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they should contribute to keeping the farm economy going. California took this view on a statewide basis in its bond amendment, when it allocated various state revenues to the water plan. The Texas plan does not propose any such statewide subsidy for agriculture, but it will require a regional subsidy. There is one aspect of statewide financing of the Texas water plan. In the early years, when loans are being made and projects under construction, there will be no revenue from water sales. During this interim period, general state revenues will be used to pay interest on the state bonds. When water sales begin, and the local agencies begin to make payments on their debt to the state water development fund, this draft on general revenues will end. Then, when the state bonds are paid back, the general funds of the state will recover what they have advanced. So there will be temporary financing from general state revenues for a time. ONE ASPECT of the financing will need further attention from the Legislature. This is the financing of the 2.4 million acre-feet of water a year to be released from the state reservoirs to keep a healthy ecology in the bays and estuaries. Where the plan calls for city-dwellers and industries to pay for the water they use, this flood water would be released for the benefit of sportsmen, commercial fishermen, and a healthy ecology in general in the several major bays. This would be, in addition to 11 million acre-feet a year of fresh water going into the bays, even after the impoundments of the year 2020 are all completed. Undoubtedly, the cost of this water should be paid for out of general state revenues in some fashion. While the $400,000 study of the bays will give the answers in a couple of years as to how much water should be sent when to the bays to restore and preserve their quality and healthiness, the Legislature will have to answer the question of who is going to pay for that part of the job. The 160-Acre Limitation Venice, Cal. Factory farmers in Texas are joining with big landowners in the American West, particularly in California, in a drive to scuttle the historic 160-acre limitation and thereby legalize the sale of federallysubsidized irrigation water to agribusiness. The $3.5-billion “Texas water plan” bond issue\(actually, including the interest, at least, a $7 billion-dollar taxpayers’ obligaof this overall program and is entirely consistent with it. Ostensibly, the money the citizens are being asked to commit themselves and their children to provide is going to be dedicated to the costs of providing water for municipal and industrial uses in Texas. The “Texas” money, about one-fourth of the total cost, is to be “spent” for these purposes. This would appear to put the bond-issue money a plausible distance from the controversy over the family farm. Yet in the nature of public works to provide water for a variety of purposes, this claim is semantics and only semantics. You cannot separate out one level of the water behind a dam as city and industrial water and another level as farm water. You do not build parallel aqueducts, just to keep the water for different purposes separate. The “Texas Water Plan” itself says: “The Texas Water System … will be planned, designed, staged, constructed, operated, and managed as a single, integrated water system in its entirety.” THE ARTICLE BY Professor Paul Taylor of Berkeley in last issue’s Observer, inquiring whether evasion of the federal 160-acre limitation might not be the purpose of the expensive state-level funding of the proposed plan, drew from Stuart Long, the Austin newspaperman, a column published in some Texas dailies which requires a thoughtful reading. 10 ‘The Texas Observer “The truth, of course,” wrote Long, “is that the $3.5 billion is to be used to finance the development of water supplies for the cities and industries of Texas in the years from now to 2020. Not a dime will be used to finance agriculture.” How can this be? Long acknowledges that the bond issue “will help finance the two big canals,” the West Texas Canal and the South Texas Canal, both starting in East Texas. “But,” Long says, “the state bond issue will finance only the part of the projects which supplies municipal and industrial water.” How is that “part” going to be separated? It cannot be. You can isolate, on books of account, the costs of building a given facility, but in an integrated water system that facility has meaning and use only as a dependent part of the whole system. The two big canals and the associated reservoirs could not be built without federal money. How will the irrigation water get west and south from East Texas without passing through those two big canals? There is no way it can. The words of the Texas Water Plan itself tell “the truth, of course.” Any water system of the dimensions of the Texas plan has to be planned, built, operated, and managed as “a single, integrated water system.” Long repeats the claim of the writers of the Texas Water Plan that “it is hoped that the federal government will finance the portion of the canals and reservoirs which will be used for agriculture.” But this claim of theirs is most dubious in its very meaning and because of a significant qualification about the 160-acre limitations. IT IS THE suppressed premise of the writers of the Texas water plan that you can separate out the costs of the plan according to the purposes of the water. No wonder they suppressed the premise, since they also assert that the system has to be unified in every respect. Yet without the premise, it makes no sense to hope that the federal government will finance the part to be “used for agriculture.” And there is an even more interesting reason not to get too explicit about this premise. In 1959 the Congress explicitly rejected it as the basis for exempting a large California water project from the 160-acre limitation. The argument used was that California would pay for the part of the programthe “state” partwhich would provide irrigation water for the vast, undefined “state service area” on the West Side of the San Joaquin Valley. The federal 160-acre limitation would apply to the “federal” part of the project, but not to the exempted “state service area.” The Congress killed the proposal to thus exempt vast areas of the Valley, including some of the largest farm landholdings in the United States, from the 160-acre limitation. The Southern Pacific, Standard Oil, Kern County Land Co., and Tejon Ranch people were not pleased. Just as the senatorial advocates of these special interests argued in 1959 that the federal and state “parts” of the California water system “do not overlap or intermix,” one finds the idea of the separateness of the “Texas Water System” from “The Interstate System” throughout the document entitled the “Texas Water Plan.” The “Interstate System” is defined as strictly those works required to divert water from the Mississippi and convey it into Texas. The “Texas Water System” is defined very broadly as “those facilities within the State of Texas required to protect, conserve, transport, and distribute Texas’ intrastate water resources and Texas’ share of interstate waters for various purposes. . . .” The state agency “would hold the appropriative rights to water conveyed through the Texas Water System,” despite the awkward fact that fe&, eral money would build most of it. THE “TEXAS WATER PLAN” also proposes “Local Projects \(Not a part of the integrated Texas Water