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1 Roads and trails do not include roads constructed and maintained by timber purchasers. Cost for fiscal year 1959 estimated to be $40.8 million; average annual cost for short-term program is estimated at $51 million; and maximum annual cost for short-term program is estimated at $56 million.

* Includes road and trail 10 percent fund, or $8.9 million.

Includes road and trail 10 percent fund, or $15.0 million average annual.

Includes road and trail 10 percent fund, which varies from $14 million in 5th year to $19 million in 12th

year.

This level should be reached in 5th year of program and continue at about this level thereafter except for roads and trails which reach $85 million in 5th year and increase to $89 million at end of short-term program due to increase in road and trail 10 percent fund.

Based on average annual costs, following are the percentages that the major items would make of the total:

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All resource development and management items together would be 41 percent of the total program.

Costs and revenues.-Near the conclusion of his statement, Mr. Peterson mentioned the expected benefits to the Nation from this program. The major benefits probably are those that are not measurable in monetary terms.

But purely from the dollar standpoint, it is worth noting that revenues from the sale of timber and other national-forest products and services are expected to increase from $94 million in fiscal year 1958, and an estimated $110 million this year, to $210 million at the end of the short-term program and to $385 million annually by the year 2000 (chart 9).

This increase in national-forest receipts would substantially lessen the impact of the proposed program on the Treasury. For example, in fiscal year 1959, expenditures will exceed receipts by about $9 million. Near the end of the short-term program, it is estimated that costs might exceed annual revenues by about $100 million. But thereafter the reverse trend becomes evident. Costs will gradually stabilize and even if they should reach $350 million annually by the year 2000, receipts by that time will be in excess of costs to the extent of about $35 million annually.

Although the national forests were not established for the purpose of making a profit it is nevertheless satisfying to anticipate that once the program has become implemented, these properties can be expected to yield a net financial return in addition to their many other benefits.

Up to this point, Mr. Chairman, Secretary Peterson and I have explained this program wholly from a national point of view. I know that a great many Members of Congress and others throughout the country will want to know what this program means with respect to the national forests in individual States.

The physical work to be accomplished during the short-term program and the estimated costs of doing this have been developed for each State. There is

not time to go into the detailed State figures, but I would like to offer to the committee a series of State tabulations which summarize the program for the national forests in each State.

That completes my statement, Mr. Chairman. May I say again that we in the Department of Agriculture are grateful for the committee's interest in the program and for the opportunity to explain it to you. We shall be glad to try to answer any questions.

Mr. CRAFTS. Do you wish me to discuss the costs of this program, even though they are included in this document ?

Senator RANDOLPH. Yes, if that is available.

Mr. CRAFTS. With respect to costs, our estimates cover what the short-term program would cost in terms of 1958 dollars.

I should make clear that what may be recommended in subsequent budget requests to the Congress will necessarily depend upon overall budgetary needs and financial resources of the Federal Government. This program cannot be considered in a vacuum or in isolation from other needs.

However, the Secretary of Agriculture has recommended to the Congress a program of needed action. You who must evaluate this recommendation are entitled to know how much the Department of Agriculture thinks it would cost.

Basically, there are two kinds of expenditures, recurrent and nonrecurrent. Recurrent include such things as timber sales, administration and management, maintenance of recreational areas, preparation and maintenance of management plans and so on. Nonrecurrent costs include such things as timber stand improvement, erosion control, tree planting, range reseeding and so on. The total cost of the program divides roughly 50-50 between the recurring and nonrecurring items.

Costs are explained in three ways, total and annual costs, costs by functions, and costs in relation to revenues.

The total gross costs of the program are estimated at $3.4 billion. This is about $2 billion more than national forest activities would cost in the next 12 years if they were to continue at the 1959 level without any change.

If, on the other hand, the program costs were compared to a continuation of recent trend in expenditures related to national forests rather than to a continuation of 1959 costs the step-up would be much less. National forests expenditures have increased very rapidly in the past 10 years, from $54 million in 1950 to $119 million in 1959, or more than double. Thus, comparing program costs with continuation of recent trends in appropriations the difference would be $1.4 billion.

Senator RANDOLPH. Mr. Crafts, at the 1959 level, you are indicating to the subcommittee that this necessary work is not being done. Mr. CRAFTS. We are indicating that it is not being done to the degree that it should be done.

Senator RANDOLPH. Yes, to the degree that it should be done.

Do you say that we fail to provide the funds and the programs to do the necessary work? And that we in reality are shortchanging ourselves as a people. Are we allowing our resources to disintegrate?

Mr. CRAFTS. I would not go so far as to say that, Senator Randolph. I would say this, that failure to accomplish this program will mean that the national forests will not be able to render the service to the American people in the way of timber, recreation, wildlife and so on,

in the future, that they should render and that they reasonably will be expected to render in relation to the increasing numbers of people that we can see ahead.

Senator RANDOLPH. Would you say then that a corollary might be drawn as if a man were investing in a business and after placing a sizable sum he had a poor plant manager and he failed to produce the product that he was equipped to produce? Would that be a correct analogy?

Mr CRAFTS. I think that is a fair analogy.

Senator RANDOLPH. Then the American taxpayers have an investment in our national forests. We are failing to carry forward the necessary work to secure for these taxpayers the return to which they are entitled. Is that correct?

Mr. CRAFTS. I think that is correct if you will interpret return to be more than merely dollar return. In a few moments I will discuss the expected revenues from the sale of national forest services under this program and the expenditures proposed in terms of dollars will not exceed the expected revenues until some time after the end of the short-term program. We believe that by the end of the century the financial returns will exceed the expenditures. However, we also believe very firmly that there are national forest services such as water, recreation, and others which are not susceptible to dollar evaluation. If you interpret investment to mean investment in the sense of expecting returns both dollarwise and in other ways then I would agree with your statement.

Senator RANDOLPH. You are saying, Mr. Crafts, that there are dividends involved which are not strictly of a monetary nature?

Mr. CRAFTS. Very definitely so.

Senator RANDOLPH. Good.

Mr. CRAFTS. The average annual cost of the program would be about $283 million per year or $164 million more than the 1959 level of $119. The program has been so planned that costs should increase at approximately equals amounts for each of the first 5 years, then level off for the next 6 years at a minimum annual cost of $321 million and decline somewhat in the last year of the short-term program because of the completion of certain nonrecurring items.

Assuming that the program gets underway in 1961 the increased costs would be $38 million annually for each of the first 5 years Another way of saying it is for each of the first 5 years the annual step-up in costs would be $38 million more than the preceding years. In round figures and in oversimplified terms it can be stated that the program would require increased costs of about $40 million for each of the first 5 years then leveling off at $321 million for most of the remaining period.

Now, with respect to costs by function, there is in the material that you said is to be included in the record a tabulation which shows the estimated annual program costs for each of the six principal functions and for several subitems. It appears in Dr. McArdle's statement.

Construction and maintenance of forest development roads and trails would continue to be the most costly item with a maximum annual direct expenditure of Government funds during the short-term program of $85 million to $89 million.

In addition to the direct Government expenditures for forest development roads there would continue to be a substantial portion of

the total road program constructed and maintained by timber purchases and financed through reductions in amounts paid by purchasers for national forest timber. This amount would average $51 million during the short-term program.

Expenditures for timber resource development and management would be the second largest items and those for recreation and wildlife habitat would be the third.

Based on average annual costs, major items would make up the following percentages of the total: roads 27 percent; timber 21 percent; recreation and wildlife 12 percent; research 11 percent; fire protection 9, and so on.

All of the resource development and management items together would be 41 percent of the total program.

The major benefits from this program we believe to include those that are not measurable in monetary terms.

But purely from the dollar standpoint it is worth noting that revenues from the sale of timber and other national forest products are expected to increase from $94 million in 1958 and an estimated $110 million this year to $210 million by the end of the short-term program and to $385 million by the end of the century. This increase in national forest receipts would substantially lessen the impact of the proposed program on the Treasury. For example, in fiscal year 1959 expenditures will exceed receipts about $9 million. Near the end of the short-term program it is estimated costs might exceed annual revenues by $100 million. But thereafter the reverse trend becomes evident. Čosts will gradually stabilize and even if they should reach $350 million annually by the year 2000 receipts would be in excess of costs by that time to the extent of about $35 million annually.

Although the national forests were not established for the purpose of making a profit, it is nevertherless satisfying to anticipate that once the program has become implemented these properties can be expected to yield a net financial return in addition to their many nonfinancial benefits.

That completes, Senator Randolph, our discussion of costs. I believe that also completes what we had in mind in describing this program to you. We will be glad to try to answer questions if we can. Senator RANDOLPH. Thanks Mr. Crafts and Mr. Cliff.

Now, you speak of certain values which are not dollar values. You are thinking in terms other than the so-called building of a better youth population for the United States, is that correct? Mr. CRAFTS. In terms of these other values?

Senator RANDOLPH. Yes, sir.

Mr. CRAFTS. The other values that we normally think of, Senator Randolph, are such things as the value of recreational use of the national forests, the value of the water that comes from the national forests, and other so-called intangible and indirect benefits.

Senator RANDOLPH. These other values are inherent in the proposed legislation; we are conscious of the direct values, also of the other values. Those are very important. We are thinking of the value of the building of a better citizenry by concentrating on what we think is a valuable program for the young men of our country.

I have in my hand a column which appeared on Thursday, May 14, 1959, in the "Spirit of Jefferson Farmers Advocate." This is an

excellent newspaper published at Charles Town, W. Va. Henry W. Morrow, its editorial writer, is also a practicing attorney in West Virginia. He accompanied the sheriff, C. A. Hehle, of Jefferson County, to an earlier hearing before this subcommittee. When Mr. Hehle, a successful businessman as well as a holder of important public office, testified as a former enrollee of the Civilian Conservation Corps, he spoke of the value which the program had for him in the years of his life encompassed by the time he spent in the CCC. And Mr. Morrow writes in the splendid article that—

It is difficult to stir public interest in programs such as this. There is a tendency to just let things go along, but it is a dangerous and costly drift. The people don't get excited about trees, but perhaps it would be appropriate to quote the immortal words of the poet:

"I think that I shall never see

A poem as lovely as a tree;

Poems are made by fools like me;

But only God can make a tree."

When a program such as that envisaged by the Youth Conservation Corps Act, now before the Senate, gives us a chance to save our trees and at the same time save our youth it deserves public support; and this small voice is raised in support of it.

Earlier in the editorial he spells out some of the values which you have supported from a natural resource point of view. Mr. Morrow indicates this added factor, which he believes exists. Let us at this point include the complete text to which I have made reference. (The editorial referred to follows:)

[From Spirit of Jefferson Farmer's Advocate, Thursday, May 14, 1959]
THE YOUTH CONSERVATION CORPS

(By Henry W. Morrow)

Senator Hubert Humphrey, of Minnesota, has introduced a bill in the U.S. Senate, which is cosponsored by our two West Virginia Senators, Senator Randolph and Senator Byrd, which would create a Youth Conservation Corps, similar in scope to the old Civilian Conservation Corps which was created in the early days of the New Deal. A subcommittee of the Senate, headed by Senator Jennings Randolph, is holding open hearings on the bill this week and I had the opportunity of sitting in on a portion of those hearings this week. Senator Randolph and asked Sheriff C. A. Hehle, of Charles Town, to appear before the committee and I went to Washington with him. Back in his early days Sheriff Hehle had been a member of the Civilian Conservation Corps and he readily testified to the value of the program.

The bill, if enacted into law, would provide for a series of camps across the country manned by volunteer youths, unmarried and between the ages of 17 and 23. The boys would be charged with the responsibility of conserving the millions of acres of forest and park lands in which the country now has so enormous an investment. The lads would be paid a nominal salary of $78 per month, in addition to board and lodging. The program would also offer training in trades and occupations.

It would seem to this observer that there is considerable merit in this program. There are literally thousands of our young people in this age bracket who find time heavy on their hands, with the inevitable result that many of them end up in juvenile court and are frequently sent to industrial homes. As Sheriff Hehle pointed out in his testimony before the subcommittee of the Senate on Monday, right here in Jefferson County there is a young juvenile delinquent who is under sentence to the State industrial school for boys at Pruntytown, but that institution is now so jammed and packed that he must wait until other lads are released before he can be taken in. Meanwhile, he is free to roam the streets with the attendant danger of more trouble. We can apparently spend millions for prisons and reformatories; but we are reluctant to spend in a healthy and

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