National Farmers Union has recognized, and has been an advocate for, both a national energy policy and a national food policy, for some time. We recognize that there is great interdependence between these two policies. Therefore, we support the creation of a Department of Energy and pledge to work with both the Congress and the administration in the development of an effective and efficient Department of Energy.

Mr. Chairman, that completes my statement.

Mr. BROOKS. I appreciate your testimony.

In your statement you express concern over the lack of provisions for citizen participation in this bill. What amendments would you suggest in order to alleviate this problem?

Ms. KOBELL. In the past we have found ways by which citizens can come to the hearing process and through advisory committee participation and comment which provides mechanics for citizens to participate. I think in this field in which we are going to ask citizens to, in many cases, change their lifestyles and change the way they do things, then it is important to count them in and help them feel they make a contribution to make the thing work.

Mr. BROOKS. You suggested that the Federal Power Commission, the oil-pricing authority of FEA, and the pipeline ratemaking authority of the ICC be combined in an independent National Energy Regulatory Commission. Why would this new Commission be better able to coordinate with the Department of Energy on energy policy than the various present Commissions?

Ms. KOBELL. It's possible that the various present commissions could accomplish the job. We were concerned with the discussion of the possibility of including those in the Department of Energy which would take away a good deal of their watchdog effectiveness, we believe.

You will have an overall energy department. So we thought it logical that you would have overall overseeing operating rather than the splintering into several different commissions. It seemed a logical step although we would not be adamant in our attitudes in either direction. But we were adamant in feeling that the Department of Energy should not have to involve itself in its own oversight.

Mr. BROOKS. Would your fears that the Secretary of Energy will be in a preeminent role over the Administrator of REA be allayed if we amended the bill to provide that the Secretary of Energy should be consulted by the Administrator of REA before granting generating and transmission loans?

Ms. KOBELL. The Rural Electrification Administration, as you know, operates under a number of guidelines both in oversight of the Congress and conferring and meeting the requirements of other departments. We believe that a criterion could be established to conform with the policies of the Department of Energy which would fulfill that responsibility without necessarily having an additional oversight which might involve delay in building transmission or generating facilities. It would simply add another layer of bureaucracy. That is something which is pretty well reviewed already.

Mr. BROOKS. Thank you.

Mr. Erlenborn?

Mr. ERLENBORN. Thank you, Mr. Chairman, I have no questions.

Mr. BROOKS. Mr. Fuqua?

Mr. FUQUA. Mr. Chairman, picking up on a question that you just asked let me say this. You mentioned the possibility that the FPC and the FEA and ICC should be made into a national energy regulatory commission. Should we include other areas such as nuclear and some others?

Ms. KOBELL. It would seem logical that the areas in which the Department of Energy has a responsibility might be included in one oversight commission.

Mr. FUQUA. One regulatory agency to cover it all?

Ms. KOBELL. Yes. I think we were citing those as examples of some of the most obvious of the regulatory operations.

Mr. FUQUA. Also you mentioned the REA and having the joint approval of the Secretary of Energy as well as the Secretary of Agriculture. It is your feeling that would add another layer of bureaucracy and cause delays in loan approvals?

Ms. KOBELL. I think if it were required that the Secretary of Energy would have to approve, then it might cause an additional delay. We assume that the Cabinet members will be coordinating in both food and energy policies rather closely, but as a legislative matter we think it would be better left under the supervision of the Secretary of Agriculture.

Mr. FUQUA. Thank you very much.

Thank you, Mr. Chairman.

Mr. BROOKS. Thank you very much.

Ms. Kobell, we appreciate very much your coming down and contributing to this hearing.

Ms. KOBELL. Thank you.

Mr. BROOKS. The Chair will next recognize J. R. Snyder. He is the national legislative director of the United Transportation Union. I have known him for 20 years.

STATEMENT OF J. R. SNYDER, NATIONAL LEGISLATIVE DIRECTOR, UNITED TRANSPORTATION UNION; ACCOMPANIED BY W. G. MAHONEY, COUNSEL

Mr. SNYDER. Thank you, Mr. Chairman and members of the committee. It is indeed a pleasure to be here today. It's my pleasure also to introduce our attorney for the UTU as well as the Railway Labor Executive Association, Mr. W. G. Mahoney, who has a great deal of experience in this area.

Mr. BROOKS. We are pleased to have you with us again, Counsel. Mr. SNYDER. Mr. Chairman, my statement is very brief and I will read it and then be open for questions.

I appreciate the opportunity to present the views of the United Transportation Union on H.R. 4806, the Department of Energy Organization Act. I serve as the national legislative director of the UTU, which represents approximately 225,000 railroad employees in the operating crafts, making it the largest union representing railroad operating employees. Our membership also includes bus operators, whose interests are not directly involved in the pending legislation.

88-131 - 77 - 33

Our organization supports the creation of a Department of Energy, and based on that support favors H.R. 4806, but we have one serious objection, and that is section 308. That section would transfer jurisdiction over the transportation of oil and coal by pipeline from the Interstate Commerce Commission to the new Department of Energy.

Our reason for this is the current push being made for the establishment of coal slurry pipelines to transport coal under the right of eminent domain from the coal fields in the West to the markets in the industrialized East. During the past several sessions of Congress we have strongly opposed coal slurry pipeline legislation, not only from the standpoint of its initial and protracted cost, but from the more practical standpoint of the hundreds and possibly thousands of jobs it would eliminate for the employees in the railroad industry that we have the privilege of representing.

We have vigorously opposed all such efforts in the States, as well as on the national level. The record of hearings on this subject is replete with the opposition of the UTU to such proposals.

The past several sessions of Congress found Members of both Houses devoting a lot of attention to the needs of the railroad industry. We have enacted such measures as the National Railroad Passenger Service Act-Amtrak, the Railroad Reorganization Act of 1973, the Railroad Revitalization and Regulatory Reform Act of 1976, to name some of the larger ones. All of these were designed to provide the rail industry with a degree of stability to recover from the problems which beset them in the 1960's and to grow strong economically.

As a graphic illustration of the negative economic impact the loss of railroad jobs involves, there is appended to this statement a chart entitled "What the Loss of 100 Railroad Jobs Means to a Community." as taken from a book authored by the UTU's president, Mr. A. H. Chesser, dealing with the subject of coal slurry pipelines.

The possibility of coal slurry pipeline legislation being enacted, either on the Federal or State level, would negate the efforts of the Federal Government in its railroad assistance efforts. Such a change in direction would be abetted by the transfer from the Interstate Commerce Commission to the proposed Department of Energy of jurisdiction over oil and coal pipelines. The ICC by tradition and experience is equipped to pass on the merits and effects of such proposals, since coal pipeline proposals are truly a matter of transportation more than simply a decision on energy use.

For the foregoing reasons I would like to strongly recommend that section 308 of H.R. 4806 be eliminated from the Department of Energy Organization Act. Our organization is in a position to support the other sections of the bill, and want to assure you that such efforts to improve our energy conservation and utilization will have the complete support of the United Transportation Union.

Thank you for the privilege of presenting our views on this measure. Mr. BROOKS. Without objection, your table will be inserted in the record at this point.

[The table follows:]

63

Mr. BROOKS. I want to thank you for being here. I have a few questions to ask you.

Why do you believe that the Department of Energy would set pipeline rates which would be more discriminatory to railroads than regulation by the ICC?

Mr. SNYDER. As you know the ICC is one of the oldest regulatory agencies in existence.

Mr. BROOKS. I know it's old, yes.

Mr. SNYDER. With their expertise in this field we think that they are more equipped to regulate not only this but other surface transportation than setting up a new department. We think it would be cheaper for the taxpayer.

Mr. BROOKS. Should regulation of gas pipeline rates also be transferred to the ICC?

Mr. SNYDER. I will let my attorney answer that one.

Mr. MAHONEY. Mr. Chairman, I believe the gas pipeline rates have been under the Federal Power Commission for some time. I see no reason to change that.

The problem with coal is that coal is the commodity which is transportable by rail. Gas is not. Practically speaking it is not transportable by rail, therefore, we feel that the agency that has the railroad under its regulatory authority should also have any transport that is common to both modes, pipeline and rail.

These should be under the same regulatory agency and not a different regulatory agency simply because for one thing, as you mentioned a moment ago, the rates, the ICC, having both modes of transportation under its jurisdiction, would be able to weigh the effects of the rates of one on the other and balance them, whereas, I do not believe a separate independent agency over a pipeline as opposed to rail would have that expertise of ability.

Mr. BROOKS. Are the present ICC regulated rates of all pipelines discriminatory to railroads, Mr. Snyder?

Mr. SNYDER. I really do not know, Mr. Chairman. We can find out for you and furnish that information.

Mr. BROOKS. Why don't you work up an answer for that. [The information follows:]