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<br />$2 billion for the natural resources activities of the Bureau of <br />Reclamation, the Corps of Engineers and the Department of Agri- <br />culture's small watershed program (P.L. 566) or a little less <br />than 1% of the total federal budget, one cannot reasonably expect <br />the application of the 7% discount rate to contribute much to a <br />relaxation of current budgetary constraints. <br />The Water Resources Council proposal appears to suggest <br />that when environmental quality and regional development objectives <br />are involved a favorable benefit-cost ratio with respect to <br />national economic development is not controlling. The environ- <br />mental quality objective appears to be directed primarily toward <br />preservation of the natural environment. Such critical environ- <br />mental objectives as employment opportunity, population distri- <br />bution, relief of urban congestion, rural-urban balance and <br />employment of unemployed resources are relegated to the regional <br />development objective; and the regional development objective <br />could be pursued in formulating alternative plans only when <br />directed (Paragraph I, page 24145). The proposed principles and <br />standards as published give no indication as to who would give <br />such direction, nor any guidelines for such direction. Thus it <br />appears that a favorable benefit-cost ratio with respect to the <br />national economic development objective will continue to be <br />essential for project authorization and the discount rate would <br />be so high that virtually no projects will qualify. <br />It is New Mexico's view that ~ principles and standards <br />should be modified to provide that the regional development <br />objective is included in the formulation and evaluation of each <br />-6- <br />