ure traffic makes it difficult to pinpoint an exact day that additional acity will be needed.

The Department of Transportation's review of the projections and lysis done by others suggest that increased capacity may not be ded until the last decade of the century.

As a practicial matter, however, a single 1,200-foot lock should be structed if there is either major rehabilitation or construction of ks and dam 26.

The study also found that a single 1,200-foot lock at Alton would t cause a significant diversion of existing rail traffic to the water

ys.

Expansion of lock capacity at Alton would cost the railroads future affic which they would have carried only if a decision were made to ld the capacity at Alton at its present level indefinitely. Thus, as far a single 1,200-foot lock is concerned, the only questions are of timg and costs.

Any further capacity at Alton beyond that provided by a new 1,200ot lock and any other major capacity increases on the upper Missippi and Illinois River system should await the completion of a tailed and extensive analysis of the economic and environmental pects of such capacity increases. A study of this sort could well quire 2 years.

During this period, we will work with other agencies to study comodity projections, the impact of user charges on these projections, termodal impacts and environmental questions, as well as engineerg questions.

What we are really talking about then is whether a decision should e made on a single 1,200-foot lock for Alton before or after such a udy is completed.

The answer to this question and the question of whether the existing acilities should be replaced or rehabilitated turns on the engineering spects of the issue.

The engineering questions are not simple. The Corps of Engineers, ollowing a traditional conservative approach to the engineering probem of the existing structure concluded that the expense of rehabilitaion would be approximately equal to the cost of replacement with a nodern structure.

If this proves to be correct, then it is crystal clear that the facilities should be replaced and that the new facilities should contain a single 1,200-foot lock. It would be foolish not to take advantage of new construction to gain a moderate increase in capacity at a relatively light increase in costs over what it would cost just to replace the existing capacity. However, the corps' engineering approach to rehabilitation has been challenged and the view advanced that the cost of rehabilitation is in fact much lower than the cost of replacement. I have had a team of Department of Transportation engineers working with the staff of the Corps of Engineers to review these differences. The conclusion reached by our engineers is that there are lower-cost approaches for rehabilitation of the existing dam which ought to be tested before a final decision is reached.

Our engineering task force is of the opinion that there is no useful purpose to be served by any further paper studies on this question.

Their recommendation is that, as nearly as possible and as early possible, engineering investigations be undertaken in such a way t will let us experiment with the techniques and measures that are question.

Secretary Alexander and I have discussed this recommendation and have concluded, especially in view of the possibility of signifer savings, that if rehabilitation proves feasible, that it should be tried In his testimony, General Graves of the corps will provide you with ; more details on specifically what is involved.

In taking this course, we believe that it will be possible to determine. for about $10 to $15 million-a low cost relative to the costs of rehabi tation or replacement-whether the lower-cost alternative rehabilra tion measures are in fact feasible. I might say, parenthetically, that this involves actual engineering work on the dam, which will both provide for its safety during the construction period and also will allow for experimentation with engineering techniques to determine whether or not rehabilitation is feasible. The preliminary work on the stre ture will enable the committee to make an informed decision or whether the engineering techniques actually will work.

If these measures do turn out to be feasible, we can go ahead with the rehabilitation of the existing structure. This rehabilita tion could well include the provision of a 1,200-foot lock. A final de cision on the level of capacity to be provided in a rehabilitated da cannot be made, however, until further engineering work has been completed.

On the other hand, if the results of this experiment show that les cxpensive ways of rehabilitating the dam do not work, then we car turn to the construction of a new facility with a certain confidence that we have not overlooked an opportunity to effect significant savings. A far as the legislation on Alton locks and dam 26 is concerned, I hav the following recommendations: First, the Congress should postpone a decision on rehabilitation or replacement until the engineering questions have been solved.

Senator DOMENICI. Mr. Secretary, how long do you assume that would take?

Secretary ADAMS. About 18 months.

Second, any future authorizing legislation should contain a prohibition against a 12-foot channel project on the upper Mississippi and provide for additional economic and environmental study of the future transportation needs of the upper Mississippi and Illino's regions.

Third, there should be action by the Congress to enact a fair and effective system of waterway user charges.

Let me now turn to the question of cost sharing and user charges. The Department of Transportation has extensively studied the possible impacts of user charges and the results of these studies are presented in the report, "Modal Traffic Impacts of Waterway User Charges."

As President Carter said in his message on water policy: "The beneficiaries of Federal water projects do not bear a fair share of the enormous capital and operating costs."

The main point here is that commercial users receive major benefits from Federal expenditures, while the full burden of those ex

ditures falls on the shoulders of the taxpayer. It is simply not itable, not just, that profitmaking businesses should have this much heir costs met by the American taxpayer.

Practically all of the Federal expenditures in support of the waterys are made by the Army Corps of Engineers and the Coast Guard. ese expenditures have been rising and are now approaching the billion a year level.

As a result of these Federal programs, inland, coastal and Great kes vessel operators do not maintain or pay taxes on the rights of y which they use.

A notable exception is our St. Lawrence Seaway Development Corration where tolls on vessels and cargoes cover not only the operation d maintenance costs of the Corporation, but annually return to the easury part of the original U.S. investment in the St. Lawrence cilities.

Establishing a fair and efficient system of cost sharing is, obviously, d I want to stress that, Mr. Chairman, is, obviously, a question of eat sensitivity and the amount and manner in which such a charge collected could have a significant bearing on whether or not Coness would pass the necessary legislation.

In addition to the purchaser of the transportation services and ultiately the consumers, there are the concerns of at least three groups at have to be reconciled in establishing waterway user charges: the ers of the waterways who resist the added cost; the railroad operars who maintain their own right-of-way and feel their competition ceives unfair subsidy; and the taxpayers who pay the Federal gencies to furnish the facilities and services.

The Department of Transportation believes the selection of a policy or cost recovery through waterway user charges should take into onsideration the principles of administrative simplicity, political easibility, and public understanding and acceptance. For these reaons, we believe a fuel tax would be preferable to the segment toll.

The complete details of the proposal have not yet been worked out, hough I can comment on what each of the bills presently before this ommittee would involve. We will work with the Congress on this mater once we have a detailed proposal to present.

I can tell you, however, what some of the basic points would be. We are going to ask for a fuel tax which would go up in increments ver the next 5 years so that at the end of that period there would be ull recovery of inland waterway operating, maintenance and rehabiltation costs. In addition, all or some portion of the cost, with interest, f new construction would be recovered over the life of the project. All user charge revenues will accrue to the general fund rather than o any trust fund. While these charges are being phased in, the impact of the user charge on shippers will be closely monitored.

While we believe, in principle, that recreation users of developed acilities should be assessed user fees and that users of developed deep raft systems also should contribute to the cost of those systems, we have not yet developed such proposals in detail. The unique cost ecovery situation which already exists on the St. Lawrence Seaway would, of course, be taken into consideration so that inequities would ot result.

In a short time the administration will be presenting a comple proposal. But these are the basic elements.

In conclusion, the administration believes that it is no longer in t national interest to continue direct taxpayer support of commerc water transportation without some form of cost sharing.

Water transportation should join the air and highway modes 2 paying user charges for federally provided rights-of-way.

Mr. Chairman, that completes my prepared remarks. I would be most pleased to discuss the prepared remarks or the bills themselves with the committee.

Senator GRAVEL. Thank you very much, Mr. Secretary. You have brought forth somewhat of a blockbuster here.

Secretary ADAMS. I thought it might be, Mr. Chairman.

Senator GRAVEL. I might say that the waterway users may have looked at Senator Domenici with a raised eyebrow. But I think they might now want to embrace him as one of their greatest friends.

Mr. Secretary, I would like to put a 10-minute rule on and we wil each go through 10 minutes of questioning and then go back again That way, we will get all the questions in in a timely fashion.

Senator DOMENICI. I thought it was so clear we wouldn't have any questions, Mr. Chairman.

Senator GRAVEL. I will be very brief on the user side of it. I interpret your position to be for user charges.

Secretary ADAMS. That is correct, Mr. Chairman.

Senator GRAVEL. I think that is made crystal clear. With respect to a fuel tax, that would have to go to another committee, the Finance Committee. I serve on that committee. I am very fond of the chairman. I can assure you that the chances of getting a fuel tax out of that committee might be fairly remote.

I only say that as a matter of judgment, not as a matter of conviction.

Recognizing that, if the administration did see a stalemate develop in the Congress in which no charges of that kind were coming for ward, would you be prepared to accept another type of user charge than the fuel tax?

Secretary ADAMS. I have not discussed this in detail with all seg ments of the administration involved, Mr. Chairman. Obviously. I can't state what they might conclude. But, as the Secretary of Transportation, I would consider other user charge approaches. We will, as you know, be coming to the Congress with an overall set of recommendations for transportation. They will follow and complement the energy proposals. You can see that there are going to be increases and changes in the cost of the fuels used by all of the modes. I think a cost-sharing proposal relating to all the modes may have more chance than it had in prior years. I would certainly accept the position that all the various modes of transportation should be equitably involved as far as costing is concerned.

As you know, I am very concerned about the fact that we do tend. through our policy, or in some cases, lack of policy, to unfairly treat one mode as compared to the other. I have always been concerned about building redundant modes, having all of them fail, and ending up having to subsidize all of them. I think we should move from that position.

Senator GRAVEL. When you come forth with your detailed proposal the other systems for user charges, I wonder if you might not come ward with a detailed proposal that would be an alternative to a

Secretary ADAMS. You mean a segment toll, Mr. Chairman?

Senator GRAVEL. Whatever you want to choose to design, what you nk would be your second best way of approaching the problem, so would be privy to that before we go to final passage. I am talking in ms of House and Senate. Certainly, you might meet a conference nmittee schedule.

Secretary ADAMS. We will do that, Mr. Chairman. There have been ensive analyses already completed in the Department of Transrtation and elsewhere on various alternatives, both percentage revery and fuel taxes as opposed to segment tolls. We would be epared to present that kind of information.

Senator GRAVEL. Good. If you could do that in letter form, that ght help us.

with

Going back to locks and dam 26, you are essentially coming up 18-month delay so that the engineers within your office can work ith the engineers with the corps to go out into the field and do me practical application, the cost of which would be somewhere tween $10 million and $15 million.

Have you any indication at all at this point in time as to what would 3 the bottom figure for rehabilitation? The reason I ask is we are talkig about rehabilitation costs that range from $50 million to $400 milon. The project built anew would be $420 million. If we are talking bout spending $10 to $15 million and the best they will come up with a rehab project that may cost us $400 million, I would rather forego ne study and charge them to do the reconstruction right now.

Secretary ADAMS. Mr. Chairman, study is the wrong word for what ve are proposing. Regardless of whether we decided today to rebuild his dam, the present structure must be made safe and last a minimum f 8 years. We are not proposing to study it, instead, we would actually e doing work on the dam.

General Graves will go into this in greater detail, but it would involve such things as chemical grouting, driving of sheet piling, and deermining the properties and behavior of the soils under static and lynamic loads. The work would be done on the structure itself to deermine whether or not, in the opinion of those involved, rehabilitation could make the structure safe. In any event, a lot of the work would be that which would be necessary to assure safety, even if it was ultimately decided to replace the structure. As I indicated to Senator Domenici, this is the work which would take approximately 18 months to be completed. However, it may run longer than that. I would rather have General Graves and the corps testify on the specifics of what they believe is necessary.

Senator GRAVEL. I will hold my technical questions then for General Graves in that regard.

I have no further questions. Again, I want to compliment you and the administration for working out a position in a very difficult area. I think you have made the right decision.

Thank you.