municipal, and sanitary purposes, and to develop power therefrom for its own use and to lease and sell to others to use for manufacturing, heating, lighting, and other business pur- poses, is hereby recognized, declared, and confirmed." No limit as to the time during which these rights were to exist was fixe about 134.000 liorse])ower, in addition to which its tenant companies will develop a.bont 8,000 horsejiower. It has paid nothing to the State for its privileges. A List of the more important industries which this company supplies, with electricity is given iu Ai)])endix B. Its managers estimate that the power plant and the industries dependent ujion it for power represent an investment of !«;i 0.000.000. 0. If. SUtfiani Falls Poircr Co. — In 1880 the New York Legislature granted a charter to a company called the "Niagara River Hydraulic Tunnel I'ower & Sewer Co. of Niagara Falls." subsequently amended in 1880. 1880, 1801. 1Sr which is placed the i)ower house. After passing through the turbines, the water is carried off by a tunnel about 2,000 feet long, and discharged into the river below the falls. Tbe works are not completetl. and less than half of the generators have been installed, the ,iag;ira Power Co. or three-tpiartei'S of a mile libove the Falls, and after passing through au elaborate system of screens enters a gate- liouse. and tlu-iu-e is transmitted through three underground conduits, each IS feet in diameter, to a power house located near the foot of the cliff below the Falls. The length of the pijie line to the nearest penstock is 0,1 SO feet, and ii' tl'.e mo^^t distruit penstock a.l)ont l.OOO feet more. The works, which re))resent an hivestuient of several .million dollars, are not completed, only about 2.000 cubic feet per second now being used. 15. The compauj- agrees to pay for its privilege an annual rental of $30,000, for which it ni^iy generate 20.000 electrical horsepower or less. For all above 20,000 and under :J0.0()O hoi-sepower it pays, in addition to the above, $1 per annum for each horsei)ower ; for all above 30,000 and under 40,000 it pays a further sum of 75 cents per amuim for each horsepower, and for all above 40,000 it pays a still further sum of 50 cents per annum for eacii liorsepower; that is to say, the annual rental for generating 40,000 horsepower will be $47,500. and for generating ls0,000 horsei)ower will be $117,500. 16. The period for which the privilege is granted is 50 yeai-s from April 1, 1900, but the company is entitled, at its option, to three renewals of 20 years each, and after the third renewal the lieutenant governor in council may require a fourth renewal of 20 years, the rentals to be adjusted at each renewal, the entire period thus covered by the agreement being 130 years. 17. V. Electrical Devcloiwicnt Co. — On the 29th of January. 1903, the com- missioners for the Queen Victoria Niagara Falls Park entered into an agree- ment with three citizens of Canada, subsequently transferred to "The Elec- trical Development Co. of Ontario (Ltd.)," incorporated by act of the Legis- lature of Ontario. (5 Edward A'll, chap. 12.) Under this agreement authority was given to take from the Niagara Kiver water sufficient to develop 125.000 electrical horsepower. The amount is computed to be 11,200 cubic feet per second. The location of the works is shown upon the map. Water is taken from the river about midway between tlie intakes of the Canadian Niagara Power Co. and of the Ontario Power Co., or about half a mile above the Falls. A gathering driin. about 750 feet long, extends out into the river obliquely up- stream, designed to divert the required amount of water into the jiower house, which is located upon the original shore line. I'lider tlie p(>wer house is a wheel pit, e.xcavatetl in the solid rock to a dejsth of 158 feet, at the bottom of which are placeil the turbines. After passing through the turbines the water is conveyed by a tunnel to the base of the Falls and discharged about midway between the Canadian and American shores. The works a.re not completed, and )io water is now being used. They represent an investment of several million dollars. IS. The company agrees to pay for its privileges an amiual rental of $15,000. for which sum it may generate 10,000 electrical horsepower or less; for all above 10.000 and less than 20,000 liorsepower it pays, in addition to the above, $1 per annum for each horsepower: for all above 20.0tK) and less than 30,000 it pays a further sum of 75 cents per annum for each horsepower; and for all above 30,000 it pays a still further sum of 50 cents per annum for each horse- jiower: xhM is to say. the annral r.Mital for generating 30,00(1 horsepower will be $32,500, and for generating 125,000 horsepower will be $80,000. 19. The i^erlod for which the |)rivilege is granted'is .50 years from February 1, 1903, but tlie same provisions are made for renewals as in the cases of the other companies, and the entire period covered by the agreement is thus 130 years. 210 PRESEEVATIOX OF NIAGARA FALLS. 20. In the case of each of the Canadian companies the anthorities reserve the right to require that one-half the power genenited shall be supplied to places in Canada. 21. Water is diverted also by the Park Electric Railway, under authority of the conijnissi(mers. the quantity to be used under plans now in execution, being estiniatofl at 1,5(»0 cubic feet per second, developing about S.OOO horsepower, while the actual present use is about GOO cubic feet per sec-ond. 22. In addition to the foregoing, six charters were granted by the New York Legislature between the years ISSG and 1S!)4 to corporations organized to take water from the Niagai'a River, but it is believed that all. with the possible exception of two. have expired by limitation. In one case, the Niagara. Lock- port & Ontario Power Co., an act to renew passed the legislature in 1904, but was Aetoed by Gov. Odell in his message of May 14 of that year. The company, however, claims the rights granted under its original charter, and is construct- ing works for the distribution of electrical energy develojied by other companies, but is not itself diverting water. Another corporation, the Niagara County Irri- gation & AVater Supply Co., has done some work, and claims that its charter has thus been preserved, but it has diverted no water. A list of these charters is given in Appendix D. 2.'?. The Dominion of Canada has granted charters to two corporations in addi- tion to those alraedy mentioned organized to take water from the Niagara River for power purposes. It has charteretl two other corjiorations. organized to take for ix)wer purposes water from Lake Erie which would naturally be tributary to the Niagara Ri\er. These- coni.panies have not finally developed their plans, and it is believed that their franchises are therefore not perfected, although all but one are still in force. In one case the charter has expireil by limitation. The charters fix no limit to the amount of water which may be used. A charter was granted in 1SS9 by the Province of Ontario to the Hamilton (^ataract. Power. Light & Traction Co. This company is using water from the Lake Erie level of the Wetland Canal, which water would otherwise be tributary to the Niagara River. The volume now being used is estimate cubic feet per second, and is to be increased. A list of these charters will be found in Appendix E. 24. The Chicago Drainage Canal, constructed under the authority of the State of Illinois, was designed to divert about 10.(XX> cubic feet per second of water which would naturally tlow over Niagara Falls. It has not been fully com- pleted, but it now has a capacity of about ."i.OOO cubic feet per second. The amount which it is actually diverting has thus far been limited by the Secretary of War to about 4,200 cubic feet per second. In addition to the foregoing, about .'i;}3 cul»ic feet per second of Lake Erie water is now taken for power ian"]:oses from tlie Erie Canal at T^ockport. 2;"). Full and jirecise information concerning the plans and the legal rights of the companies which have not l)egun or completed their works has not been obtainalile. In the cases of the corpor;itions now furnishing or preparing to furnish electricity for commercial purposes, the franchises are vague as to the volume of water to be used, whicli is the feature of greatest intert'st here. Wo have computed the volumes from the available data, and have ende:ivored to nuike the figures conservative. It must be understood that tbe.'^e figiires are fair approximations. In proceetling to an examination of the etfert upon Niagara Falls of the works proposed, the subject is much simplified by considering only those companies which derive their water from the Niagara River itself, and that is the course here pursued. Any effects caused by these works will be exag- gerated by the other works mentioned. 2G. The total quantity of water to be taken from the river by works now authorized is: Cnbic foot. Niagara F;ills Hydraulic Power & Manufacturing Co 0. "lOi) Niagara Falls plnver Co 17.200 CAnadian Niagara Power Co I), ijOO Ontario Power Co.. not including Welland River Development 12. 00<' Electrical I).'vel(»iiment Co . '— - 11.200 Niagara Fails Park Railway Co ._^_ 1. .WO Total 00,900 Of this amount 20.700 cubic feet is to be taken on (he American side and the remainder, .■)4.200 cubic feet, on the Canadian side. That is. 27 per cent of the average discharge and 3.3 per cent of the low water discharge of the Niagai;i PKESEEVATION OF NIAGARA FALLS. 211 KLver will reaso in pMss over tlu' Falls whe these works are completed and in full operation. The quiintity to be diverted is more than double tlie qnaiitity which now passes o\er the American Fall, which at the averajie stajxe is al)out 27,S00 cubic feet. That this will in general have an injurious efi'ect u))on the Falls seems self-evident. The volume of water to be diverted is about the equivalent of the entire dischar^'e of Lake Superi()r over the S.-iult Ste. Marie. The aniou)it thus far actually di>erted is but IT.SOO cubic feet per secou.d, and has had an appreciable effect upon the Falls. To foretell with accuracy the effects in detail of tlie full diversion authorized would require a more coivq)lete knowledge of the bed of the river than is tiow obtainable. The water taken on the Canadian side below the crest of the rapids will affect the Horseshoe Fall alone. If all that taken on the American side should affect the Amei-ican Fall alone, it would practically leave it dry; but it seems probable that only a part of this diversion will be at the expense of the American Fall. Exactly what portion that will be can not l)e stated with jirecision, but from a study of the channels and reefs, so far as they are known, a reasonable esti- mate IS that the water would come from the two arms in about the proportion of one-sixth from the American Fall and five-sixths from the Horseshoe P'all. Exact l.v what form the changes in the two cataracts will take, whether they will be made narrower, or be bi'oken up into a grerster number of streams, or simply be reduced in volume, retaining in general their present form, can not now be foretold, for the reason that there is no a.ccurate knowledge of the form of and depth of water on the crests. If 69,000 cubic feet per second be diverted, the loss will be inqiortant, but if the diversion be limited to this amou.nt. or retluced, as hereafter indica.ted, it may not prov6 disastrous. This can not be definitely determined until the works now under construction have been completed and put in oiieration. When that happens, if it be found that the Falls have not suffered serious damage, as :i scenic spectacle, it does not follow that additional water may be diverted with impunity. Additional diversion would be an experi- ment even more dangerous than that now being tried, and in our opinion should not be i)ermitteetnal annu-il siiving. which, if capitalizetl, will show that the connuercial A-alue of the power at Niagara Falls is very gi'eat and is to be measured by the hundred millions of dollars. 2Jt. Whether this commercial asset .shall be utilized to such an extent as to seriously impair the ma.iesty and scenic beaut.v of the Falls depends uiion the public will. In our opiuioi, the commercial advantages of a large increase in develoiunent of jiower will not compensate for the great loss to tlie world of the insjiiiation. aesthetic education, and oi)portunity for recreation and elevat- ing jileasure which the mighty cataract att'ords. The direct advantages to the public from revenue is nothing on the New York side of the river and com- jtaratively slight nx the (^anadian side. There is. of course, an indirect ad- vantage line to added taxable wealth and reduction in the cost of ])ower. but these advantages ai-e. in our opiiuon. slight in comparison with those which,' 212 PKl::SERVATr0X OF ^"lAUAKA FALLS. spriuji ii'iiii i);t" jjresfrvation of the beauty and majesty of tlie Fulls in their natural condition. (>-. er SOO.OtK) people visit the Falls annually, deriving pleas- ure and inspiration from them. TJie nations of the world have always recog- nized the great value of parks and reservations, and throughout the civilized world they have preservetl places of natural grandeur and beauty and fur- nished parks, artilicially beautified, for rest,- education, .and the elevation of their peoi)le. An iUustiation may be given in the case of the city of New York, one of many hundreds. There the municipality has acquired, in Central Park, property which is estimated to be worth $225,000,000. and has spent millions upon its improvement and ornamentation. The United States Government has leservtHl lands of striking picturesqueness. grandeur, and interest, regardless <»f their value. These illustrations would seem to prove conclusively that the l>eople are not inclined to offset mere commercial values against the intangible but none the less great advantages found in the preservation of the great -works of nature. 30. It is probably not expedient to attempt the recovery of the rights granted to companies which have taken full advantage of them. In the case of the Niagni-a Falls Po\\-er Co.. on the American side, the franchise authorizes it to develop 200,000 hoi'sepower. It has constructed works having about half that capacity, but has not begun the construction of tlie additional works, and we believe, has no present intention of doing so. In the case of the Ontario Power Co., on the Canadian side, the construction of works under the agreement of April 11. 1900, has been indefinitely postiioned. The authority for the ad- ditional works in both these cases could probably be withdrawn without inflict- ing an unreasonable hardship. All franchises of which advantage has not been taken should be extinguished. 3L The following is a sunmiary of the foregoing statement of facts : (0) The glory of Niagara Falls lies in the vohmie of its water rather than in its height, or in the surrounding scenery. (h) Works are now authorized jsnd partially completed at the Falls which will divert fi-oni tlie Niagara River ab.ove the Falls about 27 i)er cent of the average discharge, and about 3.3 per cent of the low-water discharge, which is more than double the quantity now flowing over the American Fall. In ad- dition to this, water naturally tributary to the Niagara River is being diverted through the Chicago drainage canal, and for power in addition to navigation purposes through the Erie and the Welland Canals. (c) The effect of this withdrawal of water is to in.iure both the American and the Horseshoe Falls in nearly equal proportions. While the in.iury will be perceptible, it may not be destructive or disastrous. {d) Improvements in the ti-ansmission of electric power and increased de- jiiaiul will u'ake a market for all the power which can be developed at Niagara Falls, and will cause a destruction of the Falls as a scenic spectacle if the dcelopnient l>e allowed to go on uncheckeil. (c) Charters liave been granted to corporations which propose to divert ad- ditional amounts in quantities not now limited. (/) The sums of money invested, or being invested in the works now in op- eration or under construction, and in the industries dependent upon them, amount to many millions of dollars. It is probably not expedient to attempt the withdrawal of the rights thus utilized ((/) The '■(uunxM'cia] v;tlue of the wnter power at^ Niagara Falls is very gretit. but if compared with values set aside by wealth.v comnnuiities el.«ewhere for park inirposes this value is not too great to be devoted to similar purjwses. The place is visited annually by about 800,000 people. 32. If the Falls are to be preserved it must be by mutual agrenient between the two countries. As a step in th.it direetion we recommend th:it legisla- tion be enacted which shall contain the following provisions, viz : (o) The Secretary of War to be authorized to grant permits for the diver- sion of 28 500 cubic feet per second, and no more, from the waters naturally tributary to Niagara Falls, distributetl as follows: rul>io foot. Niagara Falls Hydraulic Power & Manufactin-ing Co 0. 500 Niagara Falls Power Co 8.600 Krie Canal or its tenants (in addition to lock service) 400 Chicago Drainage Canal 10,000 (b) All other diversion of water which is naturally tributary to Niagai'a Falls to be prohibited, except such as may be required for domestic use or for the service of locks in navigation canals. I'liEj^Eia'ATiO^' or IS'IAGAEA TALLS. 213 u) Suitiiblc pen.-ilties for violation of the law to be prescribt'il. (d) The following prohibition to remain in force two years, and th(;n to be- come the permanent law of the land. if. in the meantime, the Canadian Goa'- ernmeut shall 'have enacted legislation prohibiting the diversion of water which is naturally tributary to Niagara Falls, in excess of 36,000 cubic feet per sec- ond, not including the amounts required for domestic use for the service of locks in navigation canals. It is assumed, however, that an understanding upon this sub.iect would be reached by treaty. The ob.lect of such legislation would be to put a stop to the further de])lotion of the Falls, and at the same time inflict the least possible injury ui)on the important interests now dependent upon this watei" i)ower. The amount to be diverted on the Canadian side has been fixed with a view to allowing to the companies on that side the amounts for which they now have works under con- struction, which are : ('iibic feet. Canadian Niagara Power Co 9, 500 Ontario Power Co 12,000 Electrical Development Co 11,200 Niagara Falls Park Railway Co .1,500 Welland Canal or its tenants (in addition to lock seiwice) 1, SOO 04. One of the effects of such legislation would be to give to Canjida the ad- vantage of diverting 7,500 cubic feet per second more than is di\erted in the United States. The advantage is more apparent than real, since the power generated on the Canadian side will to a large extent be transmitted to and used in the I'nited States. In the negotiation of a treaty, however, the ])oint should be considered. 05. The substance of this report was submitted to our Canrulian colleagues before the passage of the joint resolution, with a view to uniting in a joint report under the general law providing for the commission. There was a sub- stantial agreement in the statement of facts, and such differences as developed with respect to the recommendations which ought to be made did not seem insuperable, but our colleagues desired time for further consideration. We have no doubt of their sympathetic interest in carrying out that part of the in- structions contained in the resolution which requires us " to exert in conjunc- tion with the members of said commission representing the Dominion of Canada, practicable, all possible efforts for the preservation of Niagara Falls iu their natural condition." Very respectfully. O. H. Eknst. C'nJoiul. Corps of Engineers. Chairman. Georgk Clinton, Member. Oko. Y. Wi.snkk, Memhrr, Ameririni Section. The Secretary at War, Washington. D. C efj'orts uron the existing water-power situation at niagara eali,s. so fab as concerns the diversion of watek on the american side report by the amiruan memiieks ok the international wateliw.vys commission. International Waterways Commission. Office of American Section. Buffalo. A". 1„ Aovemher l.'t. 1906. Mr. Secretary : The American members of the International Waterways Commission have the honor to return herewith the report dated October 5. ]f)0(J, by Capt. Charles W. Kutz. Corps of Engineers, United States Army, upon the subject of permits for diverting water on the American side at Niagara Falls, referred to them by your indorsement of October 33. In our report^ dated September 2lt, lOOO we gave a brief description of the four kinds of permits authorized by the act approved June 29. 1000, and we concurred in the reconnnemlations contained in Capt. Kutz's report' of August 15, 190(5. which referred to permits of the third kind, or those for transmitting electiical power from Canada into the United States to the aggregate amount of 160,000 horsepower. The report by Capt. Kutz now under consideration 1 PfiuliHl in War I)(>partmiMit Document Xn. L'S-I. Office of the riii(>f of Kngineers. 211: PRESEKVATIOX OF KIAGARA FALLS. refers to pcniiits of the tirst kind, or those for diverting water from the Niagaia River on the American side to an aggregate anionut not exceeding 15.000 cnbic feet i)er second. The conditions imscribed in the law for this kind of iienuits ilre that — 1. They nnist be issned " to individuals, companies, or corporations which are now actnally producing power from the waters of said river or its tribu- taries in tlie State of New York or from the Erie Canal." 2. The amount of water to be allowed must not exceed that " now actually in use or contracted to be used in factories the buildings for which are now in pi'ocess of construction.'' 3. The amount to l)e allowed " to any one individual, company, or corpora- tion as aforesaid" must not exceed 8,(M>0 culrrc feet per second. 4. The total amount to lie allowed "to ail individuals, companies, or corpora- tions as aforesaid" must not exceed an aggregate of 15.000 cubic feet per second. Applications have been received from the Niagara Falls Power Co. for a per- mit to divert s.GOO cubic feet i>er second, from the Niagara Falls Hydraulic I'ower & Manufacturing Co. for a permit to divert 6,4(X) cubic feet per second, and from numerous industries at I^ockport and at Medina, using small quan- tities of water from the Erie Canal. After a careful examination of all tlie circumstances which should affect a decision as to the amount of water to be allowed under the act. including the capital invested, the i)resent capacity of the works and their present output, the quantity of water now actually in use. the contracts made for furnishing I)Ower. with the dates of such contracts, the future capacity of the works as projected, and the charter rights under New York State law, Capt. Kutz reaches the conclusion that a permit should be granted to the Niagara Falls Power Co. for the maxinuim amount allowed, viz, 8,600 cubic feet per second. He finds that the company and its tenants have that amount actually in use iuid may reasonably ask for the whole of it. and in that ojjinion we concur. He is in ilonbt whether it should include the water which is occasionally used for sluic- ing debris and ice. The .-inionnt of this is not accurately known. i)Ut it is esti- mated at between ('A)O and TW) cubic feet per second during the sluicing process. It is used only intermittently. The total amount thus nsed in a year would, if distributed throughout the year, be but a small average per second. The law is explicit in prohibiting a permit for any amount whatever in excess of S.600 cubic feet per second, but it seems a reasonable interpretation to take that as the general average and to allow the company to use a slightly less amount during the greater \n\vt of the year in order to accumulate enough water to supply the demands of sluicing ui)on the occasions when it is needed. After a similar careful examination of all the circumstances relating to the Niagara Falls Hydraulic Power ct Maiuifacluring Co., Capt. Kutz renclies the conclusion that a i»ermit should be granted th.il company for the diversion of 5.743 cubic feet per second, exclusive of the amount required for sluicing, or for 0,4(18 cubic feet per second if the water for sluicing be included. The latter is estimated at 000 cnbic feet per second. It seems to us desirable that the ]>ermits to ti>e two companies should resemble each other in their provisions for slniiiiig. If to the 5.743 cubic feet per second .iust mentioned tliere be added 107 cubic feet per second as an average for sluicing, an allowance will be made for the accunnilation of water which will provide 060 cubic feet i>er second for sluicing during llOs hours of each month, or .5!) days in each year, an allowance which is anqile. Under this arrangement the .-iniount to be grant(Hl to tins company for the use of itself and its ten.iuts \v(iuld be 5.S50 cubic feet per second. The industries using water from the Erie Canal are numerous, and the quan- tity of water diverted is comparatively sniall. At Lockport 27 i)ersons or cor- porations are using water taken either from the upper or the lower level. It is underst(»od tliat most of the water from the upper level is returned to the canal: Init the arrangement of tunnels is such that the water has two outlets, and it is impossible to determine what portion is permanently diverted into Eighteenmile Creek. Many of these industries are hH-ated one below the other on lOighteenmile Creek, and use the same water successively, taking it from ihe lowi-r h'vel. The ipiantily of water permanently diverted from the canal at Lockport Is found from measin-ements taken above and bi'low all diversions to be upon an average 103 cnbic feet i)er second. Industries at Medina. N. Y.. use ai)out 105 cubic feet i)er second. Tlio num- Iter of Die industries is n(>t given. Imt it is underiJtood that they an- in general of about the same niai:nilu Niagara Falls Hydraulic Power & r^Ianufacturing Co. by the permits of those companies. He recommends that a iiermit for the diver- sion of oftS cul)ic feet per second be granted to the State of New York. The objections to this course are that the State of New York has not applied for a itermit and might perhaps not be willing to accept one. and it is a some- what forcenstocks to the turbines which are installed near the bottom of the two wheel pits under the two respective power houses. After leaving the tur- bines tiie water is discharged into a horseshoe-shaped tunnel with an area equivalent to tliat of a circle 21 feet iu diameter, which carries it to the lower river, a distance of about 7.000 feet. 7. In power house No. 1 the turbines discharge their water into the tailrace openly without draft tubes. In power house No. 2 draft tubes are used, mak- ing the theoretical effective head 144 feet in power house No. 2 as against 136 feet in power house No. 1. These power houses have a combined generator capacity of 105.000 horsepower. 8. In addition to the above, water is supplied from the intake canal to the International Paper Co. and to the i)umping jilaut of the Niagara Falls Water Works Co. 9. As a result of more or less recent tests made by the engineers of the l»ower company, it was determined that an avera.ge in the two power houses of 0.101 cul)ic foot of water per second was required to develoj) 1 electrical horsepower at the .'switchboard. If this deternn'nation is correct, the develop- ment of 100.000 electric-il horsepower, the nominal capacity of the ]»lant. would require 10.100 cul)ic feet of water per second. This amount exceeds l)y 1.500 ^•ubic feet the ansnunt computed as necessary under the a.'?sunu>d cihcieucy of the turl)iues and the theoretical effective heads noted above. This ditl'erence is due to certain defects in the design. Ihe tail water in the two wheel pits standing at such a level as to materially affect the effective head. 10. The plant of the International I'aper Co., one of the power company's tenants, consists of 6 turbines, each rated 1,600 horsepower, and 2 centrifugal pumps, representing about 69 horsepower. The amount of water used by this company was determined by test made iu 1904. using a current meter placed at various jioints in a given cross section of the paper niiil's headraci>. fhese measurements were taken with an average of 87 per cent of gate ojiening. and showed a tUiw of about 660 cubic; feet per second, or about 7.50 cubic feet per second with full gate opening. 11. The hydraulic jtlant of the Niagara F*al!s Water Works Co. cunsisis of two Peltou water wh-^els. each r.ited at 4 water that is occa- sion.-illy usinl for sluicing debris and ice. the amomit of which is not known. It is questionable whether water used for this iturpose should be included in that for which a permit is considered necessary. Such u.se is intermittent, and PRESERVATION OF NIAGARA FALLS. 217 it is practic:ill3- impossible to deterniiue tlie aiuoiiiit used at any giwii time. The Niagara Falls Hydraulic Power & Mauufacturing Co. estimates tliat 6C0 cubic feet per second is at times required for tliis purpose. If it be delermined that water used for sluicing ice nn.st l)e iiiclnded in the amount covered by the permit, the mid-winter electrical output of this company will be still furtlier curtailed. 14. The maximum output of this company during the weelc preceding that in which the examiutition was made was 64,800 horsepower, while the average of the maximum weeklj' loads since October, li)05, was 73,000 horsepower. 15. The company in its statement includes a list of contracts for furnishing power in which the optional amounts aggregate 367,000 horsepower. Of this amount 102..5.50 horsepower has been called and is now in use. These contracts cover the output of both this plant ;\nd th.-it of the Canadian Niagara Power Co. The amount called for represents the sum of the maximum amounts of power used by their tenants. These peak loads never occur simultaneously. and tiie actual peak electrical load generated up to date by the American and Canadian plants combined has been about S5.000 horsepower. 16. The books of this company show iui iii'.estment in i)ower ])lant of $13,500,000. Tills amount is largely in excess of what it would cost to repro- duce it, as it is evident from the investments now being made on the Canadian side. It is also evident from the estimate of $7,000,000 given as the amount required to increase the capacity of the plant to the statutory limit — that is, 200,000 effective horsepower. This l.;rge investment, $135 per horsepower developed, is partly accounted for by the fact that this company was the- pioneer in this method of utilizing the power of Niagara Falls, but it can not fairly be said to be due to investments made with the object of doubling the capacity of the plant. The intake is probablj- larger than necessary for the development of 100.000 horsepower, but the rest of the plant was designed for that amount. Notwithstanding this large investment, the books of the company show that its net earnings, after paying interest on its bonded debt and all oher fixe<^l charges, now amount to 9 per cent on its outstanding capital stock of over $4,000,000. 17. This company is entitled by reason of its contracts to the fullest con- sideration that is now possible under the law — i. e., a permit for the diversion of 8,600 cubic feet per second. .Such a permit will practically limit the com- pany to its present output and will not allow any growth, but if this company is allowed to receive from the Canadian Niagara Power Co. the amount recommended, 60,000 electrical horsepower, the normal development of the two companies considered as one will not be seriously interferetl with. The ISiiagara Fulls Hydraulic Poivrr cG Munufucturing Co. IS. This company was chartered under the laws of the .State of New York in 1878, and subsequently, by an act of the Legislature of the iState of New York, known as chapter 968, laws of 1896, its rights were conlirmed. In this confirmatory act the company was limited and restricted to the use of "such quantity of water as may be drawn by means of the hydraulic canal of said company when enlarged tLrougli its entire length to a v/idth of 100 feet and to a depth and slope sufficient to carry at all times a maximmn uniform depth of 34 feet of water.'" This limitation is more or less indefinite, but the capacity of such a cbannel hns l)een computed to be 9..500 cubic feet per second without material diminution of the head. 19. The canal leaves the Niagara Kiver about 1 miie above the Falls and extends through the city to ;i p.olnt about one-haif mile below the Falls, where the jjower houses of tiie comi)any are situated. 2r second. In jiower house No. 2 (No. 3 being obsolete). 21(S PRESERVATION OF NIAGARA FALLS. situjitt'd on tlie river It.uik at the f(M)t of the bliift', the company develops 32.000 mechanical li(ii>eiio\ver, nsing for tlu' pnrposc 2,011 cnl)ic feet of water per second inuler an ettective head of 200 feet. Of this amonnt 2T,30.S meclianical borsep'iwer are sold to customers, who convert it into electrical jKnver by the use of generators attached to the power coyipany's turbines. The remaiidnii power de\eloped in power hou.'^e No. 2 is converted into and sold as electrical power. For several years past Ihe company has been engaged in the further development of its water power, and now has under construction a fore bay capable of furnishing .sutficient water, when tlie canal has been widened and deepened to the extent authorizeer seconer second. 22. The settlement of this question will not affect the Niagara Falls Hydraulic Power & Manufacturing Co.. but will affect the output of the Niagara Falls Power Co. 23. The investment rep-resented by the plant of the Niagara Falls Hydraulic Power & ^fanufacturing Co. is .$5.00(X000. This includes $1.400.(«K» expended or obligated for work on the canal and in connection with power Innise No. 3. It is estimateerated the lease. The lease in-ovides that the water so used shall be discliargetl into the lower level at such i)lace and in such mauTier as the State canal connnissiimers shall from time to time deem most advisable for tiie security of the canal and for the convenience of the Jiaviga.tion thereon. 26. In an investigation of this m;itler made in .Tuly by tlie secretary of the American section of the International Waterw.-iys Conindssion it was developed that the arrang(Mneut of tunnels in Market Street near Exchange Street was such that the water nnnle Creek, thus making it impossible to determine what portion of the water supjilied to these mills is permanently div<'rted from the c.-uial. though it is understood that as a rule it is all returned to the canal. In the application tiler second, wberens Mr. Henry A. Van Alstyne. New York State eniiineer and surveyor, is authority for the statement that 350 fubic feet per second is the anioiuit tnkeii fi-oin the tipper level and returned to the lower level of the canal. In a subsequent letter from the attorney for the l.,ockiK)rt Hydraulic Co. it is learned that the amount nameil in the api)licatioii represents the maximum quantities covered by the couqiany's leases, and further that it iuchKles the amount of water required to operate the machinery of the Holly Mauufacturiufx Co.'s i)lant not now in actual operation, but which was used for more than 20 years prior to irM)4. and which then developed 150 horsepower. 27. In addition to the industries which obtain tlieir water throui^rh the Lock- port Hydraulic Co. thei-e iire a number of large manufacturing plants being <)perate<^l at the city of Lockp.ort by per second. Assuming the latter information to be more nearly cor- rect, the maximum .-imouut of I>ake Erie water diverted from the canal at this point is 105 cubic feet per second. The total amount of Lake ICrie water that is permanently diverted from the Erie Canal .at times of minimum flow in the f(>eder is therefore 103 plus 105. or 3.58 cubic feet per second, and it is recouunended that a iternnt for this amount be issued to the State of New York. 220 PRESERVATION OF NIAGARA FALLS. 32. If it be detorniinefl that the amount of water occasionally ustxi for sluicing debris and ice must be included in any permits that are granted, the interested parties are, in my opinion, entitled under the law to permits for diversion as follows: Cubic feet per second. Niagara Falls Hydraulic Power & Manufacturing Co. in greatei- detail than is Niagara Falls Hydraulic Power & Manufacturing Co 6,403 State of New York 35S 33. Descriptions of the power plants of the Niagara Falls Power Co. and the Niagara Falls Hydraulic Power »& Manufacturing Co. in greater detail than is given in the body of the report are appended hereto, marked Appendix K and Appendix L. They were iirei)ared b.y Mr. Earl Wheeler, electrical engineer, who assisted in the examination. A'ery respectfully. Charles W. Kutz. Captain. Cnrpfi of Enijineers. Brig. Gen. A. Mackknkik, f'liirf (if Eiif/incers, U. S. A. RKPOinS UPON TilK KXISTING WATKR-POWKR SITUATIOX AT NIAGARA lALLS. SO FAR AS CONCKRXS THK CAXAUIAX POWER COMPANIES AND THEIR ASSOCIATED TRANS- MISSION (•OM]*AN!K.S REPORT BY THE AMERICAN MEMBERS OF THE INTERNA- TIONAL WATI inVAYS COMMISSION. International Waterways C-imm issiox. Office of American ejection. Buffalo. N. Y.. Siptcmbcr 29. 1906. Mr. .Secretary-: The American members of the International Waterways Com- mission have examined the report dated August 15, 1900. liy Cajit. Charles W. Kutz. Cnri)s of Engineers. United States Army, upon the subject of permits to the power companies at Niagar;-. Falls, referred to them by your indorsement of Septentbev ;". They have the honor to return it herewith, and to submit in connection therewith the following remarks: In our report.^ dated March 19. 1900. we stated that the works i)ro.iected on the American side at Niagara Falls would produce 342.tl()0 horseiK)wer, besides a snijill amount (m the Erie Canal, and would consume about 28,0(X) cubic feet of water per second, while those pro.iected on the Canadian side would produce 4.32.000 horsepower, besides a small amount on the Welland Canal, and would consume .about .".O.OOO cubic feet of water per second. We thought that the amount on the American side could be redu-ed to 242.0<^IO horsepower, using IS.noo culiic feet of water per second, without inflicting undue hanlshi]) upon invested capitiil. l>"t ^ve doubtefi<) to ;!."iO,"1 in SeniHc ! tuciiini-nf No. Il-IL'. l-'ift.v -ninth Coiiirrcss. Iirs( .-irssion. l>KKSKRVATION OF NIAGARA FALLS. 221 Di.'idi' for !1h' iKUpost' ower to he equnlly livided betweer. the Ontario Power Co. and the Canadian Niagara Power Co.. giving them 00,000 horsepower each. "We believe this to be an equitable divisioi' of the iM)wor available and we join with Capt. Kutz in the recommendation that permits for the transmission of jiower to the Uniled States be granted to: Horsepower. The Niagjira. Lockport & Ontario Co. from the Ontario I'nwer (Jo 00,000 The Electrica' Transmission Co. from the Electrical Develoiiment Co 87.500 The Niagara Falls I'ower Co. from the Canadian Niagara Power. Co 00, (mki Yours, veiy respectfully. Hon AV. H. Taft. Secretary of War. O. H. Ernst. Chairman. Glokok Clinton. Mewbcr. E. E. II.\SKKM., Memher. RKI'ORT I;Y C.\PT. ClI-VKLKS W. KITZ. COHl'S OK KNtilXKKRS. War Dkpartjjk.nt, Okfick of thk Chiw OF Encinkkks. Wafi]iiiiti1oiK August 1.'>. 1906 General: 1. In compliance with the written orders of the Secretary of War, dated July 14. 1906 (copy attached marked A), and your subsequent oral in- structions, I have the honor to submit herewith the following report n\un\ tlie existing power situation at Niagara Falls: 2. The information called for by the Secretary of War concerns not only the power companies now diverting water on the American side, but also those on the Canadian side who are seeking through their associated transmission companies to import power into the United States. This latter information, being of more immediate importance, will be considered first. 3. The four Canadian companies applying directly or through their trans- mission companies for permits to import power are the Ontario Power Co., of Niagara Falls; the Electrical Development Co., of Ontario (Ltd.): the Canadian Niagara Power Co.. and tlie International Railway Co. The Ontario Power Co. 4. This comi)any was incorporated by au act of the Dominion Parliament in 18S7, and is not limited by its statutory rights to the product ioi\ of any given ' amount of power. .\11 its plans, however, are subject to the approval of the commissioners for the Queen Victoria Niagara Falls Park. The present ap- proved plans were designed for the production of ISO.OOO electrical horseiiower. using its Niagara River intake. In addition to its Niagara River rights, the Ontario Power Co. has a franchise for taking water from the Welland River, but beyond the i)urchase of a limited amount of land for right of way for the intake tunnel or canal this franchise has not yet been exercised. 5. The Niagara River plant as designed consists of headworks located above the first line of rapids, three main conduits or flumes 0.000 feet or more in length leading the water though the park to a point below the Falls, thence by penstocks in tunnel through the clifl: to the generating station in the gorge, and lastly a distributing station or transformer house situated on the high bluff directly above. 1 PRESERVATION OF NIAGARA FALLS. 223 6. The heiidworks arc constructed for the full devolopuient — that is, isO.OOO electrical horsepower. Only one of the three main conduits has been built, and this has a capacity sutlicient, it is claimed, to supply water to 6 gen- erating units, n with a capacity of 10,000 electriial horsepower each, and the remaining o with a capacity of 12,000 electrical horsepower each. The valve ch.miber of No. 1 conduit is complete for 7 units except 3 valve motors, and rough excavation has been made foi- the valve chaml)Pr (»f Xo. 2 conduit in which an eighth valve has been inst;illed, st) th:it No. 7 can be operated either from No. 1 or No. 2 conduit. lv\ca\ati(m for the power house is com- plete for 8 units, the foundation and structure for U units. The central or main portion of the transformer house was designed and built for the control of 22 imits, the number originally planneenditures made in its name have been advanccHl bv the Electrical Development Co. The books of the Electrical Devel- opment Cf).' show an expenditure on this account of $246,000. which was used for the purchase of an interest in the Niagara Falls Gas & Electric IJght Co., Niagara Falls Gas Co.. and the Albion Power Co.. ttnd for the purchase of real estate in Niagara Falls, $40,000 being the amount of the last item. This invest- ment, together with the holdings of the " Nicholl syndicate," a group of men who control the Electrical Development Co.. gives control of these subsidiary comi>anies to the power comapny. /s,w^/^/w^ 15. The value of the properties thus controlled is approximately $1,000,000. The Niagara Falls Electrical Transmission Co. also has an agreement with the [nternatii.nal Ra.ilwav Co. looking to the building of a bridge crossing Niagara River lo he owned jointly by the two companies, across which it is proposed to PEESERVATION OF NIAGAEA FALLS. 225 convey power that is sold by the Electrical Developniont Co. to the Niaj^ara Falls Electrical Transmission Co. Negotiations with this company (I. U. Iv. Co.) also contemplate the granting to the transmission company of a right of way for its transmission lines over the right of way now being acquired by the r.'.il- way company between Niagara Falls and Buffalo. This agreement with the International Railwaj' has not yet assumed the form of a written contract. For carrying its transmission lines to Rochester this company proposes to use the right of way of the Buffalo. LockiH)rt & Rochester Electric Railway. There is no contract to this effect, but as the Buffalo. Lockport «& Rochester Railway is controlled by the NiclioU syndicate above referred to, there is a conununity of interest. The Buffalo, Lockport & Rochester Railway is now under construc- tion, the contract for grading a double-track road and for the construction of a single-track road having been entered into with J. G. While & Co., coutractor.s, on Jlay 14, 190G, at a cost of .$2,250,000. In addition to the above the Electrical Transmission Co. has acquired franchises in its own name in seven cities and towns in western New York for the sale and transmission of power, and through the Niagiua Falls Gas & Electric Light Co. and the Albion Power Co. it con- trols 20 other such franchises. The Niagara Falls Electrical Transmission Co. has not executed any contracts for the delivery of power, but expects that its allied interests will require 17,500 horsepower. This expectation is based on the use by the Niagara Falls Gas & Electric Light Co. of :J.000 horsepower, though the amount now distributed by this company is about 10;IAGARA FALLS. and cables wilL a capacity of 32,000 liorseinnver are now iiit;talleil. A seia- I'ate transmission line, capacitj- 25,000 liorsei)ower. running for 10 miles along the west shore of the Niagara River to Fort lOrie is under construction, together with the towers requii-ed to carry the cables across the river to Buffalo. For its transmission lines it has actually expended or is committed bv contract t.i the amount of $430,000. 20. It is now delivering 1,340 horsepower to Canadian tenants, who have th€ option of increasing the amount to 4.237 horsepower. At the present time there is no detiuite contract covering ihe sale of the power intended for delivery in the United States. This is explained by the intimate financial relations existing between the Niagara Falls Power Co. and the Canadia.n Niagara Power Co. At the time of the examination it was actually transmitting to the United States about 36,000 horsepower, but the combined load sheet of the two companies shows that the maximum amount thus far delivered to consumers is about 85,000 electrical hoi'sepower. Iiitcriuitiuiiul RnUKUy Co. 21. This company is incorporated both in the State of New York and in the Dominion of Canada. In its first capacity it owns and operates all the electric railways in the city of Buffalo and adjacent towns, and the city of Tonawanda, Erie County, and the cities of Lockport. Niagara Falls, and the intervening ter- ritory in the county of Niagara, N. Y. Under its Canadian charter it owns and operates an electric railway along the shore of Niagara River from Chippewa to Queenstown. It also owns two bridges over the Niagara River, one just below the Falls and one at Lewiston, over both of which it has specific legislative authority to transmit power. 22. Its power ])lant is located in the Queen Victoria Niagara Falls Park, which l)lant was acquired when it acquired the property and franchise of the Niagara Falls Park and River Railway Co. In acquiring this railroad it paid for the equity therein $733,000, and assumed a bonded indebtedness of .$600.0lant for this Iiurpose, at an estimatetl cost of $150,000. Pending the determination by the Dominion Government of this company's rights, it Is believed that no permit should be granted to them. Having in mind, however, the fact that they are now generating 2,500 horsepower more than they can use on the Canadian side, and the fact that the transmission of this power to the United States would result in an estimated saving of $30,000 a year, it would seem equitable to re- serve 2,500 horsepower for the i)resent of the 160,000 horsepower for which per- mits can be granted, so that a permit for this amount could be issued in case the present cnntroversy is decided in favor of the railway cnnq)any. PRESERVATION OF NIAGARA FALLS. 227 24. Tlie priucipal facts with reference to the three big Canadian companies are tabulated as follows : l^xpenditures to date in power plants, exclusive of rights and franchises Amount required to complete existing contracts and orders Amount required to complete plants to projected size l:ffective head feet. . Capacity of generating machinery actually installed, electrical horse- power Nominal capacity of generating machinery installed and ordered, electrical horsepower Nominal capacity of projected plants electrical horsepower. Amount invested and obligated for Canadian transmission lines I'robable sale of power in (. anada horsepower. . .\mount of water required for machinery installed and ordered, in- cluding exciter sets — efficiency of the "unit being taken at 70 per cent " cubic feet . . .\movmt of water required for plants as projected do Actual expenditures by their associated American transmission companies Ontario Power Co. $5, 142,000 15715,000 ,500,000 180 42,000 (JbjOOO 180,000 , 000, 000 10,000 ■1,250 11,700 Electrical Develop- ment Co. $4,500,000 $1,760,000 $1,570,000 135 50,000 125,000 !i52,62O,0OO 30,000 4,300 10,800 Canadian Niagara Power Co. 84,072,000 $078,000 $1,250,000 141 5.5,000 55,000 110,000 '$430,000 5,000 4,500 9,500 82,785,000 2 $246, 000 $600,000 1 The major portion of this amount has been expended in the construction of transmission lines intended for deUvery of power to the United States distributing companies. - This does not include any expenditures by the NichoU Syndicate. 25. If these companies were limited iu their output to the capacity of the geueratiug; machinery now actually installed and ordered, their investment iu power plant, exclusive of franchises per horsepower developed, would be ap- proximately as follows; Oiitario Power Co $S9. 00 Klectrical Development Co 125.00 Canadian Niagara Power Co 97. 00 If permitted to develop to the limit of their approved plans the investment* in ix)wer plant per horsepower developed (nominal capacity) would be: Ontario Power Co $68.00 Electrical Development Co 62.00 Canadian Niagara Power Co 60.00 These- figures must be considered as only approximately correct, owing to the different methods of cost distribution used by the several companies. The aim has been to take the actual cost of the power plants, exclusive of rights, rentals, and franchises. Regardless of their absolute accuracy, -or even their relative accuracy as between the three companies, they serve to sliow the extent to which tiie companies by their expenditures and contracts have committed them- selves, and also the ai)in-oximate losses which they will sustain if they are limited to the production of an amount of power less than their projected ca- pacity. All three of these power developments were undertaken in good faith several years ago and long before the agitation in Congress which led to the ]iassage of the present law, and there is no evidence that any of their subse- quent tiausaetions were made with the object of securing rights which they had not always intended to claim. 2n. The total cajiacity of the generating machinery installed and ()rderee granted for l.")7.0(Mi liorsi'ijower. Ihe niaxiniiun anuunit iindei the lirsi liniiialioi!. less L',r»00 horsepower reserved for the International Railway Cd. 27. The "Oiiditiois surnMUiding th(> development of the Canadian jx-wer coui- l»anies differ so materi.ally Mint an I'x.-ict statement of tlieir n-lative rights to the Aniei-ic.-in market is not possil)le. Tlie Niagara. Lockpoi't iV- Ontario Power 2^0 PPESERVATIC>X OF NIAGARA FALLS. «'".. tlie (listribiUinK -.'Ui'Ut h> the Uiiiletl St:iteH for tlie Ontarid I'owi-i- t'o.. b:is expeiidetl a lai^c sum in oi>'i!ing ui) a new market. Tlie Klectrir:;! Develop- ment Co. .'•tarteil itriniarily to develop the Canadi.-.n niaili)anies. Es'ch of the companies, however, fully utilizes the head incident to its geographical location, and any distinction in the matter of jiernnts based on relative natural advan- tages would appear to be unjust. '2S: The Electrical Develoiunent Co. had for its primary object the furnish- hig of power to various i)oints in CaTiada, as is indicate amount to be transmitted to the United States. On the other hand, any greater dis- crimination against the Electrica.l Development Co., which is owned almost wholly by Canadian cai)italists (the other two coTupanies bring owned almost wiiolly by Americans), nsay give ris<' to a feeling of resentment on the part of the i»eoi)le of Canada and tend to retard the negotiation of a treaty between the two countries '-oncerninu the preserxation of Niagara Falls. 2[). The applications for permits made by the transmission eomjianies are as follows : I [oi-sepo\ver. Niagaia, Loclqiort »& Ontario Co., from the Ontario Power Co 00,000 Electrical Transmission Co.. from the Electrical Development Co 02,500 Niagara Falls Power Co., from the Canadian Niagara I'ower Co 121,500 The application of the Niagara. Lockport & Ontario Co. is based ujHin the desire to secure a reasonable return on the investment already made, but con- sidering the date named in its contract with the Ontario Power Co. for the delivru-y of the second block of 00,000 horsepower, i. e.. January 1. lltll. and having in nnnd the fact that any production of power in excess of OG,0(K) horse- power means the construction by the Ontario Power Co. of a second conduit and a conseipient exiuMiditure of .$o.250.000, it is believed that a present limita- tion to 00.000 horsei)ower will not work undue hardship. ;50. The application of the Electrical Transmission Co. contemplates the marketing of one-half of the total output of the Electric Develoi)ment Co. Considering the situation of the latter company in the Canadian market and the limited extent to which the Electrical Transmission Co. has comnntted itst'lf by its expenditures, a present limitation to 37,5(X) horseixiwer does not aiipear to be inequitable. ol. The plant of the Canadian Niagara IVnver Co. is intended to supplement that of the Niagara Falls Power Co., and a fair estimte of the rapidity with which its power will be marketed is found in the rate of growth in the past of the Niagara Falls Power Co. This has amounted to about 20 per cent in recent years, with a present ontjiUt of both companies amounting to S.3,000 horseiiower. Assuming that the same rate of growth will continue, thmigh in all probability it will be veductxl owing to i)ower which the other comi^anies expect to market in this territory, it will be two or three years before the full capacity of the Canadian plant as now installed will be utilized. For these PRESERVATION OF NIAGARA FALLS. 229 reasons a iireseiit limitation to (>0.0C)() hoiseiKnvor will not. in my jntlgment. sei'ionsly intfiferc wllli its normal doN olopnifnt. i>2. If permits are granted for these amonnts the Ontario Power Co. would be jnStified in installing a seventh unit as a spare, the Canadian Niagara Power Co. wonld be jnstified in installing two more nnits, one as a spare, making the nominal capacily of its i»lant (515,000 hors(>power. The Electrical Development Co. would be .lustitied in installing three more nnits, one of them a spare, mak- ing the nominal capacity of its plant 75,000 horsepower, half of which, the proportion asked for, it wonld lie permitted to transmit to the United States. If each installs these nniis the relative investment in power plant, exclusive of franchise, per horsepower developed (nominal capacity) would be: Ontario Power Co $92.00 Electrical Development Co 91.00 Canadian Niagara Power Co 87.00 Ho. Ba.sed upon what precedes, it is recommended that permits for the trans- mission of power to the United States be issued as follows : llorsi'power. Niagara. Lockport & Ontario Co., from the Ontario Power Co 60,000 Electrical Transmission Co., from the Electrical Development Co 37.500 Niagara Falls Power Co.. from the Canadian Niagara Power Co 60,000 157, 500 In order that the various companies may proceed with this limited develop- ment, it is further recommended that ix^rmits for siich amounts as may be authorized be issued without delay. 84. As to the question of granting transmission permits for amounts addi- tional to the first 160.000 horsepower, it is believed to be the intent of the law to delay the issue of such permits until it is known what appreciable effect, if any, will be produced on the Falls by the diversion of the amount of water that will be used under the first limitation. If this interpretation of the law is correct, the granting of such i)ermits will be a matter for the future, as it will be fully a year before the companies will be in a position to develop 160,000 horsepower, in addition to the amounts sold in Canada. ',]~K The iiifoi-;i.ali.)ii cui^t.-rn: .1 in tliis jiariial ri'itort was oi>ta!U('tl fr;i]ii the parties interested and its important features verified by a personal inspection of the works and a general examination of the books and records of the various companies. These inspections and examinations were made July 20 to July 28. 1900. and descriptions of the power plants of the Ontario Power Co. (Ap- pendix B). Electrical Development Co. (Appendix E), and the Canadian Niagara Power Co. (Appendix G). and of the transmission lines of the Ontario Trans- mission Co. (Apjiendix ('), Xiag;ira Lockport & (/utariii Power Co. (.Vppcndix D), and the Toronto »fc Niagara Power Co. (Appendix F), in greater detail than in the body of the report, are aiipended hereto. They were prepared by Mr. Earl Wlieeler. E. E., who, with Mr. F. D. C. Faust, a representative of the Department of Justice, assisted in the examination. A photographic cojiy of a map of Niagara Falls, taken from a monograph prejiared in lOfW by the Can- adian Society of Civil Engineers, is also appended. Hi}. The preparation of that part of the report which concerns the diversion of water on tlie American side has been delayed by the nonreceipt of certain information, and will be submitted later. \'ery respectfully, Charles W. Kutz, Cdi't'iiii, Corpft of Engineers. Brig. Gen. A. Mackenzie, Chief of Engineers, U. .S', A. The Chairman. Is tliere any other o'entlemaii present who de.sires to be heard briefly? Hearinif no re^jionse. this committee will stand adjourned. Thereupon, at 4 o'clock p. m.. the coiinnittee adjourned until Tues- day. January 28. 1912. at 10 oVlock a. m. 230 preservation of niagara falls. Committee on Foreign Affairs, House of Representatia'es, Tuesday, January 23, lOm. Mr. Sulzer in the cliair. STATEMENT OF MR. CLARK H. HAMMOND, CORPORATION COUN- SEL, BUFFALO, N. Y. The Chairman. You may proceed, ]\lr. Hammond. Mr. Hammond. Mr. Chairman, I was sent down here to repre>ent the city of Buffalo b}- a unanimous resolution passed b}^ our board of aldermen yesterday. That is the only 'excuse I have for being here. My ])osition in comino- down here is one of wanting to learn and find out. I do not knov/ that there is anything I can say that will be of an}- particular benefit or use to your committee. Congressman Smith an'd. I do not think so. Mr. ToAVNSEXD. I do not think it would be even persuasive in the presence of testimony in regard to the price charged for power on the Canadian side by the transunttino; company. Mr. Ham:,i()>d. But that price, $9.40, is not transmitted to the city line? Mr. To^^•^\s^:^l). It is the same character of power that is trans- mitted. Mr. Ham:moni). How are yon going to supply that intervening lapse? You can not take the price at the Falls and say it is only worth that price at Buffalo. We can not go into the cost of trans- mission. That is the answer. Under the public service commission law we have no right to hie a complaint against that company, and the public service commission is the only one to do it, and they say they can not do it. JNIr. Tt)AV>«SEND. Mr. Hammond, you said a moment ago in answer to a question that there is an absohite monopoly? Mr. Hammond. That is what we claim. Mr. ToAVNSEND. Are there not laws that can give you power out- side the laws of the public service commission? Mr. Hammond. Yes: I might start in. but I would never see the finish of it. Mr. Cline. It is not a defect in your methods of procedure, if that is true? Mr. Hammond. Suppose I can not prove there is a monopoly? That does not remedy the situation. Mr. Toavnsend. I did not have the advantage of hearing the first part of your presentation. I did hear you say, however, that there was a foreign company that transmits power to the city line and then turns it over to a distributing company. Am I right ? Mr. Hammond. Yes. sir. Let me correct that. It is not a foreign company. They generate — it is a Xew York State corporation, a corporation of the State of New York. Mr. DiFENDERFER. They generate it and transmit it to the city line? What is the name of that company? Mr. Hammond. The Niagara Falls PoAver Co. Mr. Toavnsend. The public service commissioners can iuA'estigate, then, absolutely the distributing company in Buffalo? Mr. Ham^niond. Yes. sir. Mr. Toavnsend. They can also, so far as the transmitting appa- ratus is Avithin the territorv of the State of Ncav York, iuA^estigate that? Mr. Hammond. That is Avhere I differ AN'ith you. Mr. Toavnsend. It is Avithin the State of New York. Mr. Hammond. I understand, but how are you going to get that corporation before the public service commission? Mr. Toavnsend. That is a corporation that takes at the boundary line and transmits it to the city line? Mr. HA:>rMOND. A corporation from the Falls to the city line. Mr. Foster. Congress can not help you in that. Mr. Hammond. I am not sure about that. Mr. Garner. Let us suppose a case. Suppose that the public service commission in NeAv York had plenty of time and plenty of 236 PRESERVATION OF NIAGARA FALLS. clerical assistance, and eniplovecl experts iiiider them, could they not go into the question of the cost of the power company's transmission from Niagara Falls to the city of ButFalo and determine whether or jiot it was reasonable, and upon its OAvn complaint? Mr. Ham MONO. They could. Mr. Gakner. Then how do you expect Congress to assist you in doinliai Ave ])ay. Mr. DiFENDERFER. In fact, the price is $12, is it not ? Mv. HAjr:\roND. My information is that it is $17.45 in Toronto, and $18.55 in Hamilton, as against $30 in Buffalo. Mr. Sharp. I refer to other places in this country, on this side. Mr. Ha^imond. That i^ right ; Ave liaA'e also made im'estigations there. Mr. Sharp. Is that generated by Avater poAver or steam ? Mr. Hammond. I understand Avhere it is generated by steam it is supplied at less cost. Mr. Sharp. Does part of this cost come largely from the number of distributors, there being three different agencies? Mr. HA>r:\roND. That is one. Mr. Sharp. Is there any Avay of controlling that? Mr. HA:\r:\roND. Xo way as to the generating and transmitting com- panies. Mr. Sharp. HaA'e you any evidence that there is an identity of the personnel of the two com]-)anies. either in the board of directors or the stockholders? Mr. Haacaiond. Yes, nr: Ave haA^e that. Mr. Sharp. Do you bcli-ve that is true? Mr. Ha:v[:mond. I believe they are all controlled by the same inter- ests, and in fact, their representatives say that the officers are the same. We are talking about the distributing companies. Mr. Sharp. Are they connected Avith the other companies aa-Iio fur- nish poAver to them for distribution, reaching to the original com])any that takes ]ioAver direct from the Falls? ^fr. Hamaiond. That is my information. Each of the distributing companies in Buffalo is either controlled by the transmitting com- pany, or they have a. large amount of stock in the company, so that thev have control. PRESEKVATION OF NIAGARA FALLS. 239 Mr. DiFENDERFER. Is it iiot a fact that the president of one com- pany is the vice president of another? ]\ir. Hammond. That is true. Mr. Sharp. Just one more question. The other day some reference Avas made by one of the speakers Avho I thought was very well quali- fied to speak. He said that one of these companies had as one of their assets certain political standino- in the State, and he mentioned some of the former statesmen who were in touch either with tlie com- mission or the companies. Do you think there is anything in that — that there is a political asset as well as a property asset ? Mr. HAM:NroxD. That I could not say. My iuA^estigations have not led me to that. ^Ir. Sharp. You do not know anything about that? Mr. Hammond. T do not know anything about that. Mr. DiFENDERFEit. I would Hkc to know what the price of power in Burt'alo is as compared with other cities in New York that receive this same character of ]5ower. Mr. Hammond. Tliese matters of poAver prices are very intricate and complicated aii'airs. I find. In a general way I have found that Buffalo is pavino- more than Lockport or other places that are near Buffalo. ^Ir. DiFENDERFER. Can you state what it is in Lockport? Mr. Hammond. I can not. I have understood that it is lower. Gentlemen who are here can irive you those prices absolutely. I do not like to say what they are when I am simply giving you my impres- sions in a general way. What the city of Buffalo wants is also more power granted to the State, so that we can have the benefit of having the entire amount of Avater that is available and feasible to be diA^erted under this treaty. We would like to have absolutely stated in this bill the amount of Avater diA'erted and used, and I care not, and the people of Buffalo care not. whether our learned Attorney General is correct and that it should be done by the bill giving the State the power to regulate and control and take care of that matter or whether it be done by the Federal Government, if Congress has that poAver. That is a matter I haA'e not gone into. But we do say, AvhicheA^er Avay your committee here deterniine is proper. Ave do want to have that Avater poAver avail- able, so that if the people in the State of New York and the different municipalities Avithin and outside the State want to have some grant made by the State of Xew York, if it is necessary, in order to put into operation a proposition somewhat similar to the hydroelectric com- mission of Canada, that that can be done. That comes to the propo- sition as to AAdiy I am here. That is one proposition we want. Mr. Levy. That is what I want. ^Ir. DiFENDERFER. You would uot favoF giving this power to these two companies that are generating? Mr. Haaimond. I assume they should be put under a proper control. I Avould not take it aAvay from these companies if they are justly and fairly entitled to it, and it can be reasonably exercised by power of control over them to see if it was properly used: but I do say that any power taken should be controlled by some authority — I do not care AA'hether it is the State of Xcav York or the Federal Gov- ernment — I believe it should be used most efficiently. In other words, 240 PRESERVATION OF NIAGARA FALLS. "we are coming to the point now where this Avater power is so valuable that there should be home control to see that the power that is taken Is used efficiently and the best results produced. In other words, not to let some company take the power and not have an efficient appa- i-atus by which it can get the most with that power and not waste the power. We of Buffalo believe it should be properly handled and properly regulated bj' the proper authority to see that efficient power IS generated and that efficient plants are erected and taken care of to use that power. Mr. Flood. Is there any complaint that these companies have any inefficient plants? Mr. Hammond. I have heard that some plants are more efficient than others. Mr. DiFENDERFER. Xow, the Hydraulic Power Co. is a company which is not distributing except in the neighborhood of Niagara? Mr. Hammond. I can not tell you the details of that. Gentlemen here can give you those facts better than I, and I do not like to give you my impressions. Mr. DiFENDERFER. AVliat company transmits it to the city line? Mr. Hammond. The Niagara Falls Power Co. Mr. DiFENDERFER. Then it is taken from that company by a dis- tributing company that has an agreement with another comparn' for the service ? Mr. Hammond. Absolutely. Mr. DiFENDERFER. So that there must be three profits paid from the time the water is taken to the time when it reaches the consumer? Mr. Hammond. Absolutely. Mr. DiFENDERFER. I should like to know something about that. Mr. Hammond. That is something I can not talk about, but there are gentlemen here Avho can give you more facts. One company, the Cataract Power & Conduit Co., distributes only power, and they then furnish power to the Buffalo General Electric Co., which fur- nishes light, so that with that company there are only two profits, whereas with the Buffalo General Electric Co. there are three, which you mention. ^Ir. Fix^OD. With reference to this question of efficiency, what is the greatest quantity of power produced by any of these companies per cubic foot ? Mr. Hammond. I can not tell you. I have not the knowledge nor the inclination. That is all I have to say. Those three propositions are the things I cjime here for, an.d I have presented them as best I could, without any preparation. I came down to give you these facts and to say to you that, as far as the people of the city of Buffalo are concerned, they would like to have those things done, as well as that M'ith regard to further regulations, if possible. Mr. Levy. Do you know what the cost of street lamps is in Buffalo comi)ared with the city of New York? Mr. Hammond. I do not. Mr. Levy. I woidd like to get some idea of just what benefits these companies are to Buffalo. How much do these companies, that may be considered as domestic companies, how much do they pay in taxes annually to Buffalo? Mr. Hammond. I can not tell you that. We have in New York State a franchise tax by the State, as the attorney general can ex- PRESERVATION OF NIAGARA FALLS. 241 plain, unci in addition to that we have the general taxation and the board of assessors of the miuiicipality. I can send them to the com- mittee if _you desire it. I can give you the total amount of taxes rhat they pay. I will be very glad to do that. Mr. Levy. How much difference is there between the price charged for this electric power in Buffalo, per horsepower, and the price charged per horsepower generated by steam? Mr. Hammond. We have not in Buffalo any company that gener- ates power b}- steam and sells it to the public that I know of. In other words, we have simply these two companies, the Cataract Power & Conduit Co. and the Buffalo General Electric Co. Mr. DiFEXDERFER. They do substantially all of the business? Mr. Hammond. xVbsolutely ; it is a monopoly. Mr. DiFENDERFER. There is no competition whatever? Mr. Ham:'.iond. We do have some private plants for the purpose of lighting public buildings like the city hall. But there are only a few of those in Buffalo, and outside of that the only way the city of Buffalo can get electric poAver at the present time is from those companies. Mr. DiFENDERFER. AAliat does it cost per horsepower? Mr. Ham:mond. $30 j^er horsepower for purposes of power. Mr. DiFENDERFER. AVliat is the relative difference between the two, between the power and the lighting? Mr. Ha3imond. The lighting runs from i to 9 cents a kilowatt hour. Nine is the house lighting. ^Ir. DiFENDERFER. I clo uot sce liow you can institute any com- parison between those two. yir. Haj[:mond. We can make a comparison in the horsepower. Mr. CoHN. Mr. Hammond, you have stated here several times that this is a monopoly in the city of Buffalo. Mr. Hammond. That is my claim. Mr. CoHN. Do you object to that, or do the people of Buffalo object to it as a monopoly ? Mr. Hammond. My position with regard to that, and here I can not speak for the city as a whole, I can speak from my experience. For instance, in the gas investigation — that is, I believe if we had the proper power placed somewhere to regulate and control and see that proper service is given, that a monopoly is best for the city. But without that proper control to regulate, to control these com- panies, then it is bad. ^fr. CoHN. Is it not a fact that the company which I represent a]iplied to the city of Buffalo to distribute pcwer in the city, and its application was refused? Mr. Hammond. That is so. That was some years ago. Mr. CoHN. Is it not a fact also that the Ontario Power Co. have tried to come into the city of Buffalo to distribute power, but that the franchise which was offered was of such a character Mr. Ham:\iond. I do not know. Mr. DiFENDERFER. Why do you not ask him under what con ditions? Mr. CoHN. There were no conditions Mr. DiFENDERFER. AVhv was the rate refused? \Mr. Hammond. They did not want competition. 242 PRESERVATION OF NIAGARA FALLS. Mr. DiFENDKKFEi!. Wlio coiitrolled the refusal? ]\Ir. Hamjiond. The public authorities of the city of Buffalo. Mr. Legare. Have you the rioht under your charter to manufac- ture your own electricity? Mr. Hammond. I think we would have to have an amendment to the charter, to have an amendment by the lenrislature. Mr. Legare. Are you sure about that ? ^Mr. Hammond. That is my impression : that we would have to do that to have that risfht. Mr. DiFENDERFER. lu orrantin*r this original rioht, did you i^ive this power companv absolute right to use the streets without compe- tition? Mr. Ha:m:moxd. Oh. no; not without competition at all: absolutely not. Mr. Browne. Comino- back to the question suggested by Congress- man Levy, I understand that Avhen you speak of what the city of Buffalo wants, vou speak onlv of quantity? Mr. Hammond. Of what? ' ]Mr. Browne. Of quantity. What the city of Buffalo wants is that the full amount of 20,000 feet allowed by the treaty shall be allowed to be diverted, so that it can get the benefit of the 4,400 feet ? The city of Buffalo wants more power? Mr. Hammond. Yes, sir. ^fr. Browne. Is it not trn.e that they also want more power by im- portation — that they want more power, by importation— that they want more powder, wherever it comes from ? Mr. HAisrivroND. And Ave need it. Mr. Browne. And there is a demand for it? Mr. Hammond. Absolutely. And it should be properly regulated and controlled. That is why I come back to the Federal proposition. The Chairman. Is that all you desire to say? Mr. Flood. You said in your opening remark you were going to say something about a division of territory between these companies. Mr. HA:\r:\iOND. I simply said to you that from the facts I have been able to ascertain, what I expect to ]^rove in the investigation is that there is that arrangement. Mr. Flood. You did not expect to prove it here? Mr. HA^rMOND. I am satisfied there is a division of territory be- tween these companies. Mr. Flood. Could you state Avhat territory the res])ective com- panies have? ^Iv. Hammond. T can not state that at the present time, and T would not Avant to state it, if I might be permitted not to. The Chairman. Is there any other person here aa-Iio desires to be heard, from the State of New York? We will now hear from ]\[r. EdAvard Haggeman Hall, representing the American Scenic and Historical Asociation. PRESERVATION OF NIAGARA FALLS. 243 STATEMENT OF MR. EDWARD HAGGEMAN HALL, OF THE AMERICAN SCENIC AND HISTORICAL ASSOCIATION, OF NEW YORK, N. Y. Mr. Hall. 'Sir. Chairman, I represent the American Scenic and Historical Association. I c-ame down here by vote of the trustees of our society at their regular monthly meeting last evening, upon only two hours' notice. Our interest is in the preservation of the scenery of Niagara Falls. Two of our trustees best qualified to speak on that subject were pre- vented from coming, one by illness, and another by an engagement in the courts. It seems to me proper that one should speak with specific facts with regard to these nuitters. I do not feel qualified upon this short notice, so to speak, and I do not think it is just, either to our society or to you or to myself, to attempt to present such an argument on such short notice, without preparation. I feel, however, that the principal legal question which has come up here is one which is worthy of your consideration, and I might say we called it to the attention of the senior Senator from New York something over a year ago. and called his attention to the fact that the question which the Attorney General has brought up here to-day is liable to come up. I want to say for our society that, in case Congress shoidd turn that power over to the State, we have as much confidence that our State authorities will be amenable to the sentiment in regard to the preservation of the Falls as you gentle- men here. Mr. Garner. Who Avas the senior Senator from New York, whose attention you called to it? Mr. Hall. Senator Root. Mr. Garner. You do not know whether he was interested in any of these companies, do you? ]S[r. Hall. I do not. Mr. DiFENDERFER. AVould youT association be satisfied to turn this matter over to the conservation commission of the State ? Mr. Hall. I think so, sir. They have not passed upon that ques- tion because I do not think they knew about it. ]Mr. DiFENDERii^R. You would be willing to have them take juris- diction in this matter? Mr. Hall. If they could. The CirAiR:MAN. The committee will now hear from Mr. J. Horace ISIcFarland. president of the American Civic Association. STATEMENT OF MR. J. HORACE McFARLAND, PRESIDENT, AMERI- CAN CIVIC ASSOCIATION. ]\rr. ISIcFarland. Mr. Chairman, the legislation before you relates to the enforcement of Article V of the treaty between the United States and Great Britain, proclaimed May l-S, 1910, the .section cited being that Avhich limits the diversion of the water of the Niagara Kiver above the Falls of Niagara for power purposes. In order that the true intent of the article of the treaty mentioned may be discovered, it is proper to consider the circumstances preced- ing its discussion, signature, and ratification. 244 PRESERVATION OF X1A(JAKA FALLS. On October 0. 1905, the American Civic Association then in session in Cleveland, telegraphed to the President of the United States and to the Governor General of Canada a statement strongly urging international action for the preservation of Niagara Falls, and thns raising for the the first time, upon the basis of the ordinance of 1787 erecting the Northwestern Territory, the question of international ownership of the great cataract. This resolution was by the Presi- dent of the United States referred to Attorney General AVilliam H. Moody, who replied in the following Avords : As to the ground for Federal intervention, so far as proposed, I thiiilc there can be no fair donbt. The character of Niajrara Falls as one of the jiroatest natural wonders, its situation in a boundary river on the frontier <>f a foreign country, its undoubted historical reh'.tion as a natural possession and common heritage— all these elements in the case would fully .iustify you in jiroposing tlirough the ordinary diplomatic channels the consideration of this subject by the two (iovernnients immediately concerned. The same point of view in reference to the paramount jurisdiction of the United States and the Government of Great Britain was held by former Attorney General P. C. Knox, now Secretary of States, and also stated by formery Attorney General John W. Griffffs. in the following words: Whatever .iurisdiction the State of New Yetween this Nation and Canada, in respect to which the United States and Great Britain have the right by treaty stipulation to impose such conditions and regulations upon the use of the river and its waters as they deem mutually proper. A treaty duly negotiated between these two powei's and ratitied by the Senate of the T'nited States would be the supreme law of the land, and if in such treaty it were provided that no such use of the waters as is coutem]ilatenforced by act of Congress, the treaty .-nid the legislation wonld be valid, the rights of the State of New York and all private riparian owners to the contrary notwithstanding. * * * It is in my .judgment necessary, in order that full and complete control of this subject may be obtained by the two i)0wers. that an international agree- ment in the form of a treaty sbould be made. Such a treaty would involve no infraction of or tresi)ass upon the rigb.ts of tlie State of New York, because its rights as above stated are sul>ordiiiate to the superior jurisdiction of the Nation with respect to the stream as a navigable river and as an international boundary. Deeming it proper so to do. President did institute diplomatic corres])()nden(e Avith the Government of (^ireat Britain looking to- ward the negotiation of a treaty for the purpose of preserving Niagara Falls. Meantime he thought it wise to call the attcMition of Congress, upon its assembling in December. 1905, to tiie necessity for intervening legislation on the part of the United States, and in several interviews with officers of the American Civic Association the President made plain his earnest de^sire that legislation be enacted looking toward a cessation of the proceeding spoliation of the Falls. The ]ioint is here nuule that all this effort in re>pect to an inter- national treaty to be negotiated arose from an insistent desire on the part of the President and the people of the United States to jireserve the Falls of Niagara in their scenic majesty. The further point is made that, whereas, in consequence of a re.so- lution of the Legislature of the State of New York, passed March 17, 1904, the then Secretary of State, Hon. John Hay, had begun nego- J PliESEKVATION OF NIAGARA FALLS. 245 tiatioiis with tlie British ambassador for the preservation of Niagara Falls, active work in that direction was not instituted until after, by the action first mentioned, in October. 1005, the American Civic Association drew the attention of the President, Congress, and the country generally to the dangers then and since existing and to the international ownership of the Falls. Although the State of New York did, bj' its action in 1904. thus call the attention of the Federal Government to the necessity for the preservation of Niagara, that State had exercised no efficient control over the Falls looking toAvard their preservation under its then j)re- sunied exclusive State control. Thus that legislature had granted to the Niagara F:dls Hydraulic Power & Manufacturing Co. and to the Niagara Falls Power Co. the right to use a total of :2G,T00 cubic feet per second and had likewise granted six named corporations, between 188G and 1894, additional charters permitting the taking of water from Niagara Eiver for the production of power, some of them practically Avithout limit. There had been by the State of New York no attempt whatever to restrict the use of the water of the Niagara River for the production of power, as may be judged by the total amount involved in the right actually granted and alive to-day, so far as that State is concerned. While also the State of New York had, through its creation in 1885 of the State reservation at Niagara, admirably restored the sur- roundings to the Falls, against the opposition of the beneficiaries of their local desecration and the city of Niagara Falls, it had not and has not since imdertaken anv protection whatever of the gorge below the State reservation, or of such extension of the State reservation as would make it compare in extent with the Queen Victoria Niagara Falls Park erected by the Province of Ontario on the Canadian side of the Falls. That is, the State of New York has not, when it had unchecked con- trol of the Falls, in any way attempted to restrain their diversion for the purpose of power production, or to take care of the scenerj^ inci- dent to this great natural spectacle, except in respect of the admirable reservation above mentioned. The point is therefore made and enforced that there is no warrant for the contention that has been made before this committee that the State of New York has any right whatever in connection with the distribution or assignment of water permitted to be diverted under the treaty of Canada. Your committee has heard numerously, from various corporations, and some individuals.. upon the effect of diversions that have already proceeded, and upon others it is desired to authorize, directly or indirectly. Attention is called strongly to the fact that every one of these arguments relates to the taking of more water from the Falls of Niagara. Not one of those corporations here and now represented is seeking to give up any claim it may have to the use of the water of the Niagara River. Any yielding, of whatever nature, to any of the claims here made means, then, a further deple- tion of the cataract. All statements made should be considered in this light only, except as made by those few who are here to represent the great American peo])le, the rights of whom in the ownership of this natural wonder I am confident your committee will safeguard. 246 PRESEKVATIOX OF NIAGARA FALLS. Now, it iy apparent that, first, the State of New York has shown almost no concern as to the integiity of the Falls of Niagara, and. second, that the institution of the diplomatic negotiations, which resulted in the treaty j^roclaimed May 18, 1910, was. so far as the pur- l^ose of this present discussion is concerned, entirely with a view to the jjreservation and not the extended use of the Falls of Niagara. According to a letter wi'itten me by Hon. Flihu Root. Avhen he was Secretary of State, under date of October '20. 1UU(). "the negotia- tions between the United States and Great Britain for the preserva- tion of Niagara Falls were begun between Mr. Hay and the British Ambassador." In a further letter, written to me by the same gentleman, October 24. 1900. Mr. Root says: There is serious tliiiif^er tliat we can make no treaty for tlie preservation of Aiagara P'alls. There was no other thought than this in the minds of those who have furthered the institution of diplomatic negotiations, and the net. approved June 29, 190G, in section 4, specifically requests the President of the Ignited States •' to open negotiations with the Gov- ernment of (ireat Britain for the purpose of effectually providing by suitable treaty with said Government for such regulations and control of the Avater of Niagara River and its tributaries as will preserve the scenic grandeur of Niagara Falls and of the rapids of said river." No further argiunent is needed, I infer, to prove that the only purpose of the United States in seeking the treaty proclaimed May 13. 1910. in so far as Article V is concerned, was to preserve Niagara Falls. That there is no such statement in Article V of the treaty does not change the intent of the people of the whole country whose insistence brought about the action which resulted in the negotiation of the treaty. AVi)en the details of the treaty were first made known, and pre- vious to its ratification, the American Civic Association "was impelled to make objection, first, to the absence of any specific mention of the real object of that })art of the treaty outlined in Article V; second, to the large authorized diversion; and, third, to the absence of any mention or supervision of the importation of electric power from Canada. These objections were made known to Secretary of State Root, and it is betraying no confidence to ^ny that he urged me with all vigor and force not to interpose objections to the confirmation of the treaty by the Senate. Avhich objection at that time could have been made conclusively effective, alleging that he had done his utmost with the Government of Great Britain, and specifically stat- ing that the inclusions of Article V Avere permissiA'e and not obliga- tory. Secretary Root understood them fully that there would be strong opposition in the United States to the extension by more than 25 per cent of the amount of diversion which had already been foin)(l to injure the Falls, and more opposition to the mn-estricted importation of power from Canada. It was upon Secretary Root's presentation of the i)ermissive fea- tures of Article V that I agreed not to interpose any obstacle oil behalf of the American Civic Association to the ratification of the treaty by the Senate. The language of the treaty is plain when it says : PRESEEVATION OF NIAGAEA FALLS. 247 The United States may authorize and permit the diversion withiu the State of New ,Yoiiv of the waters of said river * * * for power purposes, uot exceeding in the aggregate a daily diversion at the rate of 20,000 cubic feet of water per second. The same permissive phrasing is attached to the Canadian section. It wonld be stultifying to say that the deliberate conclusion in Article V of the words '* may authorize " and " not exceeding "" Avas equivalent in its inclusion to the Avords in the preceding paragraph, which said "no diversion of the waters of the Niagara River above the Falls from the natural course and stream thereof shall be per- mitted." It is proper, though incidental, to hear remarks that the third jjaragraph of Article V authorizes the United States to permit the diversion of a certain amount of water, and not the State of NeAv York, whereas the fourth paragraph authorizes a certain diversion '*■ by the Dominion of Canada or the Province of Ontario." The treaty thus i^lainly settles the question of jurisdiction as betAveen the Province of Ontario on the one side and the Federal Government only on the other side. As bearing upon the A^iew had of this matter by the British am- bassador himself, Hon. James Bryce. I may say that at an extended interview had with him in the spring of 1906 he most emphatically joined in the desire of the American CIahc Association for the full preservation of the Falls of Xiagara. At his request I sent him to Ottawa full details as to permits, diA^rsions. power Avorks. and the like, not previously in his possession. It AA-as characteristic of Mr. Bryce's public spirit to have him say to me : If I were not British ambassador and could make S|x^eches al>out this matter for two weeks in Canada, I know the Falls could be preserved. The points are here made that, first. Article V of the treaty under discussion Avas, so far as the United States of America is concerned, formed solely and only for the preserA^ation of Xiagara Falls, and not for the extension of the use of Xiagara Falls in the production or imj^ortation of additional power; second, that the preserA'atiA'e idea was fully in "the minds of all those concerr^ed on the part of the United States, and at least of the British ambassador himself on the part of (ireat Britain, at the time of the negotiation, the signature, and the ratification of the treaty. There aaouUI have been no such article in the treaty had not the American Civic Association and otlier organizations of like aims voiced the AAill of the people for the preservation of Xiagara Falls. I need not present to your connnittee details Avith Avhich you are already completely familiar in the extended and admirable dis- cussion as to the preservation of Xiagara Falls contained in Senate Document 105, as transmitted in a message fronj the President of the United States, inider date of August 21, 1011. The facts there pre- sented, after thre^ years of engineering work of a uoatI, delicate, and intricate character, speak for themseh'es. Gen. Marshall says: The existing diversions have already seriously interfered with and injured the scenic grandeur of Niagara Falls, at the Horseshoe, which injury and inter- ference will be emphasized by the effects of lower stages fewer to recur on I^ake Erie and the upper lakes, due to natural causes. Referring to the established reduction in the depths of Lake Erie, due to the present authorized diA-ersion for poAver for production 248 PBESEEVATIOX CF ^flAGARA FALL^?. at Niagara Falls, and contemptuously disregarded various plea.-, made to you by those who are interested in taking more water from Ni- agara, the -tatement is made by the Chief of Engineers that " the aggregate loss per season for the entire fleet using Lake Erie pons as terminals becomes a very large amount." which is an additional reason for restraining any fnrtlier diversion. There can be no doubt a> to the will of the people of the United States, which Congress is bound to respect, and which has l^een emphatically manifested as desiring the efficient preservation of Niagara Falls further unharmed. In fact. I Ijelieve that if a referendum was now made to the voters of the United .States there would be an overwhelming majority for the complete restoration of Niagara Falls to their pristine majesty, re- gardles- of the private interests, thus dispossessed. The people are cognizant of the fact that in the Falls of Niagara — a world spectacle of increasing value — they have not only a va^t and beneficient financial resource in its attraction of a million visitors a 3'ear, with an admitted travel expenditure of $25,000,000 annually, which at 5 per cent would give Niagara Falls a capitalized value of 5^500.000.000. but they have also the knowledge that if the Falls are preserved and developed into electricity for distribution entirely to private advantage, there may continue a wide combination of utilization and conservation which, should the last final needs of the Nation require, might in the then-improved methods of producing and distributing electricity, inure to the enormous advantage of many millions of people. I desire to emphasize strongly the fact that, as based upon the findings of the Chief of Engineers, already referred to, any diversion of water for power purposes from the upper pool, whether that diver- sion Ije made in the United States or in the Province of Ontario, equally interferes with the scenic integrity of Niagara Falls. Thiis the diversions of the Ontario Power Co.. the Niagara Falls Hydrardic Power & Manufacturing Co.. the Niagara Falls Power Co.. all draw equally and indiscriminately from this upper pool, and equally and indiscriminately destroy the scenic integrity of the cataract. It is true the United States can not control such diversion as is made within the Province of Ontario, in so far as the resulting power is used within the Province. It is equally true that the use of electric power in the United States, whether it is developed on the Canadian side or on the American side, efjually and eificiently interferes with the integrity' of the Fall-. It woidd Ite unworthy of ci great nation, and an evasion which the people of the United .States would properly reseift. if the view should be taken that, while there was maintained sharp restrictions on the diversion of water in the United States for the production of power in order to preserve the scenic integrity of the Falls, there need be no restriction of the importation of that power produced across the international border from water drawn from and equally depleting* exactly the same pool. This point of view is the more efficiently presented in the aeen superseded b}^ more advanced and efficient items. The same criticism applies quite properly to the admission from Canada within the limitations of the Burton bill, of the power pro- duced by the Canadian-Niagara Power Co. at 'a utilization of but 130 feet one of a fall of 172 fwt. and I respectfully urge that in line with Gen. Marshall's report, this company "should be called upon to 250 PRESERVATIOISr OF NIAGARA FALLS. increase economy of conversion to the utmost limit permitted l)y the present condition of kno^^led^e." The water of Niagara is precious water: it belongs to all the world. It is of vast value to all the world as it ])lunges over the great preci- pice. And anv diversions from and depletions of its glory should be attended by the utmost possible economy and value, and I respectfuU}' urge this as one reason for declining to permit any additional diver- sions from Niagara on the American side, or admission of power from Canada, beyond the restrictions included in the Burton law above mentioned. TIk- recommendations in the report of the Chief of Engineers, pre- viously referred to, contain certain no\el propositions, looking, in one instance, as given on page 15, to the building of a "submerged dam placed in the bed of the river immediately above the Horseshoe Falls," and in the other instance, as mentioned on page 75, to '" the construc- tion of regulating works in the Niagara Kiver to avoid the wasteful outflow of the water of Lake Erie." If, upon further and detailed engineering study, these recommen- dations should prove practicable, and if the submerged dam in the first instance could be completed and in eft'ect observed Ijefore any further diversion was authorized, it might be worth while then, and in the event of no further chimage a[)pearing. for the P^ederal Govern- ment to consider an extension to the limits of the treaty permission. The American Civic Association has from the outset had no dispo- sition to interfere with the sincere investments of those who Avere develo]nng power at the time the wishes of the people of the United States became apparent, but it believes that no lease extension beyond the works then in actual or potential going form should be per- mitted, unless such extensions should be conclusively shown to pre- vent no further possibility of damage to the attractive and i)rofitable spectacle of Niagara Falls as the greatest cataract of the western world. In coiiclu>ion I w i.-li to urge u))ou your c-ommittee. as in line witli the most liberal thought of the American people, with whom we have had contact in letters, newspaper articles, and public meetings, aggre- gating the sentiment of millions, the qualification of existing pro- posed legislation before you. or the formulation of new bills, to bring about effectually and during the life of the treaty under discussion the recommendations found on page 15 of the document entitled " Preservation of Niagara Falls." already (juoted from, namely, that the "minimum limit'" of diversion autliorized on the American side — namely, 15,100 cubic feet per second — be recojnmended ; and that no greater amount of energy is permitted to be imported into the United States from Canada than 160,000 horsepower. Maintaining the status quo as thus outlined will be acting on be- half of the American people. Extending the use of the Avater, either by granting permits for the diversion of a single additional foot, or in' the admission of an additional horse})()wer from Canada will l^e for the interests of and in accordance with the demands of only ihc relatively few persons involved in the corporations selfishly develop- ing power from the waters of the Niagara River. 'J'he Chairman. I*f you have anything further to. submit. Mr. ]Mc- Farland, as a part of your remarks, it will be incorporated in the record. PRESEKVATION OF NIAGARA FALLS. 251 Tlio Chair Avants to say that the comniittee Avill take a recess in regard to the hearings concerning the Niagara Falls power hill until next Friday morning at 10 oV-lock. We desire to close the hearings in this subject next Friday, if possible. •Thereupon, at 12.25 o'clock p. ni., the committee adjourned until Friday. January 20. 1912, at 10 o'clock a. m. Co:Nr>riTTEE ox Foreign Affairs, House of Representatives. January 26, 1912 — 10 o'clock a. in. 'V\\Q committee this day met, Hon. William Sulzer (chairman) presiding. The Chairman. Dr. McLaughlin, representing the Public Health and Marine-Hospital Service, will be heard this morning. STATEMENT OF BR. ALLEN D. McLATJGHLIN. Dr. McLaughlin, will you give your name in full and your re- lations to the Government? Afr. MrLAUGiiLiN. Dr. Allen D. ^fcLauglilin. first assistant sur- geon. United States Public Health and Marine-Hospital Service. The official interest of the Public Health and Marine-Hospital Service on this problem is of course limited to the sanitary assets solely, and it may be narrowed even further to the undue prevalence of tyi)hoid fever in the cities on the Niagara frontier. In P>ulletin No. 11 of the Hygienic Laboratory is published the results of a preliminary sanitary survey of the territory, touching upon sewage pollution of the interstate and international water, with special reference to its bearing on the spread of typhoid fever. Of course you readily understand that in the undue prevalence of ty])hoid fever in the cities of gi-eat industrial and commercial im- portance — cities Avhich by reason of the surrounding country draw a large number of visitors from every State in the LTnion — the ques- tion of water sup])ly involves the cities as an interstate matter; it is a great interstate matter because the traveler is not protected as well as the resident. He is at the mercy of the hotels and has to take what they give him. while the resident is warned that the Avater is dangerous. For this reason the Federal Government made this survey. The following extracts from the bulletin will show practically the view which I held before and which I have no reason to change. In lejiJinl to sewage disposal. Buffalo has done nothiiiii beyoiul conveying its sewage to the Buffalo and the Niagara Rivers. It amounts to about 11(J.()(M».00() gallons daily. Proper sewage disposal requires two things — it must not create a nuisance and it must not be a menace to health. It is conceded that a stream flow of 3^ to 7 cubic feet per second for each ],0<)0 ]iopulation will care for sewage so that no nuisance is created.. Accord- ing to this calculation Buffalo would require for disposal of its sewage from the standiioint of nuisance, a stream How of about 1..500 to 3,0<.M) cubic feet l)er second. The Niagara River has a flow of about 220,000 cubic feet per second. From the standpoint of menace to health, Buffalo's sewage disposal is an- other question. While the dilution is great, it is not a.s great as it appears at (irst glance, because of the fact that the polluted current hugs tlie shore 252 , PRESERVATION OF NIAGARA FALLS. aue a very small matter. Ahnost negligible. Mr. (tarner. Would the possibility for a slight deflection of the river be less from a canal running from the Niagara River than from the Chicago Canal, because of the greater rapidity with wdiich it Avould flow { Dr. McLai (iiiLiN. T don't think tliere would be any difference in the quiet stretches of Avater behind the canal. Both canals would furnish excellent ])laces for sedimentation. Mr. (lAKNER. The riA-er? Dr. McLai:ghi,in. I dou't know. 1 don't think tliere Avould be any arreat difference. ^ PRESERVATION OE NIAGARA EALLS. 259 The CiiAiKMAx. AVe are imich obliiivd to yon. Doctor. Mr. Barton is ijreseiit and will now be heard. STATEMENT OF PHILIP B. BARTON. Mr. Barton. In connection with the qnestions that are asked me, may I have the privilege of volunteering certain information? The Chairman. Yes. Mr. Barton. I am manager of the Niagara Falls Power Co. Mr. Chairman and (xentlemen, we did not intend to make any other statement at this time than that presented by Mr. Brown. I :«m simply here to answer any questions that the committee may wish to ask. Mr. Sharp. AMiat position do vou hold and whom do you repre- sent? Mr. Barton. The Niagara Falls Power Co.; I am vice president and general manager of the Niagara Falls Power Co. Mr. Sharp, Are you fainiliar with the equipment for using that power in a mechanical sense? Mr. Barix3n. I am. Mr. Sharp. It has been said here by different witnesses at different times through this hearing that there was not the efficiency developed that there ought to be in the economical use of this power. If that is true, to what extent is it true — not only in your company, but if you know of the other concerns using power, applying to them also? Mr. Barton. The tunnel of the Niagara Falls Power Co. has a loss of about .55 feet — that is. a slope, a difference in level — between the upper end of the tunnel and the lower end, and about 55 feet, which, of course, results in loss in the amount of power that can be developed from the head available between the river above the rapids and the ri\er below the Falls. Mr. Sharp. Can that be remedied in any way by more efficient ecpiipment ? Mr. Barton. In connection with second tunnel that we had planned to put in if we should develop our second hundred thousand horse- l^ower, Ave had under consideration the plan to put in a very much larger tunnel at a lower level, and in that way not only make our second develoi)ment more efficient than the first but also help the loss of the head in the first tunnel by connecting the old wheel pit with the new tunnel. B)it we did not develop the second half of our power, Mr. Sharp, Can you do that with profit vvith your ])resent diver- sion of water? Mr, Barton, I don't think we could, because the cost of the tunnel and the alteration of the ])lant would be exceedingly expensive. It is a serious question Avhether it would be commercially feasible. Pos- sibly it might. But it is a serious question, Mr. Sharp. What would you say if you had the knowledge of the other companies who use this power, as to their efficiency com- ])ared with what it might be made? Mr. Barton. T don't know that I ought to speak for the other companies because T have only a general knowledge of their features. 1 think the hydraulic company is using water about as efficiently as 260 PRESERVATION l)i' NIAGARA FALJ^S. it is possible to be used with the head they have got. So are we. The companies on the Canadian side are using water about as effi- cienth' as it is coniniercially possible to use it. considering their loca- tion, (^f course the reason for this loss of a head with Niagara I'alls Power Co.. which has been spoken of, I think has been ex- l)lained. When we built our plant in 1890 one of the very first con- siderations that our directors had in mind was that there should be no interference of any kind whatever with the scenic features of the Falls. For that reason we placed our plant a mile and a half above the Falls, where it could not be seen by spectators of the Falls, and that necessitated a long tunnel. In order to get water with suf- ficient rapidity the tunnel was given the necessary slope. At that time there Avas no question about the amount of water to be used. 'Jliat was '2'2 3'ears ago. The amount we could use in any case would be absolutely a negligent quantity so far as the scenic beauty is con- cerned. As was explained to you the other day by advice of the most eminent engineers that could be found in the world that slope was adopted, and the whole thing was done largeh^ to preserve the scenery, on account of which we are now being criticized for the lack of efficiency. ^Ir. DiFENDERFER. What time in the day do you use the most force to create your power or the most water? Mr. Barton\ Our load is substantially uniform throughout the 24 hours. It is almost a straight line. From midnight until 7 o'clock in the morning there is a slight depreasion due to the falling off of the load at Buffalo. Between the hours of 4 and G o'clock in the afternoon in the fall and winter months there is a decided peak due to the overlapping of the heavy street car traffic and the lighting load when the lighting commences somewhat earlier due to the longer night. Mr. DiFENDERFER. Tlieu during the day you would consume more water than 3'ou would from 12 o'clock to 7 o'clock the next morning, w^ould you not, during daylight? Mr. ]5arton. Yes, sir; slightly, but the difference in efl'ect on the aj^pearance of the Falls is absolutely imperceptible. ^Ir. DiFEXDERFER. That Avould be about the time when visitors would like to see the Niagara Falls at its best, wouldn't it ? ^Ir. Barton. I presume that is the case; but they couhln't possi- bly see i\nj difference. Mr. DiFENDERFER. Thcu at the time the most water is falling over the Falls would be at the time Avhen they were sleej^ing. Mr. Barton. Theoretically, yes; but our variations are small, and as a matter of fact cause no variations in the depth of water at the crest of the Falls. Mr. DiFENDERFER. There is one other question I would like to ask in that connection and that is this: How do you measure the water that you take from the Falls, by the hour, or do you measure it by the day — 24 hours, is that where you get your measurement from per hour? JMr. Barton. The amount is determined by means of half hourly readings of the electric horsepower output on the basis, fixed by the Government engineers, of the relation between output and quan- tity of water. This then makes accurate measurement every half hour. PBESERVATION OF NIAGARA FALLS. 261 Mr. DiFE>'DERFEK. That was done by measurement? Mr. Barton. That determination was made by measurement, they determined the rehition between the water taken by our plant and the output in electrical horsepower. ^Ve keep a continuous record of our output. Mr. DiFENDERFER. By the hour? Mr. Barton. Eveyy half hour, and those records are transmitted to the War Department, and they can see by that data whether at any time we have exceeded the limit. Mr. DiFENDERFER. Under that agreement, what are you privi- leged to use? Mr. Barton. It Avasn't an agreement, it was a requirement of the law. "We are permitted to use 8,G00 cubic feet per second. Mr. DiFENDERFER. Have you used that at any time? Mr. Barton. Yes, sir. Mv. DiFENDERFER. The full auiouiit ? ]SIr. Barton. We have been using that continuously. Mr. DiFENDERFER. I believe it is in evidence that the cost of pro- duction on the Canadian side is about $9 per horsepower. Do you care to state what the cost of producing this power — I believe you are a transmitting company? Mr. Barton. We are a generating and transmitting company. Mr. DiFENDERFER. Distributing company, are you? Mr. Bartom. We distril)nte to seme extent. We distribute to our own customers at Niagara Falls, and on the Canadian side the Canadian Niagara Co. at Bridgeburg and Fort Erie distributes a small amount to consumers. Mr. DiFENDERFER. I would like you to state to this committee what the cost per horsepower is for generating this electricitv. ^Ir. Barton. Our cost last year. 1011 — I am not j^retending to give the exact accurate figures— was approximately $14.50 per horsepower. Mr. DiFENDERFER. Now. you sell that power, do you not, to dis- tributing companies i Mr. Barton. AVe do; some of it. Mr. DiFENDERFER. Havc you any idea what they charge the citizens of Buffalo and Lockport ? Mr. Barton. The price we charge them? Mr. DiFENDERFER. Havc 3'ou any idea what they charge the pub- lic? I understand there are three profits that come out of this. Mr. Barton. That is a mistake. We sell the Buffalo City line to the Cataract Power & Conduit Co.. which takes fi-om us and dis- tributes in Buffalo about 05,000 horsepower. Mr. DiFENDERFER. Now to Avliom do they sell? Mr. Barton. Of that ()5,000 horsepower they sell about 55,000 di- rect to consumers, and about 10,000 is sold to the Buffalo Oeneral Electric Co., which is an electric lighting company, engaged in busi- ness long before the Conduit Co. was organized and before we began to deliver power. ^Ir. DiFENDERFER. Then it passes through three hands? Mr. Barton. Tlie power delivered to the lighting company, which is used only for lighting and running small motors, passes through three hands. Mr. DiFENDERFER. Then there are, naturally, three ])rofits? ]Mr. Barton. In that case there ouofht to be. 262 PKICSKHVATIOX OF X'iACAKA FALLS. Mr. DiFEXDKRrEH. T should judge so. Mr. Barton. But the investment in that lighting company Avotdd have been just the same if there had l)een only one company. Mr. Dtfexderfkr. Noav, of course, when you make up your esti- mates of cost you include in that your capital invested? Mr. Bartox. The costs that I gave you? Mr. DiFEXDERFER. YcS. Mr. Bartox. That includes all expenses, fixed charges, operating charges, cost of transmission. ]\Ir. DiFEXDERFER. Wlmt lias been the cost of the construction of that plant up to this time? Mr. Bartox. Taking the whole property of the Niagara Falls Power Co. and the Canadian Niagara Co. on both sides of the river, the actual investment to-day is abont $24,000,000. Mr. GooDWix. Do you include in your estimate of cost the interest on the investment? Mr. Bartox. Yes, sir; if you refer to cost of production, interest on the bonds, etc. : but no interest is included in cost of investment. Mr. DiFExnERFER. HoAv do you account for its costing so much more than the cost of production on the Canadian side? Mr. Bartox. AVliat figures do yori take as the cost of production on the Canadian side? Mr. DiFEXDERFER. Nine dollars per horsepower. Mr. Bart(~>x. That is the selling price on the Canadian side, not the cost of production. Mr. Dn-'EXDERFER. Twelve dollars I understood was the selling price on the Canadian side. ^rr. Bartox. Nine dollars and forty cents is the price at which I understand the Ontario Power Co. sells to the hydroelectiic com- mission. ]Mr. DiFEXDERFER. TliQU the cost of producing is about that, as I understand it ; they are furnishing it at the cost. Now, the question asked Avas, Plow do you account for this difference between the cost of production on the American side and the cost of production on the Canadian side? ^Ir. Bartox. T don't admit that i^0.40 is the cost of production on the Canadian side. Mr. DiFEXDERFER. AVould vou sav tliat they are giving it away for less than cost? ~Mr. Bartox. I don't know: I have no information. But. leaving that question aside, it naturally costs ns more to generate and deliver on the American side. We have a larger investment because we have a larger tunnel, as I have explained, and for other reasons. Mr. (toodavix. How modern is the Canadian company? Mr. Bartox. The Canadian plants are not complete yet. There are three of them, and none of them actually completetl. They were all started at ap]n-oxiniatelv the same time, about 1901 or 1902, I think. ]\Ir. (lARXER. AVould you mind telling the committee if there is any Avater connected Avith your company outside of what you take from the Niagara Piver? Ml'. Bartox. You mean in (he capitalization? Mr. (lARXFR. The caintaliz-ation. PKESERVATIOX OF NI.UiARA FALLS. 263 Mr. Barton. I doirt think there is, sir. Mr. (tarner. How did you organize witli a capital of twenty-four million to begin with. Mr. Barton. The capital stock is about $5,760,000. The bond issue is a little over $18,000,000. The original capitalization started Avas $10,000,000 of bonds— first -mortgage bonds— and about $4,000,000 in stock, before the American plant was completed, $3,000,000 in bonds in addition were issued, making $13,000,000 and $4,000,000 in stock for the American plant. Mr. DiFENUERFER. Now, if your directors should conclude to become distributors in the city of Buffalo, would you consider that you had capital enough to do so? Mr. Barton. In that case we should have to raise more capital. Mr. DiFENDERFER. You could raisc it, could j^ou? Mr. Barton. I think so. Mr. DiFENDERFER. AMiy is it vour company does not distribute in Buffalo? .... Mr. Barton. Because there is a distributing company there, and there is no reason to go into competition with them. Mr. DiFENDERFER. Doii't you think so? Don't you think, as a pro- ducing company, you could go into competition with them and sup- ply the people of Buffalo with power at less cost per horsepower? Mr. Barton. I do not think so. We should have to make the same investment they have made, and I don't see hovr we could sell power any cheaper. Mr. DiFENDERFER. Do vou Ivuow if there is any gentlemen's agixie- ment existing now ? Mr. Barton. There is more than a gentlemen's agreement. There is a contract. We have specificalh' agreed not to go in, in considera- tion of their agreeing to take and pa}' for a large amount of power at a specified price for a long term of years. Mr. DiFENDERFER. D(X'S the hvdraulic companv distribute in Buffalo? Mr. Barton. Xo; they do not. Mr. DiFENDERFER. Do tlicy sell poAver as you do? Mr. Barton. In Buffalo? Mr. DiFENDERFER. Yes. ^Ir. Barton. They do not sell any power in Buffalo. Mr. DiFENDERFER. It is confiued principallv to Niagara Falls, is it not ? Mr. Barton. Yes. sir. Mr. DiFENDERFER. Do VOU distribute any in Niagara Falls? ]Mr. Barton. We do. Mr. DiFENDERn:R. To big consumers? Mr. Barton. About 80.000 horsepower. Mr. DiFENDERFER. Does the hydraulic company infringe upon your territory in the neighborhood of Lockport ? Mr. Barton. A^'e have no territory. Mr. DiFENDERFER. You distribute in Lockport? Mr. Barton. AA^e do not. Mr. DiFENDERFER. To wlioui do you sell? Mr. Barton. AA"e sell poAver to the International Railway at Tonawanda. It has a transmission line going through Lockport. Mr. DiFENDERFER. They supply Lockport ? 264 PRESERVATION OF KIAGAKA PALLS. Mr, Barton. They do not. They use power for their own rail- way purposes. Mr. DiFENDERFER. Who distributes power to Lockport? Mr. Bartox. I understand there is a local company there the name of which I have forgotten. Mr. Difenderi'^r. Do you know who furnishes them with their power ? Mr. Barton. They get some of their power from the Niagara & Lockport and Ontario Power Co. Mr. DiFENDERFER. Do they get any from you ? Mr. Barton. They do not. Mr. Sharp. I may have misunderstood you, but in your reply to Mr. Goodwin in reference to the companies on the Canadian side, did you state that they had not completed their equipment over there yet ? Mr. Barton. None of their plants are as yet completed. Mr. Sharp. They are supplying power there, are they not? Mr. Barton. Yes. but they are not completed to their ultimate capacity. Mr. Sharp. What will be their ultimate capacity with reference to the taking of the amount provided for under the treaty on the Canadian side? Mr. Barton. They would take the entire 36,000 cubic feet. Mr. Sharp. Now, they are simply supplying it as they can find sale for it ? Mr. Barton. That is all. Mr. Sharp. They will build up to that demand as fast as it grows? Mr. Barton. Yes; I am speaking for the Canadian Niagara Co. when I say that, and I presume other companies are in the same position. Mr. Sharp. How many thousand cubic feet per second are they ac- tually using? jNIr. Barton. I have forgotten the exaft figures. They are all recorded in the reports. I think the Army engineei-s got those. I should sa}' somewhere in the neighborhood of 18,000 cubic feet per second — about half of the amount I should say. speaking roundly. ]\[r. Sharp. Are vou in favor of the importation of this power to the United States?' Mr. Barton. Yes, sir. Mr. Sharp. Do you think any arrangement could be made whereby a fixed amount of poAver imported into this country could be given a definite lease of duration, so that with the increasing demand on the Canadian side it Avould again be diverted back to Canadian industry? Mr. Barton. I don't think that Avould be practicable, because Canada could at any time prohibit the exportation of the power, but I don't (hink there is much danger of their trying it. Mr. Si[ARP. So that it would be simply a question of getting a benefit that might Ix? temporary on this side? Mr. Barton. It might be temporary with this in mind, that if the power is once brought over here and is actually used in industries the Canadians would Ix? much less apt to say you shall stop bringing that power in than they would to say you shall not send over any more power than you arc now sending. I think it is a great advantage to get power over bore before It is preempted by Canadian industries. PBESEKVATION OF NIAGARA FALLS, 205 Mr. Sharp. What company would get that power? Mr. Barton. You mean on this side? Mr. Sharp. On this side ; that was imported. Mr. Barton. So far as the Canadian Niagara Co. is concerned, the Niagara Falls Power Co. would take what was imported at Niagara Falls and distribute it to its customers there. Mr. Sharp. Have any of these companies, including your own, made any tentative arrangement with the Canadian company to take any imported power that would be allowed to come in on this side? Mr. Barton. You mean the American companies? Mr. Sharp. Yes. Mr. Barton. Not that I know of. Mr. Sharp. There is no understanding at all? . Mr. Barton. No. Mr. Sharp. How would that be regulated — have you given that fixing question any consideration as to how they would get that power for distribution ? Mr. Barton. I think that would be a matter of contract between the producing company and the distributing company. Mr. Sharp. With your equipment for distribution and that of the other American companies, it is quite likely that the existing com- panies would get that power imported? Mr. Barton. The existing distributing companies? Mr. Sharp. Yes. Mr. Barton. That would be the natural development, I should say. Mr. Sharp. Is it your opinion, after having given this subject much consideration, that there would be any such competition by the im- portation companies as would lower the rate to the ultimate consumer on this side of the water? Mr. Barton. I think the tendency to low^er the rate perhaps would not result so much from competition as it would from the increased volume of the product. Speaking of Buffalo, it is the only way I see, practically speaking, that Buffalo has any hope of getting a lower price for power is by increasing the volume of the power that the Cataract Power & Conduit Co. is enabled to sell, and that must be done by bringing it in from Canada. Mr. Sharp. How long would it take for the present demand for increased power on this side of the water to practically absorb all that would be imported? Mr. Barton. I think it would be much faster than it can be de- veloped. Mr. Dtfenderfer. The Ontario Power Co. is a Canadian corpora- tion, as I understand it? Mr. Barton. That is my understanding. Mr. DiFENDERFER. They supply — the Niagara & Lockport Co. is the transmitting company, is it not? Mr. Barton. That is my understanding. Mr. Dh^enderfer. Is there any connection between these two coni- ]>anies that might be considered favorable one with the other ? Mr. Barton. I have no information. Mr. DiFENDERFER. Gen. Green is vice president of the Ontario Co., is he not ? Mr. Barton. I believe he is. 266 presp:rvatiox of xiagaka falls. Mr. DiFENDEHFEiJ. That power is created on the Canadian side, is it not ? Mr. Bahtox. It is. j\fr. DiFEXDERFER. Isn'l lie president of the Niagara, Lockport & Ontario Co. ? Mr. Bartox. He is ri^rht here. T think that is the ease, isn't it. General ? Mr. DiFEXDERFER. If he is, that would show some close relation- ship, would it not? Mr. Bartox. It would indicate that to me. Mr. DiFEXDERFER. Tliis Xinijara-Lockport Co. is the distributing company for the Ontario Co., is it not? Mr. Bartox. That is my undei-standing. Mr. DiFEXDERFER. They take the product at the center of the river, as I recall the testimony given here. Mr. Bartox. I think that was the statement made. Mr. DiFEXDERFER. Froiii whom do they take it? Mr. Bartox. From whom does the distributing company take the power ? ^fr. DiFEXDERFER. YbS. Mr. Bartox. From the Ontario Co. Mr. DiFEXDERFER. In the center of the river? Mr. Bartox. I don't know anything about it. I have nothing to do with that company. Mr. DiFEXDERFER. I tlioiiglit ])o>sil)ly you might know, being pretty closly connected. Mr. Barton. Only know as much as anybody about the place knows. ]\Ir. DiFEXDERFER. Havo 3'ou any information regarding the Mc- Kenzie Mann Co., on the Canadian side? Mr. Bartox. The electrical development companj''? Mr. DiFEXDERFER. Yes. Mr. Bartox. I have some general information about it. ]Mr. DiFEXDERFER. Do you know whj^ they refused to send this power to the United States under the agreement? Mr. Bartox. I think I explained that the other day. as far as my knowledge goes. They did distribute and sell some power to come into the United States for a period of three years. They had four generators installed and as their load in Toronto increased about a year ago they needed the power of all of those machines to supph^ their own load in Canada, so that at the termination of the three years' agreement tliev said that tliey didn't wish to renew it, and the importation was stopped. They are now putting in three additional machines, as I under- stand it. and an arrangement has been made by the Cataract Power & Conduit Co. and Electrical Development Co.. which is a practical renewal of that contract, so that as soon as one of these generators is started, they will be utilizing their permit again. Mr. DiFEXDERn-^R. You said a little Avhile ago that there was more than a gentlemen's agreement existing between your company and the distributing company. Mr. Bartox. We have relations with only one company in Buffalo. Mr. DiFEXDERFER. There Avas more than a gentlemen's agreement Avith that company that you had the contract with. That contract precludes your doing business as a distributing company in Buffalo? J PKESEKVATIOX OF NIAtJAHA FALLS. 26.7 ]Mr, Baktux. It does, in tlie way T ha\e stated. Mr. I)iFKNi)f:uFEU. Ivetiuii again to the Ontario company. Mr. Bautox. It is only fair that it shoukl. because we could ruin that company by going in there and competing with them. Mr. Clixe. Because you could produce it cheaper? Mr. Bartox. Because we control the whole thing. AVe could sell power for less than the cost, for example. Mr. Clixk. I wouldn't presume that you would do that. Mr. GooDwix. "Wouldn't the public be benefited? Mr. Bartox. liy the competition you mean? Mr. GooDAVix. By you. Mr. (tarxer. Refusing to sell them power. Mr. Bartox. Only temporarily. We couldn't sell it cheaper than they do because we would have to have the same investment. Mr. GooDWix. Replying to a (question by Mr. Sharp, did I under- stand you to say that the importation of Canadian power Avould have a tendency to regulate the price? Mr. Bartox. I said I lh(jught it would tend to produce a lower ])rice by increasing the \olame. Mr. GoonwTx. In other Mords. the price would be governed some- Avhat by supply and demand. Mr. Bartox. Xo, sir; not exactly that. What I meant is, it is a general law that if you can produce a thing in larger quantities it can be produced cheaper per unit than you can by producing it in small quantities. Mr. GooDwix. But following that, you also said that you thought the consumption at least would be as rapid as the imi)ortation? Mr. Bartox. Yes, sir; that is true. ]\Ir. GooDAVix. That there would not be much cheapening? Mr. Bartox. If the law of supply and demand were to hold sway there would be no cheapening. Mr. GooDwix. But having a monopoly, there would scarcely be any difference. iVIr. Bartox. These companies are all under the supervision of the public-service conunission. which watches those things very closely, and if it were shown at any time that their i)rofits were exorbitant, it would have to be reduced. Mr. DiFEXDERFER. I uoticcd the city of Buffalo has appropriated $35,000 to put them in a position to ask for those things. Mr. Bartox. I understand that is the case. Complaint has been made. Mr. DiFEXDERFER. If it requires that much to ask a question, how then can an individual have any hope in proponnding any questions? It seems to me as though it Avere rather complicated to reach that commission, Mr. Bartox. Any individual has got to prove his case. Mr. HARRist>N. I want to ask you if any directors of your company are interested in the distributing company that you have a contract with. Ml", Bartox, The company as a whole owns a controlling interest in the stock of the distributing company. It is different from the generating business. It is more convenient to oi-ganize the thing in that way. 268 PRESERVATION OF NIAGARA FALLS. Mr, Ci RLEY. About Iioav imich property do you pay taxes on, either at Buti'alo or Niagara? Mr. Barton. AVell, we pay taxes on all of our property everywhere. Mr. CiRLEY. About how much? Ml'. Barton. At Niagara Falls last year the tax bill was $175,000; I can't give you the figures about the other companies. The Chairman. That was the local real and personal propert}^ tax to the city? Mr. Barton. Niagara Falls. The Chairman. A local tax to Niagara Falls? Mr. Barton. The city tax was about $130,000 and the rest was State and Federal income tax and one or two others. Mr. CuRLEY. A total taxation of $175,000? Mr. Barton. Yes. Mr. Ctrley. What ]n"oi)ortion of that was paid at Niagara Falls? Mr. Barton. All ])aid at Niagara Falls. $130,000. about, was the city proportion. Mr. CiRLEY. What is the tax rate there? Mr. Barton. The city tax rate is about 20 mills. The Chairman. You pay no franchise tax ? Mr. Barton. Yes; we have a franchise tax, also. The Chairman. Will you explain that, please? Mr. Barton. We occupy certain ]iropeii:y in the public streetvS at Niagara Falls with conduits and cables, and we are assessed on the valuation of that property and pay a tax to the city. The Chairman. The fact I desire to develop is that you pay no franchise tax for your permit to the Federal Government and no franchise tax to the State of New York? Mr. Barton. We furnish the State of New York all the power that is needed by the park commissioners for lighting, heating, and power in the State reservation of Niagara. We also furnish without charge all the water that is needed in the State park. Mr. Ci'RLEY. What is your figure for the total investment at Niagara Falls? Mr. Barton. $24,000,000. Mr. CuRLEY. Yet you pay at Niagara Falls, according to your statement Mr. Barton. Investment at Niagara Falls — I didn't understand; Niagara Falls in New York, our investment is $16,500,000. Mr. CuRLEY. You only pay taxes on about $6,500,000. Mr. Barton. That is, the real assessed value in the city of Niagara Falls is $6,500,000. Mr. CiRLEY. What other benefit does the business of the United States derive from the fact that these various companies that you represent other than the $175,000 that is received in taxation? Is there any other that you can think of? Mr. Barton. They get the benefit of the power at a very low rate, and power fosters and promotes industries. Mr. CuRLEY. Do you think a very low rate is a rate that is nearly three times as large as that which is charged in Canada for the same class of power? Mr. Barton. I think the rates we sell power at are low rates, and they are not three times the price of power as sold in Canada. PRESEKVATION OF NIAGARA FALLS. 269 Mr. CuRLEY. I understood that in Canada they sell power for $1*2 per horsepower and in Buffalo it is $36 according to the figures given here the other day. Mr. Barton. I think those figures are not comparable; in the one case you have power at a power house right as it comes from the generators at a high voltage, and in the other case you have the power delivered at the premises of the consumer after undergoing a process of transformation and distribution and through under- ground conduits. There is the tranformation sometimes three times. To compare those prices is about the same as comparing the ton price of pig iron with the price of nails per ton. One is the raw and the other is the finished product. ]Mr. CuRLEY. Is there niore power sold on the Canadian side than on the American side of the Falls? Mr, Barton. Xo; there is less sold on the Canadian side at present. Mr. CuRLEY. Didn't you state a few minutes ago that the greater the volume of power the companies could produce the low'er the price at which they could distribute it ? Mr. Barton. I was referring then to the distribution cost mainly. The distributing company of Buffalo has a large investment in a distributing plant w^iich is capable of distributing more power than it is now distributing and I suppose that as that volume increases the distribution cost per unit will be reduced. The same thing applies to generating. If you have an investment in a plant of 100,000 horsepower and only are turning out 50.000. you have got to pay fixed charges on the entire development on an income from the 50,000 horsepower. Mr. Garner. Let me see if I get your statement correct. You rep- resent the Niagara Falls Power Co. ? Mr. Barton. Yes, sir. Mr. Garner. That generates the power? Mr. Barton, Yes, sir. Mr. Garner. Then you represent, rather the stockholders in that company represent, the transmission company that takes it to Buffalo ? yir. Barton. Xo; there is no separate company. The generating company transmits to Buffalo. Mr. Garner. Then the Niagara company owns the controlling interest in the distributing company in Buffalo. Mr. Barton. That is true. Mr. Garner. Then the company that generates the power owns the controlling interest in all of the companies up to the consumer? INIi'. Barton. No ; the lighting business is taken care of by a sepa- rate company. Mr. Garner. Now. the public-service commission of the State of New York has power to regulate your prices? Mr. Barton. It has. Mr. Difenderfer. Has it ever exercised that power that yoii know of? Mr. Barton. In our case? Mr. Difenderfer. Yes. sir; in any case. Mr. Barton. It has exercised it in some cases, but not as to our companies. Mr. Goodwin. Lowered the rate? 28305—12 18 270 PRESEP.VATTO>- OF XI AGAR A FALLS. Mr. Barton. Yes, sir. Mr. Goodwin. To what extent? Mr. Barton. I say lowered the rate; I am not speaking throiifrh my personal knowledge. I nnderstand the commission has investi- gated a number of cases and that in some cases it has reduced the rate. I can't give any case in which it has lowered the rate. Mr. Goodwin. Let us get back to the question of taxes paid last vear. Did vou sav the total taxes paid bv vour companv aggregated S1T5.000? Mr. Barton. That is the generating company at the city of Niagara Falls. Mr. Goodwin. That is the company that you are vice president and general nuinager of? Mr. Barton. Yes. sir. Mr. Goodwin. Did that SlTa.OOO include the amount of taxes that the Niagara Falls Power Co.. of which you are the general manager, has in the distributing company? Mr. Barton. Xo; they pay taxes l^esides that on their own prop- erty. Mr. Goodwin. The $175,000 was exclusive? Mr. Barton. Exclusive of the other company and also exclusive of our property outside of the city of Niagara Falls. We pay taxes in every bailiwick through which the transmission line passes. ISIr. DiFENDERFER. What is the assessed valuation of your property at Niagara Falls? Mr. Barton. Over $6,000,000. Mr. DiFENDERFER. The reasonable value you claim is $16,000,000? Mr. Barton. That is our investment in the city of Niagara Falls. Mr. DiFENDERFER. That is rather a low assessment, is it not? !Mr. Barton. As compared with other assessments at Niagara Falls it is higher than some others. Mr. Cline. Do you mean to say that the New York commission fixes the exact price, or does it fix a maximum price for you ? Mr, Barton. The public service commission? Mr. Cline. Yes. Mr. Barton. I understand tlint after investigating a given case it determines whether the rates charged are fair and reasonable, and if it concludes that they are not reasonable it reduces the rate. Mr. DiFENDERFER. ^AHiat do you mean by a given case? Mr. Barton. Any case brought to them by complaint. ^fr. DiFENDERFER. Givc US the case. Is it one of your own? Who furnishes this case? iSfr. Barton. We have no reduction. The case Avould be furnished by the people who complain against the rate. Mr. DiFENDERFER. I Understand there are no individual com- plaints. Mr. Barton. In our case, you mean? Mr. DiFENDERFER. YcS. Mr. Barton. No; I was discussing a general proposition. Mr. Cline. T want to ask for information whether the commission fixes the maximum price that you charge or whether it fixes the iden- tical price at Avhich you should distribute power. Mr. Barton. It fixes a maximum. I don't think they prevent you from charging any lower rate. PEESERVATION OF NIAGARA FALLS. 271 Mr. Sharp. In all cases that maximum rate is identical with the rate charged. Mr. Barton. I should think it would be. The CiiAiRrkiAN. Which company paid the larger amount of money for taxes to the city of Niagara Falls, the Niagara Falls Co. or the hydraulic company ? Mr. Barton. The Niagara P'alls Co. The Chairman. WhyT Mr. Barton. Because we are assessed at a higher valuation. The Chairman. Because it owns more real property in the city? Mr. Barton. That is the theoiy, I think. Most of it is on our plant, $5,000,000 is on our plant. Mr. Brown. By one or two questions I think I can bring out cer- tain information that the committee would be interested in. Mr. Brown. ]Mr. Barton, at what cost is the power on the Canadian side delivered to the Province of Ontario by their commission over there? Mr. Barton. $9.40. Mr. Brown. Now, at what price does the developing compaii}'^ de- liver power in bulk at, Ave will say, the limit of the city of Buffalo? Mr. Barton. That is, our company in one case. Mr. Brown. Yes. Mr. Barton. $16. Mr. Brown. In what manner is that power which is sold by the commission on the Canadian side at $9.40 — at what place is that power taken ? Mr. Barton. I understand it is at the generating station, the generated voltage. Mr. Brown. Who pays for the transmission lines, the cost of the transmission line to the point where it is delivered to the city. Mr. Barton. The hydroelectric commission. Mr. Brown. Included in this cost of $16 you get at the limits of the city of Buffalo, what is the difference in the conditions from the conditions at which power is delivered at $9.40 on the Canadian side ? ]Mr. Barton. I think I can answer that best by stating the price quoted by the hydroelectric commission. ]\Ir. Brown. What does your company do before you charge this $16 that is not done on the other side? Mr. Barton. The same thing, precisely. We step up to a high voltage and transmit it to the point of delivery. Mr. Brown. In other words, that cost of $16 includes transmission across the river from your poAver plant up the river to the city limits. Mr. DiFENDERFER. Supposc vou (lo uot take it from the Canadian side? Mr. Barton. The same thing; we step up and transmit. Mr. Brown. You transmit to the city limits of Buffalo? ]VIr. Barton. Yes, sir. Mr. Broavn. What effect is that distance, as to AA^hether it is ex- pensive transmission ? Mr. Barton. TA\enty-tAvo miles on the Canadian side and 18 miles on the American side. We have tAvo separate pole lines Avith three separate transmission circuits. On the Canadian side Ave have Iavo pole lines with three separate independent circuits. 272 PRESERVATION OF NIAGARA FALLS. ^Ir. Brown. The difference here bet^Yeen the tAAO costs — that is, the cost to the Canadian side taken at the power house and the cost on the American side taken at the city limits — is approximately $6. Now, whether considering the extra cost of transmission, and the ex- tra cost for the investment for transmission appliances, is that a fair rate, is that extra $6 any more than necessarily reasonable to cover the difference in cost ? ]\Ir. Barton. I don't think it is. Mr. Broavn. On the Canadian side the Canadian commission has taken this bulk quantity of power at the plant on the Canadian side and transmitted it to consumers. You have spoken about a place, Bridgeburg, where the Canadian commission transmits and delivers to consumers. Mr. DiFENDERFER. The hydraulic commission you have refernce to? Mr. Brown. I mean that. '\"Miat is that ? Mr. Barton. It is the hydroelectric commission. It does not trans- mit to Bridgeburg, but the business men at Bridgeburg asked the commission to quote them a price. Our transmission lines to Buffalo run through both of those villages. They wanted to get some power from us but they were afraid that we were going to charge them too much so they asked the Canadian commission for a price, and the price quoted by the commission was a sliding scale. The village could only use less than 100 horsepower to begin with. The commission said it wouldn't transmit less than 200 and the price quoted was $37.81 per horsepower delivered at the high tension in the village of BridgelDurg, and the municipality had to take the power and trans- form it and distribute it. Mr. DiFENDERFER. How far is Bridgeburg from the power plant? Mr. Barton. TAventy-two miles from Niagara Falls. We are sell- ing power at Buffalo at $16 under those conditions precisely. Mr. Brown. Take the retail price to the consumer that exists at Toronto, and that at Buffalo to the consumer. Generally speaking, how do they run? Mr. Barton. I understand the rate established by the hydroelectric conmiission for power in Toronto in some cases is lower than the Buffalo rate to consumers, and in some cases they are higher. Taking the rates of the Cataract Power & Conduit Co. as a whole. I am told that the application of the Toronto rate to customers would result in a substantially larger income to the distributing company. Mr. DiFENDERFER. The hydroelectric connnission. as I understand it, transmit their power for $12. do they not. a horsepower, in some instances? Mr. Barton. I think for less than that in some. Mr. DiFENDERFER. Well. I am taking $12 as a maximum. Mr. Barton. The maximum cast or selling cost? Mr. DiFENDERFER. The selling cost — $0.40. AMiat they get it for. Mr. Barton. I don't know of anv case in which thev are selling for $12. The price at Toronto, I understand, is about $18. that is, the transmission price. Mr. DiFENDERFER. ToFonto. what is the distance? Mr. Barton. About 90 miles. That is not the price Mr. Brown. Is that the price to the city line or the price to the consumer ? Mr. Barton. At the city line. At transmission line Aoltage. PRESERVATION OF NIAGARA FALLS. 273 Mr. Broavn. How far is it from Niagara to Buffalo? Mr. Barton. Twenty-two miles. Mr. DiFENDERFER. They charge the same price for 90 miles as you do for 22. Mr. Barton. Their price is $18, our price is $16. Mr. DiFENFERFER. Two dollars difference. Mr. Barton. Two dollars difference, in our favor. Mr. Brown. State generally, so that the committee may have an idea, since your company and these other companies were furnishing power in Niagara Falls, Avhat has been the development in indus- tries in that city under the price at which you furnish power? Mr. Barton. I would say that the population of the city of Niagara Falls has grown from 1890 up to the present time from about 8,000 to about 35.000, and that has been entirely due to the develop- ment of power at Niagara Falls. Mr. DiFENDERFER. At Niagara Falls, you speak of? Mr. Barton. Yes. sir. Mr. DiFENDERFER. Aloiie ? Mr. Barton. Alone. Mr. DiFENDERFER. Isii't it a fact that the Hj'draulic Power Co. have that as their territory? They do not distribute to any other point than that particular point, Mr. Barton. That is true. JNIr. DiFENDERFER. Is there competition there? Mr. Barton. There is. Mr. DiFENDERFER. Betwceii your company and the other company? Mr. Barton. There is. Mr. DiFENDERFER. Do vou cliai'ge any less there, or do they charge iiny less than you ? Mr. Barton. I don't know what their prices are. ]\Ir. DiFENDERFER. Or are they the same? Mv. Barton. I don't know what their prices are; I have no infor- mation. ]Mr. Brown. It has been stated by the statistics that from about 1900 to about 1904 or 1905 the value of manufactured output by industries at Niagara Falls increased from $8,500,000 up to $16,- 900.000. Have you statistics showing what the increase was in the value of output bv these industries between 1904 and 1909? INIr. Barton. Increased to $28,600,000. An increase of about 80 per cent in five j^ears. Mr. Broavn. I understand the consumers complained in regard to j-ates for the New York commission— that is, by the consumers, they have to be signed by 100 consumers. ]\Ir. Barton. That is my understanding. Mr. DiFENDERFER. "\Yho makcs that rule? Mr. Broavn. Do you knoAv of a complaint being made and signed by 100 consumers? ]\rr. DiFENDERFER. Is that the commission rule? Afr. Barton. That is the rule. I might say in regard to that there has recently been served on the Cataract PoAver Co. and on us — it has been stated in Buffalo the customers of a distributing company could not serA-e a complaint on a generating company. That may be the laAv, but a complaint has been served on us. We haA-e been notified to mxe an ansAver within 274 PRESERVATION OF NIAGARA FALLS. 20 days. That complaint was signed by 150 citizens of Buffalo, and ont of those three Avere customers of the Cataract Power & Con- duit Co. Mr. Brown, AVho Avere the others ? Mr. Barton. I don't know. Mr. BROAyN. They AAcre not consumers? Mr. Barton. Xot consumers. Mr. Broavn. Customers of the lighting company ? Mr. Barton, I think they were. A Member. May I ask if any of the stockholders of your company are interested in that company ? Mr. Barton, I can't say. but I think some persons there are inter- ested in both comi^anies. Mr. DiFENDERFER. They are interested in all of those companies, are they not? Possibly that is your answer to there not being a gentleman's agi'eement. That may be your answer to that proposi- tion. It isn't necessary. Mr. Barton. Why should there be a gentleman's agreement? Is there anything that is secret ? The whole thing is oj^en and aboye board. There is a lighting company- doing business there. They Avere there, and there is no reason Avhj^ we should duplicate their inyestment. Mr. Cline, Then those Ayho haA^e these other two companies — members of your company that have an interest in these other tAvo companies you speak of — also share three different profits, do they not? Mr. Barton. I presume that is the case, but three different profits, each of AA-hich represents a different inyestment. Mr. Broavn, Has the Niagara Falls PoAAer Co. or the Cataract Co any controlling interest in this electrical company, the lighting company ? Mr. Barton. None Avhateyer. Mr. Broavn. The common interest is simply the result of accident that one stockholder may hold some stock in both. Mr. Barton. It came about in this Avay : When the Niagara Falls PoAver Co. AAas organizing a distributing company in Buffalo, the lighting company Avas asked whether it Avanted to buy all this poAver that Ave Avere going to furnish to Buffalo, and it decided it Avouldn't take the risk. . Its directors thought it Avasn't Avise to inyolvc the property of their shareholders in that project. But one or tAvo of the gentlemen interested in the lighting company took the matter up and undertook to organize a local distributing company in Buffalo, and that Avas done. Mr. Broavn. State. Mr. Barton. Avhat has been the dividends paid by the Niagara Falls PoAver Co. doAvn to the present time. Mr. Barton. In 22 years the company has paid eight dividends of 2 per cent each. Mr. DiFENOKurER. What are the salaries of the gentlemen Avho are interested in this — then Ave Avill come nearer the profit^ Mr. Barton. They are inadecjuate. I should say. They are on record in the files of the public-.service commission, if you are in- terested. The CiiAHOiAN. I received a telegram from the Rev. Dr. Lyman Abbott, editor of the Outlook. If there is no objection it will be PBESEKVATIOX OF 2CIAUAKA FALLS. 275 read and incorporated in the hearings. The telegram reads as fol- lows : Xkw York, January .?.5. 1012. Hon. William Sulzer, Chalrmuti House Ooiiuuittec on Foreii/n Affaira, Washington. D. V.: May I urge upou you favorable consideiatlDn of the joiut resolution for the extensiou of the i)rovisioiis of the Burtou Act for the preservatiou of Niagara Falls? I believe that (Vjiigress shouUt take this action for three reasons: First, Congress has already deereed that Niagara Falls shall be preserved by the Federal Goverunient : second, the report of the Army engineers has shown that the Falls are already injured and are in danger of further injury : third, the Burton Act has proved itself an effective instrument for the protection of Niagara. lA'MAN Abbott. STATEMENT OF PROF. JAMES HENRY HARPER. The Chairman. Mr. Harper, yoti may proceed. Prof. Harper. I do not represent anv interest in this large ques- tion, except the 90,000,000 people in the^Tnited States. I want to contribute, if I can, a little light to the subject of the preservation of the Falls. As a preliminary proposition, I believe 3'^on have some pictures here showing the run-off of the Falls at the time when it was the low^est rainfall Avithin the lifetime of any indi- vidual present. I want to make that very prominent. We are passing just at the present time the crest of a drought greater than that within the knowledge of any man living here or likely to be. These ])eriods of minimum rainfall occur largely and af- fect largely the interior, and consequently have a very pertinent effect upon the flow of the >yiagara Falls, because it is entirely the drainage of the table-lands in the territory back in the interior that the Falls depends upon for their Hoav. With that I have been preparing some figures on this, the history of the rainfall and the drought, which will be published, I suppose, but I want to state that we have just passed or are passing that period of three years of maximum drought. This is the crest of that period, and that will not occur again within the lifetime of any individual here. The Chairman. Has the rainfall, so far as 3'OU have been able to find out, increased or diminished along the Great Lakes for the past ()0 years? Prof. Harper. The rainfall has necessarily decreased because we have cut away nature's sponge, the diminution of the timber supply around that area has been the largest factor, and the prime factor ill the diminution, if there has been any. the rmi-off at the Falls. I have no interest in them, nor do I hold any briefs for a power com- pany of any kind. The Chair:man. Is it your oli^^ervation that the Great Lakes are receding ? Prof. Harper. Not at all. The rainfall period will determine the volume of run-off and the very fact that there are some large im- poundments of water and large power development which -20 years ago were not in evidence at all in that territory, has contributed materially to a bettering or steadying this flow of Niagara. As a matter of fact the power development that Niagara now has con- tributes to the flow of Niagara. The power development and the 276 PRESERVATION OF NIAGARA FALLS. impoundment of water in those areas has helped to relieve the situa- tion that the cutting off the timber has brought about, and the more power development, the larger im])Oundment of water taken care of at the low stages. In other Avords, the larger power development that takes place back of Niagara Falls the steadier will be the flow of Niagara P'alls. It is only during the low period that people are talking about the preservation of the Falls, or an3'one else is inter- ested. The run-otf wouldn't be reduced in inches appreciabh' if there were to be another 20,000 feet of water taken there. Mr, Sharp. Do you claim that the cutting away of timber di- minishes the rainfall? Prof. Harper. Certainly not, only the rainfall, not only the natural precipitation, but it immediatel}' puts that water on its way. Mr. Sharp. I understand that, but in what way does it diminish the actual precipitation, the cutting away of the timber? Prof. Harper. That would call for quite an extended observation, but in simple terms anything that destroys the sponge, nature's sponge for the retention of that rainfall, affects the run-oft'. Mr. Sharp. I understand that, but what Prof. Harper. The cutting off in timber has brought about a lessening in the carrjdng power that is within the basin, we Avill say, of these Great Lakes, and a lessening of the precipitation, and it has thrown the precipitation closer to the coast line. Our precipita- tion here in AVashington will be sustained and at times in New York during the crest of this drought the precipitation in New York was l^henomenal. but that was the result of the precipitation being car- ried farther inland in drought periods. Nature proved that. Dur- ing a number of years the precipitation has been nearer to the coast line. And that is a sort of a balance. Nature provides for that. Mr. Sharp. Doesn't it diminish the precipitation from the clouds, the cutting away of the forests^ I can understand how the forest acts as a sponge and retains the moisture and that it doesn't flow away so rapidly, but I Avould like to know how it interferes with the amount of precipitation, because I understood that there is a good deal of controversy on that subject, and I would like to get your view of just Avhy that action takes place. Prof. Harper. There is a wide difference of opinion even among the scientists on that subject, but I might give you an opportunity to speculate a little bit on that subject by stilting some conclusions that I have arrived at myself in dynamics, which govern prinuirily the periods of greater and lesser precipitation. The sun, which is our center of energy, is a large magnetic nuiss, not in combustion, and bearing no relation to the ancients of the fiery furnace, but simply a magnetic mass. That source of energy is magnetic, entering our sphere and causing the phenomena of light- ning and the extreme local phenomena of caloric energ}'. The caloric energy determines the rainfall and the growth of plant and animal life. That is the basis of some research work that has been going on on my part for over a third of a century, and the basis of the prediction on my part that we were to pass through a drought l)eriod by reason of the occurrence of the sun spots. I made some mathematical calculations of that. I had a photograph made of the sun spots and discovered that we would have a diminution, possibly, mathematically determined, per- PRESERVATION OF NIAGARA FALLS. 277 haps as high as 5 per cent of the sun's energ}'. That brings about a drought period. That controls the whole operation. Mr. Sharp. So the existence of sun spots has to do with disturb- ances of the atmosphere? Prof. Harper. Not only the atmosphere, but seismic, pestilence, drought, famine, and others. Mr. Sharp. The sun spots, you think, were the primary cause? Prof. Harper. Yes, sir; and some others. Mr. Sharp. AVhat relation has the lessening of the forests to the production of sun spots? Prof. Harper. Now jow have got a subject that is large enough for ■ Mr. Sharp. I studied it myself for 30 years, and I think I know something about that question, and I was curious to get your views on the same. Prof. Harper. You had got enough to make deductions that any good mathematician could make and our good astronomers. Scien- tists have really accepted that theory. Mr. Sharp. Professor, I don't think I will take issue with you on the connection of the suti spots with the phenomena that we see here, but I have long been of the opinion that the mere cutting away of the forests has very little to do, if anything, with the actual precipitation and the moisture: not with the holding it back, but that the cutting away of the timber lessens the precipitation and the moisture it would seem to be rather a far-fetched conclusion. Prof. Harper. It does really lessen it INIr. Sharp. There is some doubt that it has anything to do with it at all. Prof. Harper. Not to my mind. I think if you follow my The Chairman. Now, Mr. Harper, to get down from sun spots to this mundane sphere, will you tell us what you have got to say about this legislation pending before this committee? Prof. Harper. I thought that statement to you. gentlemen, that the relation of the scenic beauty of the Falls to the present employ- ment of water for power Avhich has been carefully determined by ver_y good and competent engineers — the run-off can be had without any apparent effect upon the Falls, and as I have endeavored to show, and which is deducible to mathematical terms at the present, there has been an extreme diminution of rainfall on the table-lands, and the scenic beauty of the Falls during the year just past hasn't been materially affected. The feAv thousand or more feet run-off that is called for by the bill wouldn't have any effect at all. I desire to speak further upon the proposition of the impoundment of water. George AVashington had a plan for impounding in largo basins the water of the Potomac River, and he proposed slack-water navigation for two purposes — for power and navigation and for con- trol — it is one of the most intelligent briefs on the subject that we have got, including the best of our engineers for a hundred years since. The Chairman. Now, George was a great man. The committee will now take a recess until 2 o'clock, and the hear- ings will be closed this afternoon. The committee has been very patient and courteous to all of the gentlemen who have come here, and we have tried to give you as much latitude as possible to get 278 PRESERVATION" OF NIAGARA FALLS. your view on the legislation which is before the committee. This committee is very busy, and we must close these hearings this after- noon. AVe Avill go on from 2 o'clock until 5. three hours, and I hope you gentlemen Avho want to be heard will get together and agi'ee about how much time you Avant. Mr. CuKi.Kv. I Avas going to ask that a part of the report compiled by Dr. McLaughlin in his report, on page 47, be included in his re- marks, that portion relative to distriliution of typhoid fcA-er in the State of New York. fiEOGRAPinC.VL DISTRII5UTI0N OF TYPHOID IKVER IN THE STATE OF NEW YORK. In the cities of New York State with yood water supplies the t.vph(»i(l ower de\eloped in the TTnited States. It is fiu'ther obvious that if iiroper restraint is had upon the importation of electrical jiower from Canada, it will be many years before the damage will become more serious. With loss of ."lO.OnO horsepower in use now of the 432 000 horsepower it is expected to produce under the treaty diversion on the Canadian side, there will be time for sentiment to form in Canada, which will inevitably be formed and will prove as effective in demanding the scenic preservaton of the Falls as it has so far proved in the United States. Gentlemen, if you so act as to hold down the spoliators of Niagara to the r.mounts which liave been given them to protect their investments, with a fair profit to all enteri)rises going at the time the will of the people was manifested in the United States, you will be doing justice, and full justice, to every honest interest represented, and respecting as well the overwhelming desire of the American peojile to have, see, enjoy, and hold in reserve, no further damaged, the scenic ulorv of Niagara Falls. Kespectfully submitted. Amkrkax Civic Association, Hy .7. Horace McFarland. President. RiniARD H. Watrous, Secretary. Mr. Watrous. Followino- Tuesday morning, when we adjourned. I might say, Mr. Chairman, that this statement is a paper presented PEESERVATIOlSr OF NIAGARA FAIvLS, 281 upon the rending by Mr. McFarland of the latest report returned to the House — Document No. 24G, which inchides the figures of diver- sion up to the expiration of the present bilL I would like to ask, Mr. Chairman, if you have any knowledge when the committee is going to have the benefit — when this is going to be delivered to you? The Chairman. We expect to close the hearings to-day. Just so soon as the reporters can have the minutes transcribed they will be corrected by the various speakers and sent to the Public Printer. Mr. Watrous. You expect, of course, to use these documents? The Chairman. Yes. Mr. Cohn desires to be heard further. Mr. CoiiN. The statement was made here that the companies at the present time are utilizing but 13,800 cubic feet of water. That state- ment was based upon a report of some officials of the War Depart- ment made in June, made as on June 11, in which it was stated that the Niagara Falls Power Co. was using 7,870 cubic feet of water per second, whereas it has a permit for 8,600 cubic feet ; that the hydraulic company was using 3,350 feet per second, whereas they were allowed 6,500 feet, and the other company was using 400 feet per second^ whereas it has a permit for 500 feet per second. The suggestion was made, I think by Eepresentative Cooper, that that might have been with the same purpose. That the full amount was not used as that other company could not under the existing law get any power beyond 16,600 cubic feet, although the law allowed the Secretaiy of War under certain conditions to grant permits in excess of those, either under the Burton bill. I wish to say there is no such purpose on the part of anj'one that the use of the water is fluctuating, and that permits in excess of 16,600 cubic feet, the extent of the bill, they must, under the terms of that act, be granted to the existing companies. I just state that to answer any argimient of that character. I wish to say, in the second place, that our company, the hydraulic company, has at no time professed to waive its common-law riparian right, or the rights under its grant from the State of New York, but it accepts the permit from the Secretary of War because the whole subject of permits under the Burton bill was assumed to be a tem- porary affair. The third statement I wish to make is in respect to one matter this morning, with reference to the water of the Niagara River, that was used for domestic purposes at the city of Niagara Falls. The city of Niagara Falls is now installing and will have completed by June a suitable filtration plant so that the question of the water of the Niagara River used for domestic purposes does not enter into this affair in any way. I would like to have the chairman call upon the representatives of the War Department present to give the actual user in cubic feet per second of water for power purposes by the companies, according to its last report. The Chairman. Mr. BroAvn, is there anvthing further you desire to say? Mr. Brown. Nothing orally, Mr. Chairman, except possibly this, that the position of the Niagara company is the same in regard to this last matter stated by Mr. Cohn for the hydraulic company. We took the permits as a temporary matter, never having waived our right, and as said here the other day we have called your attention 282 l^RESERVATIOX OF XIAOABA FALLS. to our legal rights, not for the purpose of telling you what we are going to do, or what you have got to do, but ju^t to emphasize the equities that should be considered in our favor. Under the chairman's permission given the other day, I shall ask at the close of these hearings to file a brief summary, including pos- sibly answers to propositions that have been made as they occurred to me. Mr. Garner. Supposing that Congress should decide not to permit any water to l)e talcen out of the Niagara River on the American side on the ground that it injures navigation, and upon an investigation of the facts the courts should determine that it did not injure naviga- tion, although Congress on that ground refused to permit water to be taken from it. AVhat would be the residt of a contest in the courts? Or, in other words, if I may put the question in this way: If Cong-ress should find that it Avould injure navigation to permit 20,000 cubic feet per second to be taken, and by legislation should prohibit any portion of it to be taken, and you siliould go into the courts and contend that the findings of Congress were erroneous and establisli that fact to the satisfaction of the court, that it did not in- terfere with navigation, would you still be entitled to take 20.000 cubic feet per second? Mr. DiFEXDERFER. Under the treaty. Mr. Browx. In the first place, let me say if I could predict always what tlie findings of the court would be. the function of a lawyer would be done away with. It is the uncertainty in the solving of these problems in these mat- ters before the courts, that we help to bring about a solution. I could not predict, sir, what a court Avould say, and I can only say what in my opinion they ought to say and what I would advise a client they ought to say under the law as I see it to be. in that comiection I would say to my client that the United States Supreme Court has already held in the drainage case in Two hundred United States that legislation by Congress where it attempts to limit private rights, where it tends to usurp private rights, the functi(m of Congress in legislating or limiting upon personal or private rights, is stated by the United States Court that the exercise of such powers must have a " substantial relation to the public objects which the Government may legally accomplish.'' and further on the court says that the exercise, or attempted exercise, of any power by the United States Government — or any Government in these matters — must not be " arbitrary or unreasonable, or beyond the necessities of the case." Those are from the United States Supreme Court in Two hundredth United States. On the same principle I should also (piote to mj' client as laid down by the State of Xew York in a Niagara decision, where they say "not even a State has the liberty to interfere with the riparian rights of the relator arbitrarily, but such interference, if attem))ted, must be in the interest of some substantial right of the State affected by the exercise of the rights of the riparian to the use of the water of the river." (70 App. Div., 543.) Such principles as that I should present to my clients and advise them that they had rights which would be jirotected in the courts. Mr. DiFEXDERFER. At that point — supposing there was a tribu- tary branch, we will say, a river supplying a navigable stream, would a company have a right to dam up and divert that water, or PRESERVATION OF NIAGARA FALLS. 283 could the United States Government prohibit them from doing that thing? Mr. Brown, To get the question clear, Mr. Difenderfer, you mean by diversion to divert it away and have it returned to the stream? Mr. Difenderfer. Never returned to the stream. The Govern- ment would have a right. Avould it not, to interfere in a case of that Jcind ? Mr. Brown. Not only the Government, but every riparian owner below, because under the law when a man diverts water from a stream — and the same principle applies whether it is navigable or unnavigable — makes any substantial diversion — he must return it to the river. If by not so returning it the lower riparian owner suffers, or if the public suffers, they each and both have a remedy. Mr. Difenderfer. I believe there is a Rio Grande decision of the United States. Mr. Cline. There is a Colorado decision, too, on that point. Mr. Brown. Yes, but you must remember that the Colorado de- cision and in some respects the Kio Grande decision are decisions which are not based upon riparian rights. The decision there is based upon what we call the law of '' prior appropriation," that if anj' man goes in upon a stream and diverts the water, and carries it away for irrigation for instance, he does not have to return it, and he gains a prior right over every subsequent user, whether that sub- sequent user be a riparian or any other person. That laAv exists in Colorado. It is for the same reason that the decision read by Mr. Watrous, the Colorado decision, is all right in its place, but it does not apply here. That Colorado decision read the other day is where a man upon a stream had a waterfall which was attractive, and he had used it in beautifying and developing his place, his summer resort. Afterwards, somebody above tried to divert some of the stream. The scenic-beauty man said that he had appropriated this fall as a part of the beauty of his j^roperty and he claimed it by prior appro- priation. A subsequent man can not get rights against him. and the courts sustained him. Mr. Cline. I don't Mant to make this tedious. Do you claim that your company is now seeking to exercise all the rights conferred upon them as riparian owners by the common law of the State of New York, or haven't they submitted some of those rights to the jurisdiction of the Secretary of War, or the jurisdiction of the com- mission of the State of New York ? Mr. Brown. In answer to your question, sir, speaking for the Niagara compan}', we have rijjarian rights, vested property rights, beyond the extent that they have been exercised under any permits or as measured by any permits from the Govermnent. Temporarily, and having regard for scenic beauty, they have submitted to pro- visions which have limited them to a certain use which is less than their legal rights. Their taking the permits from the Government did not in any way constitute a submission of their rights to what is claimed — the right of the Government to dictate under the present law. They simply submitted as a temporary matter. For instance, our com- pany had a capacity already developed, which required, for an eco- nomical operation, 10,000 cubic feet a second. The present law 284 PRESERVATIOX OF NIAGARA FALLS. jimited that to 8,000. They submitted to that onh' as a temporary submission, until the thing should be adjusted, and we want to claim our ri per cent dividends. The Niagara Falls Power Co. is get- ting about ii>GO,000 for its share of those dividends, $60,000 a year, and at the present rate power is delivered, about 05.000 horsepower, it would be about $1 a horsepower. PRESERVATION OF NIAGARA FALLS. 285 Mr. DiFENDERFER. Per year? Mr. 13artox. Per year. Mr. Harrison. Is this company, the Niagara Falls Co., is that the company that Morgan is interested in? Mr. Barton. I am not sure that Mr. Morgan personally is, but the J. P. Morgan Co. is a large shareholder of the company. Tlie Chaiioian. Congressman Smith desires to be heard. STATEMENT OF CHARLES B. SMITH. Mr. S.AiiTii. I desire to ask, Mr. Chairman, if Mr. Kenefick wishes to say anything. I Avill read, with the committee's consent, two letters which I re- ceived from Butfalo, which tend to show the attitude of the people of that city. The first one is from Mr. Frank C. Ferguson, a leading lawyer of the cit}^, wlio wanted (o come before the committee but was unable to do so because he had to appear before the Interstate Commerce Com- mission. This is what he saj^s: Ferguson & Magavern, Buffalo, N. Y., January 20, 1912. Hou. Charles Bennett Smith, Wunhingtoit, i). V. Dear Sir: I am glad that yon are taking: such a great interest in the two Niagara Falls power qiiestions. the question of the production of electrical power on this side of the line, and the question of the importation of Canadian power. I hope that these things may be made plain to the committee, notwithstand- ing the fact that the great public does not find It so easy to go, or send its agents, to Washington, and get their views directly befox'e the authorities, as to the power companies. 1. That while electrical power Is produced by the use of the Niagara Falls current at a low cost to the producers, the public, ou this side of the intei'na- tioual boundary line at least, have never received any benefit from that decreased cost of production. On the contrary. It has always had to pay exceedingly high rates. Indeed, the city of Buffalo particularly Is worse off to-day than as though no electrical power at the Falls had ever been developed. In anticipation of cheap Niagara Falls power. It advertised itself far and wide as the electrical city. Owing to the fact that It has always had to pay exces- sive rates for power. It could not and did not "make good" in its claim, and the reaction that followed when the outside world found out the facts has harmed it greatly. You know this as well as I do, but people living 500 milee from Buffalo do not generally kut)w it. I wish that the committee could have one of its hearings at Buffalo, in order that it might find out what the local sentiment in this matter reallj- is. 2. Any sentiment in western New York that any of the power companies should be given the right to use any more water than they now have the legal right to use, is strictly confined to the power companies themselves, their agents and servants. All of the rest of the public believe either that no addi- tional water should be used for the development of electrical power, or that the additional 4,400 cubic feet of water which the treaty allows to be taken, should be turned over to the State of New York, I^eaving out of account the matter of the injury to the natural beauty of the Falls by the diversion of water, it would, of course, be to the manifest advantage of the public to have additional electrical power developed at the Falls, if the public could thereby get the power at a reasonably low rate, as It probably could if the present electrical power monopoly should be broken and the additional current or power development be turned over to the State of New York. The production and distribution of electrical power at the Falls at the present time is an abso- lute monopoly, and it would not interfere with that monopoly in the slightest 28.305—1 2 1 236 PRESEEVATION OF NIAGARA FALLS. degree to j;ive to the present coinpaiiies the ri.i:ht to tala- iiu-ieased ;uno>iiit of current. As long as the development of Niagara power remains a monopoly in private hands I li.ive no contidence in our ability to get electrical power at a fair rate through the public service commission. 3. Every restriction on the importation of Canadian power should be at ouce removed. Electrical poAver is a "raw material " and should be "free." Elec- trical power has of itself no value. It is simply an instrument to produce value. 4. Subject to the paramount viglt of Congress over navigation r.nd commerce, its treaty-making rights and its control over imports, the National (iovernmeut iias really no legal right to interfere with the State of New York in the matter of the development and sale of Niagara power. I hope that the hearings before the committee will not be concluded until the authorities of the State of New York shall be heard upon these two subjects — of the production and importation of Niagara lunver and until the committee shall be well informed as to the real local sentiment in western New York. Yours, very truly, Frank C. Ferguson. That is from Mr. Ferguson. Another letter received this morning is from Charles M. Heald. president of the Mutual Transit Co., one of the leading transportation com2)anies on the Great Lakes: Buffalo, N. Y., Janmuy 23, lUU. Hon. Charles Bennett Smith, House of Representatives, Washington, D. C. My Dear Sir: I have just read a letter recently sent you by Mr. Frank C. J"'ergusou, of this city, bearing on the question of Niagara Falls power. I am heartily in accord with the position taken by Mr. Ferguson, and I feel absolutely safe in saying that in all probability 90 per cent of the citizens of Buffalo would concur if they had the opi)ortunity to pass an opinion vipon this question. While 1 am not aware, of course, as to what it costs to produce this electrical power, I am sure it is produced at a low cost, but. unfortunately, the users of it on this side of the international boundary line have never yet been able to secure the ixiwer at anything like the proper figui'o. To properly conserve this power for the interest of the people who have the right to it — and that is the people at large — I feel the concession of any rights should be invested in the State of New York and not in private companies, as our experience with the latter up to this time has not been at all satisfactoi'y. Electrical power is, as Mr. Ferguson expressed it. a raw material : it is of no value whatever until it is put into use or, in other words. " manufactured," and therefore, as raw material, it should be admitted to this country free. The State of New York, subject, of course, to Congressional and National Government control, should have vested in it the right to control ; and through such control, if properly conducted, of course manufacturing industries generally would get the benefit of this cheap power, which they certainly are entitled to. I trust this matter will not be disposed of before all parties of any importance may have an opportunity to be heard before the committee, esiiecially the New York State authorities. This question of the use and control of the Niagara Falls power is of vital interest to this section of the State, and I trust it will receive your earnest attention and support. Yours, very truly, Charles M. Heald, Presid^ent. I have also here a letter from Senator Burd. of Albany, which I will have placed in the minutes. Committee on Foreign Affairs, House of Representatives, Washington, D. C. Gentlemen : A matter of large importance to our whole State, and especially to the city of Buffalo and its environs, is now pending before your committee, I am informed. I refer to the further diversion of water above Niagara Falls for power purposes. If it had not been for the efforts of Hon. Charles B. Smith, now Congressman from the district in which I reside. I am certain our State, and especially our locality, would have lost the direct benefit coming from this additional water. PEESERVATIOX OF NIAGARA FALLS, 287 He first, as editor of the Buffalo Courier, directed attention to tlie sul)je<'t, and has since continued his eflforts in this behalf. Our people will insist and our State will insist on these points : 1. The paramount and exclusive rights of the State in all [jecuniary benefits coruing from the water diversion; it is legally their property, subject to com- merce clause. 2. There must be no more grants in perpetuity or without adequate compeji- sation, payjsble to the .Siate. and only granted by the State's permission. 3. The residuum of water at Niagara Falls should at once be granted the State. 4. The State, and I believe Congress, should insist on re.strictions in the grant as regards prices, and uses, and should aim to approximate a maximum of power. 5. I have introduced, and had passetl in the legislature, different resolutions covering some or all the above; and I am certain our people will not condone any waste of their remaining patrimony along this line. Respectfully. . Geo. B. Burd. I have also a petition from tlie people of Niagara Falls, N. Y. I believe about 50 residents of that city signed a petition in favor of having the rights to control the water turned over to the State of New York: Whereas the rates charged for electric lighting and for power at Niagara are unreasonably high. consideiMng the world's greatest power developmenf is within our gates ; and ^Yhereas we have been unable to get relief from the public service commission of New York State : Resolved, That we urge uix»n the Conunittee on Foreign Affairs the incori>ora- tion of a provision in the proposed law which shall give full authority to the Federal or to the State authority, or to both, to grant to the city of Niagara Falls such diversion of waters as the city may require for public uses, and that copies of the foregoing shall be forwarded to Representative .James S. Simmons and to Representative Charles Bennett Smith. E. L. Brown, president Third Street Business Men's Association ; T. H. Wallis. vice president Third Street Business Men's Associa- tion ; H. J. Storck, secretary Third Street Business Men's Asso- ciation; B. J. O'Reilly, treasurer Third Street Business Men's Association; Otto W. Krueger. J. E. Paterson, Chas. C. Ilaunel, John K. Kanuuon, H. M. Gous, Welch Bros., Paterson Thompson Co., Loud's Piano Co.. Abe Walleus. Daniel Rinkhoff, Harry Abelson, Christ Blessing. Niagara Importing Co., McGraw & Crowley, McKunnle Bros., Ely Orcles, Nate H. Jacobs. Chas. N. Pochel, J. H. Ellenban, S. M. Vward, Carnum Buttius, John P. Dolan, Joseph G. Rowen. C. M. Thomas, Geo. A. Adler, John E. Seager, members Third Street Business Men's Association. I have also some official records of the public service commission which I would like to place in the record. They indicate a close affiliation among the power and transmission companies operating at Niagara Falls. On the general question of this legislation I believe the first propo- sition that would be considered by the committee is that of the preser- vation of the scenic beauty of Niagara Falls. Gen. Bixby has been before the committee. He has given the results of investigations made by the AVar Department on water diversions nlong Niagara River. I believe the committee may safely rely on the recommendations of the War Department in that particu- lar. You have a representative here for Mr. McFarland :uk1 have his views. Avhich are entitled to consideration and respect. To my mind, however, the investigation of the War Department has been thorough, and T believe the conclusion reached by its engineers ought to be final. 288 PRESERVATION <)b XiAt>AHA FALLS. We next come to the efficienc}^ of production at Niagara Falls. A statement was made by Mr. Sawyer, one of the first speakers, that we have practically a power famine in and around Buffalo. That is quite true, but I would like to call the attention of the committee to this fact, that the Niagara Falls Power Co., according to the best information obtainable, is producing about 10 horsepower for every cubic foot of water diverted, and the hydraulic company, which takes its water from nearly the same level in the river, produces 20 horse- power. I believe that new legislation decided upon by this committee should contain an emphatic efficiency clause so that the Niagara Falls I^ower Co. would be compelled to })roduce more power per cubic foot of water or relinquish its rights to a company which will produce power at a higher standard of efficienc3^ Mr. Garner. Where would you have placed that power ^ AVould you have Congi'ess provide in the bill the degree of efficiency that should be maintained by the power company, or would you leave that to the War Department or to some other department of the Govern- ment ? Mr. vSmith. I have prepared a })rovision on that point, and T would like to read it to you here. Mr. Smith read as follows: Sec. 2. That the Secretary of War is hereby authorized to grant to the State of New York revocable permits for the diversion of water in the United States, from said Niagara Kiver, aliove the Falls, to an aggregate amount not exceed- ing a daily diversion at the rate of 20,000 cubic feet of water per sec^ond : Provided. That whenever the Secretary of War shall determine that the diver- sions of water herein authorized, in connection with the amount of water diverted on the Canadian side of the river, above the Falls, interfere with the navigable capacity of said river, or its proper volume as a boundary stream, or the scenic granrleur of Niagara Falls, or that the water diverted for the development of electrical power are not being utilized to tlieir full or proper standard of efficiency, he may revolve said permits, after giving notice of not less than one year to the State of New Yoric, the President, and tlie Congress of the United States of his intention to make such revocation. Mr. Harrison. That only applies to power diverted on this side. Mr. Smith. Yes. Mr, Harrison. Does that api)ly to powder brought over from Canada? Mr. Smith. I have that question covered in another section, which reads as follows: Sec. 3. That the Secretary of War is hereby authorized to grant permits for the transmission of electrical power from the Dominion of Canada into the United States; and the said Secretary may specify the persons, companies, or corporations by whom the same shall be transmitted, and the persons, com- panies, or corporations to whom the same shall be delivered: Provided. That no permit for such transmission or delivery of iiower shall be given by the Secretary of War without the full api)roval of the State or States into which said ix)wer is to be transmitted or delivered and that the persons, companies. or corporations receiving such permits for transmission or delivery shall be governed and regulated as to rates and otherwise as the State or States may determine. Mr. Garner. Let me make a suggestion there— the word "" State " is rather broad. Hadn't you better make that the Government, the governor of the State? The word State might contemplate the legis- lature. PRESERVATION OF NIAGARA FALLS. 289 Mr. Smith. I took that provision from a law that is on the statute books. I would be perfectly willinrial]y injuring the scenic beautv of the Falls? 290 PRESERVATION OF NIAGARA FALLS. Mr. Smith. I do; and I wish to make this suggestion: That the Congress has no authorit}' to prevent the diversion of 3G,000 cubic feet on the Canadian side of tlve river; that this disputed 4.400 cubic feet allowed under the treaty on the American side is taken from the same pool as the 36,000 cubic feet authorized on the other side of the river, and therefore the only control this committee has in limiting and restricting the diversion relates to 4,400 cubic feet. Mr. (tarner. You believe, then, that the authority to import power from Canada can be authorized by the Congress and that indirectly in order to promote the power on the Canadian side would not mate- rially atfect the scenic beauty? Mr. Smith. I believe that. Mr. Garner. In that connection, how long would you anticipate, from jour knowledge of the conditions along the Canadian border, that it would be before the Canadian people would be using their entire power? Mr. Smith. I believe it would be not more than 10 years at the most, and probably nearer five years. Mr. Garner. And if we, by preventing the importation of it in that indirect way, tiy to preserve the scenic beauty of the Falls we would not accomplish that for more than five or ten years? Mr. Smith. That is my judgment, based on observation. Mr. Garner. If this power is imported, you would turn over the regulation and control of it as to prices to the State of New York? Mr. Smith. Yes. Mr. (lARNER. I think j^ou have a provision that the Secretary of War might cancel these permits if, upon investigation, the powers in New York were not being exercised properly ? Mr. Smith. That is my idea. Mr. Garner. You would have the same provision apply to the 20,000 cubic feet to be taken from the American side ? Mr. Smith. Yes. Mr. Garner. That is to say, j^ou would issue permits by the War Department to the State of New York, to be reissued by the State of New York to such persons and corporations or companies as would Avant this power, and the price to be regulated by the State of New York ? Mr. Smith. By the State of New York. Yfr. DiFENnEiMER. You would not be in favor, then. Mr. Smith, of turning over this 4,400 cubic feet to these companies that are already in control? Mr. Smith. That is a question, of course, that would be taken up with or by the State of New York. These companies are claiming a right to the remaining 4,400 cubic feet. That is a perfectly natural claim. But the companies believe they will get the 4,400 cubic feet because of the fact that it is not a sufficient amount, according to their view, to warrant the building of another plant. Thoy believe that eventually it would go to them by default, because no one else would find that small amount financially profitable, unless a project similar to that which has l)een put before you by Mr. Bowen were consummated. Mr. (i.\RNEi{. Wiiicli would udi] an additional l.GOO cubic feet? Mr. Smith. Yes. PRESERVATION OF NIAGARA FALLS. 291 Mr. Garner. In 3'our jiidgiiieiit. would that materiaUy affect the addition — 1,(300 feet — would that materially affect the scenic beauty, in your judgment? JNIr. Smith. I don't believe it would. I think it would be infinitesi- nuil, that amount of water, on Niagara Falls. Mr. Garner. If such a comjDan}' as that were to build a plant upon the plans that have been submitted here, do 3'ou believe that the public would be the gainer by it? Mr. Smith. I believe the public would be gainer. Mr. Garner. In cheaper power? Mr. Smith, I believe so. Mr. Cline. That is, if a new independent company Mr. Smith. There is practically a monopoly at Niagara Falls at the present time, and while there may be no practical or valid ob- jection to that, providing it is adequately regulated, it has not been regulated by the public service commission. The public service commission will not initiate an investigation, and that, so far as State regulation is concerned, is the whole point in this controversy. If 100 citizens or if a city makes a complaint, the commission Avill take up the complaint and examine the proofs, but the commission will not go beyond that point. The result is, in so far as the city of Buffalo is concerned, the public service commission has never regulated any rate, and the rates at the present time are extortionate. I believe this is the judgment of almost everyone in the city of Buf- falo. No relief has been obtained, because no verified complaint has ever been made to the public service commission. Mr. Harrison. Is the public service commission elected in New York? Mr. Smith. Appointed by the governor. Mr. Harrison. For how long? Mr. S:mith. They are appointed, I believe, for a period of five years. ^fr. Difenderfek. In your judgment, would there be any beneficial results if this committee or a subcommittee were to visit the city of Buffalo to ascertain some of these facts? Mr. Smith. I do not know what it could accomplish now, in view of the hearings that haA'e been held. If the committee had gone up there and S]3ent two days, as we desired the members to do, per- haps they would have avoided these long hearings and have gotten more information. The Citaiijman. We have given great latitude in these hearings as a matter of courtesy to get all views. Mr. Harrison. We certainly got a lot of information on these subjects. Mr. Garner. It necessarily costs something for the War Depart- ment to supervise this power importation from Canada and taking water on tlie American side. Is there objection for the State of New York or the parties using this power to compensate the Government for supervising their business? Mr. Smith. I do not know. That Avould be a (luestion for the ])()wer comi)anies. I believe that so far as the supervision of the War Department is concerned, that it does not take much time. The time heretofore taken has been due to the investigations made there 292 PRESERVATIOX OF NIAGARA FALLS. as to the amount of water that was actually being diverted. Once it was in their control, they would not have to exercise continual supervision. Mr. (jarnkk. But if Congress sliould adopt your suggestion and reserve in the War Department the right to investigate the question of whether or not the i^ublic-service commission was giving you a reasonable rate, they would have considerable to do, 1 iuiagine, to ascertain those facts and see whether or not you were giving a reasonable rate. It might take a good deal of machinery. It seems now that it has taken $35,000 worth of machinery to ascertain the facts in the city of Buffalo alone. Mr. I)ifp:xi)erjt:r. Then they have not ascertained it? ^Ir. (lARXEH. If the United States Government can supervise the importation of the power and have something to say about the price of it, and als(* supervise the taking of the Avater on this side, and in connection with that look into the question of reasonable rates, it seems to me that the people to get the benefit of this sujjervision ought to contribute to the amount of that expense. ^fr. Smith. I do not see how it Avould be possible, however, to provide a means of getting that compensation. ^Ir. (tarxer. Well, we would put a little tariff' on the ])ower that comes in and make pos-^ibly a condition — I have not investigated the law — but we might make some condition on taking the Avater from the American side. Mr. Smith. I am in favor of placing every restriction and ]ii'ice limitation that the Constitution Avill permit. Mr. DiFENDERFER. You are not in favor of a tariff? Mr. Smith, I would not be. Mr. IIarrisox. Have you got a law in the State of Xew York, if 3'ou know, that prevents and prohibits one competing corporation from owning stock in another competing corporation? Mr. S:mitii. I do not believe there i^ sucli a law*. I never heard of it. Mr. Difexderfer. There is a Federal law to that effect, is there not? The Chairmax. Judge Fennewick, you desire to say something to the committee? STATEMENT OF DANIEL J. FENNEWICK. OF BUFFALO, N. Y. Mr. Fexxewick. I am the local attorney for the Cataract Power Co. of r>uff'alo. I understood from newspaper accounts that reached Buffalo that some statements Avere made by counsel as to the power situation in Buffalo. Perliajis T ought to state for the purpose of clarification that long before the Niagara Falls PoAver Co. erected its plant at Niagara Falls thei'e Avas a lighting company in Buffalo: that it had three or four or five steam ])lants Avhere it generated electricity and supplied the city of Buffalo and the inhabitants of that city Avith electricity. So that that company Avas in existence long before the Niagara Falls PoAver Co. NoAv. Avhen the Niagara Falls PoAver Co. completed its plant, the question arose as to Avhether the poAver could be successfully trans- mitted to Buffalo. That problem Avas soh-ed. and the Niagara Falls PRESERVATION OF NIAGARA FALLS. 293 Power Co. decided lo tran^niil tlie power to Buffalo, hut before erect- ing its transmission lines it declined to undertake the problem of distributing" power in the city of Buffalo. Of course in all of these cities you have got to have a franchise from the common council, and you have got to submit to certain regulations. It is needless to say that in the distril)ution of power in a large city like Buffalo, with most of the streets paved, where you are required to put a certain amount of your wires underground, that there is a large financial problem involved. The Niagara Falls PoAver Co.. as I understand it. was unwilling to take upon itself the entire burden of distributing the power in Buf- falo, and certain gentlemen in Buffalo got together — some five or six — got a tentative contract Avith the poAver company, and then they got in engineers to see Avhetlier it Avould be a successful financial proposition; and tlie report of their engineers was adA'erse, and they Avere anxious to give up their contract Avith the poAver company. At this stage some of the men Avho were interested in the Buffalo General Electric Co., who did not control it, but who were stockholders in it, decided that they Avould take that contract off' the hands of these men if they Avere Avilling to giA'e it up. Those men gaA'e it up. and these other men entered into the contract Avith the Niagara Falls Power Co., and that was the inception of the Cataract PoAver & Conduit Co. I Avant to call your attention to the fact that five or six men — strong- men — in Buffalo, after making a thorough investigation of the situa- tion, abandoned the project and got out of their contract, fearing that it Avould not be successful financially. These other men took up the proposition and put through tlie Cataract Power & Conduit Co. Mr. DiFEXDERFER. So succcssfully. Judge, that they Avere enabled to give half of their stock back to the Niagara Power Co. Mr. Fexxeavick. You already haA-e had it stated by one of the gentlemen here — I think. Mr. Barton — Avhat the consideration Avas. Now. the Cataract PoAver »fc Conduit Co. sells poAver to the Buffalo General Electric Co. for all lighting purposes and for poAver in small blocks. I think the highest they sell for power is 75 horsepoAver, and the Buffalo General Electric Co. abandoned its steam plants. Now. I Avant to get it out of your minds at once that the Buffalo General Electric Co. is controlled either by the Cataract PoAver & Conduit Co. or by the Niagara Falls PoAver Co. I Avant to get it out of your minds that the Buffalo Electric Co. is controlled by any 10 men or any 20 men. Mr. Harrison. It is controlled by the Niagara Power Co. Mr. Fenneavick. Absolutely not. Mr. Harrison. Is not that what Mr. Barton said? Mr. Fenneavick. Oh. no: he said the Cataract Power Co. is con- trolled by the Niagara Falls PoAver Co.. but not the Buffalo General Electric Co. Mr. Smith. Is there not a pretty ckise alliance betAveen the Catar- act PoAver & Ligliting Co. ? Mr. Fexxewick. What do you mean? Mr. Sjiith. Are in the same offices? Mr. Fexneavick. No: they are in the same building. Mr. Smith. Isn't one of the officers of the Cataract Co. also an officer of lighting company? 294 PKESEKVATIOX OF NIAGARA FALLS. Mr. Fen NE WICK. Yes; that is true. Mr. Harkisok. What officer is tliat, president? Mr. Fen NE WICK. No, manager. Mr. Dlfenderfer. He is the manager? Mr. Fen NE WICK. Yes. Mr. DiFENOERFER. FoF both ? Mr. Fennewick. Yes, sir. In that respect, but they do not com- pete. Wliat I want to sa}- to you is that there is no control, no stock control, either b}' the Niagara Falls Power Co. or the Cataract Co. of the buffalo General Electric Co., and there is no group of stock- holders of those companies who control the Buffalo General Elec- tric Co. Mr. DiFENDERFER. Then the J. P. Morgan interests are quite evi- dent in the Cataract Co., are they not? Mr. Fennewick. I understood that they are large stockholders in the Niagara Falls Co. Mr. DiFENDERFER. Li the Cataract Co.? Mr. Fennewick. No; I understand not. Mr. Harrison. Can you give us the names of the directors of the Buffalo Electric Co.? * Mr. Fennewick. I can submit them to you. Mr. Harrison. You can give us some of the names, I suppose? Mr. Fennewick. Yes, sir. Mr. Harrison. That you remember? Mr. Fennewick. William C. Warren, Charles E. Huntley, Walter C. Cook, ^Ir. Barrick, Mr. Andrew Langdon. I can not name them all. Mr. H'AiuusoN. You have not named any of the directors in the Niagara Falls Co. that are directors in the Electric Co.? Mr. Fennewick. I do not believe there are any. Henry W. Burt is another, and Pomeroy is a director of the Niagara Falls Power Co. Mr. Harrison. What? ^fr. Fennea\ick. He is the only one director of the Buffalo General Electric Co. Mr. DiFENDERFER. Ai'c any of those mt'u you named interested in the Cataract Co.? Mr. Fennewick. I think Mr. Huntlev is interested in the Cataract Co., but I think that is all. My. Harrison. The general manager is interested in both? Mr. Fennewick. Yes, sir. Mr. Harrison. Who is that, Mr. Huntley? Mr. Fennewick. That is Mr. Huntley. Mr. Garner. As I understand it. when the Niagara Falls Power Co. decided to build up to Buffalo, they went up to the city line? Mr. Fennewick. Yes, sir. Mr. Garner. They were a local company doing business in Buffalo, and oenerating electricity by steam? Mr. Fennewick. One company, the Buffalo General Electric Co. Ml-. (iARNKR. The Niagara Co., as it Avere, said: ''Gentlemen, we are up here with some cheap power. AVe come up here to furnish tli(>se people Avith electricity. Now if you give us the controlling stock in your company we will sell power to the company and let vou continue business; otherwise we will come in and compete with Vou." PRESEKVATION OF NIAGARA FALLS. 295 Mr. Fekxe\vi(k. That was not quite the situation. Mr. Garner. It appears that way to me. At least I simply give you my idea that the Niagara Falls Power Co. said, "We have got some cheaper power, and we v.ill sell it tp you on satisfactory terms; otherwise we propose to come in " Mr. P^ENNEAviCK. The}' could not come in without getting a fran- chise from the city. They had to get a franchise that would permit them to come into Buffalo. Mr. Garner. I understand, but is it not to be presumed that the city of Bufl'alo would let a company come in with cheaper power? Mr. Fennewick. Making that assumption; yes. Mr. Garner. I do not assume that the city of Butfalo would refuse their people cheaper power. Mr. Fennewick. You are also assuming that the Niagara Falls Power Co. wanted to undertake the distribution of power in Buffalo, which they did not. Mr. Garner. I will assume, then, that they did not want to dis- tribute their power in the city of Buffalo. Mr. Fenneavick. That is, the^' did not want to undertake the financial responsibility involved. Mr. Garker. But they did make such an arrangement after they got control of the stock of the company that did distribute, and therefore do distribute in the city of Buffalo. Mr. Fennewick. They assumed the responsibility of getting up to the city line, but said to the other gentlemen: "The question of distribution is for you to determine yourselves whether under a franchise it would be a paying business." Mr. Garner. They succeeded in convincing the gentlemen Avho were then distributing electricity in the city of Buffalo to the extent of getting a contract granted with them and a controlling interest in their company. Mr. Fenneaa'ick. Hardly granted. They gave them a very good contract, a very favorable contract. Mr. Garner. It appears to me like a great big fellow walking up to the city of Buffalo and saying, " Gentlemen, you are at my mercy." Mr. Fenneavick. I think when you begin to talk about three ])rofits here, there are no three profits in the business. Let us assume that the Niagara Falls Power Co. are in the business of distributing power and light in the city of Buffalo; Avould not it have to haA-e the same plant as the Cataract Co. has and the Buffalo General Electric Co. haA^enow? It would haA'e to haA'e practically the same investment, and cer- tainly Avhen you talk about three profits there are no three j^rofits. Mr. Garner. I agree Avith that; if I had been a stockholder in the city of Buffalo at the time this poAver came through the gates, I Avould have made the best terms possible. I am not criticizing the Niagara Falls PoAver Co.. but I am saying that the situation Avas such that the Niagara Falls PoAver Co. was able to make its oAvn terms Avith the company that could not compete Avith them in the matter of cheap power. Mr. Fenneavick. I can not quarrel Avitli your deductions, of course. I Avant to go a little bit further in reference to extortionate rates. I think it is safe to say that there is no large city in the United States that gets its electric lighting as cheap as the city of Buffalo, and I want Congressman Smith to name mo some large citA' that does. 296 PRESERVATIOX OF NIAGAEA FALLS. Ml'. Clklev. The Edison Co, deliver ti power in Boston, have re- duced their kilowatt from 18 cents per kilowatt to a recent reduction put in operation last week of 10 cents — a total reduction of 50 per cent. What reduction has been made in the last five years by the operating companies in Buffalo? Mr. Fen>;ewick. I think I can say to you that our highest maxi- mum rate is 9 cents for lighting, and I believe that the statistics of our company will shoAv that the average rate we get on all of our distribution of power, as well of day power as of night power, is somewdiere between 2 and 3 cents a kilowatt-hour. Mr. CuRLEY. That maximum rate — has that been reduced at any time in the last five years? Mr. Fen^'ewick. I can not say, but that only applies to very small installations of light. I know it has been reduced, as far as the municipality is concerned, to 6 cents. Mr. CuRLEY. What did the municipality pay previous to that? Mr. FEX^•EWICK. Nine cents on small installations. The munici- pality pays for the power it gets at the pumping station $25 a horse- power. Now, I want to sa}- further to you gentlemen, a good deal has been said about the lack of power and the unwillingness of the public- service commission. AVe have got a public-service commission in the second district in the State of New York tha.t I believe is as high class a commission as was ever appointed by Governor, now Justice, Hughes. The man at the head of it was appointed chairman by Mr. Hughes, and he is still chairman, and it is a high-class commission. Now, we have had that commission in this district since 1907. At an}' time if the cost of electrical power was sirch a great burden as it has been represented here, do not you think that 100 users of power, or 100 users of light, would have taken advantage of the law and made a complaint? Now, they did not do it, although the subject has been advertised by such gentlemen as Mr. Ferguson, who is the writer of one of the letters read by Mr. Smith, Avho is a lawyer, and who has a lawsuit pending against the Cataract I*ower & Conduit Co., and that possibly may explain his interest in the situation. Here Ave have had this commission in force since 1907, and with all this talk of extortionate prices we have not had 100 consumers who would back up the move- ment. ]Mr. CwxE, There must be some friction there or there would not have been $35,000 set aside at Buffalo to investigate that? Mr. Fenxewick. You know. Congressman, that undoubtedly you will have complaints, and we are perfectly willing to have those com- plaints investigated. That is matter that is made a political issue. Mr. Cline. Under your theory, if 100 men had made a petition it would not have been necessary to set aside $35,000 to get a hearing, would it, unless the people of Buffalo had judged it to be an aggra- vated case? Mr. Fennewick. It was made a sort of a political issue by the candidates a couple of years ago, and now, to carrj^ out that pledge made in the cani[)aign. the complaint is at the present time made by the mayor. The comjjlaint can either be presented by 100 consumej-s or l)V the mavor. PRESERVATION OF NIAGARA FALLS. 297 Mr. DiFENDERFER. Is it iiot a fact that over 100, in the neighbor- hood of 150, names have been placed on the petition protesting against these high prices? Mr. Fennewick. Since the complaint was made by the municipality, Avithin about fifteen days a gentlemen who has been very active in the matter has succeeded in getting 100 names as to the lighting company and three names as to the poAver company. It is not necessary to spend $30,000 or $35,000 for this investiga- tion. Not at all. But the corporation counsel thinks it is and has got that money at his command to spend. Counsel submits tliat no investigations of rate of any of the public utilities have been undertaken by the j^ublic service commission. That is not true. We have just finished an investigation of the Buffalo Gas Co. that has extended over a year. Mr. DiFENDERFER. Has that any connection with the electric com- pany ? Mr. Fen N WICK. None at all; but I simply want to indicate that it shows that the public service commission is active when it is called upon to exercise its power. Mr. DiFENDERFER. In some particulars. Mi\ Fennewick. In all particulars. If you can indicate to me one instance I will be glad to answer you if I can. Mr. DiFENDERFER. It is quitc evident that they have not interfered with the electrical-power up to this time. I think Mr, Smith is quite right in his statement that he made here. Mr. Fennewick. In what way? We have been before them often enough, not on the question of rates, because that question has not been complained of; no one has complained. Mr. Harrison. It was so important that it was made a political issue. ]Mr. Fennwick. You know how easy such a political issue can be created. Mr. Harrison. May I ask you one question. Who won ? Mr. Fennewick. The Democrats. Mr. DiFENDERFER. Then it is a popular issue. Mr. Smith. Gen. Greene says that they are selling the power at Lockport at $18, and your company sells it in Buffalo at $25. Mr. DiFENDERFER. Aiid there is only 6 miles difference in the dis- tance to carry. Mr. Fennewick. Now, if j-ou gentlemen will consider the difference in size of Lockport and Buffalo and the difference in cost of distribut- ing power in Buffalo. Mr. Smith. It is not distributed. Mr. Fennewick. We have got to distribute. We have got to dis- tribute it and they take it from the city line and bring down the voltage. Do you know, gentlemen, it costs you from $12,000 to $15,000 a mile to put the Avires underground? There is an ordinance Mr. Cline. According to the testimony produced here the trans- mitting company gets in the neighborhood of $7 to $7.60 for trans- mitting the power, an amount equal to the cost of producing the power by the company they receive it from. 298 PRESERVATION OF NIAGARA FALLS. Mr. FE^,^E^vu■K. I understood Mr. Barton to say that the cost of producing ^vas $12, and not $9.40, on the Canadian side. It costs us from $12,000 to $15,000 a mile to put the wires under- ground in the city of Buffalo. An ordinance was enacted back in 1906 or 1907 under which we are required in the first year to put down 3^ miles, and the next year 3| miles, and the next year 3 miles; and every j-ear thereafter, con- tinuing on indefinitely, we are required to put down 2 miles. Now, we have not any such ordinance down through Lockport or in these small cities, and you gentlemen ought to have the proper conception of the cost of distribution of power Avhen you get in a large city. Mr. Harrison. You represent the General Electric Co. Mr. Fennewick. Yes, sir; I am the local attorney for both com- panies. I do not know that I have anything more to say, gentlemen. The Chairman. Maj. W. B. La Due. of the War Department. Mr. Fennewick. Might I be permitted to file here copies of some of the certificates made b}' our users of power in Buffalo indicating their satisfaction with the general service ? The CHAiR:vrAN. Is it very voluminous? I think it would be advis- able to give each member of the committee a copy. STATEMENT OF MAJ. LA DUE. Maj. La Due. I have nothing further to say, excejDt that I have here a statement that I secured in resf)onse to an implied request of some of the representatives of the power companies, showing the diversions during the month of December, which I Avill append to my hearing. It shows that during the month of December the aver- age total diversions by the two companies on this side was 13,785 feet. The maximum diversion, however, was up to the full limit of the permits. The diversion on the Canadian side, the average during December, was 12,500, the maximum being 16,400. The total diver- sion on both sides of the river was an average for the month of 20,345 and a maximum of 31,030. This information may be of value, and I will append it to my hearing. I will also append copies of the permits now in force. I have them here if the members would like to see them. I will also append two short statements prepared in the Office of the Chief of Engineers. PRESERVATION 01<^ NIAGARA FALLS. 299 Tabi>b a. — Stntcnieut shoirinu Cfrmit, provided the duration of any one such peak, mea.sured on the 52..!>00 horsepower line, does not exceed one hour, and provided that the total duration of such peaks iu 24 hours, measured in the same manner, does not exceed two hours." Notes. — The diversions of the Canadian companies are determined by applying the efficiencies of these plants, as stated in report of Sept. oO. 1911, to the output of power as determined by the inspections of the companies' rececenit)er last. STATKM1:NT as to the effect on lake ERIE COMMERCE OF A PERMANENT LOWER- ING OF ONE INCH IN THE WATER SURFACE OF LAKE ERIE. Ill view of the general interest in the very important question of the water levels of the Great Lakes, referred to. incidentally at the public hearings rela- tive to the Niagara Falls diversion, it is deemed pertinent to invite attention of the committee to the statement of Brig. Gen. William L. Marshall, Chief of Engineers, in transmitting to the Secretarv of War Maj. Keller's report of November 30, 1908 (p. 8, S. Doc. No. 105, 62d Cong., 1st sess.), to the follow- ing effect : "As each inch of draft for the modern lake freighter is the equivalent of from 80 to 1(X) tons of profitable cargo, the aggregate loss per season for the entire fleet using Lake Erie ports as terminals becomes a very large amount." Maj. Keller in his report (p. 15, S. Doe. No. 105. 62d Cong., 1st sess.), said: " The earning capacity of each freighter will be reduced to the extent of $75 to $100 per trip. During an average season the loss for each vessel would total $2,500 to $3,000." The total commerce using Lake Erie ports may be stated as approximately 03,(XK),000 tons i>er annum, of which from 30,000,000 to 40.000,000 tons is now- carried in vessels of 10,000 tons burden or over, which may be affected in any lowering of the water surface. Based uixm the above figures, and assuming that cargo is available in quantity to permit the loading of each vessel on each trip, to the maximum draft permitted by the controlling depths of Lake Erie ports, the total potenti.il loss to Lake Erie commerce due to a permanent lowering of 1 inch in the water surface may be taken at from $250,000 to $350,000 per annum; and this potential figure will increase with the antici- 300 PRKSEHVATION OF NIAGAKA FALLS. pated natural increase in the muiiber and size of the larger vessels, and iu the total commerce of the lake. When the time comes that a matter of inches be- comes a question of immeiliate importance to Lake Erie commerce, any lower- ing of that Like due to the Niagara diversions (which affect only Lake Erie and upper Niagara River) can be readily controlled by proper regulation works in Niagara River; although such slight effect and ready control will not be true of the Chicago diversion which is several times greater in amount, and must affect all four lower lakes and the St. Lawrence River, to a serious ex- tent, unless controlled at several places by regulation works of great final cost ill time and money. STATEMKNT AS TO THE USE OF WATKR DIVEHTED FROM THE ERIE CANAL BY THE HYDRAULIC R.ACE CO. (SUCCESSORS OF THE LOCKPORT HYDRAULIC CO.) Upon the request of the Hydraulic Race Co. of Lockport, N. Y.. there is transmitted herewith for the information of the committee a copy of a letter from the Hydraulic Race Co.. dated .January 20, 1912. in regard to the use of the water diverted by that company from the Erie Canal for power pur- poses, under tlieir permit to divert 500 cubic feet per second, granted by the Secretary of War under date of August 1(5, 1007. While this office has not been able, in the time available since receipt of this letter, to verify the ligures statetl therein, it is within the knowletlge of this office that the general state- ments made are substantially ccn-rect; and in view of the prominence given at the public hearings to the principle that all water diverted at Niagara Falls should be used in such manner as to utilize the maximum possible head, it is deenjod to be but fair and just to the Hydraulic Race Co. lo place before the committee this statement, showing that while the Hydraulic Race Co. at its own plant uses but a 50-foot head (approximately tbe fall between the two levels of the Erie Canal at Lockport) the water diverted by them under their permit again passes out of the canal below the locks and "'s used over and over again by other power users between the Erie Canal and Lake Ontario, so that the total head finally utilized is a very large percentage of the total head available. This successive use of the water is distinctly lu-ovided for by the terms of the permit issued by the Secretary of War to the Hydraulic Race Co., as will be seen l)y reference to that document. Hydraulic Race Co.. Lockport, ^\ y., January 20, 1912. Gen. W. H. Bixby. Chief of Engineers, United t:^tatex Arviy, Washi)igion. D. C. Dear Sir : We have before us copy of document No. 246 entitled " Preserva- tion of Niagara Falls." On page 16 of this document is a table which indicates that the Lockport Hydraulic Co. is using but 11 per cent of the efficiency of a 220-foot fall, which will, we fear, lead many into a belief that the water granted (500 cubic f(>et) under the permit is a less economical development than any of the others, when, as a matter of fact, the water is used under a much greater head than any other water diverted from Niagara River. In explanation, we add that reference to the permit of August 16, 1907. will show that it specifically provided for the use of the water by factories on Eighteenmile Creek, Medina, Albion, and other places after its passage through the development of the hydraulic company. It may fairly be said that no other Niagara River water performs a greater use in promoting the interests of the small consumer and individual manufacturer than that granted to the Lockport Hydraulic Co., nor is any more fully used. We have taken the water practically at Lake Erie level (the level above the locks being usually between 509 and 570), and of the total fall of about .320 feet from this iioint to Lake Ontario over 280 feet is available, and, iu the end, improved operating conditions and cJianges will result in utilization of even more. PRESERVATION OF XIAGARA FALLS. 301 We give tlie following lieads as approxiuiately correct for tlie various sites, beginning at Locliport and extending down Eighteenniile Creelt to Olcott : Feet. Hydraulic Race Co. (Lockport Hydraulic Co.) 50 United Boxboard Co. (first plant) 32.5 United Boxboard Co. (second plant) 14 Lockport Paper Co !) Niagara Paper Mills 0. 5 Westerman & Co 21 United Indurated Fiber Co 29 Electric Smelting Co 35. 5 Newfane Electric Co 7 Newfane Basket Co 14 Lockport Felt Co Western New Yoi^ Water Co 50 Total 280.5 All the plants of Eigbteenniile Creek are practically entirely dependent for their operation on the periuit of August, 1907, for their water power. Our company's head will be lessened somewhat under new conditions of the barge canal, and one or two of the falls are not utilized at date, notably that of the western New York Water Co. All these powers and their ojieration Iiave been very much disturbed by the building of the new barge canal, but should be greatly improved in the future with more stable conditions, and it is possible that almost the entire fall to Lake Ontario will be utilized, and the total should certainly reach 300 feet, Avhich conipares more than favorably with the 220 feet available at Niagara Falls. While we are not familiar with i)resent conditions at the plants now operating on Eighteenmile Creek, it is fair to state that the head actually in use now is approximately 220 feet, so that the efficiency of this development on this basis should, we believe, be higher than any of the others, and the power even now amounts to several thousand horsepower. We would apjireciate it if the reimrt may be amended in these particulars, lest some injury be done the various interests which have for so many years and before the passage of the Burton Act had the use of this water and upon which water their success now so largely depends. We are sending this to you rather hastily, as we believe that there is to be a meeting on this whole question on Tuesday next. January 23. and you may wish to have this data before you and the others at that time. We would appreciate your advices and trust the data may be of service. liespectfully submitted. Hydraulic Race Co., By L. H. Kunhaedt, Treasurer and Engineer. I'i:iiMIT TO LOCKPOKT HYDRAULIC CO. FOR DIVERSION OF WATER AT LOCKPORT, N. Y. Whereas by section 2 i«t an act of Congress approved June 29, 1908, entitled "An act for the control and regulation of the waters of Niagara River, for the preservation of Niagara Falls, and for other purposes" (34 Stat. L.. 626), it is provided that the Secretary of War is authorized to grant permits for the diversion of water in the United States from the Niagara River ot its tributaries, for the creation of power, to individuals, companies, or corporations, which are now actually jaodueing power from the waters of said river, or its tributaries in the State of New York, or from the Erie Canal; to an amount not exceeding in the maximum 8,600 cubic feet per second to any one individual, company, or corporation and not exceeding an aggregate amount of 15.6(X) cubic feet per second ; and Whereas waters are being diverted from the Erie Canal for the creation of power by the Lockport Hydraulic Co., a corporation organized under the laws of the State of New York, at Lockport. N. Y.. by the abstraction of approxi- mately 1,000 cubic feet of water per second from above the locks at said place. 28405—12 20 302 PRESERVATION OF NIAGARA FAILS. which water is retiirued to the Erie Canal below the locks, of which total quantity 500 cubic feet is required for navigation purposes and the remaining 50(1 cubic feet is not required for navigation purposes: and Whereas the said waters not required for navigation purposes, after being returned to the canal below the locks, are again diverted from the canal and are used for power purposes by various persons and coriiorations located upon ICigliteeumile Creek, at and below Lockport. and at Middleport. at Medina, at Eagle Harbor, at Albion, at Ilolley. and at other i)laces. and are not returned to the canal ; many of the persons or corporations on Eighteenniile Creek using the same water in succession, one after the other; and Wliereas application has been made to the Secretary of War by the Lockport Hydraulic Co. for permission to divert 500 cubic feet per second from the Eiie Canal at Lockport above the locks, and application has been made by various persons and corporations to divert various amounts from the Erie Canal below the locks; and Wliereas the diversion of water from the Erie Canal below the locks is not properly the diversion of water from the >>'iagara Kiver or its tributaries, since said water diverted below the locks has already been diverted from above the locks and has been used for pftwer puri)oses: Now, therefore, this is to certify that the Secretary of War hereby grants permission to the Lockport Hydraidic Co., said applicant, to divert waters of the Niagara River and its tributaries from the Erie Canal, at Lockport. N. Y.. abo\e the locks, for ])ower purposes, not exceeding 500 cubic feet per second, it being distinctly understood that the waters so diverted shall be returned to the canal below the locks, and that this permit shall inure to the benefit of all persons and cori)orations now using said water for power i)urposes. whether lessees of the applicant or having the right to bo furnished by it with water, and including the persons and cori)orations now diverting water as aforesaid from the Erie Canal at Eighteenniile Creek, Middleport, Medina, Eagle Harbor, Albion, Holley, and other places on the lower level. This permit is granted upon condition and with the understanding that it does not confer upon the ai>plicant. or said other persons or corporations, any authority whatever to divert water from the Erie Canal without the consent of the State of New York, and that this permit is subject to any and all regula- tions which may be imposeil upon the diversion of water from said canal by said Slate: and, further, that this permit is made sub.iect to the juristliction of said St:itc to alter, improve, or abolish the said canal and to prevent the diversion vf any water whatever therefrom, and this permit shall not be taken to impose any obligation whatever upon the said State or the authorities thereof. It is intended to confer only so far as the Federal Government is concerned, and the Secretary of War Is authorized, the right to take the water and to claim innnunity from any prosecution or legal obligation under the first section of the act approvetl June 29, 1906, above mentioned. Witness my hand this IGth day of August, 1907. Wm. H. T.iiFT. Sccrctdi'y of War. Extended September 2. 1911. to March 1. 1912. PEI'.MIT TO NIAGAU.\ FALLS HYDRAULIC POWER & MANUFACTURING CO. FOR THE DIVERSION OF WATER FROM THE NIAGARA RIVEB FOR POWER PURPOSES. AVhereas under the provisions of an act of Congress approved June 29. 1900. entitled "An act for the control and regulation of the Niagara River for the preservation of Niagara Falls and other purposes." it is provided that the Secretary of War may grant permits for the diversion of water in the United States from said Niagara lUver or its tributaries for the creation of power, and that it shall not be lawful to divert wJiter from said river for power purposes excei)t in accordance with permits so issued by the Secretary of War: and Whereas upon the applications, hearings, reports, and all the pi-oceedings by applicj'uts for permits under the provisions of the said act the Secretary of War. under date of January 18, 1907, filed a written opinion directing, among other things, that a permit be issueil to the Niagara Falls Hydraulic Rower & Manufacturing Qo. for the diversion of G.500 cubic feet i>er second ; Now, therefore, this is to certify that the Secretary of War hereby gives permission to the Niagara Falls Hydraulic Power & Manufacturing Co. to PEESERVATION OF NIAGAEA FALLS. 303 divert 6.5C)0 cubic feot of water per second from the Niagara River upon the fol- lowinjj terms and conditions : First. Tlie amount above named. 6,500 cubic feet per second, represents tbo maximum (piantity of water tliat can be diverted at any time under tlie terms of this permit. Seccmd. Tlie grantee shall malce. under the supervision of an authorized inspector of tlie United States, measurements in its intalve canals of such a character and at such times as may be deemed necessary to show the amount of water diverted. Third. The grantee shall keep such records as will show at any time the com- bined continuous output of its power stations and of the power stations of its customers to whom water power or mechanical horsepower is fni-nished. Fourth. The power stations of the grantee and of its customers, to whom water power or mechanical horsepower is furnishetl, together with their operat- ing records, shall be subject to inspection at all times by authorized inspectors of the United State.s. Fifth. This permit is issued without any determination of priority of right to divert water from the Niagara River between the parties to whom permits for diversion may be issued. Sixth. The grantee shall carry out in good faith the obligations which it assumed in its letters to the War Department, or to the representative of that Department, concerning the improAement of the scenic conditions on the American side of the gorge below the Upper Arch Bridge. Seventh. The Secretary of War reserves the right at any time to modify the form of tliis permit, to change the method or plan of measurement herein prescribed, or to substitute otlier methods of measurement whenever, in his judgment, such modifications, changes, or substitutions are necessary to carry out the provisions of the act of June 29, 1906. under which this permit is issued. Witness my hand this 16th day of August. 1907. Wm. H. Taft, Secretary of War. Exteudetl September 2. 1911, to March 1. 1912. Permit t(i Xhniarn I'dlls I'oircr Co. for tlie diversion of wnter from tlie Xidf/arti Rirci- for poiccr purposes. Whereas, under the provisions of an act of Congress, approved June 29, 1900, entitled "An act for the control and regulation of the Niagara River for the preservation of Niagara Falls, and other purposes," it is provided that the Secretary of War may grant permits for the diversion of water in the l^nitetl States from said Niagara River or its tributaries for the creation of power, iind that it shall not be lawful to divert water from said river, for power pur- lioses. except in accordance with permits so issued by the Secretary of War; and Whereas, upon the applications, hearings, reports, and all the proceedings by applicants for permits under the provisions of the said act. the Secretary of War. mider date of January 18. 1907. filetl a written opinion, directing, among other things, that a pei-mit be issued to the Niagara Falls Power CoT for the diversion of 8,600 cubic feet per second : Now. therefore, this is to certify that the Secretary of War liereby gives ]iermission to the Niagara Falls Power Co. to divert 8,600 cubic feet of water per second from the Niagara River, upon the following terms and conditions: First. The amount above named. 8.600 cubic feet per second, represents the maximum rpiantity of water tbat can be diverted at any time under the terms of this permit. Second. The grantee sh.ill make, under the superxision of an authorized inspector of the T'nited States, measurements in its intake canals of such ;i character and at such times as may be deemed necessary to show the amount of water diverted. Third. The grantee shall keep such records as will show at any time the combined continuous output of its power stations and of the power stations of its customers to whom water itower or mechanical horsepower is furnished. Fourth. The power stations of the grantee, and of its customers, to whom water power or mechanical horsepower is furnishetl, together with their oper- 304 PRESERVATION OF NIAGARA FALLS. ntiiig rocords. shall be subject to Inspection at all times by authorized inspectors of the rulted States. Fifth. This permit is issued without any determination of priority of vis;ht to divert water from the Niagara River between the parties to whom such per- mits, for diversion, may be issued. Sixth. The Secretary of War reserves the right at any time to modify the form of this jiermit, to change the method or plan of measurement hereiti prescribed, or to substitute other methods of measurement, whenever, in his .judgment, .such modifications, changes, or substitutions are necessary to carry out the provisions of the act of June 29, 1906, under which this permit is issued. Witness my hand this sixteenth day of August, 1907. AVm. II. T.\FT, Sccrctarji of W(n\ Extended Septen!l)er 2, 1011. to March 1. 1012. PKKMIT I-()I{ THE TR.VXSMISSION OF ELECTRICAT. TOWKR FROif CAN.\DA INTO THE UNITED STATES. Whereas under the jtrovisions of an act of Congress, approvetl June 29. 1906, entitled " An act for the control and regulation of the Niagara River, for the preservation of Niagara Falls, and other purposes," it is provided that the Secretary of War may grant permits for the transmission of power from the Dominion of Canada into the United States, and that it shall not be lawful to transmit electrical power into the United States from Canada except in accordance with the permits so issued by the Secretary of War; and Whereas uj^on all th(> proceedings taken in respect of permits under the said act. the Stvrotary of War. under date of January IS. 1907. filed a written oi>inion. directing, among other things, that a permit issue to the Niagara Falls Electrical Transmission Co. for the transmission of 46,000 electrical horsepower from the Dominion of Canada into the United States; and Whereas the said Niagara Falls Electrical Transmission Co. has made a supplemental petition that such permit provide that a part of such electrical power may be delivered to the Cataract Power & Conduit Co. (a New York State corporation for use in the United States after transformation by step- uj) transformers of the Canadian Niagara Power Co. at Niagara Falls, Canada, and transmission to point in the international boundary between Fort Erie, Canada, and Buffalo. N. Y., over the power transmission lines of the Canadian Niagara Power Co. Now. therefore, this is to certify that hereby the Secretary of War gives permission to the said Cataract Power & Conduit Co. and to the Niagara Falls Electrical Transmission Co.. and to such other distributing agents or companies in the Ignited States as The Electrical Development Co. of Ontario (Ltd.) may designate to receive from the said The Electrical Development Co. of Ontario (Ltd.) at the international boundary line and to transmit into the T'nitod States 46.000 electrical horsepower upon the following terms and con- ditions: First. A part of such electrical jiower may be received by the said Cataract Power & Conduit Co. at the international boundary over the power trans- mission lines of the Canadian Niagara Power Co. The remaining part of such electrical power may be transmitted into the United States over transmission circuits hereafter to be approved by the Chief of Engineers, and may be received by the said Niagara Falls Ele<^^'trical Transmission Co.. or by such other distributing agents or comjtanies in the LTnited States as the said The Electrical Development Co. of Ontario (Ltd.) may designate. Second. So long as the said Cataract Power & Conduit Co. and the said Niagara Falls Electrical Transmission Co. shall procure from the Electrical Development Co. of Ontario (Ltd.) the right for the Chief of Engineers, or his representatives to enter upon the premises of the Electrical Development Co. of Ontario (Ltd.) and to inspect and verify their records to the satisfac- tion of the Chief of Engineers, and so long as the amount of power transmitted to the United States does not exceed 75 per cent of the amount herein author- ized, the measurements necessary to insure compliance with the terms of this IKM-mit shall be made at the expense of the grantee at the station of the Electrical Development Co. of Ontario (Ltd.), due allowance being made for losses between the measuring station and the international boundary line. PRESERVATION OF NIAGARA FALLS. 305 TLird. "When the auiouut of power transmitted to the United States under the terms of this permit exceeds 75 per cent of the authorized amount, or if right of access or examination to the satisfaction of the Chief of Engineers is declined or refused at any time by the Electrical Development Co. of Ontario (Ltd.). the measurements necessary to insure compliance with the terms of this permit shall be made at suitable points in the United States near the inter- national boundary. Fourth. When under either of the conditions named in the paragraph imme- diately preceding the power imported is measured at points in the United States, such measurements shall be made by continuous record indicating watt meters of api)roYed design, to be furnished, installed, and maintained by the grantee; continuous records shall be taken on each independent circuit entering the United States; the meters shall be kept in efficient condition, and the records shall be subject to inspection at any time by authorized inspectors of the United States. Fifth. Except as noted below, 4ii,0(X) electrical horsepower represents the aggregate maximum loads that can be brought ito the United States at any time under the terms of this permit : (a) Momentary indications in excess of the authorized amount, due to short circuits, grounds, etc.. will not be considered as violations of the permit. (&) Peaks of load curves due to overlapping loads will not be considered as violations of the permit provided the duration of any one such peak, measured on the 46,000 horsepower line, does not exceed one hour, and provided that the total duration of such peaks in 24 hours, measured in the same maner, does not exceed two hours. Sixth. Maps or charts, verified to the satisfaction of the Chief of Engineers, shall be filed with the Chief of Engineers, showing the exact location of all lines or circuits over which power is transmitted into the United States under the provisions of this permit: and no change shall be made in such lines or circuits without submitting at the same time to the Chief of Engineers, or his representative, a map or chart showing such change. Seventh. One of the objects of the law being the preservation of the natural scenic conditions of the Falls and the gorge, it is stipulated that the plans for carrying the power across the international boundary be submitted to the Secre- tary of War for approval before work is undertaken. For the same reason, it is further stipulated that no steps be take by the grantee, or its allied interests, as disclosed in its application for a permit toward the construction of another bridge across the Niagara River. Eighth. The Secretary of War reserves the right at any time to modify the form of this permit, to change the method or plan of measurement herein pre- scribed, or to substitute other methods of mea.surement whenever, in his judg- ment, such modifications, changes, or substitutions are necessary to carry out the provisions of the act of June 29. 1900. under which this i»ermit is issued. Witness my hand this ITth day of August, 1907. Wm. H. Taft, Sccretdrii of War. PERMIT TO XIAC.AK.V FALLS POWKR CO. FOR THE Ti?ANSMTSSIOX OF ELECTniCAL POWER FROM CANADA INTO THE UNITED STATES. Whereas under the provisions of an act of Congress, approved June 29, 1906, entitled "An act for the control and regulation of the Niagara River for the preservation of Niagara Falls, and for other purposes." it is provided that the Secretary of Vv'ar may grant permits for the transmission of power from the Dominion of Canada into the United States, and that it shall not be lawful to ti'ansniit electrical jiower into the United States from Canada except in accord- ance with the permits so issued by the Secretary of War; "Whereas upon the applications, hearings, reports, and all the proceedings by the applicants for permits under the provisions of the said act. the Secretary of War. under date of January 18, 1907. filed a written opinion directing, among other things, that a permit be issued to the Niagara Falls Power Co. for the transmission of 52.500 electrical horsepower from the Dominion of Canada into the TTnited States ; Now, therefore, this is to certify that the Secretary of War hereby gives permission to the Niagara Falls Power Co. to receive from the Canadian 306 PRESERVATION OF NTAGABA FALLS. Niagara Power Co.. at the interuatioual boiuulary line, aucl to transmit from the Dominion of Canada into the I'nited States. T,2.'AH) electrical horsepower, npou the following terms and conditions: First. Snch electrical itower may be received in tlie United States in the first instance by the Niagara Falls Power Co. or by its distributing agents or others with whom it or the Canadian Niagara Power Co. has or hereafter may have contracts for power delivery in tlie United States. Second. Measurements of the amount of power transmitted into tlie I'nited States under the terms of this permit sliall be made at suitable points in the United States near the internalioual boundary by continuous record-indicating wattmeters of approved design, to be furnished, installed, and maintained by the grantee: continuous re(.-ords shall Ite taken on each independent circuit entering the United States; the meters shall be kept in etiicient conditioUj and the records shall be subject to insJ)ectio^^ at any tixue by authorized insjiectors of the United States. Third. Except as noted below, 52,500 electrical horsepower represents the maximum load that can be brought into the United States at any time under the terms of this permit : (rt) Momentary indications in excess of the authorized amount, due to short circuits, grounds, etc., will not be considered as violations of the permit. (b) Peaks of load curves, due to overlapping lo.ids, will not be considered as violations of the permit, provided the duration of any one siich peak, measured on the 52,5(X>-horsepower line, does not exceed one hour, and provided that the total duration of such peaks in twenty-four hours, measured in the same manner, does not exceed two hours. Fourth. Maps or charts, verifieti to the satisfaction of the Chief of Engineers, shall be tiled witli the Chief of Engineers, showing the exact location of all lines or circuits over which power is transmitted into the United States under the provisions of this permit, and no change shall be made in such lines or cir- cuits without submitting at tlie same time to the Chief of Engineers or his representative a map or chart showing such change. Fifth. The StM-retary of War reser\es the right at any time to modify the form of this perndt. to change the method or plan of measurement herein I)rescribed. or to substitute other methods of measnrenient whenever, in his judgment, sucli modification.s, changes, or subsiltulions are necessary to carrj' out the provisions of the act of June 20, 1906. under which this permit is issued. Witness my hand this 16th day of August. 1!X>7. W.M. H. Taft. Secretary of War. Extended September 2, 1911. to .March 1. 1912. Permit to Xiaffura, Loekiwrt tC- Ontario Poicer Co. for the traii.'sniifitiion of elec- trical power from CaiuuJa into the United States. Whereas under the provisions of an act of Congress approved J\me 29. 1906, entitled "'An act for the control and regulation of the Niagara River, for the j)reservation of Niagara Falls, and other purposes." it is provided that the Seci'etary of War may grant permits for the transnnssion of power from the Dominion of Canada into the United States and that it shall be not lawful to transnnt electrical power into the United States from Canada except in accord- ance with the pennits so issued by the Secretary of War. Whereas ui)on the apidications. hearings, reports, and all the jn-oceedings by applicants for pernnts. imder the i)rovisions of the said act. tlie Secretary of War. under date of .January 18. 1907. tiled a written opinion directing, among other things, tliat a permit be issued to the Niagara, Lockport & Ontario Power Co. for the transmission of 60.000 electrical horsepower from the Dominion of Canada into the United States. Now, therefore, this is to certify that the Secretary of War hereby gives per- mission to the Xi.igara. Lockport & Ontario Power Co. to receive from the Ontario Power Ct.. <>f Niagara Falls, at the international boundary line, and to transmit into the United States. 60.000 electrical horsepower upon the following terms and conditions: First. So long as the Niagara. Lockport & Ontario Power Co. shall procure from the Ontario Power Co. of Niagara Falls the right for the Chief of En- gineers, or his representative, to enter uiion the i)roniises of the Ont.irio Power Co. of Niagara Falls and to inspect and verify their records to the satisfaction PEESERVATION OF NIAGARA FALLS. 307 of the Chief of Engineers, and so long as the amount of power transmitted to Ihe United States does not exoeeti To fHrr cent of the amount lierein authorized, the measurements necessary to insure compliance with the terms of this i)erniit shall be made at the expense of the grantee at the station of the Ontario IVnver Co. of Niagara Falls, due allowance being made for losses between the me..suring station and the international boundary line. Second. When the amount of power transmitted to the United States under the terms of this permit exceetls 75 i)er cent of the authorized amount, or if the right of access or examination to the satisfaction of the Chief of Engineers is declined or refused at any time by the Ontario Power Co., the measurements necessary to insure compliance with the terms of this permit shall be made at suitable points in the United States near the international boundary. Third. When under either of the conditions above named the power imjiorted is measured at the points in the United States, such measurements shall be made by continuous record indicating wattmeters of approved design, to be fur- nished, installed, and maintained by the grantee; continuous records shall be taken on each independent circuit entering the United States; the meters siiall be kept in efficient condition, and the records shall be sub.1eot to iusiJeclion at any time by authorized inspectors of the United States. Fourth. Except as noted below. 60,000 electrical horsepower* represents the maximum load that can be brought into the United States at any time under the terms of this permit. (a) Momentary indications in excess of the authorized amount, due to short circuits, grounds, etc., will not be considered as violations of the permit. (&) Peaks of lead curves due to overlapping loads w'ill not be considered as violations of the permit, providetl the duration of any one such peak, measured on the 60,000 horsepower line, does not exceed 1 hour, and provided that the total duration of such peaks in 24 hours, measured in the same manner, does not exceed 2 hours. Fifth. Maps or charts, verified to the satisfaction of the Chief of Engineers, shall be tiled with the Chief of Engineers, showing the exact locatioii of all lines or circuits over which the power is transmitted into the T'nited States luiuer the provisions of this pernut ; and no change shall be made in such lines or circuits without submitting at the same time to the Chief Engineers or his rei>resentative a map or chart showing such change Sixth. One of the objects of the law being the preservation of the natural scenic conditions of the Falls and the gorge. It is stipulated that the grantee shall, either dii'ectly or through the Ontario Power Co.. take steps to restore the natural growth on the sides of the gorge at the point where power is now brought into the United States. It is further stipulated that no additional power crossings shall be under- taken until the plans therefor have been approved by the Secret^iry of War. Seventh. The Secretary of War reserves the right at any time to motlifv the form of this i)ermit, to change the method or plan of jneasurements herein ])re- scribetl. or to substitute other methods of measurement, whenever in his judg- ment, such modifications, changes or substitutions are necessary to carry oui the provisions of the act of June 29. 11*06, under which this permit is issued. Witness my hand this sixteenth day of August. 1907. Wm. H. Taft, Secrctdiif of W^s- iiian Cooper. Avho raised the question the other day. that there is posi- tively no disi^osition to keep the diversion down below the limit of 10,200 cubic feet, that would prevent anyone else from getting a permit under the existing law. Mr. Garxei!. Major, will you give the committee an estimate of what it Avould cost your department to supervise the taking of water on this side and the importation of power from Canada? 308 PRESERVATIOX OF NIAGARA FALLS. Maj. La Due. I would not like to hazard an estimate now, espe- cially without knowing how far the supervision would go. AVe have spent about $27,700 since the Burton laAv went into effect, but a very large part of that sum went into these very elaborate investigations, wliich were necessary in the beginning and Avhich are reported in these two documents. There will be no such elaborate investigations to undertake now. It will be a question of supervision only, and the cost will be less, but how much less I would not like to sa)^ I think it would be well to reappropriate the unexpended balance of the appropriation made by the Burton Act. Mr. Garner. After your investigations were made under this law, for instance, the continued annual expense would be about how much? The stationing of an officer there, would that be the expense? Maj. La Due. "We have not had an officer stationed there; we have one or two inspectors who go up there as needed. So far as that fea- ture of it goes, it would probably be only the salary of one or two men. Mr. Garner. A veiy nominal expense, then, after j^ou had made a tiiorough examination under this provision of the bill? Maj. La Due. A nominal expense. Of course if any especial inves- tigation becomes necessary, we will have to send parties there. In December last it became evident that the Hydraulic Co.. owing to the improvements they had been making in their plant, was approach- ing its authorized limit of diversion, so we sent a party there — just how large a pai-ty I do not know. This party made measurements and established a rule to govern the operations of the company and fix the limit of their output. The Chairman. If you have anything further you wish to incor- porate in your statement, you have that pri^nlege. .srPl'I.KMF.NTAKY STATKMKXT OF UV.y . FliANClS V. GREENE. .Mr. ("lialrmaii, yoiu" committee has listennl witli very great patience ou six successive days to statements and arguments of more than 30 individuals, representing a great variety of interests — Members of Congress. State otficials, Chief of United States Army Engineers and his assistants, city officials, and rei)resentittives of commercial bodies, representatives of the American Civic Association, and representatives of power companies, both those which are in operation and those that have jilans. I'he discussion has taken a \ery wide range and has covered every ix)ssible tojtic in this connection — legal, scientific, connnercial. sanitary, or emotional. Now. out of it all it seems to me that four very serious questions have been presented for your consideration, namely, national defense, navigation, regu- lation of rates, and the scenic grandeur of Niagara Falls. I put that last, not because it is by any means the least important, but l>ecause it is the one con- cerning which there has been the greatest difference of opinion. With your permission I will try to rehearse as accurately and as briefly as possible .M summary of the testimony which has been given to you on these four points. First. .\s to national defense. One might wonder just how the question of national defense comes in with the diversion of the waters of Niagara River, and the theory of it, as I understand it. is that the river might have been drained dry, so that it would offer no obstacle to an invading army. In the remote and almost unthinkable contingency of a war with Great Britain or Canada — if such a thing should have hapi»ened; if Niagara River had been draineev cent of tbe total flow, or SO.OOO mbic feet per second, would not materially in.iure tbe Falls. Tbe Burton law, enacted as a result of tbat bearing. ]ilaced tbe limit at ir),0(M) cubic feet on tbe Ameri- can side, and by rest ric! ions on ti-ansn)ission from Canada it was apparently intended to indirectly linnt tbe diversion of water on tbe Canadian side to about tbe same amount, or some 30.0(10 to 3].orts because tbe in this report of last Jnly the consumption in Canada has increased 20 ])er cent. Mr. DiFENDERFER. Is it uot becausc they are getting power cheaper? Gen. Green K. Whatever is the cause, I am speaking about the scenic grandeur. You say that we hired the newspaper people to raise this issue for scenic grandeur. Mv. Dtfenderfer. I said so? Gen. Greexe. Yes; it is hard to discuss such a proposition as that. But on the question of .scenic grandeur I say that you can not save the scenic grandeur of Niagara if it is danger, from Canada, by re- stricting the importation of power from Canada, because Canada will use it if it does not come into the United States. jNIr. DiFENDERFER. We have no control of that. I appreciate that. Gen. Greene. Now. I repeat that we rest our case on these docu- ments, fairly studied and considered. At any time the scenic gran- deur of Niagara Falls will not l)e endangered by the diversion of water provided for in the treaty. Mr. Sharp. In that connection I see the second document. Senate Document No. 105 and House Document No. 246. You api:)rove then more of the House document because it is several years later. Read- ing from that document on page 1.^ T find the following language used: The total chanj^es liave resulted in an appreciable decrease in iLe volume of flow there, due to the deficient depths at the end of the Falls, to a marked interference with the continuity and the lenjith of the crest line, unquestionably marring the beauty of this cataract. While natural causes haye been chiefly instrumental in effecting these changes, it api)ears indisputably that the arti- ficial diversion of the power companies h.-ivc mateiially aideil to the injury of PKESERVATION OF NIAGARA FALLS. 313 interference with the scenic grandeur of Niagara Falls, and the additional diversions now conteuiplated will increase this damage. Gen. Greene. The natural causes have been the chief instrument. Mr. Sharp. But it very plainly states that we could not increase the diversion any more without damage to the Falls. Gen. Greene. That is the engineer's opinion, based upon the record of gages, which shows a less volume of water going over the Falls. He does not say that he can see any difference with his eye. Mr. Sharp. He does say in the same connection that after these observations had been made, which lie said were made under most favorable circumstances : The effect, then, of the total diversion and of the natural change of regimeu since 1906 will account for the lowering on the Canadian and Goat Island ends of the Falls, and the mean lake level is over 15 inches and 3i inches, respec- tively. The present return to the low stage of the Great Lakes is due to de- ficiency in rainfall and runoff has had the further effect at Terrapin Point of 2 inches. Gen. Greene. Due to three causes, lack of precipitation, wearing away of the apex, and diversion by the power companies. Three causes contributed to that. Now these photographs— have you even been to Niagara ? Mr. Sharp. Quite a number of times. Gen. Greene. Have you been there within recent years? Mr. Sharp. Not within five or six years. Gen. Greene. Do your photographs, taken last July, give you a different idea of the Falls from what 3'ou remember? Mr. Sharp. Not at all. (xen. Greene. That is the whole case. Mr. Sharp. There was a great mass of Avater flowing over there. Gen. Greene. There is a great mass of water flowing over there now. It is magnificent. Mr. DiFENDERFER. You stated that your company tried to preserve the scenic grandeur by placing your building in the rocks? Gen. Greene. Part of our structures. Mr. DiFENDERFER. Ar^ these faithful reproductions here in these books ? Gen. Greene. In what books? Mr. DiFENDERFER. Of the Niagara Power & Conduit Co. Gen. Greene. That is not my company. Mr. DiFENDERFER. What company — are you not interested in this company ? Gen. Greene. The Niagara Power Co.? Mr. DiFENDERFER. YcS. Gen. Greene. Not at all. Mr. DiFENDERFER. It looks to luc as though these buildings were set out on the plains. Gen. Greene. That is the other company. If you would like to .see our buildings, I have photographs of them. Mr, DiFENDERFER. I do uot sce any of the rocks, General. Gen. Greene. I said we put some of our structures there. Mr. DiFENDERFER. I understood you to say that you put your buildings there. Gen. Greene. Oh, no; I did not say that. I said our pipes, etc. 314 PRESERVATION OF NIAGARA FALLS. Xow I submit to the committee that the testimony which you have heard in these eLiborate hearings leads to legishition along these lines. The carrying into etfect of the treaty, the diverting of the amount of water on the American side which the treaty authorizes, and suitable provision for supervision by the Secretary' of War to see that the amounts which the treaty authorizes to be diverted is not exceeded. The question of who shall receive this 4,400 cubic feet per second, I think can best be decided by the proper authorities of the State of Xew York, who will undoubtedly give a very elaborate hearing before they reach a decision, so that the rights of all of the people can be brought out. As to importation, the treaty is silent. It was designedly so. It was intended to give this country the benefit of all of the power which Canada would allow to be exported, and there has been. I submit, nothing in the Avay of testimony before your committee to justif}' you in attempting to modify, abbreviate, or restrict this treaty. iNIr. Sharp. I have before me the treaty. AMiat has it to say in regard to the duration of it.s terms? (Jen. Greene. It runs for five years. The treaty — 'ratifications were exchanged at AA'ashington May 5. 1910, and that is the official date of the treaty. The date when the ratifications were exchanged, not the date when it was signed. It was signed in 1909. Article XIV. The present treaty shnll he ratified by the rresident of the United States, etc. Mr. Garner. What have you to say to the suggestion of Congress- man Smith with reference to retaining in the Secretary of War the right to cancel permits after the Public Service Commission of New York would not give what the people considered reasonable rates. In other words, giving the Secretary of War — making the Secretary of War the appellate court as between the power companies and the Public Service Commission of Xew York? Gen. Greene. Do I understand you. a Democratic Representative from Texas, to ask me what I think of an appeal from the govern- ment of X'^ew York to the Secretary of War ? Mr. Sharp. Well, I was not advocating that: I was asking you what you had to say about it. Gen. Greene. I think it is a monstrous proposition, absolutely in- consistent Avith the dignity of the State of Xew York. That is my opinion and I am a Republican. Mr. Sharp. I wanted to see how far you Avere going to follow the doctrine in this direction in concentrating the power at Washington instead of the State of Xew York. Gen. Greene. There is no question whatsoever, under the decision of the Supreme Courts — I am not a lawyer, but I have got btisiness sense enough to tmderstand some decisions — that the United States has exclusive jurisdiction so far as it extends to navigation. This treaty has fixed a limit to the water to be diverted on the American side. The Federa^l authorities should see that that treaty is carried into effect. Beyond that we have nothing to do with. Mr. Dieenderfer. Do you believe that we are bound to allow these companies to take the limit ? PRESERVATION OF NIAGARA FALLS, 315 Gen. Greene. I believe it is expedient to allow them to take the limit in view of the facts. The Chairman. Is not that a question for the Government to de- termine? Gen, Greene. That is a question for the United States. The Chairman. If the Secretary of War determines how much shall be taken, is it for the State to say who shall have it? Gen. Greene. Yes, sir; that is where the line is clearly defined. Navigation belongs to the United States. The Attorney General Avas here to try to preserve what he thought — ^I gathered — -what he thought were the immemorial rights of Ncav York, to preserve them from national legislation. The Chairman, I agree with the law as cited by the attorney gen- eral of the State of New York, Mr, Cooper, While this statement hj the civic association goes into the record, yet it would be brought more forcibly to the attention of the committee if the representative of that association could reply to these statements made by Gen, Greene by just reading these few pages, and I ask that that be done in justice to the association which he represents. The document referred to was read by Mr, Watrous. Mr, Curley, Can you tell me what membership your association has in the United States? Mr. Watroi s. I can tell you in this wa3\ Mr. Curley, It has some 2,500 what we call annual members, but included in that are some 700 or 800 affiliated societies, composed, we will say, of from 100 to 1,000 members, representing several hundred thousand in the aggre- gate, Mr. Curley. What salary is paid the president? Mr, Watrous, No salary, Mr. Curley. Do you receive a salary ? INIr. AVatrous. Yes, sir; I am the only salaried officer of the asso- ciation. Mr. Curley, You are paid by the association? Mr, Watrous, Yes. sir, Mr, Curley. You are emploved permanentlv on legislati\e mat- ters? Mr. Watrous. No. sir; the legislative matters — Practically all I have done have been in attendance on these meetings; I am the ad- ministrative secretary with a great deal of work accumulating on my desk right now. The Chairman. Is there any other gentleman who desires to be heard this afternoon? Mr. Smith, I would just like to say in connection with that letter presented by Gen. Greene that so far as I know the chamber of com- merce has not held a meeting, and no individual has a right to send a conununication to this committee purporting to speak for that body. ^Yh\ was it not signed by the president and secretary if it was an official matter? Mr. Curley. I would like to ask Gen. Greene the date of that letter? Gen. Greene. I have not seen the original letter so I do not know. I understood that the letter had been sent to the chairman of this committee on January 24. 316 PEESERVATIOX OF NIAGARA FALLS. The Chairman. I will state that I received the letter. Is there ai\y other gentleman here who desires to be heard ? If not, the hearings will be closed with the exception of hearing a gentle- man who will be here to-morrow morning at 10 o'clock. The conmiittee will now take a recess until 10 o'clock to-morrow morning. Thereupon, at 5 o'clock p. m.. the committee took a recess until 10 o'clock a. m. to-morrow. January 27. 1912. CoMMrrTEK ON Foreign Affairs, House of Representatrtes, Tuesday^ January 23, 1912. The committee met at 10 o'clock a. m., Hon. William Sulzer (chair- man) presiding. The Chairman. The committee will hear this morning, Hon. Thomas Carmodv, attorney general of the State of Xew York, Gen. Carmody, you may proceed. STATEMENT OF HON. THOMAS CARMODY, ATTORNEY GENERAL OF THE STATE OF NEW YORK. ALBANY, N. Y. Mr. Carmody. Mr. Chairman, I wish to thank you and the com- mittee for the courtesy extended the Stat^ of New York in granting this hearing, so that the State could be represented, and to especially assure the committee of the grateful a[)preciation of this favor by the governor, who is particularly interested in the whole conserva- tion proposition. Our rights in this matter involved in the bill now l^efore this com- mittee, are somewhat intensified by the contemporary interest which the State of Xew York is taking in the conservation proposition. I need not tell you, I am sure, that for the purpose of formulating a policy, and for the purpose of asserting the rights of the State in hydraulic matters, the last legislature passed an act constituting what is called a conservation commission, with more particular reference to the administering of the surplus waters impounded by reason of the construction of the barge canal, and the impounding of waters in the streams and tributaries, for the purpose of feeding the barge canal. The proposition involved in the bill and in the administra- tion of the powers under it, is at present somewhat crude in the minds of the officials of the State, but we do stand upon this propo- sition, and it is one that it seems to me is not fully recognized by the bill pending before this committee. I have been shown two bills, one introduced by Mr. Smith, and the other by Mr. Saunders, both of Avhich seem to proceed upon the right claimed in the National Government to control and distribute the water power in Niagara River. I contend that that is an asser- ti(m of a poAver that the Government does not have. The Govern- ment has only such powers as the Constitution gives it, and in respect to navigable streams — and this includes border streams — that right is limited to the control of those streams for purposes of commerce and navigation, and f(jr military defense, neither of which i)urpose I PRESERVATION OF NIAGARA FAL/KS. 317 i.s asserted, and Jieitlier of which is farthered by the bills before this Gomniittee. or by any legislation which Congress has passed, bearing n])on the Niagara Falls ])roposition. Now, it will not take me very long to state the position of the State of New York, and it will not take me very long to furnish to this connnittee the authorities upon which the State rests in basing its contention for what it will ask for when we are through. The State claims to be the owner of the soil to the center of Niagara River, and consequently the owner of the water that passes over the American side of the Niagara River, subject only to the right of the National Government to control the waters of that river for the purposes of na\igation and for military defense. The right which the State owns in this river is no different, according to the decisions of the courts, from its right in rivers that are entirely within its borders, that are navigable, and the legal status of that right is so clearly established by the decisions of our courts that it is unnecessary to more than refer to them for the purpose of establishing its correct- ness. Now. the treaty between this country and Canada, under which this bill is apparently drawn, undertakes to exercise some national power, the extent of which I can not understand. I think we all understand that the Govermnents, the parties to that treaty, have the i-ight to state their relative positions so far as the use and occupa- tion of that river is concerned, for the purposes of navigation and for military defense. That is alleged to be the purpose of the treaty, and there is notliing in the treaty that undertakes to carry out that power, which is the only power that our Government has to deal with that scheme, I am not assailing this treaty; I am just coming in a moment to what Congress is now asked to do under it. The treaty states tliat it is passed for the purpose of settling dis- putes between the owners or claimants on either side of the Niagara Eiver. Now, whatever the ownership of property on either side of the Niagara River may be, it rests, under the laws of the State, in either the State or some riparian owner, and is not a subject of na- tional supervision or contral. Now. the Burton Act, so called, under- takes to carry out specifically the powers that were intended to be conveyed by the treaty. l)y providing that we may take from the Niagara River a certain quantity of water — 15,600 cubic feet per second. We say that that is a subject \ipon which the National Gov- ernment has no right to legislate, except to go far enough to say that there has been released to the State of New York a certain quantity of Avater from our supervision and right of control for pur- poses of navigation and military defense: that when the Government has gone that far it has discharged its power and exercised the only governmental function which it possess, the only power which it has over the waters of Niagara River, and under that bill you have stopped where we ask you to stop in Avhatever legislation you recom- mend, namely, that when it is specified as to how much water may be taken from the river on the American side, thereby releasing the control of the National Government to that point; then that must go to the party that owns it under the laws of our State and Nation, namely, the State of New^ York. 28305—12 21 -*; 318 PKESKRVATION OF NIAGARA FALhS. Mr. Gaknki;. Geiieral, let us suppose that some Member of the House should disagree with you as to the power or control o^ver this water. AVhat is your idea about the policy of the Federal Government stepping in and undertaking to say to a State how and under what conditions it shall regulate hydraulic power. Mr. CARMooy. I say that is objectionable from two standpoints. In the first place it is the assertion of a power that does not exist, and it is undertaking to administer a policy that belongs to the State. It is made the right of the State in two respects, first, State ownership of said power, and, second, the right to administer that in trust for the common people. The Chair^max. That is fundamental. Mr. Garner. In reality it is an indictment against the State by the Federal Congress that it is not capable of conducting its own affairs. Mr. Carmody. Very truly that is so. The Burton Act goes further than that; it not only asserts the right to control the distribution of it, but to say who shall have it, and it provides that it shall only go to those owning the water power at the present time. In other words, it grants what, under the constitution of the State of New York, is an exclusive privilege. We are ai'guing against the folly of the National (Tovernment undertaking to exercise functions which it does not possess, and thereby invading the functions of the State, wherein the State has the means of administering, the right to ad- minister, and a vital interest in the result. Mr. Flood. What act does that? Mr. Carmody. The Burton Act, Mr. P^i^oD. The one that is on the statute books? Mr. Carmody. The one that is on the statute books now. We con- tend against the principle that the National Government has the right to distribute this water. Our position is that the National Government has the right to control the waters of Niagara River for purposes of navigation and for military occupancy, but for no other purposes; and where it does not restrict them for those pur- poses then the riparian rights are invoked, and those riparian rights mclude the right of ownership to the center of this stream and to the water that passes over it. Mr. Garner. What do you say to the proposition of the Federal Government having the right to formulate certain rules and certain conditions precedent to the taking of this water that the greatest amount of power may be derived from the use of it. For instance, I presume you will concede that the Federal Government would have a right to say that you could take only 20,000 cubic feet per second, and that it could designate the Secretary of War or some one else to see that that provision was adhered to. Could they go further and prescribe the engineering features of the plant in order to get the greatest power out of that 20,000 cubic feet? Mr. Carmody. Very clearly, they can not. Their function is sim- ply as was pointed out, to decide how much we may take, that does not injure navigation. When they have decided that they have exercised the only power they have under the National Government, and every other right over that water is in the State of New York, or in some riparian owner, if any rights have privately been acquired to the use of the water. The right to limit the cost to the consumer, or PRESERVATION OF NIAGARA FALLS. 319 to regulate the question of engineering, is one that belongs to the State government. Mr. Cline. Do you concede that the Federal Government has the right to establish any limitation upon tlie diversion ? I think you do. The Chairman. There is no question about that. Mr. Carmody. Oh, yes. Mr. Cline. It has the right to grant or withhold to any extent that meets its own discretion? Mr. Carmody. Yes; and that discretion ISIr Cline. And would have the right to refuse any diversion at all? Mr. Carmody. Yes; in the exercise of this function. In other words, I think the proposition is more logically stated in this way, that the State may continue to enjoy its riparian rights until the Government desires to exercise its authority for the purpose of navi- gation or military defense. Mr. Cline. The Government will reclaim it by simply asserting that no diversion shall occur? Mr. Carmody. Yes, sir. Mr. Cline. It is your position that while the Government would have the right to grant or withhold in the discretion of Congress — that the Government can not impose any condition upon its exercise. Mr. Carmody. I say it can not. The Government can only decide now much can be diverted, and that is the only control the Govern- ment has over it. and then the rights of the State are asserted to the further control, and that is fully competent to deal with the question you raise. Mr. Cline. I understood that that is your contention? Mr. Carmody. Yes ; that is the contention. It comes to this point, further objection to the provisions of the Burton Act is idle, and I wish to assert it here — vou are familiar with the provisions of this: bill? Mr. DiFENDERFER. Uiidcr the treaty, is the Government not morally bound to stop the pollution of international waters? Mr. Carmody. The pollution? Mr. DiFENDERFER. YcS. Mr. Carmody. That, of course, comes under a different power of the National Government than the one we are discussing. Mr. DiFENDERFER. It would liave some control. IVIr. Carmody. The two Governments would have the right to agree upon some sanitary policy of controlling that question of the pollu- tion of the waters of boundai*y streams. Mr. DiFENDERFER. If the Government should go further and in- fringe, as you possibly would say, upon the riparian rights of the State of New York in order to stop pollution, would you think they would have any power? Mr. Carjiody. If it is a legal right, it must be founded upon some legal principle of Government. Mr. DiFENDERFER. The State of New Yor, as I understand it, has perfect health laws, has it not? Mr. Carmody. Yes. Mr. DiFENDERFER. Now, has the State ever made any exhaustive investigation of the waters of Niagara in regard to that question? Mr. Carmody. In what respect? 320 PRESERVATION OF NIAGARA FALLS. Mr, DiFEXDF.RFKR. Ill this respect, as to whether scenic beauty has l>een destroyed? Mr. C'ARArooY. (),h, yes: that is a common topic of investigation and conversation and denunciation in the State of Xew York. It seems to be agreed by the popidace that lives there, and by the great mass of people who go there, that there has been no diminu- tion of its scenic beauty, and. as I am informed, there will b(^ none, if the State of New York is ])ermitted to divert the use of those 20,000 cubic feet })er second. But no one will claim. I assume, that this (Tovernment has the right to legislate for the purpose of pre- venting and j^rotecting and enhancing the scenic beauty of property that l>elongs to the States. That is not alleged to be the ])urpose in the bill. It Avould not be a proper subject of legislation, for it is not in the Constitution. I know it has often been advanced, but I do not believe that in the face of the aesthetic sentiment, that anything will be done to decrease the glories of that stream, and we will all be glad to see something done, and perha]:)s we will close our eyes to the exercise of power, if it were a little arbitrary, if it would prevent an}' desecration of the Falls. Bear this in mind, that the State of New York has done and is doing much to preseiwe the beauties of the Falls. The sentiment that has grown up against the desecration of the Falls shows how the jTeople estimate the importance of pre- serving for posterity the grandeur of that most noble of Nature's Avorks. Mr. Flood. The (irovernment has exercised jurisdiction under the Burton Act for the past six years? Mr. Carmoov. Yes. sir. Mr. Flood. Have the power companies questioned the authority of the State of Ncav York up to this time? Mr. Cline. The truth is that the State government has fully acquiesced in this assumption of power. Mr. Carmody. Apparently the State acquiesces by not asserting it, and Ave found that the same thing was attempted to be done else- where in the State, and I am informed in other places, namely, the assertion of the right on the part of the National Government to control the hydraulic power of the States. We have in the Hudson River the same proj)osition. There is a specifi<' ap))ro])riation for the building of a dam in front of Troy, there having been one there for some time, where waters were impounded, and accomi)anying the ])assage of the act were re])orts from the engineers of the War De- partment, recommending that the riparian rights should be turned over to the National Govermnent before the appropriation was made available, and incorporated in the appropriation Avas that condition that the ap])i'()j)riation is not available until the riparian rights have been exterminated, and the canal board undertook to do that by rescinding and canceling the existing leases for poAver. The present administration has taken a stand against that. They huva rcA^oked that resolution, and we stand upon this right, that the State of New York owns this Avater power, so that if there has been anj' acqui- escence in the State of NeAv York in that policy in the past, that is so no longer. Mr. Clixe. Was that not made a condition of the appropriation to improve the river, provided certain rights should be restored to the Government? FRESEKVATJON OF NIACiAKA J-WLLS. 321 Mr. CAinioDY. Hardly that way, because it stated that a certain amount is directed to be used when the rights were exterminated— — Mr. Cline. a conditional gi'ant ? Mr. Carmody. Yes. That is simply asserting what is asserted in this bill, that the Government has the right to control the hydraulic resources of the State. Mr. Garner. The Government has the right to put a limitation on the appropriation, for the purpose for Avhicli it is to be used? Mr. Carmody. Very true. I am not questioning the exercise of that power, but there has been a policy to acquire the hydraulic power. Mr. Garner. You contend that if Congress had directly passed an act ordering the cancellation of these leases it would not have had that power? Mr. Carmody. Yes. Congress has no such power. INIr. (tarner. And that power Avas lodged in New York. Mr. Carmody. That i)ower was lodged in New York. The State of New York can not surrender it. It is lodged in the ])eople of the State of New York, and the Government holds it only in trust. It is a sacred right which belongs to the people, and we are dealing with something here, the principles concerning which can not be changed by any action taken here or elsewhere. Now, to get down to the point of my discussion here, to the assertion of the principle that I am maintaining, which I find is familiar to the members of the committee, I trust "there is no lawyer who has examined the legal principle I have asserted, nameh% that the Mr. Cline. There is no need to recite authorities on that propo- sition. Mr. Carmody\ Yes, sir. Mr. Cline. What relation do you bear to the State ? Mr. Carmody. Attorney general, and in company with Conserva- tion Commissioner Moore and Mr. Bacon, of the Attorney General's office. Mr. FiA)OD. Do you contend that the United States Government should not permit the Secretary of War to have supervision over this diversion in order to protect navigation i Mr. Carmody. I do not contend that the United States Govern- ment should not safeguard the releasing of its control in any way that may be proper. What I am contending against is the principle in that bill that we must ask the Secretary of War to give to us what belongs to us as a matter of law. He should be required, upon an application from the proper authorities of the State of NeAv York, it seems to me, to release the amount permitted to be diverted. I "would think that would sufficiently safeguard the rights of the National Government; that Avhen the proper authorities of the State of New York apply for the use of the balance of the power, 4,400 cubic feet per second, which we ask you to grant up to the full limit of the treaty, that it shall be the duty of the Secretary of War to sign the permits, provided, in his judgment, it does not interfere with the uses of the National Government. Mr. Ci.ine. Is his judgement final on that question. Mr. Carmody. I think it is. I think that his power must be arbi- trar^^ It certainly can not be questioned b}^ the State if he chooses to say, " we need this for military defense or navigation," even though that may not be so. We can not question it. 322 PRESERVATION OF NIAGARA FALI^. Mr. Garner. Let me oret a distinct understanding about that. Congress decides that 20.000 cubic feet per second can be used without injuring navigation. Mr. Cline. Fifteen thousand six hundred, in this case. The Chairman. That is the amount of water on the American side now being utilized. Mr. Garner. Congress decides that 20.000 feet can be diverted Avithout affecting navigation or the military defense and we lodge with the Secretary of War the power to grant a permit. Is it your contention that the Secretary of War should arbitrarily say he will not grant any of these permits for any of this water because in his judgment it would affect navigation or military defense? Mr. Carmody. T am arguing the opposite side of that question, because we claim we have the right to enjoy that water as a natural right, but the National Government has the right to control it for purposes of navigation. Mr. Cline. We do it through an act of Congress. Mr. Garner. Although the Secretary of AVar has the power to issue a permit, he would not arbitrarily fly in the face of Congress. Mr. Flood. You are making a concession to the other side. Mr. Carmody. I am not here to question the right of the National (Tovernment to do anything it believes it is doing in the interest of navigation. When you have passed that point Mr. Cline. When you make that concession, do you not minimize the rights of the State that you have been talking about? Mr. Carmody. Not at all. Mr. Garner. If I understand, your position is that Congress has the right to say whether there shall be one or twenty thousand cubic feet per second, but that after that the power of Congress ceases and the State's rights begin. Mr. Carmody. Yes. Mr. Cline. I think we clearly understand that. Here is my propo- sition : If you concede to the Federal Government the right to estab- lish the amount of diversion there, basing it upon the proposition that navigation will be affected or that the security of the country may be involved — if you concede that proposition, then the Federal Government has the right to authorize the diversion of 1 cubic foot or 20,000 cubic feet ; if the Government noAv has the right to fix the amount, is not the importance of your State rights reduced to a minimum ? Mr. Carmody. You have already stated how much may be diverted. I am starting in where you have stopj^ed. Mr. Clixe. But the Federal Government can at any time revoke the Burton Act. Is not that true? Mr. Carmody. Yes: but you have got to fight the riparian owners. Mr. Cline. What rights have the riparian owners? Mr. Carmody. The right of ownership. Mr. Cline. But what does the right amount to. if it is so difficult or impossible of assertion as you say? Mr. Caiok^dy. It is the right to enjoy, until you have deprived them of it. I do not see how you are going to hurt them. The}^ are drawing power from the river. You may say there can not be any power taken from the river, but you have got to settle that other question in another tribunal. PRESERVATION OP NIAGARA FAbLS. 323 The Chaik.man. The Government has made a treat}^, which is the supreme hiAv of the land, and that treaty provides how much water can be taken by the Canadian Government and how much by the United States Government. The question before the committee is, who shall have the right to dispose of that water power, and whether there shall be any limitations upon its disposition, so far as the price of the power to the consumer is concerned. Mr. Flood. There is another question, as to Avhether the Govern- ment will permit the 20,000 cubic feet per second to be diverted. Mr. Cline. If diversion is permissible. JSIr. Garner. Let me aslv one question in connection with that. Suppose that Congress should decide that there should not be a single foot of water diverted on the American side, and should pass a law directing that none should be diverted, which would naturally seri- ously affect the power companies, would they have that right? Mr. Carmody. They have no such right. Mr. Garner. They outline in a bill that it is for the purpose of preserving the navigation in Lake Erie and pass a law prohibiting the diversion of another foot of water; you must assume they would have that power. Then, the only remedy that those companies would have would be a claim against the United States Government for such damage as might have occurred. Mr. Carmody. Or some legal proceedings. Mr. Cline. These are revocable permits, and would the Govern- ment involve itself in damages for doing what it is authorized to do? Mr. Garner. Some of these companies have been there for years and years, and have been given permits. Mr. Cline. They claim they derive the power from these permits. Mr. Carmody. Not necessarily, I believe. Mr. Cline. I should not want to concede that the only power we have is from the permit. Mr. Carmody. I would like to read the bill which we present here. It represents the idea of the State of New York in regard to this concession. [Eeading:] A BILL To givo effect to the fifth article of (he (reaty between the United States and Groat Britain, signed January 11, 1909. Be it enacicd by the Senate and House of Representatives of the United States of America in Congress assembled. In order to give effect to the fifth article of the treaty l>etween the United Stiites and Great Britain signed Jann- ary 11, 1909 : The United States hereby authorizes and permits the diversion witliin the State of Xew Yorlv of the waters of Niagara River above the Falls of Niagara, for power purposes, not exceeding in the aggregate a daily diver- sion at the rate of 20,000 cubic feet of water per second: Provided, however. That no water shall be diverted from said river at said point for power pur- poses except pursuant to written permits signetl by the Secretary of War, who is hereby authorized and directed to issue such permits for the making of such diversion to said amount, to the State of New York, upon application therefor by its officials, thereunto duly authorized. Said permits may be revoked by the Secretaiy of War at any time when in his judgment such revocation is deemed advisable for the i)roteftion of com- merce or navigation or for military defense. We contend that the bill recognizes the one right that the Govern- ment has and asserts the right that belongs to the State. The Chairman. We will carefufly consider the proposed bill. o24 PKKSERVATION OF X1.\(JA1!A FALLS. ""Mr. I'"Lt)(»i>. The l)ill requires him to issue the permits, regardless of whether he mav think that if he issiie^H them they would be detri- mental to navigation or the public defense. Mr. CARMonY. He has the right to revoke them. Mr. Flood. Suppose, before he issued them he thought that to issue them would be detrimental to navigation or to the common defense. Mr. C'AK."sn)»v. Of course you have the right The C'HAiinLVX. In this proposed bill, as I understand it. he has the right to issue the permits. Mr. Cak^eody. He must issue them. The Chairman. Please explain the last part of the bill? Mr. Carmody. That relates to the revocation. S.iid iHTiiiits may hv revnki'd by the Sorivtary of War at any tiiin- when in his judKniwnt su<*h iev(»catil;> for the i»rolc(|ion of .-oin- rnerce or navifrntion or for military defcnso. You have given him the only atithority he possesses by act of Congress. You authorize him to revoke permits. Mr. Flood. If this proposed amendment should be enacted, the Secretary of War would be compelled to issue the additional permits "notwithstanding he may l)olieve that in doing that a radical injury to navigation might result. At ]:)resent only lo.OOO rubic feet are being diverted. Mr. Carmody. I should think that would be in the disci-etion of the Secretary of War. Mr. (.^.iNE. Un(iue,stiomd)ly that is correct. Mr. Carmody. Therefore, "we contend against the provisions now before you. which places in his discretion the arbitrary power to issue these permits, and thereby deny to New York its proper rights. Mr. DiFENDERFER. As a matter of fact. Oeneral. there is not now diverted 15.C)00 cubic feet per second. It has been IH.HOO feet. Mr. Carmody. Yes. I desire to state further that the rights of the State are in entire harmony with the other rights. Mr. Flood. I do not so understand it. Mr. Difenderfer, from Gen. Bixby's statement. Mr. Garner. They were granted more, but only i:^.:>00 feet are being diverted at presen.t. Mr. Flood. P^leven thousand on the other side. Mr. Carmody. We claim that, for the purpose of carrying out the policy of conservation whicli the State of New York has adopted, that you have the power of deciding how this power should go. Mr. Clixe. I dislike to interrupt your argument, but how would you possess that power? Mr. Carmody. We have a conservation commission that now deals with the surplus water- that are impounded by the constrttction of the barge canal. Mr. Cline. Is that organized and operating? Mr. Carmody. Yes: some of the nuMubers are here. We do want to be permitted to exercise some control over the ))ermits granted and to fix a maximum jirice to the consumers of that power. We say that if the franchise is granted by the State of New Yoik. therefore the State has the right to limit the charge that the companies may make. We have no such right without contendiiig against the princi- ples which you have inserted in the r)urton Act. and we have nothing PRESERVATION OF NIAGARA FALL.S. 325 to say ahoiil the manner in T\hicli that power, which is very im- portant to ns, is administered. Mr. Cline. I suppose the regulation of rights would he committed to your public-service commission? Mr. Carmody. Practically: but the administration of water power goes by specific provisions of our State law to the conservation commission. Mr. Garner. You have some idea with reference to the public opin- ion of your State in regard to the power of this commission to fix prices. Mr. Carmody. The conservation commission? Mr. Garner. The public-service commission. Mr. Carmody. I do not know much about it. It is certainly sus- tained by popular sentiment, and I think popular sentiment has asked to have it further extended to all corporations. I think the principle underlying it is popular and is growing in popularity. I believe. The control that comes in here, of course comes under another power of the National Government, and we have nothing to say about it. I am simply here to ask you to deal with us upon our natural rights and privi- leges as to this hydraulic question; but bear in mind that our interests are in harmony with those of every poAver company at the Falls. We are not going to confiscate anything: we are not going to de])rive them of any rights they have b\' reason of the riparian ownership or by reason of the terms granted by the Secretai-y of War. AVe want these 4,400 cubic feet stripped of all these complications. AVe want you to realize that and to say to us, "• You may administer it, Avith the right in the National (Tovernment to reclaim." Mr. Garner. The people are interested in the questions of Avhether they should be permitted to buy their poAver in Canada, and you are also interested in the question as to whether the Federal Congress shall fix the price, or your ]mblic-service commission? Mr. Carmody. Yes. jMr. Garner. You are also interested in the question about the con- ditions Avhich shall be imposed upon power imported from Canada? Mr. Carjiody. AVe are interested, Imt I do not think they should be in the same bill. The transmission of current comes under another poAver from the exercise of your power here. Here you are dealing Avith the assertion of your right to control navigable streams. The Chairman. If it Avere not for the provision in the Burton Act limiting the amount of poAver to be brought into the State of New- York to 100,000 horsei)OAver. the Canadian GoA'ernment Mr. Carmody. The State of New York ought to be permitted to get a revenue the same as for any other franchise for this vast power AAdiich is being carried tAvo-thirds the Avay acrass the State. AA^c tax eAcry other corporation, and Ave can not touch that, because you haA'e said they can take it into our State and send it across the State, and charge the people as they see fit. You haA'e preA'ented our control OA'er matters that belong entirely to us. I thank you, gentlemen, and shall be glad to ansAver any other questions. Mr. Levy. You claim that the Secretary of AA^ar shall be jicrmitted to issue permits to exercise rights that belong to the State of New York? 326 PRESERVATION OF NIAGARA FALLS. Mr. Carmody. I think lie should be compelled to issue them. The Chairman. To those designated by the State? Mr. Levy. That riofht belongs to the State of New York ? The Chairman. Yes. Mr. Carmody. When you say that we can take 20,000 cubic feet you have said all you can sa}'. The rest belongs to us. The Chairman. In your opinion, if Congress should pass this pro- posed bill submitted by you on behalf of New York, it will gi-ant to the State of New York all it desires? Mr. Carsiody. Yes. It may not be in proper form. I did not ex- l^ect to represent the State here, but we got our views together and that represents them. The Chairman. The State of New York, as I understand it, Gen- eral, is in favor of taking the maximum amount of water on the Americjin side that is provided for in the treaty? Mr. Carmody. Yes; we are. The Chairman. In your opinion that would not destroy the scenic beaut}- of Niagara Falls? Mr. Carmody. We are very sure about that. The Chairman. The State of New York has no objection to wip- ing out the limitation now imposed by the Burton law as to the amount of power coming in from Canada. All the State of New York wants is the power to regulate the price to the consumers. Mr. Carmody. Yes. The Chairman. There being no Federal act prohibiting it, the State would have the right? Mr. Carmody. Yes. Mr. Garner. I just want to ask you, supjjose the Burton Act was repealed — it expires on the 1st of March — and Congress did not pass any law with reference to the importation of power from Canada, they would have, under the general law, the right to bring in that power ? Mr. Carmody. Not without the permission of Congress. They could not get in here and exercise a franchise, it seems to me, cer-" tainly not with the permission of the State of New York. Mr. Garner. There is no law on the statute books which I know anything about prohibiting the importation of power from foreign countries. When they get in, it would be under the jurisdiction of the State of New York, so if Congress does not say a word about it. New York would have just what it wants. Mr. Carmody. We would have this complication, that the Constitu- tion says that no State shall interfere with interstate commerce, or make laws Mr. Garner. Then your contention is that it would take an act of Congress to give your State jurisdiction? Mr. Carmody. That clears away that right. Mr. FiA)oD. Would it not be rather difficult to fix prices, when the public-service commission could not go into Canada and find out the cost of production? Mr. Carmody. You are asking me something that is in regard to an administrative matter, not legal. Mr. Cline. Suppose Canadian operators should refuse to disclo.se the information? PRESERVATION OF NIAGARA FALLS. 327 Mr. Carmody. I think we would reciprocate — I think the law of reciprocity would be quite effective. We would say you can not transmit your power. Mr. DiFENDERFER. Sucli a decision as that would be in favor of Canada. Canada would be benefited, Mr. Carmody. I would not want that kind of benefit. Mr. DiFENDERFER. AVould uot the effect be this, that if they kept the electricity they manufactured on the other side, it would encour- age factories being built there, because of the fact that they could produce power and sell it to these companies very much cheaper than on the American side? Mr. Carmody. It may be so. Mr. DiFENDERFER. Then would it not be to their benefit to keep their power? Mr. Carmody. I think it is beneficial to them to come over and charge their present prices. Mr. Flood. Have you considered the provision in the Smith bill in section 2, in reference to the limitation on the charge on power imported from Canada? Mr. Carmody. I have not given any particular attention to it, be- cause I am not here to discuss the power question. There is another department of the Government whose territory I do not wish to invade, which deals with that. Mr. Sharp. A^^iat would be the position of the State administra- tion toward the governing of rates of this imported power, should that be consented to? Mr. CARiNroDY. As I said, the public service commission is the de- partment that deals with that. I have no authority to speak for them here. I do not know what their polic}^ woidd be. Mr. Sharp. Do you understand there would be competition be- tween the power imported and the power on this side of the line? Mr. Carmody. I am not prepared to speak on that subject. I do not want to be put in the position of expressing the views of an administration for which I have no authority to speak. Gen. Greene. You have stated that the power from Canada is lieinir transmitted two-thirds of the way across the State. Is your idea that a foreign corjioration transmits that power? Mr. Car^iody. It is transmitted from Canada, from a foreign country. I undertook to answer some questions here in regard to it. ^\liat i have tried to say is that the State of New York should have the right to regulate the transmission of that power across the State, and control the price of distribution. Gen. Greene. The State of New York has that right at this moment. The Chair:man. I think so — especially to regulate the price to con- sumers. Mr. Carmody. It would have, if the National Goveniment Gen. Greene. The power is transmitted two-thirds of the way across the State by a New York corporation. The corporation pays all the taxes which the present laws impose; it is subject at every point to the regulation of the public service coumiis-ion ; it has been before the public service commission in many matters and has always complied with its orders. Was there not a law. prior to the 328 PRESERVATION OF NIAGARA FAI.LS, passage of the Burton Act, which made it illegal to bring power from Canada ? Mr, Caraiody. There was not any law. I believe. These people were enjoj^ing that power on the Niagara River without asking any permission from the National Government at all. Mr. FosTEK. Is not this about the situation, with reference to this (juestion of the importation of electricity? You treat that as part of the foreign commerce over which Congress has control? Mr. Carmodv. Yes. Mr. Foster. That is. Congress has the sole power to regulate it? Mr. Carmody. Yes. Mr. Foster. Now, when that electricity cmce reaches the hands of the importer; that is. once reaches the consignee on your side of the line, then does not the authority <>f Congress absolutely cease, with- out any law ? Mr. Cakmouv. It certainly does. Mr. Foster. So that if a New York company imi)orts it from Canada, we have the right to regulate the importation of it, but just as soon as it reaches your New York company, then, without any law on the subject, our authority ceases. It is analogous, is it. not Mr. Car.^iody. The only diti'erence comes when you go further and undertake to say to the State of New York, as you have said to this power company, Avho shall have that privilege, then we say you are going beyond the powers of Congress, and you are invading the rights of the State. ]Mr. P^osi'TiR. My point is that it ceases to be foreign conunerce as soon as it reaches the hands of the consignee on your side. Mr. CAH:N[onY. "We should be permitted to regulate its transmis- sion. ]\Ir. Fos'iTCR. AVe can not take it away from you. Mr. Carmody. You may have no right to take it from us. but I {im arguing against your undertaking to do something here which you have not any power to do. Mr. Garner. I understood the Attorney General to contend the only reason why Congress should pass any law touching the question of the importation was because of the danger that a Canadian com- pany would bring across the power and deliver it in this country, and it being interstate commerce the State of New York would not have any control over it. Mr. Carmody. Yes. Mr. Foster. My point is that as so(m as it reaches the consignee in the State of New York we lose ccmtrol over it. unless it goes out- side the State of New York. It is analogous to this liciuor question that we have with us, like the poor are. always. Mr. Garner. To illustrate then, take a concrete proposition. Sup- pose a power company in Detroit. Mich., should undertake to carry power into New York, or a power comj^any in Canada should come across the line and take it into New York, it would be interstate traffic Avhich the State of New York could not reach, and therefoi-e it is necessary for Congress to turn over this ])Ower to j-egulate the prices and the conditions of interstate traffic in this power to the State of New York. The Chairman. General, have vou concluded? PKKSKHVATION OK NFAGAKA FAIJ^S. 329 Mr. Cai{:viod^-. That is nil I care to say, unless there are some other questions. Mr. Bkow >K of ^Minnesota. Simply to enforce attention to that which I assume to be a well-known fact, do you not understand that all the disti'il)utin:derfer. Are you associated in any way — that is, your company — with transmission of power to Windsor? ]\[r. Blackstock. No. Mv. Djfenderfer. That is another company? ]Mr. Blackstock. That is another company; yes, sir. We have no transmission. Our transmission is practically^ to Toronto. Mr. Difenderfer. Then you have no connection, have vou. with the Hydro-Electric Co.? Mr. Blackstock. None whatever. The Chairman. I understand Mr. Bowne desires to make a brief additional statement. We will hear him now. STATEMENT OF MILLARD F. BOWNE, REPRESENTING THE LAKE ERIE SANITARY CANAL CO. Two eminent engineers have stated that the diversion already made will not affect the beauty of the Falls. Maj. Charles Kellar,'of the Corps of Enginers, reports in one paragraph this : ■\^'bile the preceding conclu.sioii jis to the effect produced upou the Falls by the existing diversion is a statement of opinion based upon ascertained facts, the interest of justice seems to demand the further statement that in my opinion the damage already done, and that which may be anticipated from further diversion and from the impending fall in the level of I^ake Erie, may be largely, if not entirely, remedied by a submerged dam placed in the bed of the river immediately above the Horseshoe Falls. The dam as proposed and planned would serve to change the direction of the flow so as to increase the streams that feed the falls at Terrapin Point and at the Canadian shore. The decrease in the mighty volume that overflows the center of the apex of the horseshoe would not be noticeable. If built, the dam should be paid for by the interested power companies, but Canada and the United States should do the actual work under some form of international agreement. A very direct result of the construction of this submerged dam would be a diminution in the rate of recession of the apex of the horseshoe. This result is extremely desir- able. (P. 15, S. Doc. No. 105, Rept. of Maj. Charles Kellar.) The other engineer referred to as having a plan is the one con- nected as the chief engineer of our company, Isham Randolph, of Chicago, who was invited last year by President Taft to present his plan to the Canadian authorities, and that is to stretch two cables across from Goat Island to Canada above the Horseshoe Falls, and use these cables for transmission of reenforced concrete blocks, fas- tened together, immense, large, and heavy concrete blocks, and drop these blocks into the channel, into what is called the Chorwick above 332 PKESERVATIOM Oi" MAGAKA FALLS. Horseshoe Falls, where the recession is very dangerous and continues year by year and may result in irreat (laiiiatje. The dropping' of tliost^ blocks into the deepest part of the center of the Horseshoe Falls will diifuse tbe water to both sides toward the edge of the Falls and without aliecting the beauty of tlie center it will increase the beauty of the sides. As Mr. Randolph has said, and give even further amount of v^ater for commercial purposes Avithout affecting the beauty of the Falls. Now, those are a partial answer, if not complete answer, to the complaints of the civic association, which has maintained that there will be irreparable damage to the Falls. CLOSING SUMMARY BY ROME G. BROWN IN BEHALF OF THE NIAGARA FALLS POWER CO. AND CANADIAN NIAGARA CO. Mr. Chairman and gentlemen of the committee: After listening to Gen. Greene's admirable suunnary of the facts shown at this hearing and of his logical conclusions therefrom, I felt that little if anything could be added to emphasize the ju.stice of the i)osition which is here taken by the companies Avhich 1 represent. However, despite the indisputable facts which have been shown, soine of the questions which have been asked and quite a number of statements that have been made during the hearing, would indicate that there is still some misapprehension in regard to the attitude of these companies toward the questions which are before you. Let me, therefore, briefly sum- marize certain of the ])oints. The SiTLATiox of The Xia(;ara Falls Power Co. ThivS company has certain vested property rights by virtue of (1) its riparian ownership, (2) its grants by the next lower riparian owner, the hydraulic company, and (3) patents and grants from the ."^tate of New York, which State is ri])arian owner below, both it and the hydraulic compaiw, and which State also holds whatever sov- ereign interestvs there are of use or control in the waters of Niagara River upon the American side, subject only to the sovereign right of the Federal (rovernment to prevent uni'easonable interference w ith luivigation. These property rights, as clefinetl by the law and as described in the various grants referred to, include the right to take from the Niagara River above the Falls a quantity of water sufficient to make 200,000 horsepower and to discharge the same below the Falls by means of a tiumel passing by and through the lands of the two lower owners: that is, of the hydraulic compan}^ and of the lands of the State of New York u.sed for a park. These rights were ac- quired previous to the year 1900, and a plant had been constructed and put in operation, requiring them, as it now does, at least 10,000 cubic feet pei- second of water to operate the same on an economical basis, altiiough that quantity is not sufficient for its maximum ca- pacity. It was thus operating that plant for years before the passage of the Burton .\.ct in 1906, but since the passage of that act has drawn only ^.(H)0 cubic feet ])er second, submitting temporarily to the terms of that act until the treaty should be made, as contemplated by (hat act, adjusting between the two countries the matter of diversion. ]t claims to operate by virtue of its riparian rights, although permits PRESERVATION OF NIAGARA FALLS. 333 under the Burton Act luive been accepted and complied \vitli, relying upon the faith that its rights and equities would be recognized in the final adjustment of the matter under the terms of the treaty. The Treaty of 1U09 recognized the injustice of the restrictions of the Burton Act, as neither expedient nor necessary to preserve scenic grandeur, and as unjust and inequitable to this company, and fixed tlie limits of diversion at a quantity which would allow this company J, 400 cubic feet per second more and the hydraulic company 3,000 cubic feet per second more and thus allow each company to operate at its normal economical capacity of 10.000 cubic feet per second for this company and 9.500 for the hydraulic company. No other power plants exist on this side and none could be constructed for the purpose of utilizing the 4,400 cubic feet per second increase provided in the treaty over the 15.600 fixed by the Burton Act as the total diversion on this side, the additional quantity being too small to warrant the expense of an}' new plant. Tt has been assumed and stated in newspaper articles, in statements by representatives of the civic association, and even by a Senator of this Congress (in a statement made in public while these hearings were in progress), that this company is asking for an unreasonable increase in the amount of diversions allowed on this side with the intention of further installations in order to utilize such increase, and that its position here is one of a further " attack " upon the scenic grandeur of the Falls. You gentlemen who have heard the facts here know this is not true. The treaty fixes the total limits of diversion upon this side so as to forbid any further installations than had been nuule jirior to the Burton Act. Although this company claims the legal right to double its installation and to operate the same, it asks here only that the treaty limits be observed, and that thereby it may be enabled to operate economically its installation which had been installed and put in operation before the question of scenic grandeur Avas ever thought of in Congress. This company originally installed with particular respect for scenic grandeur and protected the land- scape and scenic beauty of the Falls, although at great expense and loss of head. The undisputed facts presented here show that the extra amount of diversion up to the treaty limits will not affect scenic grandeur nor an}' public interest. SITUATION OF THE CANADIAN NIAGARA PC AVER CO. Before the Burton Act was thought of, this company had installed and had in ojjeration a plant upon the Canadian side taking its Avater from the pool beloAv the upper crest, so that it could not possibly have any effect upon navigation. It also constructed Avith regard to scenic beauty. It acquired its riparian rights solely from the Canadian GoA'ernment, and as consideration therefor agreed to reserve one-half of its developed power for use in Canada when required. This com- pany, as the other tAvo Canadian iiiA'estors, Avere intended to bo pro- tected by the treaty of 1909, so far as consistent with the public in- terests invoh'ed in the question of senic grandeur, and therefore that treaty made the total limit of diversion upon the Canadian side 36,000 cubic feet per second, which was no more than sufficient to supply the demand of the three installations already made and pro- jected upon that side by those three companies. The limits of total 28305—12 22 334 PRESERVATION OF NIACARA FALLS. diversion upon both .sides liaving- been fixed by the treaty, the excuse for prohibition of importation to the American side ceased to exist; and therefore the treaty contained no such prohibition. This was a concession to. or rather proper adjustment with (ireat Britain in be- half of Canada to protect not only the public-interests of Canada but the interests of Canadian investors. It was an adjustment also ac- quiesced in by this country in makino- the treaty, because it was recoirnized to be for the public interest of this country, where indus- trial development had created a demand which would absorb all the power de\eloped upon this side and all the power that could be imported from Canada. This company, therefore, with the other Canadian companies, join with the distributinc; companies upon the American side, to denuuid that the "ati<)n : (2) That, althouirh the protection of scenic o:randeur is not within the proper scope of Federal legislation (for if it belongs to any sovereign power, in this case it belongs only to the State of New York), nevertheless the total diversions allowed l)y the treaty will not have any appreciable eli'ect U})on the scenic grandeur of the FalN. a.nd in any e\ent the extra 4.-t00 feet allowed by the treaty on the Ameri- can side can have no effect: and that, with artificial diversions so limited, the danger to scenic grandeur lies wholly in the effect of natural causes, like erosion, wdiich dangers, together with any Sj^ecii- lative injury by diversion, can be averted by artificial means: (r^) That the total diversion allowed on the Canadian side will surely and quickly be made and that over that matter Congress can have no control, and that any restriction or i:)rohibition ui)on impor- tation to this side is objectionable for the following reasons: {(() The entire diversion upon the Canadian side will surely be made within a short time, and a prohibition of importation will not help scenic grandeur or any other public interest: (b) The Ani' rican r.-rrket is ready and is now demanding all the power that can be imported beside all that can be developed on this side. The demand is increasing faster than the power can l)e fur- nished, even with free im[)ortation. AVith importation prohibited, industrial development stops upon this side and progi'ess upon the Canadian side. That one of the two cotnitries which first gets hold of the i)ower will keep it : {(') The cutting off of the supply which would exist otherwise than for prohibition or restriction tends to increase the price: {(/) The prohibition can not be sustained on the ground that it is a tariff regulation, for it is not a general ]n'ohil)ition. but a sixv ial and local one: PRESERVATION OF NIAGARA FALLS. 335 (6') It is reiMioiinnt to tlie si)irit and terms of the treaty of 1009 by which each country a<2:ree(l with the other that eacli misfht have the privileii'e of a certain limited diversion, with the American market in mind, and Canadian investments were made on the stren of the engineer ^vhich use the waters of Niagara River to drive the wheels of inchistry are even more spectacuhir than the cataract itself. " " * "After rushing tho turbine Avheels beneath these po^ver lioiises. developing a total of 110.000 horsepower, the water passes through a tminel a mile long under the city of Niagara Falls, and empties into the lower channel under the first steel bridge. Over 1.000 men were engaged continuously for more than three years in the construc- tion of this tunnel, which called for the removal of more than -500,000 tons of rock and the use of more than 10.000.000 bricks for lining. "As these power houses represent the first attemi)ts to ' harness " Niagara upon a big scale and embody the hitest achievements of elec- trical engineering, thej'^ are visited yearly by thonsands. and form one of the attractions of the Niagara regions. " It is in no small measure due to the energy, courage, and pers^^"- \erance of the directors of the Niagara Falls Power Co. and their associate engineers that Niagara P'alls owes its present importance as an industrial center. " Upon October 4. 1890. ground was l)roken at Niagara Falls, N. Y.. for the initial power installation of the Niagara Falls Power Co. The trial development was for 15.000 horsepower. At that time three small towns, with a combined population of less than 10,000. were contained in the limits of what is now the city of Niagara Falls. The assessed valuation of all three towns was about $7,000,000. Five years later the first electrical power from the initial installation was delivered commercially to the Pittsburgh Reduction Co. for the manu- facture of alununum. To-day. Ki years after the breaking of ground for the tunnel, the aggregate amount of power developed by the Niagara Falls Power Co. and its allied interest, the Canadian Niagara Power Co., is about 100,000 horsepower, with additional capacity in course of construction amounting to GO.OOO horsepower. Niagara Falls is now a city of almost :>0,000 inhabitants, with an assessed valuation amounting to over $!iO,000.000. Such in brief arc some of the residts accomi:)lished by the men and engineers who harnessed Niagara Falls. Less than 4 per cent of the total Hoav of Avater over Niagara Falls has been diverted by these coinpanies and its beauty and grandeur are unimpaired."' The establishment of the great works of the Niagara Falls Power Co., the pioneer not only in the establishment of great hydraulic iuid electrical niiits- but the first projector of extensive power trans- mission in America. In-ought forth the following conmient in the New York Tribune by Mr. Royal Cortisson. an art critic of the first rank: " P)eing utterly ignorant of these things. I won't conunit the imper- tinence of pretending to ai)preciate the genius embodied in those colossal fabrics. All I can tell you is that they made me feel as though I was looking on while s(mie unthinkable Olymjiian went gloriously mad, in a kind of divine frenzy, and expressetl himself in terms raising the art of the Fgyptian temples to a higher power, giving to things of overwhelming l)ulk an immeasurable life and ]Mirpose, and ^onlehow putting over them a glamour of the subtlest delicacv and charm. It was like a fairyland created for the pranks of the high gods. It was like a force of nature tamed and held by a silken thread. I won't say it was like the most wonderful thing ip the world. It is itself the most wonderful thing in the world." PRESERVATION OF NIAGARA FALLS. 343 THE CAMPAIGN OF SCARE. It is a sio-iiificant fact that duriuo- hearings extending over two Aveeks. given the widest i)ubli('ity. there ai)peared liefore this com- mittee only two persons who had any other snggesticm to make than that the fnll limitations as to diversion and as to importation, alknved by the treaty of 1!)0!) shonld be the basis of the proposed act of Con- gress. The first of these was Mr. Spencer, who claimed to be a pho- tographer and engineer, and who explained the extent of the natural erosions of the Horseshoe Falls, and who i)retended to state that the change in the appearance of the crest of those falls, which had devel- oped in the past 20 years, was due to artificial diversions of water for power. The value of his evidence, or lack of value, was shown by the fact that he claimed that the baring of the crest upon the Canadian side of the Horseshoe Falls which enabled the Canadian park conmiissioners in 1902 to fill in 250 feet of that crest line for . Smith, Congressman, Washington, D. C. Sir: Incloseil resolutions adopted at a general meeting of the board of trade, liold Tn<>sday, .Tannary 2P>, 1012. Yonrs, re.si)Gctfnily. Ciiari.ks Wooiuvard. Secret II rji. Resolved, That the board of trade of the city of Niagara Falls, N. Y., in meoling assembled, hereby favors ai. amendment to the Unrton Act. wliicli will allow the diversion of an additional 4,400 cubic feet of water per second from the Niagara River for power purposes. Re-.247,r)ij(). I!!.n-onue fi'om numicipal heat and i)o\ver, $S3,.")21. sr». Buff ah) General Electric Co. — Power generated, none. Power purchaseil, 3!»,0r)3J4(» k. w. h. I'ower purchased from the Cataract Power & Conduii Co., 38,521,720; and Niagara, Lockport & Ontario Power Co., 1,131,420. Gross price k. w. h. purchased, $312,430.97. K. w. h.' delivered to private consumers, 18,377,047. Two hundred and thirty-three thousand one hundred and forty- four k. w. h. sold for commercial flat rate lighting which is not included in this item, the net revenue from which is $13,849.53. Revenue from k. w. h. to private consumers, $848,509.12. Maximum load kilowatts. 9.430. Date when carried, November 3(t, 19J0. Dividends. !t>222,440. Four dividends during year of 1^ per cent on $3.724,0'chased from Canadian Power Co., Niagara Falls Power Co., and Toronto Power Co., 181,531.061, for a total gross lirice of $724,649.06. Total number of kilowatts sold, 177,296.138, for a revenue of $1,210,880.33; miscellaneous revenue, $1,049.76; total revenues. $1,211,930.09. Maximum peak load not shown. Total dividends during the year, two dividends of 3 per cent on $2,000,000 stock. Increase in surplus during the year, $40,994.22. Number of meters, 5.30 ; connected load. 80,000 e. h. p. Number of consumers, 454. Niagara Falls Power Co. — K. w. h. generated, 417,256.803; purchased, 77,705,- 292. Sold, 458.481,883, for a revenue of $1,290,912.66. and miscellaneous reve- nues of $74,179.95, making total revenues for the year. $1,365,092.61. Maximum load. 60,0u tor your jKninit to ti-ansuiit from Canada and to receive in the T'nited States electric power .generated in I'anada from the works of the Canadian Niagara Co., to an amonnt not less than that indicated in the rei)Ort of your engineer, Capt. C. W. Kntz. enlarged in accordance with the views of the American nienil>ers of the Internalional \Yaterways Conunission. T'nder the act of June 29. I'.MMj. adopted upon the report of the House Com- mittee on Rivers and Harbors, jiresented by i s chairman, Judg*- Rurtou. after protract(Ml In^arings and jiersonal inspe--tiou. yon were authorized to grant per- mits in the aggregate for the transmission of ;!."(). (KK) electric horseiiower from Canada, of tins :in>ouut the transmission of i;X>. eb'ctric horsci»ower is to be permitted after practical exjterieuce shall have demonstratt'd the effect uiK)ii Niagara Falls of transmitting 1()0,(MM) electric ht)rsepower from the Canadian side. Y'our engineer, Capt. Kwx. and the thre*^ couunissioners, who at the hearing before you on July 12. ll>0(i, were .justly termed by Mr. McFar- land.' "the very able governmental conunission which has lookeil into the physical details of this question."" have investigated the conditions and have submit. ed you their reports that your discretion may be exercised to the extent of now permitting transmissicm of 3 »>(>.()< 10 ele -trie horsepower, with i-onditional enlargement as staled by the American conuuissioners. Their calm, lucid, and imi)artia! report upon this point has sMrreil to opjjo- sition Mr. .T. Horace McFarland. president and spokesman of the American Civic Federation, some of whose extraordinary statements may well be considered at the outset, for if well founded tb.e alle.ga'ions of Mr. McFarl.ind would pre- clude any transndssion at all. At the hearing in .Tuly, ^Ir. McFarlaud referred to himself as a '" white black- berry," and as the "lone represeutatise (if the peoiile." Since then and since the rei)orts of your advisory officers b.e has '"gone to the couniry" with printed broadsides for the u(>wspapers, intended to induce letters and telegrams to you to overrule y(mr advisers, anil making allegations so violent and so inac- curate, that, as I suggested in July the source from which they emanate can not be regarded as strictly resiM»usible; that i.s, as feeling bound to substantiate them. This charge is material and proper for present consideration, for. If well fonndtMl, it nuisl relieve you from the necessity of giving serious attention to his heated appeal, or to "the flood of personal letters" thereby invited. Of course, the iturden is niurn me to supi>ort this charge of irrespon.sible and inac- curate assertion: for at the .July he.iring, referring lo Mr. McFarlaud's extreme statenuMits. 1 said that if the effect uiion Niagara were to be as serious a.s he an;icipates. I should be with him entirely. Therefore, it is due to the gravity of the interests involved that I should indicate some of the important errors of ^Ir. McFarland <1oing grave injustice to men not less honest than he. so Mi; MlSSTATK.\li:.N IS l!V MI',. M "l- .\ i:i..\ N D. 1. Mr. McFarland states that the Canadians already havt> cut off .")(Mi feet of the Horeshoe Falls "to acconunodate a jiower ci>nipauy." and ;igaiu "to give a better chance to one of the power com|>anies." This statement is .absolutely untrue, and upon .July 12. I'.Xm;. .Mr. McFarland was informed of th.-it whieh is the triuh, namely, that whatever was done in this particular was done by the order of the commissioners of the Queen Vic- toria Niagara Falls Park not for the i)urposes of any jiower company but for » In his excess of zeal in a cause wliicli in its intention is highly meritorious. Mi-. McKiirlaiMl lias marte attacl ex. S) : •• Tl'.e tilling in of the slion> line above the Falls bv excavated m.-iterial from the tunnels will increase the park area very considerably and will permit the roads and walks being constructed on the margin of the river, which will greatly improve the views of the upper rapids and at the same time cover the foreshore, which in some places has become exposed by the recession of the waters owing to the breaking away of the cataract." The arrangement here referred to by the commissioners was emiiodied in a plan delivered by the commissi(niei-s to the contractor, Mr. A. C. Douglass (now niayCivelopment. In pursuance of this purpose they have caused to be reclaimed an area which, measured along the crest line of the IToi-seshoe Falls, extends 400 feet, but at right angles to the original shore line only 175 feet, and this reclamation they deem to be for the public benefit. Of the 4t reclaimed loO feet had been reclaimed prior to 1S05. If. as usual. Mr. McFarland doulited the truth of any statement favorable to the power companies, it would have been easy for him to ascertain the facts fi'om the Canadian commissioners. But he has chosen to make a derogatory and untrue assertion, notwithstanding forewarning of its falsity, and thus has invited the renewal of the charge of irresponsibility, which now I nnist repeat. Since the foregoing was written the Canadian Niagara Power Co. has received from the Queen Victoria Niagara Falls Park commissioners the following letter, finally and utterly destroying the basis of Mr. McFarland's twice-repeated liitelous charge : (Ki !'^' Vrtoui.v Niagara F.vlls Park Commissioneks, Toronto, Xorriiibcr .>0. IHOii. Ca.xaui w N'tagara Powicb Co.. Xidffara Falls. Ontario. Dkau SiKS: Referring to the following statement contained in the pamphlet entith'articular. they actwl accsthetic 348 PBESERVATION OF NIAGARA FALLS. conditions of the Tlorscsluie Falls. :is wt'U as of the shore lino ;iiii>ro:u-Iies tliorcto. Belii-ve uie. yours, truly, J. W. I>anc:.\iuii?. ('hnlnntiii. 2. As to the siiuouut of water likely to be witlulr:i\vn. .Mr. McF:irlan«l makes the following extraordiuaiy misstatements:' (u) "A recent examination of the tailraces and channels intended to turn the water into the Niagara River after it has been used in the great turbine wheels of the existing Canadian plants, shows that their aggregate section is 68 by 72 feet. The velocity of water now beginning to rush through these vast channels is at least live times that of a rapidly flowing river. Is it likely the volume of water which will pass at Niagara siieed through a channel as wide as a city boulevard and as Electrical Development Co. ci-oss section, approximately 514 Ontario I'ower Co. tailrace, approximately 720 Total 1. 030 (h) Mr. McFarland further states: "Another comi>utation i*hov>'s that the water it is proposed to abstract on the Canadian side alone would make a rapidly flowing river 1,085 feet wide and 18 feet deep" — and in another place — " a rapidly running river nearly half a mile wide and IS feet deei)." The engineers of the Niagara Falls Power Co. advise me that this state- ment is even more wide of the truth than those already dissipated. The amount of water on both sides which under the temporary permits of the Secretary, and the report of Capt. Kutz, it is proposed now to abstract would be 20,kl0 feet per second.'' This volume of water, flowing out of a river IS feet deep and 1,085 feet wide, would make a "rapidly flowing river" only if this term, borrowed from Mr. McFarland, could be applied to a stream run- ning at the rate of less than half a mile an hour, which may be compare. Mann, refers to these statements as well as other statements of Mr. McFarland. deprecating an.v doubt of their truth. If. as now shown, the absolute error of these statements had been known to Dr. Mann and to the many oth(M-s who have been misled thereby, they could not have expressed themselves as they have done. - Present permits, American side, 8.600 + 4.000. Mr. McFarland's statement for 100.000 horsepower. Canadian side, 13,500. PRESERVATION OF NIAGARA FALLS. 349 " tlu' sdber (indiiii: of tho Aniericrni members of the Internatioiiiil Waterways t'diiiniissiiiii, rliat " the k'oI'.v of Niagara Falls lies in its volume of water rather than in its hei^'ht or in the suri-ounding scenery.'" B'.it. as stated by Mr. McFarlaud in his circular of November "», (his "is the very same body that has recommended to Secretary Taft to permit the admis- sion of 1(!0,rs to rely upon "recent visitors to the Falls." who " insist that there is already evident a substantial rerection of structures? " Mr. Bede. Vou can not detect it by sound either, can you? "Mr. Dow. No. sir. It is the fear of the future development that l)rings us here — what may l)e done. AVe are looking after this tremendous diversion." From this it appears that after Kit. 000 horsepower has been taken from the American side, the scenic effect is not visible even to the chairman of the New York Niagara Reservation. This Impressive fact becomes especially important In the consideration of the probable effect upon the Horseshoe Falls, over which, as Mr. Dow testified, there is a flow which in volume is nine times greater than that of the American Falls. It has been and is generally recognized that the draft on the Canadian side Is so far below the division of the river at (ioat Island that the draft proposed on the Canadian side would not sensibly affect the American Falls. This was the basis of my oral argument, addressed to the Secretary of War on November 2(). that — " This leads me to the conclusion, and I hope you may be led to the conclusion from an observation of the conditions, that it is practically demonstrated that l.".1.000 hor.sepower produces no appreciable diminution of the American Falls ; and inferentially, that .".">0,000 horsepower taken from the Canadian Falls, which is from six to ten times the capacity of the American Falls, and which draft, as stated by Prof. Clarke this morning, would not afl:ect the American Falls — I say that the Infei-ence which you are permitted to draw, and I believe you will draw, is that the withdrawal of ."550.000 horsepower would not affect the Canadian Falls any more than the withdrawal of i:?l,000 horsepower has affected the .American Falls, and which is not appreciable." 28305—12 23 350 PKESERVATIDX OF NIAGARA FALLS. :->. Mr. .Mcr'arlaiitl iiuiuiils liinisi'lf to iiuliiljie in the fnlhnviiiK iusinuiitioii, which is umvorlhy. aiul in its necessary implication is absolutely false. He says: '"It is reiunted that they are ready to deceive the authorities, for one of their engineers uii\vittin};Iy disclosed the fact last Julj" that preparations had been made to bring in 4(t.(Kt() horsepower and to expend it or wasie it throuirh a water rheostat, in order that (hey might claim and show by instrument that they are actually ti'ansniitting that cnornious amount of power."^ The reference here is to the ('anadian Xiairara Power Co., wlii<*h I represent. I appeal to the personal exiierii'iice of the Secivtary of War. or his engineer, Caiit. Kutz. and of the American members of th(> International Waterways Commission whether the conduct and bearing of the Canadian Niagara I'ower Co. and its otRoers have not been such as absolutely to refute the suggestion that it has been "ready to deceive the authorities." even though it were silly enf)Ugh to wish so to do. All of its works and records have been thrown open fully and cheerfully to all of the authorities. It would have been futile, as it would haM' been base, for the com|)any to make any false itretense that it was otherwise disposing of an amount of jjower that it was carrying only to waste in a water rheostat. Any such false jn-eteuse could not have survived insjiec- tion for five minutes. Howe\er. it is true, and it was i)erfectly legitimate, that upon the intrnduc- tion of (he Burton bill it was considered whether, in order to demonstrate the actual i)ro .:. tiiat the impairment of Niagara would not be so serious as anticipated by Mr. .McFarland; and. that if it were to be as scmIous as anticipated by him I should be with him entirely. (Record, p. 21.) And now I repeat as firmly and comprehensively as I can that I have nothing but respect for the sincere men and women who by api)eals, sometimes as incendiary and erroneous ;is those of Mr. McFarland and sometimes more temperate but not founded on investigation, have been stirred to anxiety lest the greatest natural wonder of northeastern America is to be destroyed or imiiaired. This .anxiety is praiseworthy, and, did I believe the peril were rwil. I should stand with those who feel and express this anxiety. If I believed that the pioneer companies I represent would have produced any such result. I would cheerfully fore.go every peiniy of possible profit rather than further the enterprise. But I do ni>t so believe, nor after tlieir exhaustive investigations did Judge Burton or his committee so believe, for otherwise they would not have reported the bill which invests you with your discretionary powers up to the limit fixetl bv the law under which we now are i)roceeiIing. PKESEEVATION OF NIAGARA FALLS. 351 The question is uot, as suggested by Mr. McFarliiud, oue as lo the folly of the Anici'lciui i)eople, but is one of fact — " Will or will not tlie Falls of Niagara be affecteil appreciably by the diversion or the transmission of the walers to the extent recommended by the American members of the International Waterways Commission?" This is the question .which to the extent of 850,000 lun-sepower from the Canadian Falls Congress decided to leave open for determination by you, and it is the question upon which you have chosen to take capable and pro- fessional advice from your captain of engineers and the American connnis- sioners. It is the question also concerning which the advice of these conunis- sioners as to the aggregate quantities that may be withdrawn is Die l)a.sis of our api>earauce before you to-day. 1( is an insult not only to the companies whose position he belies, but also to yourself, that Mr. McFarland should luive issued the misstatements of which he has been guilty. He has advised the American people that — " Kesolutions and petitions have little force, but a flood of persitnal letters will be effective. This flood should begin to drop in upon Secretary Taft at once and continue until November 15." ^ A ■• flood of personal letters," induced by such a cloud-compelling appeal, can have little weight with the Secretary, not even though the flood were to equal ■' the comI)ined outflow at their mouths of the Susquehanna. I'otomac. Hudson, Delaware, and James Rivers." This is a case in w'hich apparently Mr. :McFar- land has proceeded upon the second line of the Lincolnian canon, that you " may fool all of the people some of the time." Disi'egarding the statutory regulation of the Niagara Falls Power Co., which at its own suggestion limited its rights to 200,000 hoi-sepower, Mr. McFarland states that the iiower-developing companies were jierfectly satisfied to have all the water they wanted for nothing from the State of New York — and this in the face also of the fact tliat. as has been decided by the courts, the power companies upon the American side, being the riparian owners, received from the State of New York no right in Niagara waters to which they were not justly entitled by virtue of their riparian rights. Neither the State of New York nor the United States were the owners of the running waters as against the ri[)arian owners (Niagara Falls r. Smith, TO App. Div.. 543; 175 N. Y., 469; see also Sweet r. Syracuse. 120 N. Y.. 31t>-335; Niagara County, etc., Co. v. College Heights Co., Ill App. Div., 770.) 5. :Mr. McFarland states that— "Not content with getting free water from the United States" to produce profit-bearing power, the Niagara Falls power companies have introduced con- siderable water into their stock, it is said, which is free to those inside, but expensive to the public." This statement can refer to only two companies, the Schoelkopf company, which has a stock of only $500,000, of which no part has ever been sold to the public, and the Niagara Falls Power Co.. which has a capital stock of about $4.0,000. which has never sold above SO cents on the dollar, and which in the sixteenth year of its issue sells for only 50 cents on the dollar, although in the opinion of the comjiany it represents an investment fully equal to the par .'I mount of the stock. Mr. ]McFarland refers to the greed of these companies. The extent of that greed may be indicated by the fact stated by me at the July hearing, that for 15 years the Niagara Falls Power Co. has been contented to continue with a (asii investment of over $20,000,000, receiving only ordinary interest upon th^ 1 In Ilis tliirrt emorfrency call, dated Nov. Irt, Mr. McFarland reproduces his metaphor. .V literal response will inundate the war otTic(> until it becomes a bureau of rivers and harlinrs I Up says : " This second postponement gives further opportunity to strengthen the Niagara flood of protest and appeal which is heing turned toward the one man in America who can halt the commercial assault ujion oiu- greatest scenic glor.v." -This is an eiror. No couii)an.v has yet got free water fi-oni the Fniled States. Fuder the law (see authorities above recited), as against the Niagara Falls Power Co. and the Schoelkopf company, riparian owners, neither the Fnited States nor the State of Ni-w York owned the water of the river. The State of New York did own the lands under watei-. which it sold to these ui)lan breath condemn the riparian companies foi- making no i)ayment ti> the State. One answer is that, unlike the Province of Ontario, the State of New York neither sold or leased any upland to these companii's whose canals and tunnels were entirely on their own riparian uplands outside of the State reservation. 352 PRESERVATION OF NIAGARA FALLS. cash investment represented by its bonds, and witliout ;i dollar of dividend npon its very moderate stock, in which alone conld be found any opportunity for real profit. A corporation whose activities and enerjries ai-e directed to, and satisfied by. the return of ordinary interest, can not .justly be accused of screed. 6. Mr. McFarland refers to a newspaper publication of a plan of merger of the four power conii)anies of Niagara Falls, so as to create a monopoly, and asks: •"Should the United Slates protect this potential monopoly?" 'The suggestion of an intended monopoly is absolutely untrue in fact. Neither the Niagara Falls Power Co. nor its subsidiary, the Canadian Niagara Co.. has any iiresent intention of entering into a combination with any company. Against any monopoly, though intended, suliicient protection would be afforded b.v the provisions of each of their charters. 7. Mr. McFarland indiscriminately assails all of the jtower comi)anies, irre- spective of the fact upon which I dwelt at the July hearing^that the two pioneer companies, the Niagara Falls Power Co. and the Schoelkopf company, were ai)s<)lutely inunune against any charge that their operations would or could appreciabl.v diminish the volume of Niagara Falls. This fact was the snb.ject of examination and final report by the committee of the New York Constitutional Convention of 1894; the report, upon page 11. stating — "Two of them" (that is. the Niagara Falls Power Co. and the Schoelkopf company) "have expended large sums of mone.v. and are now oi)erating their respective i)lants, and the amount of water which they take will not do any appreciable in.iury to the Falls." At the Jul.v hearing, in answer to my question as to his view of the effect of the diversion by the Niagara Falls Power Co., Gen. Ernst replied: " If you were the only persons concerned, you would probably never have heard all this agitation." Upon this im])ressive recognition of our innocence of the charge of in.inrious assault upon Niagara Falls. I am content to rest. The report of the engineer, 1010. states that there has been no in.iury what- ever to the American Falls; and that of the in.iury to the Canadian Falls only an unknown part is due to diversion, the larger part being due to natural causes, the erosicm of the crest. THE COMPARATIVi: COST OF NIAGARA POWER. The Niagara Falls I'ower Co.. this pioneer in the development and establish- ment of great electrical central power houses and lines of ti'ansmission. has conferred an inestimable benefit on maid^ind. and in an especial degree upon the Niagara frontier, to which it is now delivering more than KiO.OOO horse- power at prices which, tliough misrepresented and ridiculed by Mr. McFarland. are readily accepted by hundreds of users, and this without compulsion: for if the Niagara power were not nicnv to their advantage than steam power devel- oped from coal, they would use steam power. The Niagara Falls Power Co. has published its schedule for standard 10-hour merer ))ower at a rate which offers a maxinumi use of 100 horsejmwer and an average use of 75 horsepower for a month of 250 hours, at an aggregate ])rice of $144.17. This compares with the following reported charges in six important northern cities: Boston $937.50 •Philadelphia .839.25 New York 699. 37 Chicago 629. 43 Cleveland 559.50 Rochester 419.62 Niagara Falls 144- 17 In the face of such figures, who can doubt the beneficent effect of the opera- tions of the Niagara Falls Power Co. furnishing power at not more than one- fourth of the cost in New York, Chicago, or Cleveland, and at less than one- fifth of the cost in either Boston or Philadelphia? Mr. McFarland's statement as to the cost of the public lighting in Buffalo, misleading as it is, has nothing to do with the case. Neither the Niagara I-^alls Power Co. nor its ally, the Cataract Power & Conduit Co., has any relation to or control over the public lighting in Buffalo. They merely sell and deliver electric current to the lighting company, the same as to any other customer over PRESEEVATION OF NTAGAEA FALLS. 358 whom they have no more control than the pain?!' seller has over the iniajjina- tions which Mr. McFarlamI imliscrhniiiately impresses upon his voluminous printed outjint. In great numbers, our customers have come to Niagara Falls, which at the heginuiiig of oiu* work was a country village with comparatively few industries until now it has become a prosperous city, the ninth in the State, in the volume of industrial products ajiproaching .$2<).0tX).(K)O per annum.' and this without apjireciahlt' diminution in the ajsparent volume of Niagara River, and with a steady in(r«>ase in the number of visitors, not only to the Falls but to our power houses as well. The moderate admission fees chargever is. is but the lure and symbol toward what can be willed and done.. Man lives to make — in the end he must make, for there will l»e nothing l(>ft for him to do. "And the woi'ld he will make — after a thousiuid years oj- so. " L at least, can forgive the loss of all the accidental, unmeaning beauty that is going for the sake of the beauty of tine order and intention that will come. I believe — jiassionately. as a doul)ting lover believes in his mistress — iu the future of mankind. And so to me it seems altogether well that all the froth ^ Bulletin ."i7 of tlie Census of Manufactures for 190.5. shows the following increases In fhp v.nlue of nianufnetured outjjut frotu 1900 to 190."> : Buffalo, from $126.156.8.39 to $172.11.5.101 : Niagara Falls, from $8,540,184 to |16,- 01.5.7.<<6 : Lockpoit. from .«.5..''..52.669 to $.5.807.908 : Rochester, from $59,668.95'.) to .i;S2,747.:UO : Svracuse, from $26,546,297 to $34,823,751. 354 PRESERVATION" OF XTAGARA FALLS. and hurry of Niagara at last, all of it. dying into hungi-y canals of intake, should rise again in light and power, hi ordered and equipped and proved and beautiful humanity, In cities and palaces and the emancipated souls and hearts of men * * *." Mr. AVells is not alone in his belief. Prof. "Walter Frewen Lord, of Durham College and of the University of Cambridge, has exi)res.sed himself as follows, as appears in the Toronto Mail and Empire, upon December 4, 1906 : " I went over the Niagara power plant at the Falls the other day. It was a revelation to me. The cataract was wonderful, of cctors of the Niagara Falls Power Co. and their associate engineers that Niagara Fa.lls owes its ])resent iniiiortance as an industrial center. " Fiion October 4. ISitK), ground was broken at Niagara Falls. N. Y.. for the initial power installation of the Niagara Falls I'ower Co. The trial develop- ment was for ir).(K10 horsepower. At that time, three small towns, with a com- bined population of less than 10,000. were contained within the limits of what is now the city of Niagara Falls. The assessed valuation of all three towns was about !f7,00(>.(tOO. Fi\e years later the first electrical power from the initial installation was delivered connnercially to the Pittsburgh Kediirtion Co. for the manufacture of aluminum. To-day. 10 ye;irs after the breaking of groiuid for the tmuiel, the aggregate amount of power develoi)ed by the Niagara Falls Power ("o. and its allied intt>rest. the C.anadian Niagara Power Co.. is about 100.(X)0 horsepower, with additional cai)acity in course of con- struction amotniting to 00.000 horsepower. Niagara Falls is now a city of almost HO.OOO inhabitants, with an assessed valuation amounting to over 1 The visitors linvo nnmlKM-cd manv thous.nnds, .nnd have included the wise and the vre.it of the earth. William jNIeKinlev's last si.unatur.-. an hour before the fatal shot at ISuftalo. was inscribed in our visitors' l)ook. .Vs already observed. Theodore Hoosevelt wrote his name there in ISOO. Li Hunt: Chanj: and Lord Kelvin, foremost in their widely sep- arated splieres. have been followed by vast processions throujch these power houses and have left their tribute of admiration also upon our books. PRESERVATION OF NIAGARA FALI^. 355 $20,000,000. Such in brief nre some of tlio results acoouiplished by tlie men !ind eiijjiueers who harnessed Niagara FalJs. Less than 4 per cent of the total flow of water over Niaijara Falls has been diverted l»y these coiui>auies, and its beauty and grandeur are uniiupaired." Till-: NIACAKA l-ALI.S I'OWKK CO. NOT A VANDAL. We readily accept the characteristically fine statement of President Koose- velt that Niagara Falls should be preserved " in all their beauty and majesty," and we rest confidently on the proposition already announced by us and elaborated at the July hearing that no use of Niagara waters ai.'complished or proposed by either or both of our two pioneer companies who have spent hundreds of thousands of dollars to secure the most appropriate architectural effects would diminish either the beauty or the majesty of Niagara. If there is to be any such injury, it will be because of the proceedings of later comers, whose plans originated and have developed subsequently to ours. For their actions, if injurious, our two power companies should not suffer. Those later comers inidonbtedly will be able to speak for themselves. They can not speak or act to the detriment of our prior riglits and the innocuous character of our separate and independent exercise of those prior riglits. They have filed briefs apparently in attempted diminution of our rights, although we had not in any way attacked them. We are forced now to an assertion not only of our rights but of our itriority of right even if necessary to the entire subordination and l)ossible exclusion of any beneficial enjoyment by them. Kecognition of the Niagara Falls Power Co. as the pioneer in elec-trical de- velopment has been made by many, but by no one more graciously or acceptably than by Cien. Greene, the representative of the Ontario company, in the fol- lowing language: " yir. Stetson claims that his company is the pioneer company in the develop- ment of Niagara power. We cheerfully concede this claim. By the brains and the courage of Mr. Stetson and his associates, at a time 10 years ago when the electrical science was far less developed than at present, and the hazard of the enterin-ises c-orrespoudingly greater, the utilization of so much of the iiower of Niagara as can be taken without in any way detracting from its sphere and glory as a scenic spectacle, was made possible; and I would like to add. if I may. that Mr. Stetson and his friends, as well as those associated with me in the Ontario Power Co., are the true friends of Niagara, and can be more safely trusted to preserve its beauty than the noisy advocates who occupied so much of your time yesterday with misleading statements." In the same interest, Mr. Cravath followed Gen. Greene, saying: " While ^Ir. Stetson has been a pioneer in the generation of power, we have been ihe pioneer in the long-dist;ince transmission of this power in the State of New York." Mr. Secretary, this question which is now before you, as I ai)i)reheud it, con- cerning the distribution of the amounts of power to be taken generally by the different comiianies upon the report of your engineer as to the aggregate amount of power to be taken b.v companies tvoux the Canadi.in side and transmitted to the United States, is different from the question of how much power can be taken in the aggregate from the Niagara Iviver on both sides. That is the ques- tion that I supposed was discussed and fully discussed before you last July at Niagara, when you had the great advantage of taking the evidence of your own senses as to what was occurring to the river as a whole. But unless I ujisappre- hend the scope and effect of the argtnnents this morning, and the scope and effect of the arguments and appeals that Mr. McFarland has addressed to the i)ublic. that question as to the effect upon the Niagara Itiver as a whole, which we supposetl was argued and settled, so far as argument was concerned, last Julj'. now h;is been brought up again, and thus we are cimipelled to turn our atten- tion again to that question, as to which I stated at the close of the argument last July we readily acquiesced in the statement and the wisdom of the state- ment of (he Secretary of War that those n)atters should be referred by him to his master — that is. to the American members of the International Waterways ('omnussion — and to the Board of Engineers of the Army for report; and we have nor come here with any idea of contesting that report upon the main sub- ject. But we are forced to take your lime for a few minutes concerning that branch of the question, because of the voluminous, and I might say, in some resixH'ts. venomous, attacks that have been made upon our positions. 356 PRESEKVATION OF NIAGAKA FALLS. Out of the voluuies of siieeeb that were uttered this morniug one stood out couspifuous for its knowledge of the facts, and I shall esteem it, always a privilege to have heard Prof. Clarke in his address. Such a speech as 'that, to whatever conclusion it leads, is a speech that fair-minded men should wel- come, and concerning which fair di.scn.ssion can be had; and with the highest respect to the emotions of some of the other gentlemen. I must resijectfully say that it is the only speech that I have heard since I have been here that requires consideration. Last July I took considerable time, as, !)efore this entire debate is closed I shall ask to take some time again, in asking .vour honor to discriminate between those who are using Niagara power. The i)ower that one man takes from the Niagara Kiver. an amount of power which is absolutely inappreciable in its effects upon the river, does not .iustly condemn that man or his investment to denunciation or destruction because of that wliicli may be done by others who come after. I have insistetl upon that Itefore. and I shall insist upon it again with all the force that I can command. I wish gratefully to acknowledge the contribution to that feature of Prof. Clarke. wh(un I never saw before, and of whom I never heard before except for his high official position, and whose statement in that particular in recognition of the Niagara Falls Power Co. was as entirel.v impartial as I believe it was effective. I'rof. Clarke uttered his sentiments with reference to nature, with reference to natural oI>jects. with reference to this particular natural object, in some respects the greatest of all natural ()l>.iects in the world, and certainly tihe greatest natural object in northeastern America, and he exi)ressed his interest in it and his love for it. He expressed his desire to )ierpctuate and to protect it, even, if left to himself, to the extent of going to the very point of prohibit- ing the use of any water of the Niagara River for inewiston. i-.ud to reestablish the primeval forests, it would be a sacrilege to permit mere industry to enter such a scene of beauty and sublime power. But the era in which that restoration is possible has i)assed away. We are dealing with the era of 1S7S. when, under tbe inliuence of Lord Dufferin. Governor General of Canada, and Lucius Uobinson. governor of the State of New York, an agreement was reached that upon each side of the river there should be a park reservation created and maintained severally by the two governments. That movement proceeded to fullilment. so that in 1SS6, through the results of taxation, there had been developed and established on the American side that jiark which now is a reservation maintained, at their own e.xpense. by the people of the State of New York. On the other side is a park which, as I understand it. was expressly declared shtiuld not bi- made a charge upon the people of the Province of Ontario. So the connuissioners of the Qiu>en Victm'ia Niagara Falls Park, for the creation, preservation, and maintenance of that park, have been obliged to seek revenues from the park itself. Thus, as suggested by Mr. Ely. on the two sides of the river you are dealing with two different (piestions. On the Canadian side you are dealing almost entirely with the Canadian or Provincial Governn\ent. The commissions that then sat on the tv.o sides of the river undertook in the exercise of their discretion to determine how much property it w, s desirable should be t.iken for the iireservation of the Falls. rpon the Americjiu side the State of New York had sold the American Falls jtnd (ioat Island, under a soldiers' grant of 1S12, which came into the possession of your pred(>cessor in that chair. (Jen. I'eter B. I'orter. The American Falls, having been sold to had lieen no such alienation by the Province of Ontario, as far as I understand, though there is ;! gentleman here who can answer as to that much better than I can. * The principal declared purpose of the Buzton l)ill is to i)reserve n;ivi;iation in tlie Ni.-iirnra Itiver where it is inip<>ssilile of navigation. Tlie only I)asis in the ronstitution of Federal intervention is tlie eoninieree elaiisiv This now is iuv<>ket4 to counteract what is termed "■ coninnTcialism," Thus tlu' eoiiinnTi-f elausi- is turned against itself. 358 PRESERVATIOX OF NIAGARA FALLS, At iill events, on each side of the river the t-onnnission exercise decision of Judge Childs in the case of Smith r. Hydraulic Co. (TO App. I>iv., 7Ao). which Mr. Itomer knows so well, and which was afHrmeeen estab- lished ])ecausc their ]»ronioters were unal»1e to obtain the power on the side of the T'nited States, was made in violent error as to the facts, certainly so far as ciM.icerns the Canadian Niagara Co. The Canadian concessions began as early as the American : and they began for the reason I have pointed out, that the Canadian commissioners were de- sirous of obtaining from the use of the park itself. Queen Victoria Niagai-a Falls Park, the means with which to sustain the park. And thereupon a pum- ber of Canadian gentlemen and Englishmen joined under the Canadian act in forming the association which possessed the Canadian right in the i>ark. That had been done entirely anterior to the incursion of the so-called vandals. Mr. D. O. Mills, Mr, J, Pierpont Morgan. Mr. Morris K. Jesup, myself, and others, who now are supposed to be lacking in interest in beauty and art. Before our incursion all this which I have descril)ed had been accomplished by law. and these properties were on the market. Somebody was going to develop them : and in 1SS7 or 3SS8 began the discussions which, in 1890, resulted in the present group of capitalists acquiring the Niagar.-i Falls Power Co. They never asked anything of the New York I'ark Connni-:sioners They had no occasion to aslc anything of them. They were not dealing with any property under control of the park connnissioners. They were dealing with property entirely above and outside the ]iark. This proceeding on the American side ran on for two years, wlien I was approac hcd personally by Col. Albert I). Shaw, formerly a Member of C(jngress. formerly counsel at Manchester, and formerly consul at Toronto, where he became interested in Canada. He said, " We are going on to build on the Canadian side unless you will buy our right." What did we do'? We bought the charter after it had been offered to us. We did not go and seek it. .Mr. Woodruff is entirely mistaken in sui)posing otherwise. We bought that charter, and then what did wc doV We let it lie dormant for nine years. If we had not thus imrchased. you would have had a Canadian development twice as large years ago. That shows how little eager or pressing we were for the purpose of interfering with the tlow of the Niagara. We come now to the year 1892. On our side we had sunk our shaft in October. 1890. By that date we had made engagements involving millions of money, when that gentleman, who has gone to his rest, and for whom I have a high respect for his niany services to the public, and at one time we were PRESERVATION OF XTAGAKA FALLS. 359 close friomls, Mr. Aiulvcw II. Green, who was .1 w.ilcbdog. if there ever was a watchdoiir. made the seventh annual report for the Niagara Falls Park Com- mission in whieli he made statements concerning our proposed work, which I will submit with my remarks.^ That is the first report that was made about 1 From Seventh Annual Report (pp. 11-12), Jan. 29, 1891 : •• The water power of the river is, however, soon to be made use of in a hij^hlj- re- markable and original way, under the direction of the Niagara Falls Power Co. This company is composed of prominent business men at Niagara Falls, and from the circular which they have recently issued the followiug information is derived : •■ Befiinnini; at the water level below the Falls a tunnel is to l)(> constructed 29 feet in height by 1.S feet in width. It will e.xtend through the solid rock underneath the village to the upper river at a point about ] mile above the Falls. From this point the tunnel is to continue parallel with the shore of the river IJ miles, at an average depth of 100 feet below ground, and about 400 feet distant from the navigable waters of the river, with which it is to be connected by means of surface conduits or canals, through which the water from the river is to enter and be drawn through the shafts and wheel pits in to the gi'eat tunnel below. The water will fall upon turbine wheels in the pits, and the power developed thereby will be brought to the surface and delivered to mills or factories, or be transmitted by cable, pneumatic tube, or electricity to other points. The company has purchased about 1,300 acres of land near the reservation. This land will be used for mill sites and dwellings for operatives. " By the act of incorporation the power granted to the company by the State ' shall not in any sense be construed as permission to cross, intersect, or Infringe upon any part of the lands of the State reservation at Niagara.' "A communication from the State engineei- and surveyor concerning the effect upon the American Fall of the diversion of a large amount of water of the river into the proposed tunnel, is appended to this report." The State engineer's report was as follows : I Letter from John Bogart, State Engineer and Surveyor, as to the division of wali-r near Niagara Falls. State of New York.] Office of the St.\tk Exuinekr and Slrveyok, Albany, N. Y., December J, IS90. lion. A.XPUKW II. (iUEKX, Presithnt of the ComDiissionrrs of iJic 8t(ite Reserration at Niaffara. De.vu Sir : In accordance with your request I have considered the question of the effect upon the American Falls of the diversion of the water which may be taken by the tunnel now being constructed at Niagara. I have visited the Falls and the point where it is proposed to take the water from tlic river by a canal, this water afterwards passing through wheel pits to the tunnel referr(>d to. The entrance to the river from this canal is in the navigable part of the river about 1. ."-!(> miles above the Falls and 1 mile above the head of Goat Island. It is about half a mile above the entrance to the jiresent hy- draulic canal and entirely above the rapids. In my opinion the water taken into a canal at that point will not affect the American Falls specially, because the regular regimen of the river will become reestablished before reaching the head of Goat Island where the currents to the American and to the Horseshoe Falls divide. The effect of the water flovping into this canal will therefore be distributed over the whole river, and will not at all be confined to one section of it. What this effect will be depends upon the relation of the volume of water taken into this canal to the volume of water flowing in the river. The amount of flow over the falls has been variously estimated in ])ast years, bur in ]8(j8 the volume was measured by the Corps of Engineers of the United States .\rmy in connection with the survey of the (ireat Lakes. The flow thus determined varies from 27.">..">2y cuhic feet per second to 280,757 cubic feet per second. It will, I think, be proper to call this 275.000 cubic feet per second, or 16,500,000 cubic feet per minute. The amount that can be taken by the tunnel now under construction, if developed to its full capacity, may be 10,000 cubic feet i^er second. This is .S.64 per cent of the whole flow. Tiie actual depth of tlie water at the crest of the Falls can now be accurately observed, except near the sides of the F:ills. The depth varies considerably at different points on the ci-est. A calculation based upon the observed facts gives 6.22 feet (or feet 2g inches) as an aiiproximate mean depth of water a very short distance (less than 10 feet) above the edge or crest of the Falls when the present mean volume of water is pass- ing over: and O.O" feet (or 6 feet and four-fifths of an inch) as the depth at the same point wh(>n the volume shall be reduced by the amount that can be taken by the tunnel referred to. 1'iierefore. the depth of water along Hie whole Falls, lust above the crest, may be re- duced 1;.* inches by the diversion of water into the tunnel. From the operation of a well-known hydraulic law tlie depth of water directly over the crest will be somewhat less, the velocity being gr(>ater : but the decrease of depth at that point, by the diversion of tlie water, would also l)e less. It might be suggested that, as the proposed tunnel may divert :i.64 per cent of the total volume of water, the dejitli at the I'alls would be decreased by the same i)ercentage ; that is. .■■..(•.4 per cent of 6.22 feet, which would give a decrease "of 2.7 inches. But. in fact, the decreased voluni(> will give a decreased velocity, and therefore a greater rela- tive depth at the crest. I therefore think that 1* inches is the probable amount of the mean reduction in depth at the Falls to be caused by the tunnel diversion. In conclusion, it is mv opinion that the amount of water that can l)e taken through this tunnel will not affect the depth of water tlcwin-r over the Falls to an extent that will he visible. \'ery respectfully. Johx Bog.art, State Engineer ami Surri ii<,r. 380 PRESERVATION OF >,'IAG.VRA FALLS, our work aud it was oublislied by way not of coudemuation but comniendatiou. lu the report of that coiuuiission for 1800, submitted to the legislature January 29. 1801. you will find it stated that a liitrhly roiiiarkable and original develop- ment of power was about to be made by the prominent business men at Niagara I'alJs. We understood that Mr. Green and his associates considered this to be an interesting and desirable undertaking. AVe had no word or suggi'stion ot oiU'OsiLiou from them or from anyone else luitil long after we had c(;mmitted ourselves publicly to our undertaking, beginning work iu October. 1800. The report for 1891 called attention to the diminution of the water in the Niagara Kiver. You will find it in the Eightli Annual Report. 1891, sub- mitted to the legislature January 29. 1S92.' I shall submit it with my argu- ment. It called attention to the low water in Niagara Kiver, and to the incep- tion and progress of the works, and it left it to the public to infer whether or not those works were the cause (tf tliis low water. That shows t)'e inconse- quence of mere impressions. That low water, tlnit now we hear so nuuh about, was connnented ujion in the report for isoi. which was three years before our tunnel was bored through. That goes to show how even most intimate and forcible observers may be misled. The complaint of the efiect upon the Niagara River was m.ule three years bef< re our tunnel was bored through, and from persona] observation I may say the water then was lower than it is now — and for a series of years it had been lower. Secretary Taft. Was there not a company before yours taking out water'.- Mr. Stktson. Pardon me. I sjteak to what was actually done by those connected with the pioneer electrical development. Here was no assault by those gentlemen, who have been sarcastically called " our grand dukes," upon the rights of the 'From Ei;:hth Anunal Koport. .liin. •_•!>. IsOi'. p. Sit. Accordiiiii to stateiiienls i-eccnily maral feet, so that it has at times been difficult for the steamboat Maid nf Ihe Mixt to effect a landing at the dock near the foot of the Inclined Railway Huildin.g. The Maid of the Mist .Vssociation has petitioned the commmissioners for permission to extend its dock, in order that landings may he made at any time. There can he no doubt that Ihis extension is necessary with the rivei' at its present level. Till' commissioners are unable to state with any accuracy the cause of the low water. But the commissioners deem it advisable to sng.gest that the h>gislature scrutinize with great care ;ind even refus(> t;) enact .-ill bills the obji-ct of which is the utilization of tiie water jiower of the river above the Falls for manufacturing and other purposes. The I'^alls themselves, being within the limits of the reservation, are no doubt secure from successful attack, but hardly a session ))asses without the introduction of one or more bills in Ihe interest of companies organi7,(>d for the purpose of utilizing the water power of the Niagara River, with the sanction of the legislature. The commissioners do not mean to imply that these undertakings are necessarily without merit: but. without relleclion on i)ast .-ictlon. it is undeniable that if the legis- lature shall continue to authorize (li\ersions of the water of the river the volume at the Falls will constantly diminish, and the level of the river, both above and below the I'alls. necessarily sink. PEESERVATTOX OF NIAGARA FALLS. 361 public at Xiasara. On the American side what was done was ])ro.iected l)y citi- zens of Xia.trara Falls who owned the ri])arian lands. On the Canadian side the project was authorized by the Goveriunent itself, in order to create and maintain the Canadian Park. That is the orisrin of the two pioneer corporations for whicii I speak, and which were endeavoring not to injure but to perve the public in a new and vastly important way. What then did we do? We made an investigation — all of us did — earnestly, to see whether there could be a possii)le effect upon the Falls by reason of our taking up this first object on the American side, and we reached the conclusion to which I will refer again hereafter, that there would not. Rut we let the Canadian side rest in order to demonstrate just what our American action might effect, that we might proceed with safet.v. We intended, tiien. and always we intended, to preserve the integrity of the Falls in all their sublimity. Well, the laws haA ing been passed, and we having acquired the rights under the laws which we did not originate, we undertook to have what was the best possible wa.v of making the development, which should be consonant and consistent with the splendid features of this great natural object. I will not detain your honor at len.irth as to that, but will state simply that we went abroad: that we offered prizes throughout Euroiie amounting to $30,000; that personally I made a trip over Europe to look at all the methods of power development: that we consulted Lord Kelvin, Prof. Willian.i Caw- thorne Unwin, Col. Theodore Turrettini, and Prof. Mascart. of Europe, and Dr. Sellers, of this country, and we adopted their recommendations. V>'lien Prof. Clarke said this morning that it was our sin that we did not use but one-tliinl of the power we might have from the water taken by us. I would respectfully repl.v that it is not our sin. If the loss be such, then it is our terrible misf(n'tune. Distinguished ]>rofessional gentlemen advised us what to do, and we knew of no better or higher authority in the world. We took their advice and followed it : and if we could get back to that date most gladl.v would w© give Prof. Clarke $500,000 for the formula that would s-ive that other two- thirds that he thinks that we are losing.' I^iast summer, at Niagara Falls, Mr. McFarland made an assault indiscrimi- nately, upon the looks of things, and I asked him if he would come to our plant. He went with me, and as he stood in our powerhouse he could not have the face to stand up against that most beautiful installation that had ever been conceived and say that it was such as justified his remarks. No: he said. " You know you are a lawyer, and you know when you are making an argument you can not weaken it l\v distinctions " — and so he did not distinguish between us. He just said, indiscriminately, that we were all in that condition. Now, we have advanced through five years from the beginning. On the 1st of June. 1895. our wheels began to turn, and they have been turning continuously and increasingly from that time to this, until, as your honor has observed, we have brought out from the Niagara Falls Power Co.'s electrical plant the out- put, in round numbers, of 85.000 horsepower: and in the h.vdraulic plant, con- verted into horsepower, we have substantially, in round numbers. 8.000 more, making 01.000 horsepower: and I believe, though I am subject to correction, that Mr. Romer's company is producing thirty or forty thousand. Mr. Roi[ER. Forty thousand horsepower. Mr. Stetson. There you have the result, 131,000 horsepower on the American side, which, as yon found this morning, is from an eighth to a ninth of the Canadian side in volume. That is what is in operation now. It is not a question of what is going to be. It is not a question of whether, when you look in the glass to-day you see you are a day younger and more beautiful than you were yesterday. It is a ques- tion of what has been the effect of turmoil and tedium and resistance to assaults for about 16 years. That is the phase that to-day is exhibited and illustrated when you look at what now is the effect of the withdrawal of 131,000 horsepower from the American side, which is one-sixth or one-ninth of the Canadian side. Now. Mr. Secretary, it has been my great privilege and pleasure to listen to your decisions for many years, and sometimes to hope to influence them. Here is a case in which I can not hope to influence your decision, but there 1 ]n ISOO no .Vnioricnn m.inufnfturer w.-is willinjr to tendpr either a turbine or a dynamo of more than .500 hor.sepower capacit.v. We led the wa.v first to 5,000 horse- power, and now to 10.000 hor.sepower turbines and d.vnamos. This was an oxperioment involving coverage and resulting in great benefit to mankind. The story was told fully in Cassier's Magazine, "Niagara Tower Number." .July. 189.5. 362 PRESEr.VATIOX OF ^-lACiAUA FALLS. has been a mightier advocate than I. That river which, unlilve the Nia.i|:ara flood admitted by Mr. McFarland into some one of these rooms, thunders its cataract over the Falls, spoke to you on the 12th day of July last. You stood in front of it and you looked at it. and if you had ever seen it before I would defy even your acumen to detect a difference in its flow from the time when you first saw it. before there were any mills there at all. I have watched it for 20 years. Our judgment may be biased. That is all right. Charge us with bias : we may be wrong about that. P»ut we insist that our .iudgment is as good as that of the gentlemen to whom ^rr. McFarland has reiferred when he says " Recent visitors at Niagara Falls report that." Well, we are not " recent visitors at Niagara Falls who report that." We are people who have lived at Niagjira Falls. We are the people who have done more in a day to attract attention to Niagara Falls than even the output from Harrisburg. The world has been interested in Niagara Falls as it never was before. The Falls, as Gen. Ernst says, are not conspicuous for their height. The falls in Labrador are higher; the Znmbesi Falls in South Africa, and the falls in Norway are higher. Why is it that the people are interested in Niagara FallsV It is because, to use a classic expression, they are "in our midst"; it is because we have invested, and for those who are to come after us we have invested them witli human interest, and that I say, with great respect, is quite equal to beauty and to scenic interest. When yon have got away from the contrary delusion jou realize that what we and others have done has been an addition, a vast addi- tion, to human interest, and I defy you or any man who can speak the language of truth, and keep within the bounds of truth, to say he can detect a differenc^e, visuall.v. I do not quite understand the report of Gen. Ernst when he says " appreciably affect the Falls." Neither last summer, now, or at any time could I willingly be dravrn into any statement which seemed to conflict with Gen. Ernst; but I can not believe that when he says "appreciable" he means ni)preciated by the e3'e. When we are talking about scenic grandeur and beauty we refer to the eye oDly. and referring to that organ. I defy anyone truthfully to say that he can detect tlie difference belween the American Falls as they are to-day, with 13] .000 liorsei>ower sul>tracted. and what thej- were 30 years ago, when less than 10,000 horsepower was being subtracted.' TJial, then, leads me to the conclusion — and 1 hoi^e you may be led to the conclusion from an observation of the conditions— that it is pi-actically demon- strated that the development of 131,000 horsepower produces no ap])reci{ib]e diminution of the American Falls, and. inferentially, that 350,!X)0 hor.sepower tnken from'the Canadian side, winch is from G to 10 times the capacity of the American side and which, as stated by Prof. Clarice this morning, would not affect the American side— I say the inference which you are permitted to draw, and which I belie\e you will draw, is that the withdrawal of 350,0t)0 hols«^ [lower would not affect the Canadian Falls more than the 131,000 horsepower ii;is nffccted the American Falls. riUOK AND VREFERENTIAL RIGUT OF CANADIAN NI.\(iAR\ CO. In their report the American couunissioners say that Capt. Kutz concludes "that ihere is no sutficient reascm for discrimination between tlie Canadian companies except their relative ability to command the Canadian market." In reiiching this conclusion Capt. Kutz. as a hiyman. naturally enough has failed to take into account the consideration to which in equity our Canadian company is entitled as the prior appropriator and licenste of the water. We annex an Appendix A, showing that at all times our prior and superior rights have been recognized by the Queen Victoria Niagara Falls Park Commission, and perforce by each of the other companies now claiming their subordinate rights. Under the established rules concerning water comses and rii^arian rights, if by a iihysicfil convulsion the waters of the upper Ni:igara River were to be carried into the Aiuerican channel so as to leave available for use on the Canadian side only 100.000 horsepower, our company in equity would bf en- titled to the whole of that power though the two junior lessees were to go dry. Corresiiondingly. if by the act of law flow of the river available for i)ower transmission to the I'nited States is to be reduced to 160.000 horsepower, tlien our jimiors should first sufl'er reduction for this purpose to 39,000 horsepower, 'This also is tlie view of t'liairman Dow and of Dr. nalloctc. quoted at lenjrth above. PRESERVATION OF NIAGARA FALLS. 363 for tliey are not entitled to consideration to tlie detriment of our prior riiilit to 121,tt00 horsei>o\ver for any and all purposes. The three successive rights of the three principal lessees must in equity be reducf^d. if at all, in the hiverse order of alienation by the Canadian authorities. I make no reference to the International Railway Co., whose rights we do not discuss. Another ground ujion which we base our claim to preferential consideration is the comprehensiv',' purpose (*f the act of Congress of June 2!». 1900. The obivct of this act is to preserve Niagara Falls in their entirely, not the Canadi.an Falls alone, nor the American Falls alone, but the entire natural wonder for the gratification not of Cana.da alone or of America alone, but for all mankind. \Vith this generous purpose I heartily sympathize, provided that it shall be accomplished as it can be accomplished with .just regard to himest rights in the order of their priorities. In this compreheiisive view of the sub.lect it is to be considered that the two companies now reju'esented by me are substan- tiall.v one and that their developments have been and are mutually interde- pendent. For this reasou we have not resorted to the semblance of a contract between them. Thus considered, it will become evident that the Niagara Falls Power Co. is suffering more than any other company, for it has been forbidden to i)roceed under its charter right to construct in New York a second tunnel for lOO.OOO horsepower, for which it has acquired its right of way and has made large expenditures. It is also hindered from proceeding under the charter right of the Canadian Niagara Co. to complete the second half of its wheel pit, filrcidy excavated, for the erection of six 11,000 electric horsepower tnrVtines and dynamos. As the greatest sufferers, we submit that nothing slionld be conceded to our .iuniors because of their lesser and inferior deprivations. THE OXTAIIIO CO.'S POSITION. The Ontario Power Co., in its printed memorandum, has submitted certain claims for special consideration, to which, in our view, it is not entitled. (>i) The claim of the Ontario Co. to special consideration on the ground that it uses the water more economically than any other company is not ac- cepted by Capt. Kutz (p. 13, clause 27). It may not be irrelevant also to suggej-t that as this economy is due to the construction of a power house directly and conspicuously in front of the Falls, it is unlikely to be regarded as a merit'by those who are seeking to protect and preserve the scenic grandeur of Niagara. The construction of this power house directly in Niagara Gorge was the sub.iect of timely and vigorous protest by Mr. Andrew H. Creen and his associate commissioners to the Canadian commissioners, as fully considered in their seventeenth report at page 9. (ft) The suggestion that the Ontario Co. is entitled to special consideration because it is payiug twice as much rent as any other company is inconqilete. It should have been addeil that for each of its grants each of the three Can- adian companies pays the same initial rent of $15,000. The Ontario Co. has two grants, of which one is upon the Wetland River, which it does not now choose to use, but which it is at liberty to use. After the rents, covering 40,000 electric horsepower, each of the three companies is to pay exactly the same rent for all of its power. Upon the sale of 40,000 electric horsepower two of the com- l)anies will pay $37,500 and tlie Ontario Co. will pay $47,500. As the Ontario Co. asserts that it has contracted to sell more than 40,000 horsepower it wouhl seeuras though now its rental will be not materially more than that of the other two .companies. If the amount of rental is of consequence, the Canadian Niagara Co., which has been paying rent since 1892 — eight years longer than any other company — clearly is specially entitled to consideration. These payments up to 190(; are shown as follows by the commissioners' reports (19th, p. 11; 20th, p. 16) : Canadian Niagara Co $239, 577. 73 Ontario Power Co 140. 000. 00 Electrical Development Co 37.500.00 id) The plant investment in August. 1906. of the Ontario Co. ])roper ( $5,.>42.000) is not greater, but is less than that of the Canadian Niagara Co. ($('. 2ri(K(MM)). (See Capt. Kutz's reimrt. p. 7, clause 7: p. 10. clause 16.) The additional expenditures by the Ontario Co.'s customer — the Niag.ira. Lockport & Ontario Co. — are insiguiticant compared with those of the Canadian Niagara Co.'s principal — the Niagara Falls Power Co. — and its subsidiary companies in Niagara, Tonawanda, and Buffalo, with their four transmission 364 PRESERVATKIX OF XIAGAEA FALL8. lines, and the many customers all exhibited to Capt. Kutz. The actual invest- ment on the faith of this development of the Canadian Niagara Co. has been and is more than that of all the other Canadian companies and their subsidiary companies combined. ((•) The prospect of service rendered or to be rendered by tlie Ontario ti-ans- mission line is highly colored l)y hope, as shown by the cold facts arrayed by Capt. Kutz in section 10 of his report. Prooeedinic from a present actual delivery tif 700 liorsepower and a present firm contract for only 14.240 horsepower, the Ontario Co. deludes itself into the plea that it is to be considereockport «& Ontario Co.. and on pjige 2 of the brief of the Ontario Co.. and stated also on page 11. paragraph 20. in Ca[)t. Kutz's report, as the electrical load of the "combined comi'.anies" (The N. F. P. Co. and C. N. P. Co.) must be added, aijproxlmately S,.")tM) horse[)ower, the amount of the Niagara Falls Power Co.'s hydraulic load delivered to the International Paper Co.. and not converted into the form of electricity As a matter of fact, Capt. Kutz somewhat underestimated the n)axinium electrical load of the combined companies. During the winter of IDO.VO, it was substantially 00,000 electric horsepower. Adding 8,500 horsepower hydraulic, we have, at that time, a combined load closely approximating lOO.WK) horsepower. (See Appendix C.) With the adequate i>rovisions for reserve and for necessary rejiairs. in prac- tice and under present conditions, the American electrical plant working to its capacity can not be relied upon for S5,(X)0 horsepower. The printed statement made by the Nia.gara Falls Power Co., and submitted to Capt. Kutz. under date of July 27, lOCMJ, gives the i)ower contracts of that conii)any in detail, and shows an aggregate of 107,740 horsepower subject to call thereunder on the American side. The originals of these contracts also were all submitted to Capt. Kutz, and those for larger amounts of power were gone over in detail by him and by his associate. Mr. Faust, of the Department of Justice. The printed statement of the same (Niagara Falls I'ower) com- pany to the Secretary of War. dated July 3. lOfK), gives the amount called or in use under eac-h of these contracts. This amount then aggregated 102,550 electric horsepower. Since that time several power consmners have increasoil or called for additional power in a considerable amount — notably the Niagara Electro-Chemical Co. which is now instiilliug additional electrical apparatus to use up to a maximum of 4,500 electric horsepower; The Pittsburgh Keduc- lAs may be seen by reference to Census Bulletin 57 nlie.idy quoted, the value of manu- factured products In 1905 was as follows: Buffalo $172, 115,100 Niagara 16, 915, 786 $189, 0:50, 880 Rochester 82, 747, 370 Syracuse S4, 823, 751 Lockport 5, 807, 908 123. 378, 959 312.409, 845 Tlie lighting and transportation requirements keep pace with the manufacturing conditions. PRESERVATION Or NIA(iAKA FALLS. 365 lion Co. to use up to a niaxiuiuni uf ai)i)r(jxiui;Uely lU.OUU liorseiiowcr, and tlie Union Carbide Co. up to 25.000 li()r.se])ower. The Cataract Power & Conduit Co.^ the Buffalo distrilniting a.uent of the cdinbiued couipauies, ah-ojuly during the present month has called ui)on our eombiued companies to provide at their po\A-er houses, a maximum whicli with the Tonawanda demand will call for 40.(K)0 electric horsepower, and durinj^ the month of December will require pro- vision, at the power plants, of not less than 5,000 electric horsepower in addi- tion to the amount last mentioned. The amount of 25,000 electric horsepower which the Canadian Niagara Co. is transmitting under the provisions of its temporary i)ermit has been barely suthcient to supply the pressing demands of the present use of our combined companies. Except for the fact that on account of unexpected dilttculties in construction and in crossing certain properties with its cables, the Canadian company was delayed, the entire amoiuit of the present temporary permit ah'eady would have been used in Buffalo alone, in which case the American company would not have been able to supply the present enlarged demand ou its own lands in the city of Niagara Falls, N. Y. It is true, as stated in the memorandum of the Niagara, Lockport «& Ontario Co., that our original application for 121,500 horsepower is for an amount which, in the opinion of Capt. Kutz, exceeds by 500 horsepower the present capacity of the plant, which he states "were designed for the production of 121,000 horsepower " ; that is, 11 units each of a capacity of 11.000 horse- power. His deduction of one of the units as a spare, so as to put the company on the same basis with the other two Canadian companies, disregards the fact that in the case of our company reserve will be provided by the Niagara Falls Power Co. on the American side; and therefore our original application should have been not for 121,500 horsepower, but for 121,000 horsepower, which, as stated in Capt. Kutz's report, is the ultimate full capacity of our Canadian plant. When the installation of the electrical machinery above referred to is com- pleted, the combined companies, at times of maximum load, will require the entire available output of both the American and Canadian plants in order to supply the power demands now under contract. THE t'I..\IMS OF THK TWO TKANSMISSION COMPANIES. To the separate claims of the two transmission companies, the Niagara, Locki»ort & Ontario Co. and the Niagara Falls Electrical Transmission Co., we consider it unnecessary to make separate reply, for their claims are merely in support of their several principal companies in Canada. With reference to the Niagara Falls Electrical Transmission Co., it does not appear that it is legally authorized "both for diversion and transmission" so ;is to come within the scope of the second section of the act. THE cr.AlM OK THE ELKCTRICAE DEVELOPMENT CO. The claim of the Electrical Development Co. for equality of treatment does not seem to us unreasonable if disiiosed upon the basis of priority of the three companies in the order of their establishment. In other words, we would not deny that in fairness each of the three com- panies should be permitted to transmit to the extent of its capacity as de- velojted or really in course of bona fide development prior to congressional action. But if it shall become necessary to limit the exercise of these rights, then, equitably, the discrimination should be inversely in the order of priority. CONCERNING INTERNATIONAL TREATY. Mr. McFarlaud rests his two •emergency" calls particularly upon the propositions, first, that congressional legislation will prove ineffectual unless supplemented by an international treaty; and, secondly, that " contidential advices from the Slate Department at Washington indicate the improbability of success in negotiations with Canada for the treaty unless the United State's shows a real desire to preserve the Falls." Thereupon Mr. McP'arland proceeds to make the following statements: (a) "The United States is now in a position to either save or ruin Niagara Falls. If Ave freely admit all the electricity the Canadian companies want to send in, wo divert the water from the Falls as directly as If we had control of 28305—12 24 366 PRESKHVATIOX Ol' NTAGARA FALLS. the Caiiiidiaii fioiuicr. If (lie United States denies admission to this iiower it will not be in-'iduced, and the glory of Niagara will continue." (6) ■• Insist respectfully that he (Secretary Taft) refuse to aduiit any power from Canada not now being admitted. l)ecause in so refusing he will be pre- veJiting the depletion of N'iagara." It is hardly conceivable that the author of these two sentences above quoted could have seriously considei-ed their etfeet upon an effort to promote an inter- national treaty, which must be written, if at all. with the free will of Canada. How could he. or those who think with him, possibly expect that the friends of Canada would concede a treaty to those who by indirection and through Ameri- can authorities are virtually proposing in this particular to accomplish the "control of the Canadian frontier'"? The fair disposition of the Canadian authorities is plainly shown in the unanimous conclusion of the members of the International AVaterways Commis- sion, both of the United States and of Canada, as embodied in the report of May 3, 190U, transmitttil to Congress by President Iioosevelt under the date of May 7, 19<)G. (See jtamphlet entitled "Preservation of Niagara Falls, H. R. 18024," p. 283.) In this report the connnission stated that while it was not fully agreed as to the effect of the diversion from Niagara Falls, all were of opinion that more than 3G,000 cubic feet per second on the Canadian side of the Niagara River or in theJS'iagara peninsula, and 18,500 cubic feet per second on the American side of the river, could not be developed without injury to Niagara Falls as a whole. Accordingly the International Commission confined its recommendation to these ligures, conceding twice as much draft upon the Canadian side as on the American side, jirobably because of the greater depth of water at the Horseshoe Falls. But it was stated expressly by the Canadian members that their assent to these conclusions was given only upon the understanding that any treaty or ari-angement for the preservation of Niagara Falls should be limited to the term of 25 years, and should also establish certain principles, including the right of each country to an tHjual share of the diversion of inter- national waters whether navigable or nonnavigable. In the face of this reasonable declaration, how could anj-one imagine that an international treaty would be facilitated by the suggestion that by discriminat- ing against Canadian diversion and importation the United States in this jiar- ticular may virtually control the Canadian frontier".' ^^'e should all concur in the unanimous conclu.<5ion of every member of the waterways commission, Canadian as well as American, that " it would be a sacrilege to destroy the scenic effect of Niagara Falls"; but we must recognize also that while Niagara Falls is a wonder. " fair play is a jewel." Such an indirect attempt to control the Canadian output certainly would not lead to the Canadian belief that we were disiwsed to play fair. To a considerable extent the Canadian Niagara Co. represents Canadian capi- tal, but to a still larger extent. Anserican capital. Nevertheless, it is a Canadian company, entitled to the protection of its Canadian contract, and cheerfully recognizing and prepared to fulfill its Canadian obligations under that con- tract. As stated by me at the July hearing, it desires the opiwrtunity to use lu the United States all of its power not required to meet the Canadian de- mands under that contract, to which demands, when received, it will make prompt and cheerful resix)nse. The counsel of the Electrical Development Co. of Ontario have misapprehended my statement, when they say that our " com- pany is not desirous of entering into any contracts with the Province of Ontario." Of course the Canadian Niagara Co. is desirous of remunerative business in Ontario as well as elsewhere, and has submitted a most reasonable bid to the Ontario Government. Here and now the Canadian Niagara Co. rests its case upon a consideration of its rights as a Canadian corporation, and not upon any pretense that, representing American capital, it has therefore any particular right of hearing which is not open equally to the P^lectrical Develop- ment Co. of Ontario, representing especially Canadian and English capital. The three applications of the three Canadian companies for the right of transmission can not be. and will not be, decided by .vou upon a consideration of the nationality of the holders of the corporate securities. How essential is the right of transmission, even in the view of the Electrical Development Co. of Ontario, is stated in the brief of that company at page 3, where it points out that if the amount of power which can be sold by interested l>arties in Canada is to become a basis of division of power to be imported into the United States, "each of the comi>anies would doubtless willingly abandon PRESERVATION OF XIA(iAKA FALLS. Bttt all gales in ranada, so as to be permitted a laiiier entry into the richer markets of the United States." This frank declaration of the Electrical Development Co. — Canadian both in incorporation and in membership — serves to indicate not only its own slight appreciation of its home market, bnt also the sense of in.jnstice that wonld be induced generally in Canada by unjust discrimination against the right of im- portation of Canadian ])ower. Since writing the foregoing we have received Mr. McFarland's tliird emer- gency call, dated November li). in which again he complicates the possibility of international arrangement by the following extraordinary plea : "Now there is another opportunity. Because Canada, while jilanning to pro- duce 4ir),000 horsepower in destroying Niagara, can herself use less than 50,000 horsepower, her power companies i)ropose to sell it in the United States. Here is our opportunity. The Secretary of War controls absolutely the admission of this power. If he shuts it out, the water whicli would otherwise be harnessed for the power companies will,thunder its way unfettered over the great ciitaract. " Inclosed are some Niagara [a-eservation ])osr cards. Get each one Liuickly into the hands of a man or woman who cares a single cent for Niagara, and let Secretary Taft thus see what the county thinks of the claims of the power com- panies. Ask him to admit no Niagara electrical power from Canada." If this plea for the total exclusion of Canadian power were to prevail, the following results would happen : The companies which have invested large sums of money in the estal)lislnnent of their worlis would find their investments unprofitable, except to the extent that they could find consumers of power in Canada. Can anyone be fatuous enough to suppose that thereupon the companies wonld not seek to protect their Canadian investments by Canadian development, welcomed and assisted by the Canadian authorities? Such establishment and development in Canada, of course, would involve such concessions in the cost of Canadian power as would afford sufficient inducement to Canadian users. But with sufficient concessions, the cost of Canadian jKiwer <'Ould be brought so low that no r;, Hvoi'.d in the Province of Ontario could afford to forego the use of electricity from Niagara. Such operation would supply a market for Canadian power vastly in excess of any figures yet suggested. The Canadian Niagara Co. already has its line to Fort Erie, opposite Buftalo, and already contemplates considerable development in that vicinity and elsewhere, which ultimately may make it indifferent whether or not Canadian power .shall then be transmissible into the United States. Thus, in the end, the volume of water taken from the Niagara River would be not less than tlie amount which would have been taken had the Canadian power been admittetl into the United States: while the United States and in pai-ticular the State of New York would lose, through the establishment in Canada of industries which otherwise would have been established in the United States. Speaking for myself alone, and not for anyone else, 1 do not hesitate to ex- press the belief that the Niagara Falls Power Co., having a New York charter right for a second tunnel in the city of Niagara Falls, could view with compara- tive equanimity a positive prohibition of the admission of any power from the Canadian side. Nothing could tend more directly or more effectively to make a reality of the Niagara monopoly which :\Ir. McFarland has regarded as poten- tial. (First emergency call, section 9.) The revealed puri)0se to coerce Canada into a treaty by laying an embargo upon power importation into the United States of course would affect Canadian development. tSee Capt. Kutz, p. 14, sec. 20.) Thus again we are led to doubt that the author of Mr. McFarland's emergency calls had formed an intelligent puriJose as to the practicability of an interna- tional treaty limiting the Canadian rights. CONCLtTSION. Upon these considerations, as well as upon those presented last summer, we ask the favorable action of the Secretary of War upon the application and the supplemental application heretofore submitted by the Niagara Falls Power Co. and the Canadian Niagara Co. for a permit to transmit Niagara power from Canada into the United States, the exact form of the permit to be submitted after decision of the principle. Francis Lynde Stetson. For the Niagara Falls Power Co. and the Canadian Niagara Go. 368 PRESKRVATION OF NIAGARA FALLS. Appendix A. THE PKIOKITY OF THE CANADIAN NIAGARA CO. The Cauadiuii .Niagara Co. is and always has been recognized by the Queeu Victoria Niagara Falls Park Commissioners as the "pioneer company." (19th Kept, pp. 12-13; 18th Rept., p. 5.) The first contract between this company and the commissioners was made April 7, 1892 (IGth Kept, p. 14) ; the modifyinj? contract Jnly 15, 1899. (14th Itept., p. 11.) Clause 11 of the modifying contract (p. 17) provides that if from any cause the supply of water at the point of intake should be diminished the company should have no claim or right of action against the commissioners "nor give to the company any right of action against other licensees or grantees of the com- missioners in respect of any diminution not substantially interfering with the supply necessary for the company." The subordinating effect of this clause has been forced ujion the recognition of each of the junior lessees. A substantial interference would result from the proposed diminution of our available supi)ly. Under this contrisct the Cnnadian Niagara Co. began its work May ol, 1901 (Kith Kept., pp. 5-11 ) before either of the other companies had even acquired a right to their present works, and long before such works were begun. Tlie Ontaiio Tower < 'o. <'ntere. ) The prior rights of these earlier grantees were also expresslj- recognized in a further agreement dated 9th Januarj% 1905, between the Electrical Development Co. and the commissioners (19th Kept., p. 30, clause 3), which, however, failed of legislative ratification. In theif memorandum of argunienr, submitted in l)eceu\ber. 19(»2, before the Canadian commissioners (17th liept.. pp. 51. 5:2), Sir Christopher Robinson and Mr. Macrae, the couusel for the Toronto company, made the following state- ment : •' If the Canadian Niagara Power Co. can demonstrate that the taking of water in the manner proposed bj' the applicants will cause physical injury of a substantial kind to their licensed works, the Government would be justitietl in refusing the applicants permission ; but the burden of establishing this injury rests upon that company." This necessary admission as to the immunity of the physical structures of the Ca)iadian Niagara Co. trom injury through the establishment of the works of the Toronto company, by necessary implication concedes also the iuununity of the Canadian Co. in the operation of its works, from depreciation or diminu- tion of its giTiutotl rights in order to enable the Toronto company to operate its junior works to their full extent. lu other words, the undoubtal right of the Toronto company under its agree- ment of January 29, llM)o. to use the Canadian reservation waters therein granted, is a right to take such waters only to the extent that they are available after the prior grants of the commissioners shall have been fully satisfied. This priority of right entitles the prior licensees to preferential consideration, ac- cording to their prioiities, whenever nud wherever conflict in respect thereof may arise among the several licensees. Certainly it should not be overlooked in the present discussion, which is to be concluded upon a full recognition of all the erpiities of all the parties. Fkancis Lyndk Stetson, For the Niagara Falls Power Co. and the Canadian Niagara Co. AprENDix B. American Civic Association, Office of the President, Harris'burg, Pa., Decanher 1, 1906. Mr. A. C. Douglass, Niagara Falls, N. Y. Dear Sir : I have never made to anyone, consciously, a misleading statement. I recognize your entire honesty of purpose also. And I therefore, as I told you, proposed to obtain the details as to the statement I made in regard to the reduction of the crest line of Niagaia Falls. Hon. Charles M. Dow, of Jamestown. N. Y., chairman of the New York State Reservation at Niagara, has replied to me by v»-ire, referi-ing to pages 16S and 169 in the report of the hearings before the Conmiittee on Rivers and Harbors, giviiig his statement in my presence, and. I think, in yours, on April 21 last, in regard to this matter. If you will look this up you will see he made a clear-cut and definite state- ment, which fully su])porteages 168-109 of the report of the hearings before that com- mittee; and you add, "If you will look this up you will see he made a clear- cut and delinite statement which fully supported my statement." In answer to this invitation, I have referred to ^Ir. Dow's cited testimony, and I do not find that either fully or otherwise does it supi)ort your statement that this work was done " to accommodate a power company " or " to give a better chance to one of the power companies." Mr. Dow do(>s state that the filling in was done by the power companies, but he does not state, nor does he undertake to state, why the power companies did the filling in. The sting of your charge was not that " the filling in had been done by the power com- panies," which is true, and which is all that Mr. Dow said, but it was in the allegation that the filling in was done by the power companies "for their own I'urposes," which is untrue and which very tardily you recognize as untrue under the compulsion of Chairnnin Langmuir's letter, that the filling in was done for the benefit of the Canadian Park by the orders of the Canadian com- missioners and not for the benefit of any power company. I am sending a copy of this communication to .Mr. Charles M. Dow, and also appending the same to the revision of my brief before the Secretary of War. I am, faithfully, yours. Fkaxcis Lynuk Stetson. Appendix C. New Yohk. DvrrinJxr /, lUOii AV. J. Barden, Captain, Corps of Enfflnccra, Waxhiiigton, D'. C. My Dear Sik : I beg to acknowledge the rec-eipt of your favor of November 28, transmitting the Supphnnental Report of Capt. Kutz. I have only to express my appreciation of the reasonableness of Capt. Kntz's additional conclusions, which I am happy to accept with the fallowing modifi- cations: (1) As stated at the hearing before the Secretary of War. I am willmg, without prejudice to our reserved right and claim of priority, and as a modus Vivendi, pending a treaty negotiation, to consent to the eipial division between the three comi)anies of "the 157.500 horsepower for which in his first report Capt. Kutz reconnnended that transmission permits might now issue. This concession is made wi'liout any doubt as to the justice of the report of Capt. Kutz; but because our present Canadian installation would not enable us now to develop or to transmit the full amount of OO.iXM) horsepower. So soon as we shall have comiileted our Canadian power house as now proposed, to the full extent of 121,(X»0 horsepower, we shall upon the ground of our priority expect to be permitted to transmit that full amount irresjiective of any claim of any other company. PRESERVATION OF NIAGARA FALLS. 371 (2) While upou the hearing I concurred tliat liermils for power trausniis- siou, as well as for power diversion, should be preferably in terms of cubic feet of water rather than in terms of horsepower, I did not intend, nor do I intend, to concede that Ihe Onlario Power Co. lias any ground uix>n which it can claim special consideration ; nor did or do I intend to concede that upon any ground the Ontario Power Co. is entitled to take any water until after the full demand of the Canadian Niagara Co. has been met. (3) As already stated in my earlier brief I ask that at all times the Canndian Niagara Co. shall be authorized to supplement and to make good from its works the draft, which under the permit of the Secretary of War the Niagara Falls Power Co. shall be authorized to make on the American side to the extent that, for any cause, such authorized draft shall fall short of the amount authorized. As these two companies are substantially one, their combined draft should be considered as one; and so long as such combined draft does not exceed the aggregate authorized by the law, it would seem to )>e equitable that if necessary water might be taken from the Canadian Falls to the relief of the American Falls. (4) I desire to renew the prayer contained in my earlier brief, that consid- eration be given at present to our application for additional power, and this for the reason there indicated, that suc-h permission is necessary in order to enable us to proceed witii the completion of our power house, for which the wheel pit already has been dug. In tliis particular our position is analogous to that described by the felicitous figure used on Monday by the Secretary of War. We are in the position of the man who has built his house to the second story, and thereby is involved in the necessary expense isnd consequence of a roof to cover it. For the protection of this right to complete our power house to the full extent of 121,000 horsepower, we rely primarily npon our prior right to take all of the power necessary for our i)urposes. e\en though our juniors go dry, and, second- arily, if, notwithstanding our plea, our claim to priority be rejected, then upou a consideration of our equities in respect of the additional power to be granted, (ii) I ask that after decisi^m the form of permits be settled on notice. This communication I submit to the Secretary of War in printed copies as constituting my reply upon the entire subject, including Capt. Kutz's report. Your obedient servant, Francis Lynde Stetson, For Canadian Siugam Co. and Niagara Falls Power Co. Postscript, December 3, 1906. In paragraph 5 of this report Capt. Kutz ob serves that the Niagara Falls Power Co. now is limited to the production of 76,000 horsepower (which as hereafter considered is electric horsepower not including hydraulic service), which falls short of its 102.000-horsepower re- quirements as stated in paragraph 4. and thus " throws a load of 20,000 horse- power on the plant of the Canadian Niagara Co." These figures may be explained as follows: The anKHU't of 102,000 horsepower represents the aggregate of the maximum use of power, both electric and hydraulic, supplied by the Niagara Falls Power Co. To this amount of maximum use the 8,600 cubic feet of water permitted would be barely adequate, and would allow only 70,000 electric horsepower available for sale, as follows : Hydraulic : Niagara Falls Waterworks feet SO International Paper Co do 808 .S8S Electric : Exciters do 34.4 Available for sale* do 7,676 7, 710. 4 S, 598. 4 Francis Lynde Stetson. 70.000 horsepower X 101 sccond-fei't^T.tiTB spcond-foet. .'^'72 l'Kt:SEKVATU)X OF XIAtiAHA FAIJ.S. TiiK rj{Fsi;i:\ A'liON of niacaka kmj.s. To rile KiMioi: oi' Tin- S(ii:.\rinr A.Mi.'tJc ax : At the lii'jid of the editorial colunnis of your i»iil»iicat ion I iiou- tli.u ii is (lecliUHHl that " The jm: pose of tliis journal is tc; record a'-cu>arely and in siiuiile terms the world's i)!-o;j;i-ess in s.jieiitific kiiowledjie and industrial aehievenient." Immediately following this declared ))nrpose. in yonr issue of May 27. you pub- lish an editorial entitled " Niagara Falls again threatened." The writer has resided a lifetime in i)roximity to the great Falls of Niagara. has witnessed the electrical power development from the beginning, is faniiliai- with every detail of it. and confidently asserts that the diversion of the waters of the Niagara Kiver for power-development purjioses has made absolutely no j>erceptil)le difference in the tlow of tiie river. The only difference I hat has been seen in the river has been caused by the changes in the din^ction of the wind, by ice .ianis for a few hours in the winter, and by high and low water conditions that are perifsdical and are common to all lakes and streams. Some- times Lake Ontario washes its banks and sometimes there are many yards of beach. In corrob<»ratiou of my statement that the power develoi)ment has made uo perceptible difference in the flow of the river. I bring ofhcial testimony. In the early sunmi«'r of 11M)S the two power comiiany plants in this city were en- tirely shut down for .several liours, and a test was made by Fnited States engi- neers to ascertain the effect upon the How of the river over the Falls. In a letter t*' the Engineering News of July 2, 1908. Ma.j. <"harles Keller. ('ori»s of Engineers. Fnited St.-iles Army, officer in chai-ge of lake survey, said that during the period of the shutdown " the rise shown by the gauge set by rhe lake survey close to the crest of the American Fall was about an inch, and was fully as much as anticipated."' Another test about the same time was officially rejiorted i>y G. Edwai'd Wilson, secretary of the .\nierican section of tb(» International Waterways Commission, as forty-six one-hundredths of an inch. The Burton law was in effect tlieii. it is in effect now. and Niagara Falls is not •■ threat- ened " any more now than it Mas tlien. In fact, a treaty between the Fiiited St.ites and (Ireat liritain has since been ratified which permits the diversion of 20,000 cubic feet i)er second of water on the American side and .".(."..(MiO cubic feet per second of watei- on the Canadian side. This provision was in accordance with the recommendation of the International Waterw.iys Conunission. which thorouglily investigated the subject. The present diversion on the American Hide of the river is 15,000 cul)ic feet per second of wafer, so that tliere is still a leeway of 4.400 cubic feet per second of water under the limitations of the treaty. Before tlie present permits were granted under the Hurron law that went into effect .Tune 20. 1900. William H. 'I'aft. then Secretary of War. came to Niagara Falls and- gave a hearing to all iiarties interested. In gr.inting the power permits Srcret.-iry T;rft promulgated a lengthy opinion, in viliich he said: "The International Waterways Commission, a body appointed under a stat- ute of the United States to confer witli a siunlar body .•ii)pointed under a statute of Canada, to make recommendations with reference to the control and government of the waters of the Great Lakes and the valley of the St. Law- rence, have looked into the question of the amount of water which could be withdrawn on tlie American and the Canadian sides of the Niagara River with- out subst.-intial injury to tlie cataract as one of the great natural beauties of the world. .(Ud after a most careful examination they have reported, recognizing fully the n.ecessity of preserving infat-t the scenic grandeur of the Xiauara Falis, that it would be wise to restrict diversion to 28.600 cubic feet jier second on the American side of the Niagara River and to restrict the diversion on the Canadian side to ^0.000 cultic feet jier second." Later the Rritisli-Anierican treaty provided for a diversion of 20.000 cubic feet per second of water on the American side and ."ifi.OtX) cubic feet iier second of water on the Canadian side. :My infoimalion is that the present diversion is 27,000 cul)ic feet per second of water. Your statement is that it is 34,000 cubic feet per second of water. In the o])inion referred to above Secretary Taft continued : "I have already said tb:ii the object of the act is to ])reserve Niagara Falls. It is curious, however, tliat this pnriwse as a limitation upon the granting of pernuts by the Secretary of War is only specifn-ally recited in reference to his granting permits for diversion of additional amounts of water over l.'.OOO cubic feet on the American side, which are to be limited to ' such amount, if anv, as in connection with the amount diverted from the American side, shall PRESERVATION OF NIAGARA EALL8. 37o not interfere with tlie navlf;al>le oapacity of said river or its integrity and proper volume as a bonndai-y stream or tlie scenic grandenr of Niagsira Falls.' This peculiarity in the act is sijiniticant of the tentative opinion of Congress that 35.600 cubic feet of water might be diverted on the American side and 160.000 electrical horsepower mi.uht be transmitted from the Canadian side without substantial diminution of the s?enic grandeur of the Falls." And then Secretary Taft gave his decision that "'acting, however, upon the same evidence which Congress had, and upon the additional statement made to me at the hearing by Dr. John M. Clark, State geologist of New York, who seeius to have been one of those engaged from the beginning in the whole movement for' the preservation of Niagara, and who b.as given close scientific at'ention to the matter, T have reached the conclusion that with a diversion of 15,600 cubic feet on the American side and the transmission of 160,000 horsepower from the Canadian sifle the scenic grandeur of the Falls will not be affected substantially or perceptibly to the eye." That is the diversion that is taking place to-day. It was the judgment of the International Waterways Commission and the men who frameed from the Falls of Niagara 350,000 electrical Horsepower. Their total power-iu-oducing capacity is estimated at from 5.000.000 to 7.000.000 horse. Do you think the cataracts as a spectacle are seriously threatened? C. T. Williams, Cifj/ Indufifrial Agent. Niagara Falls, N. Y. .TrxF 27. 1911. The Speaker of thk IIoukk of IIepresentatives, Washiiifiio)!. D. V. Sir: I have the honor to invite attention to the situation with re.sijecr to the legislation for the protection of Niagara Falls. The act of June 29, 1908 (the Burton Act), as extended by j. Howlaud, of New York, treasurer; and Richard P.. Watrous, of Washington, secretary. These are assisted by live vice presidents — George B. Dealey, of Dallas, Tex.; Dr. John Wesley Hil'l. of New York; Mrs. Edward W. Diddle, of Carlisle, Pa. ; George W. Marstou, of San Diego, Cal. ; and J. lA)ckie Wilson, of Toronto, Canada. In addition there is a general executive board made uji of IS prominent men and women from various cities all over the country. The scope of t)ie association is not limited. It stands for better living condi- tions, and that takes in almost everything. It stands for clean streets and solicits the aid of every citizen; it advocates germ-free drinking water, and is doing what it can to educate the public to see that economy and health are i»()th on the side of good water; it espou.^es underground wires for electric lines, and is striving to impress the public with the importance of such a program ; it believes in playgrounds for the children and parks for grown-ups, and is lend- ing aid to every agency that would bring them about; it believes water fronts free from filth are essential to public health, and therefore advocates adequate systems of sewage. I'ublic-comfort stations, garden schools for children, group- ing of public buildings, care of the trees and planting of new ones — these are some of the planks in the platform of the association. And it has more effective means of campaigning for the public good than are usually at the disposal of uplift workers. Its members are enthusiastic believers in the promotion of the jjublic welfare, and are moved by humanitarian instincts; it has hundreds of afliliated organizations which work to further its purposes; it has an efficient juiblicity system for commanding the public attention aiid a system of dis- tributing its literature where it will count. Thus equipped, it expects to do its part toward making the ensuing year notable for the itromotion of the welfare of all classes and conditions of society. IN THE ( iRcriT (M)rirr of the inited states within and for THE district OF COLORADO, SITTING AT PIEP.LO. The Cascade Town Company, complainant, r. The Empire Wat<'r and Power Company et al.. defendants. In equity. No. 418. Leander A. Rigger, comidainant. r. The Empire Water and Power Company et al.. defendants. In equity. No. 353. I. ruV. F.\.CTS. Complainant. Tlie Cascade Town Co.. owns several hundred acres of land up T.'te Pass, about 11 unles from Cololrado Si)rings. Fountain Creek Hows through Ute in an easterly direction, and as it i^asses the lands of the complainant company its waters are augmented by those of Cascade Creek — short in length of flow but jirecipitous — which eome down from the watershed on the north- erly slope of Pike's Peak to the westerly. The said complainant company and its predecessors in title have owned these lands for many years, and they liegan improving them as a summer resort more PRESERVATION OF NIAGARA FALLS, 375 than 20 years ago aiul have maintained them as such ever since and have not sought to utilize them otherwise. For that purpose they have constructed hotels there and built cottages, roads, and trails on its lands extending up through Cascade Canyon, thnnigli which the stream of tli<» same name flows, and on beyond into the moimtains. hiid out. dedicated to the public, and im- proved a small park in said canyon, made a lake and fountain, built a pavilion or auditorium for conventions, and otherwise improved its grounds, thereby adding to the attractions of the place as left by nature. The complainant com- pany and its predeces.sors are not, and were not, numicipal corporations but business ventures created for the puriwse of maintaining their i)ro])erty as a resort for tourists during the summer rseason. The place is known as Cascade. The Midland Railway, which traverses Ute Pass, has a station there. The com- plainant company has sold some of its property to persons who desired to im- prove the same as sunmier homes, and the complainant Rigger has spent about $15,000 in improving his lK)me on land bought from the company, lying on both sides of Cascade Creek just below the canyon. The company obtains an in- come from those who stop at its hotels and enjoy other accommodations which it offers. It has spent a large amount of money in improvements. The roads and trails up Cascade Canyon and on into the mountains were constructed at an expense of fifteen or twenty thousand dollars. It also built a small water- works to supply the cottages and its hotels. It advertises the place for the purpose of inducing the public to go there, and for the past quarter of a cen- tury it has been visited annually by twelve or fifteen thousand people. It has a permanent population of 50 or 60 i)eople. Among other attractions held out in its advertisements are Cascade Canyon and the falls of Cascade Creek through the canyon. The canyon and falls are rare in beauty and constitute the chief attraction. Without them the place would not be much unlike any other part of Ute Pass. The canyon is about three-quarters of a mile long and very deep; its floor and sides are covered with an exceptionally luxuriant growth of trees, shrubbery, and tlowers. This exceptional vegetation is produced by the flow of Cascade Creek through the canyon and the mist and spray from its falls. Some of these falls are as much as 30 feet in height, but the difference in elevation between the foot and the head of the canyon is so great that the falls are almost continuous from the head down. The volume of water is the greatest during the summer .season. It comes from the melting snows and on the north slope of I'ikes Peak. But the flow is fairly even, due to the fact that the upiier stretches of the water- shed are composed of disintegrated granite, into which the water first sinks and gradually percolates until gathered into the bed of the stream. The volume is said to be equivalent to a stream about 8 feet wide and to 8 inches in depth. The vegetation in the canyon and up its sides consists, in part, of pine, si)ruce, tir, balsam, aspen, black birch. Jai)anese maple, thimbleberry, wild cherry, chokecherry. and aster ct)lumbine, larkspm-. wild rose, the red raspberry, wild gooseberry, ferns, mosses, and many other kinds of trees, shrubs, and flowers. The stream is annually stocked with trout. The birds which are found in the canyon — some grouse, a few squirrels, and perhaps a few wild animals there — are i)rotected by the complainant company. The complainant called a florist of 25 years' experience and a landscape gardener of 25 years' (experience as witnesses. They tell us thiit the native flora of th(> countx'y is quite extensive in Cascade Canyon: that the evergreen features are perfect; that there are three or four varieties of pines, three of junijier. and three of spruce, probably 25 vai'ieties of native perennials, and several varieties of moss growth and a large variety of wild flowers and flowering shrul>s: that the waterfalls create a spray .-md mist which, together with the undergi'ound seepage down the sides of the canyon, produce this very luxuriant growth, there being at least 200 varieties of vegetation; and that it is far superior in th:it respect to any other canyon in the neighborhood, and exceptional. The seepage and the mist and spray give life to the foliage. The defendant was incorj)orated for the purpose, among other things, of generating electricity by water power, and to dispose of the same as a com- modity: and to exwute that purpose it sent its agents on to the watershed of Pike's Peak, above the head of Cascade Canyon, and located a reservoir site and did some acts, at small expense, looking to the execution of that purpose, whereby it intended anvIA(iAHA FALLS. asking that tlie defeudant be enjoined from so doing as a threatened injury tt) their vestetl rights. It is found as a fact that if the defendant do impound the waters of Cascade Creek above the falls and conduct it therefrom in pipe as aforesaid, the falls in the canyon and the vegetation on its floor and sides will be lar,gely if not wholly destroyed and the canyon hence become a dry gulch, and that all the waters flowing in sjiid stream are needed by complainant company, and are necessary for the aforesaid purpose to whicli they have been ai»plie(l 1)y said complainant. II. THE LAW. 1. The first contention of both complainants is that the Government, while It was the owner of the lands on which the canyon and the falls are situated, had riparian right in the stream and that those rights were conveyed by patent from it, through mesne conveyances, to the complainants. This contention can not be accepted. There are no riparian rights in Colo- I'ado as against a valid appropriation of water. In Sternberger r. Eaton Co. (45 Colo., 401. 404). it is said: "The doctrine in this State that the common-law rule of continuous flow of natural streams is abolishc^l is so ttrmly established by our constitnticm, the statutes of the Territory and the State, and by many decisions of this court, that we decline to reopen or reconsider it, however interesting discussion thereof might otherwise be, and notwithstanding its importiince." And again, page 403: " The Supreme Court of the United States in several cases has approved and indicated its satisfaction with the decisions of the State courts which hold that the common-law doctrine has been abolished, and has s;iid th.it each State, without interference by the FKleral courts, may for itself, and as between rival individual claimants determine which doctrine shall be therein enforced." In Coflin );. Left Hand Ditch Co. (6 Colo.. 443. 440). it is said : " It is contended b.v counsel for appellants that the conmion-law principles of riparian in-oprietorship prevailed in Colorado until 1870, and that the doc- trine of iiriorit.T of right to water b.v priority of aiiiiojiriation thereof was first recognized and ado]itetl in the constitution. But we think the latter doctrine has existed from the date of the earliest appropriations of water within the boundaries of the Slate. The climate is dry. and the soil, when moistened only by the usual rainfall, is arid and unproductive; except in a few favored sec- tions, artificial irrigation for agriculture is an absolute necessity. Water in the various sti'eanis thus acquires a value unknown in moister climates. In- .rovements made; the soil has been culti- vated and thousands of acres have been renden^l immen.sely valuable, with the understanding that appropriations of water would be protected. Deny the <|octrine of priority or su|)eriorit.v of right by jiriority of appropriation and a great part of the value of all this iiropert.v is at once destroyed. "The right to water in this country by priority of appropriati(ui thereof we think is, and has always been, the duty of the National and State governments to protect. The right itself, and the obligation to i)r()tect it. existed ]irior to legislation on the sul>jtHt of irrigation. It is entitliKl to ]irot(Htion as well after patent to a third party of the land over which the natural stream flows as when such land is a part of the public domain; and it is immaterial whether or not it be mentioned in the patent and expressly exeluded from ilie grant. "The act of Congress i^rotecting in patents such right in water apiiropriated, when recognized b.v local customs and laws, was rather a voluntary recognition of a preexisting right of possession, constituting a valid claim to its continued use, than the establishment of a new one. ( Kroder c. Notoma W. & ^I. Co- ll Otto, 274.) " We conclude, then, that the common-law doctrine giving the riparian owner a right to the flow of water in its natural chnnnel upon and over his lands, even though he makes no beneficial use thereof, is inapplicable to Colorado. Imperative necessity, unknown to the countries which gave it birth, comi)els the recognition of another doctrine in conflict therewith. And we hold that. PRESEKVATION OF NIAGAEA FAI^LS. 377 in the absence of express statutes to the contrary, the first approitriator of water from a natural stream for a beneficial pnrj)Ose has, with the qualifica- tions contained in the Constitution, a prior right thereto to the extent of such appropriation." Congress, as early as 1SG6, recognized the necessity of the abolition of the common-law doctrine of riparian rights in the arid States. Speaking of the act of July 20, 18(J(J, the Supreme ,Court, in United States r. l{io Grande Irri- gation Co. (174 U.'S., OyO, 740), said: "The effect of this statute was to recognize, so far as the United States are concerned, the validity of the local customs, laws, and decisions of cdiirts in respect to the appropriation of water." And again, at page 702: " AVhile tills is undoubted (the rule of the oonnnon law as to riparian rights), and the rule obtains lu those States in the Union which have simply adopted the conunon law, it is also true that as to every stream within its domain a State may change this common-law rule and permit tlie appropriation of tlie flowing waters for such purposes as it deems wise." In Gutierres r. Albuquerque Uand Co. (188 U. S., 545, 552) it is said: " We think, in a iew of the legislation of Congress on the subject of the appropriation of water on the public domain, particularly referred to in the opinion of this court in United States v. Rio Grande Irrigation Co. (174 U. S., 090, 704-700), the objection is devoid of merit. As stated in the opinion just referred to, by the act of .July 20, 1800 (14 Stat., 253). Congress recognized as respects the public domain, so far as the United States are concerned, the validity of the local custctms. law, and decisions of courts in respect to the appropriation of water." Also Clark v. Nash (195 U. S., 301, 370) : "The rights of a riparian owner in and to Uie use of tlie w;iter fiowing by his land are not the same in the arid and mountainous States of the West that they are in the States of the East. These rights have been altered by many of the AVestern States, by their constitution and laws, because of the totally ditferent circumstances in which their inhabitants are placed, from those that exist in the States of the East, and such alterations have been made for the very purpose of thereby contributing to the growth and prosperity of those States arising from mining and the cultivation of an otherwise valueless soil by means of irrigation. This court must recognize tlie difference of climate and soil which rendered necessary these different laws in the States so situated." This question had direct consideration by the circuit court of appeals for this circuit in the case of Snyder i*. Colorado Gold Dredging Co., opinion in which was tiled August 4, 1910. In that case it is said: " The common-law doctrine in respect of the rights of riparian proprietors in the waters of natural streams never lias obtained in Colorado. From the earliest times in that jurisdiction the local customs, laws, and decisions of courts have united in rejecting that doctrine and in adopting a different one which regards the waters of all natural streams as subject t() appropriation and diversion for beneficial uses, and treats priority of appropriation and con- tinued beneficial use as giving the prior and superior right. ( Yunker r. Nichols, 1 Colo., 551 ; Coffin ?;. I>eft Hand Ditch Co., 6 Colo.. 443, 447 : Platte Water Co. V. Northern Colorado Irrigation Co., 12 Colo., 525, 531 ; Crippen v. White, 28 Colo., 296.) In so choosing l>etween these two inconsistent doctrines Clorado acted within the limits of her authority, first as a Territory and then as a State, and her choice was recognized and sanctioned by Congress, so far as the public lands of the United States were concerned." And again : " It needs only to be added that, by the settled rule of decision in the Supreme Court of the United States, conveyances by the United States of public lands on nonnavigable streams and lakes, when it is not provided otherwise, are to be constructed and have effect according to the law of the State in which the lands are situate, so far as the risrhts and incidents of riparian proprietorship are concerned. (Hardin v. Jordan, 140 U. S., 370, 384, 402; Hardin v. Sheed, 190 U. S., 508, 519; Whittaker v. McBride, 197 U. S., 510; Harrison t'. Fife, 78 C. C. A. 447, 148 Fed., 781, 783.) Here it is not provided otherwise, either by statute or by the patent, and, as has been seen, the local law does not recog- idze a conveyance of the land as carrying any right to the unappropriated waters of the stream." It is therefore believed that the patent from the Government did not pass, and the patentee did not take riparian rights to the waters in question, but iation 378 PKESEKVA'ifON OF NFAGAHA FALLS. tlint said lands aro liold by the coniplaiiiants puhject to the law of api^-opria of waters as eslal)lished in this State. And inasnmch as there is no testimony showing any right to the waters of Cascade Creelc in the complainant Rigger, other than that of a rii)arian owner, the finding of the court must he against him. and his case dismissed, if the alleged threatene Fetl., 41. 43.) 3. Does the testimony show an api)ropiiation of the waters of Cascade Creek by the com))l«inant comjjany or its predecessors in title along the falls as they flow through Cascade Canyon? The people of Colorado dedicated to the public all unapproi)r!ated waters of every natural stream within its borders and made them subject to appropria- tion as private iirojierty. (Const, of Colo., art. 16, sees. ,"> and 0.) Section (» reads, in itart, as foll()ws: "The right to divert tlie unai)propriated waters of any natural stream to beueticial uses shall lU'ver be denied." lUit neUher the manner of malcing siicli appropriation nor the acts necessary to be done to constitute an api)roprialion has been definitely fixed by the con- stitution, by the statute.^, or by the decisions of he courts. Nor has the term " beneficial uses." as usetl in section (i. supra, been definitely fixed and limited in its meaning. I can not better express my own views as to the meaning of thar phrase. ai)plicable to the facts here, than to quote a ])art of the brief of the learned solicitor for comi)lainant : " The courts have not defined, because they as yet are unable to define, the exact boundaries of the territory known as 'Iteneficial use."" Mr. Kinney, in his work on Irrigation, says: " Tl;e puri'ose contemi)]ated for the. use of the water may be irrigation for agricultural or horticultural purposes, mining, milling, manufacturing, domestic, or an.v other ptirpose for which water is ncn^ded to supi)ly the natural and arti- ficial wants of man provided to be a beneficial use." (Sec. 150 ) Pomeroy says (sec. 47) : " The purpose may be mining, milling, manufacturing, irriarating. .•igrictil- tural, liorticultural. domestic, or otherwise: but there must be some actual, positive, beneficial purjiose, existing at the time or contemplated in the future, as the subject for which the water is to be utilized. "The public health 's a beneficial use. and for that imrpose, auiong others, a city may condemn streauis of water. The water, when so obtained, may be used, and is used, in any manner that will promote the public health: it is used for sprinkling the streets, washing the pavements, and flushing the sewers. "Rest and recreation is a beneficial use, and for that purpose water is used to make beautiful lawns, shady avenues, attractive homes, and public parks, with fountains, lakelets, and streams, and artificial .scenic beauty. " Cities condemn water and use water for the foregoing i)urposes. No one questions but that public health, rest, and. recreation is a domestic use as well as a beneficial use. No one, we may add, questions the right to these uses. " The law inside of a city is not different from the law outside of the city. In one sense there is no commercial value to fountains and parks; they do not bring in a revenue, but they are vastly beneficial to the public health, rest, and recreation, and such fact is recognized the world over, and there can be no question but that water applied to their maintenance and creation is a 'bene- ficial use.' " We say that the creation of a summer resort is a beneficial use Is it no benefit to the public to si»end money in making a beautiful, jtlace in nature visible and enjoyable? Is it not in line with public health, rest, and recrea- tion? If a person takes a stream and, after putting in waterfalls, j)onds. bridges, walls, shrubbery, and blnegrass sod, works it into a beautiful home, that is a beneficial use. It is beneficial to the weary, ailing, and feeble that they can have the wild beauties of nature placed at their convenient dis- posal, is a piece of canvas valuable only for a tent fly but worthless as a PBESERVATTON OF NIAGARA FALLvS. 379 painting? Is a block of stone iKHieticially used when put intv> the walls of a daui and not benefit-la lly used when carved into a piece of statuary? Is the test dollais. or has beauty of scenery, rest, recreation, health, enjoyment sonie- thinir to do with it? Is there no beneficial use except that whi<'h is purely commercial? •' Tt would seem thai )iarks and playf;:rt>nnds .md blue grass are benetiis and their uses beneficial although there is net i«rotit derived from them: if not. then the conreution of the defendant corporation must he maintainetl that nothing hut money-making schemes are benehcial. The world delights in scenic beauty, but iimst scenic beauty dis:tpi)ear because it has no api)raised cash value? If this defend.int I'orporafion takes rlie water out of Cascade Canyon, it can take the wafer out of tlie Seven Falls arid Cheyenne Canyon, and Glen Eyrie, and the beautiful parks, and homes and sunnner resorts of the State. We feel co'upelled to say that there are other I.eneticial uses of the f:ill of water (ban tlie nioie production of commodities in comietilioii with others now existing. \Yhen the defendant company says the c(.n!i)lainanls .ire putting tlie fall of tiie water to no beneficial use, it means that the i-omplainants are not ruining the beautiful scenery for casli." It is therefore held that tlie maintenance of the vegetation in Cascade Canyon for the purposes to which it has been devoted by tlie complainant, by the flow and seei)age. and mist and spray of the stream and its falls as it passes tlirough the canyon, is a beneficial use of such waters within ihe meaning of said section 6, article IG of the constitution, that the complainant intended to use tli« waters of Casc.-ide Creek f<»r tliat puriiose and has so usfd them for many years and tliereby appropriated the same. The complainant is not required to construct ditches or artificial ways through wliich the water might be taken from the stream in order tliat it might appropriate the same. The only indis- pensable requirements are that the aitproiii iatoi-, in order to constitute a valid appropriation, first, must intend to use tlie waters for a beneficial use, and, second, actually apply tliem to a beneficial use. There 's expres.s statutory recognition of utilization of lands from natural overflow as one means of ap- propriation, as ill the flooding of meadows by natural overflow without the use of any artificial means wliatever. (Rev. Stats, of Colo.. 1908, sec. 3105; Humph- revs Co. r. Frank. 46 Colo.. 524; Broad Run Inv. Co. r. Deuel & Snyder Imji. Co., 108 Pac. (Colo.), 755.) The supreme court of this State, in considering the means necessary to con- stitute appropriation, in Thomas r. Guiraud (6 Colo., 530, 533). said: " We do not agree witli counsel for plaintiff in error in tlieir i)osition, as we understand it that the appropriation of water by Guiraud in 1862 was not valid or permanent because he constructed no ditches. Some of the witnesses testify that he did construct ditches, but it is unnecessary for us to weigh the testi- mony and determine tlie preponderance thereof upon this question. If a dam or contrivance of any kind will suffer to turn water from tlie stream and moisten the land sought to be cultivated, it is sufficient tliough no ditch is iieeded or constructed. Or if land be rendered itroductive by tlie natural over- flow of tlie water thereon, without the aid of any appliau,ces whatever, the culti- vation of such land by means of the water so naturall.y moistening the same is a sufficient appropriation of such water, or so much thereof as is reasonably necessary for such use. The true test of appropriation of water is the success- ful application thereof to the beneficial use designed; and the method of divert- ing or carrying the same or making such application is immaterial." And again, considering the same question, that court, in Larimer Co. R. Co. v. People ex rel. (8 Colo,, 614, at 616), declares: " It is claimed rhfit when the constitution recognizes the right to appro- l)riate water by diversion, it excludes the appropriation thereof in anj' other m.'inner. Further, that the word 'divert' means to take or carrj'^ it away from the bed or channel of the stream : that therefore respondent's act of utilizing a natural reservoir in the bed of the stream and thus storing surplus water for future use, not being a diversion in the sense of the constitutional provision cited, is in conflict therewith. We are not prepared to concede the correctness of counsel's position. It is our opinion that the above is not tlie most natural and reasonable view to adopt concerning the meaning of the constitution. The word '' divert ' must be interpreted in connection with the word ' appropria- tion ' and with other language used in the remaining sections of that instrument referring to the subject of irrigation. We think there may be a constitutional appropriation of water without its being at the instant taken from the bed of the stream. This court has held that ' the true test of the appropriation of 380 PRESERVATiox OF :niagaka falls. water is iht- miccesslul appliiatiun tliere<»f to the beneficial use designed, and llie inetliod of diverting or carrying the same or making such application is immaterial.' ■' (Thomas v. Guiraud, 6 Colo., 530.) See also Fort .Morgan L. & C. Co. v. South Platter Ditch Co., lli Colo.. 1, 5. In Offield 0. Ish, 57 Pac. (Wash.), 800, it is said: " The right to use the water is the essence of appropriation. The means by which it is done are incidental.'* See also McCall v. Porter (70 Pac. (9re.), 820, 822). It therefore appears that the waters of Cascade Creek, which the defendant threatens to inipound and carry away in pijies. has already been appropriated by the complainant, the Cascade Town Co., for beneficial uses, and that it has a vested property right therein which the defendant's contemplated acts, if executed, will destroy. The complainant compiiny may have a decree as prayed, with costs. The bill of complainant. Bigger, will be dismissed, with costs to the defendant against him. PrEBLO, Colo. District Judge. f'lVloirrani.] Feuisuary 17, 1911. We respectfully urge that you use every ellort to secure the adoption of Senate joint resolution 143 extending the Burton Act for the preservation of Niagara Kiver. The Burton Act was carefully, framed to recognize and protect every interest Iben existing to the full extent of all development then projected. To maintain the status can inflict no possible harm upon existing enterprises. To change it as ])roposeunt of the water which may be diverted at Niagara Falls for the i)urposes of power. My understanding is that this bill is intendeort the bill out. and feels that your record for e with the situ- ation of charges by electrical coni'ianies for power. I desire to say that such is not the ojiinion of this body, and to express to you on the contrary that we believe that the macliiuery devised and in successful operation for the control of public-service corporations in general, and of the electrical situation in par- ticular, is entirely adeending. It desires to secure for its citizens a readjustment and in many ca.'jes a reduction of present charges, and it is satisfied with the tribunal established by law to decide the issue. In conclusion. I beg leave earnestly and cordially to repeat the iuvitatif>n extended to your counnittee to visit the Niagara frontier and gather the facts jat first hand. Yours, resjx'ctf ul ly. Chamber of Commerce and Manufacturers' Clur, By ED(iAR C. Neal, Vice President and Acting President. 386 PRESEKVATIOX OF NIAGARA FALLS. La Sai.i.e, X. Y.. January 15, 1912. Hon. Wm. Sulzer, M. C, Chairman House Canwiittee on Foreign Affairs. Washington. D. C. My Dear Sir: I regret very much being unable to attend the hearing on Niagara power before your committee on Tuesday, but wish to present for your consideration a few facts regarding the situation. The Hydraulic Power Co., of Niagara Falls, will undoubtedly make a strong effort at this session of Congress to secure for its own use nearly all the remaining 4,400 cubic feet of water permitted by the treaty. On the basis of present effective use of Niagara waters for power development this company undoubtedly has a paramount claim. I think, however, certain other things should be known before so valuable a grant of public property is made. 1. The Hydraulic Power Co. is a close corporation, all the stockholders (so far as known) being members of one family. 2. Its property rights were acquired at sheriff's sale at a price far below their actual value of cost. 3. It is also true that the location of its plant and character of its develop- ment have done more than all others to destroy the beauties of nature near the cataract. 4. The Hydraulic Power Co. can not now be earning less than 20 per cent net annually on its entire investment. This will be greatly increased If their appeal is now granted. May I suggest and urge that before any additional water is granted to this or any other company its affairs be fully investigated and a sworn statement of its present earnings and profits be laid before Congress. If this is done I believe if any additional grant is made it will be conditioned upon a libei'al return to the Government as grantor of property in this case unquestionably worth many millions to the grantees. Otherwise, and in any event, it seems to me it would be far wiser and more conducive to the public good if this request for additional water by private corporations was denied. In my judgment the only proi^er course is to remove all restrictions on the importation of power from Canada, and then use the remaining water on this side to develop the greatest possible amount of power. Having already fully presented my views along this line in a previous letter, it seems unnecessary to add more at this time. Thanking you for the notice sent me and assuring you of my continued high regard, I am, Very sincerely, yours, John W. Williams. P. S. — Four thousand four hundred feet of water will develop, at Devils Hole, 109,000 horsepower; at Hydraulic Power Co., 85,000 horsepower; at Niagara Falls Power Co., 56,000 horsepower. [Tplesrams.l Albany, N. Y., January 17. Hon. William Sulzer, Chairman Committee on Foreign Affairs, Hoit^e of Representatives, Washington, D. C: Please telegraph immeS. and September 21, 1901). which, as explained in the letter of the Secretary of War. also tran.smitted herewith, have hitherto been retained for the assistance of the executive branch of the Oovernment. A final report of the proceeilings of the War Departnicnt in connec-tion with the act referred to will be included in the forthcoming annual report. W.M. II. Taft. The WiiiTi: llorsi:. Ani/ust 21. 1911. WaH DKI'AinMENT. \Vasli.inyt(»i. Aiifiiist 19. 1911. The Prksidknt : The act of Congress ap!)roved .lune 20. IfMW. •' Fther pnriKtses," authorized the Secretary of War to grant permits for the diversion of water from the Niagara Uiver for the creation of power to an aggregate amount of ir..(MXt cubic feet per second, and it also authorized him to grant permits for the diversion of additional amounts of water for power imrposes after the approximate amount of l."),fi(M) feet per second had been illverted for a period of not less than six months, but only to such additional PRESERVATION" OF NIAGARA FALLS. 389 auioinit. " if any, as in coniuH-tlon with tlie amount divM-twl on tlie Canadian side shall not injure or interfere \A-ith the navigable capacity of said river, or its integrity and proper volume as a boundary stream, or the scenic grandeur of Niagara Falls." It VA'as early recognized that the information necessary for intelligent action ui>on matters of such complex character could only be acquired by extended observations of a precise and ditticult nature, and the local study of the ques- tions involved was therefore assigned soon after the ai)i)roval of the act to the officer in charge of the survey uf the northern and northwestern lakes, then conducting oi>erations in the vicinity of Niagara Falls. Comprehensive and valuable reports on the subject submitted by that ofHcer November 3U. lUCS. and St'ptember 21, 1!¥»0, have hitherto been retained for the assistance of the executive brancli of the (lovernment, but as the i)rovisions of the act of June 29, 190ti. as extendwl by the joint resolution approved June 3, 1JX)9, expired by limitation on the 29th of June last, and as the executive departments have no furtlier duty to jierform in connection with that act, I submit herewith the rejiorts in (luestion and recommend that they now be transmitted to Congress. A tinal report of the proceinlings under the provisions of the act referred to will be included with my forthcoming annual reiiort. ^'ery respectfully, Henry L. Stimsox. Secretary of War. MEMORANDUM CONCERNING THE RESTRICTIONS ON THE TSE OF NIAGARA POWER. First. The campaign for the purpose of preserving the scenic grandeur of Niagara Falls was begun b.v the American Civic Association in the summer of 1905. The association asserted that Niagara Falls had been seriously in- jured It.v the power c(,)mpanies, and unless legislation was enacted b.v Congress the Falls would speedily be entirely ruined. The annual meeting of the asso- ciation was held at Cleveland in the autunm of 1905. and the association secured the support of Mr. Burton, then Member of Congress from that district. The President of the T'nited States in his annual message to Congress brietiy rectnumended that legislation he enacted to preserve the Falls from destruction. The association procured the signatures, it is said, of 100,000 people asking for such legislation. Soon after the meeting of Congress Mr. Burton introduced his bill, entitled "An act f(n- the control and regulation of the waters of Ni- agara River, for the preservation of Niagara Falls, and for other purposes." Numerous hearings were held before the Rivers and Harbors Connnittee, of which Mr. Burton was then chairman, at which the constitutionality of the proposed legislation, the necessity for it. and the form of it were eIal)orately argued. The bill was i)assed and approved by the I'resident on June 20. 1900. It was to remain in force for three yi-ars, but on March o. 1909. it was. by Joint reso- lution, extended for two years. f'nless further extended it will expire by limitation on June 2'.t. 1911. Second. Section 4 of the act recpu'Sted the President of the T'nited States to negotiate a treaty with the (Government of (Great Britain, providing " for such regulation and control of the waters of Niagara River and its tributaries as will iireserve the scenic grandeur of Niagara Falls, and of the rapids in said river." Such a treaty was negotiated, ratified by the Senate on March 3. 19(i9, ratified by Great Britain in March. 1910. and proclaimed by the President to be in force from and after Ma.v 13. 1910. Third. I'he treaty is the supreme law of the land. The Burton law is in some respects inconsistent with the treaty. The Burton law restricts the diversion of water on the American side to 15,000 cubic feet per second: the treaty raises the limit of restriction to 20.(kk) cubic feet per second. The Burton law places restrictions ui)on the amount of power which can be transmitted into the United States from Canada: the treaty makes no restric- tion on the transmission of power from Canada into the T'nited States. Under these circumstances Mr. Alexander, Member of Congress from Buffalo, introduced a bill in June, 1910. amending the Burton law so as t(» make it 390 PRESERVATION OF NIAGARA FALLS. roiiiply vvitli the teviHs of the treaty, and exteiulinir tlie operations of the Bvirton law thn.s amended so lon^ as the treaty remains in force. The Alexander bill increases the amount of water which can be diverted on the American side from ];j,GOO cubic feet per second to 20,r»00 cubic feet per second: and it leaves out of the i)ill all restrictions upon the transmission of i)ower from Canada into the United States. In other respects the original Burton law is not changed, 'i'he orifriual law was intended, in pursuance of its purpose to preserve Niagara Falls, to ijreveut any new power projects from being started at Niagara ; and it therefore stipulated that the permits, which under the law the Secretary of War was authorized to issue for the diversion of water on the American side, should be issued only to those individuals, companies, or corporations which were at that time actually producing power " from the waters of said river, or its tributaries, in the State of New York, or from the Erie Canal." The original law also prescribed penalties of fine and imprisonment for violations of the law, and gave jurisdiction over such cases to the United States circuit court. These provisions in identical language are repeated in the Alexander bill, which is simply the Burton law amended to accord with the treaty. This bill failed to pass. On April 20, 1011, Senator Root inti'oduced a bill [S. 1490] to give effect to the treaty, and the bill is now pending. Fourth. Prior to the introduction of the Burton law two American and three Canadian corporations, acting on the faith of laws enacteil and contracts made by and with the State of New York, the Province of Ontario, and the Dominion of Canada, had undertaken the construction of five extensive projects for the development of power, three of them on the Canadian and two of then) on the American side. At that time upward of $30,000,000 h'hd been expended on these projects, which were all of them incomplete ; but relying on the rights granted to them by the i)ublic authorities on both sides of the river, the companies had made their plans and entered into contracts, which would have entailed enor- mous financial loss, if not entire ruin, unless the companies had been permitted to carry out these projects. It was quite clearly shown hi the hearings before the Burton conunittee that the diversion of the water necessary to carry out to their full extent the projects which then were only partially completed, would not result in any serious injury to the scenic grandeur of Niagara Falls. N(!vertheless the Burton law only i)rovided for the partial completion of these projects. Its restrictions upon the diversion of water on the American side and the transmission of power from the Canadian side were such that the companies would only have been able partially to complete their projects. This injustice and ine00 miles, supplying Niagara power to tht-se industries, have about reached the limit of the power which they can obtain ul!le^s (be Alexander bill is enacted into law. Fifth. The average rtow of the Niagara Biver, as determined by the obser- vatiiMis of the United States engineers extending over a period of 01 years, is 212,000 cubic feet per second. The treaty authorizes 20.0ed under the restrictions imposed by the treaty will be less than 700,000 horsepower. The present in- stallation at the Falls is approximately 400,000 horsepower, which will shortly be increased to about 450,000 horsepower. Sixth. Elaborate measurements taken by the United States engineers in 1908, at a time when the American power houses were all temporarily shut down, show that the difference in depth in the water passing over the American Fall when the power houses are in operation and when not a wheel is turning is only a fraction of an inch. This is determined by minute and complicated scientific measurements. It is not visible to the eye, and it has no effect upon the scenic grandeur of Niagara Falls. In Exhibit D are reproductions of photographs of the Falls taken in 187G. ISS'5, and l.'^SS. wheu there were no electric-ix)wer plants; in 1900 and 1905, when the amount of power in use was about 100,000 hoi'sepower; and iu 1910, wheu the amount was more than 330.000 horsepower. These photographs show that under similar conditions, in spite of an increasing diversion of water for power purposes, the appearance of the Falls presents no change which can be detecte^l by the eye. It can be confidently asserted that, under the restrictions imposed by the treat.\, it will require scientific raeasureiuents to detect the change in the depth of the water at the Falls, but that this change will not be visible to the eye. The scenic grandeur of Niagara Falls will be preserved un- impaired. Seventh. The production of 1 horsepower continuously for 24 hours through- out every day in the year requires the consumption, under the most improved and modern apparatus, of about 13 tons of coal per annum. The treaty has decided that about 700,000 horsepower can be taken from Niagara without affecting its scenic grandeur. To produce this amount of power by coal would require about 8,500,000 tons of coal per annum. This is a comparatively small portion of the 450,000,000 tons of coal consumed in the TTnited States every yeai-, but it is still worth saving. There is absolutely no destruction ol natural resources in the use of falling water for producing power. The eternal laws of gravity, evaporation, and precipitation form a cycle in which the sun's heat is the ultimate source of energy ; and in this cycle the loss of such energy is inapi)reciable, and can not be measured by any instruments or methods known to man. The scenic grandeur of Niagara appeals to the imagination as a manifesta- tion of overwhelming force. The utilization of a small portion of this titanic force by the wit and brain of man for the benefit of his fellow men equally appeals to the imagination ; and the thousands of visitors who annually go through the different power houses are quite as much impressed by the evi- dences which they there see of mechanical ingenuity and of the control by man over gigantic force as they are by the spectacle of this gigantic force going to waste. Eighth, lae treaty runs for five years from May, 1910, and thereafter until terminated by either country on one year's notice. It has determined and fixed, after the most careful consideration, the restrictions which, so long as the treaty remains in force, are placed upon the use of Niagara water for power pm-poses. T'nder the contracts made with the Canadian authorities by the Canadian power conqianies one-half of the power generated in Canada can be transmittal to the United States. The Burton law undertakes to nullify these contracts by limiting the amount of power which could be brought in from Canada. The treaty, recognizing that no harm could be done to Canada and nuich good couUl be done to the United States by bringing in this surplus power fron» Canada, placed no restrictions upon the transmission of i)ower from Canada, so lliat the manufacturers of western New York might have tlie l)enefit of all the power which, under their agreements with the Canadian authorities, the Canadian power companies can send here. It only remains to enact such legislation as will give full force and effect to the treaty. Fu.^Ncis V. Crekne. 392 PRESERVATION- OF XIACJARA FALLS. Exhibit A. THE BURTON LAW. AN ACT For tho control and itgulation of the waters of Niagara Kiver. for the preserva- tion of Nia(i:arH Falls, and for other purposes. I Public — No. 367.] Be it enacted by the Senate and House of Representatives of the United State.'^ of America in Congress assembled, That the diversion of water from Niai;ara River or its tributaries, in the .State of New York, is hereby prohibiteil, except with the consent of the Secretary of War as hereinafter authorized in section 2 of this act: Provided, That this prohibition shall not be interpreted as for- bidding the diversion of the waters of the (Jreat Lakes or of Niagara River for sanitary or domestic purposes, or for navigjition, the amount of which may be fixed from time to time by the Congress of tlie United States, or by the Secre- tary of War of the United States under its direction. Sec. 2. That the Secretary of War is hereby authorized to grant permits for the diversion of water in the United States from said Niagara River or its tributaries for the creation of power to individuals, companies, or corporations wlxich are now actually producing power from the waters of said river, or its tributaries, in the State of New York, or from tlie U.rie Canal ; also permits for the tmusmission of power from the Dominion of Canada into the TTnited States. to companies legally authorized therefor, both for diversion and transmission, as hereinafter stated, but permits for diversion shall be issued only to the individuals, companies, or corporations as aforesaid and only to the amount now actually in u.se or contracteower so generated in Canada, but in no exent shall the amonnt iiiclndeil in such permits, together with the said IGO.OOO horsepower and the amoinit generated and ustnl in Canada. <>xceeti;>50.000 horseiK>wer ; I'rorided alirays. That the itrovlsions herein per- mitting diversions and tixing the aggregate horsepower herein permitted to be transmitted into the T'nited States as aforesaid are intended as a limitation on the atithority of the Secretary of War. and shall in no wise be coi-strued as a direction to said Secretary to issue p<'rinits. and the Secretary of War shall make regulations preventing or limiting the diversion of water .-ind the aritannic Majesty, the Right Hon. James Bryce, O. M.. his ambassador extraordinary and plenipotentiary at Washington ; Who, after having communicated to one another their full powers, found in good and due form, have agreeil upon the following articles: Preliminary article. For the purposes of this treaty boundary waters are definetl as the waters from main shore to main shore of the lakes and rivers and connecting waterways, or the portions thereof, along which the interna- tional boundary between the United States and the Dominion of Canada passes, including all bays, arms, and inlets thereof, but not including tributary waters which in their natural channels would tlow into such lakes, rivers, and water- ways, or waters flowing from such lakes, rivers, and waterways, or the w.iters of rivers flowing across the boundary. Article I. The high contracting parties agree that the navigation of all navi- gable boundary waters shall forever continue free and open for the purposes of commerce to the iidiabitants and to the ships, vessels, and boats of both coun- tries equally, subject, however, to any laws and regulations of either country, within its own territory, not inconsistent with such privilege of free navigation and applying equally and without discrimination to the inhabitants, ships, ves- sels, and boats of both countries. It is further agreed that so long as this treaty shall remain in force this same right of navigation shall extend to the waters of Lake Michigan and to all canals connecting boundary waters and now existing or which 'may hereafter be constructed on either side of tlie line. Either of the high contracting parties may adopt rules and regulations governing the use of such canals within its own territory and may charge tolls for the use thereof, but all such rules and regulations and all tolls charged shall apply alike to the subjects or citizens of tlie high contracting parties and the shii)s, vessels, and boats of both of the high contracting parties, and they shall be placed on terms of equality in the use thereof. Art. II. Each of the high contracting parties reserves to itself or to tlie sev- eral State governments on the one side and the Dominion or Provincial govern- ments on the other, as the case may be, subject to any treaty provisions now existing with respect thereto, the exclusive jurisdiction and control over the use and diversion, whether temporary or permanent, of all waters on its own side of the line which in their natural channels would fiow across the boundary or into boundary waters; but it is agreed that any interference with or diversion from their natural channel of such waters on either side of the boundary, result- ing in any injury on the other side of the boundary, shall give rise to the same rights and entitle the injured parties to the same legal remedies as if such injui'y took place in the country where such diversion or interference occurs; but this provision shall not apply to cases already existing or to cases expressly covered by special agreement between the parties hereto. It is understood, however, that neither of the high contracting parties intends by the foregoing ])rovisioii to surrender any right which it may have to object to any interference with or diversions of waters on the other side of the, boundary the effect of which would be productive of material injury to the navi- gation interests on its own side of the boundary. Art. III. It is agreed that, in addition to the uses, obstructions, and diversions heretofore permitted or hereafter providetl for by special agreement between the parties hereto, no further or other uses or obstructions or diversicms, whether temporary or permanent, of boundary waters on either side of the line, affecting the natural level or flow of boundary waters on the other side of the line, shall be made except by authority of the United States or the Dominion of Canada within their respective jurisdictions and with the approval, as herein- after provided, of a joint commission, to be known as the International Joint Commission. PEESEKVATION OF NIAGARA FALLS. 395 Tlie forojioiiis ])rovisi(ms nro not iiitciKUMl to limit or iutorforc witii ihe exist- ing rights of tlie (iovoriuueiit of the United States on tlie one si(h; and Hie Cov- errunent of the Dominion of Can.-uhi on tlie other, to undertake and carry on governmental works in lionndary waters for the deepening of channels, the eon- struction of hreakwaters, the imiirovenient of liarhors, and other governmental works for the benefit of commerce and navigation, jtrovided that sncii works are wholly on its own side of the line and do not materially affect the level or tlow of the bonndary waters on the other, nor are sucli provisions iiitendwl to interfere with tlie ordinary use of snch waters for domestic and sanitary purposes. Akt. IV. The high contracting parties agree tluit, except in cases provided for by special agreement between tliem, they will not permit the construction or maintenance on their respective sides of the bonndary of any i-emedial or pi'otective works or any dams or other obstructions in waters flowing from boundary waters or in waters at ^i lower level than the boundary in rivers flow- ing across the boundary, the effect of which is to raise the natural level of waters on the other side of the boundary, unless the construction or mainte- nance thereof is approved by the aforesaid international .ioint commission. It is further agreed that the waters herein defined as boumlary waters and waters flowing across the boundary shall not be polluted on either side to the injury of health or property on the other. Art. y. The high contracting [larties agi'ee that it is expedient to limit the diversion of waters from the Niagara River so that the level of Lake Brie and the flow of the stream shall not be appreciably affected. It is the desire of both parties to accomplish this ob.1ect with the least possible injury to investments which have already been made in the construction of power plants on the United States side of the river under grants of authority from the State of New York, and on the Canadian side of the river under licenses autliorized by the Donnnion of Canada and the Province of Ontario. So long as this treaty shall remain in force, no diversion of the waters of the Niagara liiver above the Falls from the natural course and stream thereof shall be permitted except for the jnirposes and to the extent hereinafter provided. The United States may authorize and permit the diversion within the State of New York of the waters of said river above the Falls of Niagara, for power purposes, not exceeding in the aggregate a daily diversion at the rate of 20,000 cubic feet of water per second. The United Kingdom, by the Dominion of Canada, or the Province of Ontario, may authorize and permit the diversion within the Province of Ontario of the waters of said river above the Falls of Niagara, for power purposes, not exceeding in the aggregate a daily diversion at the rate of 36,000 cubic feet of water per second. The prohibitions of this article shall not apply to the diversion of water for sanitary or domestic purposes, or for the service of canals for the jnirposes of navigation. Art. YI. The high contracting ])arties agree that the St. Mary and Milk Rivers and their tributaries (in the State of Montana and the Provinces of Alberta and Saskatchewan) are to be treatee appropriate, subject, however, to any restrictions or exceptions which may lie iuqjosed with respect thereto by the terms of the reference. PKKSEKVATION OF NIAGARA FALLS. 397 Such rejK'its of the comruissiou shall not be regarded as decisions of tho questions or matters so submitted, either ou the facts or the law. and shall in no way have the character of an arbitral award. The commission shall make a joint report to both Governments in all cases in which all or a ma.iority of the commissioners agree, and in case of disagree- ment the minority may make a joint report to both Governments or scjiarate reports to their respective Governments. In case the commission is evenly divided upon any question or mailer re- ferred to it for report, separate reports shall be made by the commissinnors on each side to their own Government. Art. X. Any questions or matters of difference arising between the high contracting parties involving the rights, obligations, or interests of the United or of the Dominion of Canada, either in relation to each other or to their re- spective inhabitants, may be referred for decision to the international joint commission by the consent of the two parties, it being understood that on tho part of the United States any such action will be by and with the advice and consent of the Senate, and on the part of His Majesty's Government with the consent of the Governor General in Council. In each case so referred, ihe said commission is authorized to examine into and report upon the fads and circumstances of the particular questions and matters referred, together with such conclusions and recommendations as may be appropriate, subject, however, to any restrictions or exceptions which may be imposed with respect thereto by the terms of the reference. A majority of the said connnission sliall have power lo render a decision or finding upon any of the questions or matters so referred. If the said commission is equally divided or otherwise unable to render a decision or finding as to any questions or matters so referred, it shall bo the duty of the commissioners to make a joint report to both Governments. or separate reiwrts to their respective Governments, showing the different con- clusions arrived at with regard to the matters or questions so referre;!. which questions or matters shall thereupon be referretl for decision by the high con- tracting parties to an umpire chosen in accordance with the proced\ue pre- scribed in the fourth, fifth, and sixth paragraphs of Article XLV of The Il.igue convention . for the pacific settlement of international disputes, dated October 18, 1907. Such umpires shall have power to render a final decision with resjiect to tliose matters and questions so referred ou which tlie commission f;iiled lo agree. Aet. XI. A duplicate original of all decisions rendered and joint reports made by. the commission shall be transmitted to and filed with the Secretaiy of Stale of the United States and the Governor General of the. Dominicm of Can- ada, and to them shall be addressed all communications of the commission. Art. XII. The International Joint Connnission shall meet and organize at Washington j)romptly after the members thereof are appointed, and when organized the commission may fix such times and places for its meetings as may be necessary, subject at all times to special call or direction by the two Governments. Each conmiissioner, upon the first joint meeting of the commis- sion after his appoininient, shall, before proceeding with the work of the com- mission, make and subscribe a solemn declaration in writing that he will faith- fully and impartially i)erform the duties imposed upon him under this treaty, and such declaration shall be entered ou the records of the proceetlings of the commission. The United States and Canadian sections of the commission may each ap- jtoint a secretary, and these shall act as joint secretiiries of the commission at its joint ses.sions, and the commision may employ engineers and clerical assist- ants from time to time as it may deem advisable. The s;\laries and personal expenses of the commission and of the secretaries shall be paid by their re- spective Governments, and all reasonable and neces.sary joint expenses of the comnnssion incurred by it shall be paid in equal moieties by the high coniract- ing parties. The commission shall have power lo administer oaths to witnes,ses and to take evidence on oath wdienever deemed necessary in any proceefling or inquiry or matter within its jurisdiction under this treaty, and all partes interested therein shall be given convenient opportunity to be heard, and the high con tracting parties agree to adopt such legislation as may be appropriate and necessary to give the connnission the iH)wers above mentionetl on each side of the boundary, and to provide for the issue of subpoenas and for compelling the attendance of witnesses in pi-oceedings before the commission. The commis- 28305-12 26 398 PRESERVATION OF NIAGARA FALLS. siuu may ;uloi>t such iiili's of prot-etlure ms shall he in accordance with justice ^ and equity, and may make such examination in person and through agents or -^ cni|)]oycos as m.iy he (h'emed advisjihle. ^^ Akt. XIIL In all cases where sjiec-ial ajrreements between the hiph coiV'~>^ Iractinir parries hereto are referrefl to in the forejioinc articles such ajirc^ ments are understootl and intended to iuclnde not (tnly direct agreements be- tween the hifih contracting: parti»>s. hut al8t> any mutual arran- iiiinif>n. Ai!T. ,\l\'. 'ilie pres^Mit treaty shall be ratitied by the President of the I'nited States of America, by and with the advice and consent of the Senate thereof, and l»y His Kritannic Majesly. The ratifications shall be excliansed at Washington as soon as ]iossible. and tlie treaty shall take ettect on the date of the exchange of its ratittcations. It shall remain in force fe construed as affecting or changing any existing territorial or rii»ariau rights in the water, or rights of the owners of lands under water, on either side of the international boundary at the rapids of the St. ^Mary's Kiver at Sault Ste. Marie in the use of the waters flowing over such lands, subject to the x-equirements of navigation in boundary waters and of navigation canals, and without prejudice to the existing right of the United States and Canada each to u.se the waters of the St. Mary's River within its own terri- tory : and, further, that nothing in this treaty shall be construed to interfere with the drainage of wet. swamp, and overflowed lands into streams flowing into boundary waters, and that this interpretation will be mentioned in the ratification of this treaty as conveying the true meaning of the treaty and will, in effect, form part of the treaty. .Vnd whereas th»> said understanding has been accepted by the Government of (Jreat Britain and the ratifications of the two Governments of the said treaty were exchanged in the city of Washington on the 5th day of May, 1910: Now therefore, be it knoVn that I. William Howard Taft, I'resident of the United States of America, have caused the said treaty and the said under- standing as forming a part thereof to be made public to the end that the same and every article and clause thereof may be observed and fulfilled with good faith bv "the United States and the citizens thereof. In testimony whereof I have hereunto set my hand and caused the seal of the I'nited Stiites to be artixed. Done at the city of Washington this thirteenth day of May. in the year of our Uord one thousand nine hundred and ten. and of the independence of the T'nited States of America the one hundred and thirty-fourth. Bv the Rresident: Wm. TI. Taft. |si;ai.. I V. <'. K.N'ox. Seeretar]/ of i^tdte. I'KOTOCOl. or IXCHANCK. On proceeding to the c\ch:inge of the ratificaticais of the treaty signed at Washington on Januarv 11. 11)00. between the UnitiKl States and Great Britam, relating to boundary waters and questions arising along the boundary between the United States "and the Dominion of Canada, the undersigned p enipo- tentaries duly authorized thereto by their respective Goverments, hereby de- PRESERVATION OK NIAGARA FALLS. 399