' FEDERAL ADVISORY COUNCIL REGIONAL ECONOMIC DEVELOPMENT SIXTH MEETING— MARCH 17, 1971 WASHINGTON, D.C. Digitized by the Internet Archive in 2012 with funding from LYRASIS Members and Sloan Foundation http://archive.org/details/federaladvisorycOOfede FEDERAL ADVISORY COUNCIL ON REGIONAL ECONOMIC DEVELOPMENT SIXTH MEETING— MARCH 17, 1971 Maurice H. Stans Secretary of Commerce and Chairman Federal Advisory Council George J. Pantos Special Assistant to the Secretary and Executive Secretary Federal Advisory Council U.S. Department of Commerce WASHINGTON, D.C. Table of Contents Page Introduction v Federal Advisory Council on Regional Economic Development Members of the Council vii Attendees at Meeting ix Agenda x i Opening Remarks 1 James T. Lynn, General Counsel Discussion Leader . . . 1 George Pantos, Special Assistant to the Secretary Coastal Plains Regional Commission Plan 3 Federal Cochairman G. Fred Steele, Jr. General Discussion by Executive Agency Participants 9 Department of Health, Education, and Welfare 9 Department of the Army 9 Department of the Interior 12 Department of Transportation 14 Department of Labor 18 Department of Housing and Urban Development 21 Department of Agriculture 23 Office of Economic Opportunity 24 Small Business Administration 25 Department of Commerce 25 Discussion of Implementation of Regional Plans 31 Fred Eaton, Deputy Director, Office of Regional Economic Coordination Appendices Appendix A— Written Statements of Executive Agencies 33 Appalachian Regional Commission 34 Department of Agriculture 37 Department of the Army 40 Department of Health, Education and Welfare 44 Department of Housing and Urban Development 47 in Appendix A— Continued TABLE OF CONTENTS-Continued Page Department of the Interior 51 Department of Labor 54 Department of Transportation 56 Office of Economic Opportunity 62 Small Business Administration 67 Appendix B— Written Statements of Commerce Intradepartmental Committee 79 Office of Assistant Secretary for Economic Affairs 80 Office of Policy Development 85 Office of Regional Economic Coordination 87 Office of Business Economics 120 Bureau of Census 124 Bureau of Domestic Commerce 125 Economic Development Administration 127 Maritime Administration 134 National Oceanic and Atmospheric Administration 136 U. S. Travel Agency 141 Appendix C-Draft Paper on Implementation of Regional Plans 143 Appendix D-Executive Order No. 1 1386, dated December 28, 1967, establishing Federal Advisory Council 151 Appendix E-Outline of Plan Review Process 157 IV INTRODUCTION The Federal Advisory Council on Regional Economic Development convened on March 17, 1971, to formally review the five-year comprehen- sive development plan of the Coastal Plains Regional Commission. The first draft of the plan was accepted by the Secretary of Commerce as an "interim document" in January 1970. During the intervening months, the Commission worked with the three member States of North Carolina, South Carolina, and Georgia; the regional offices of the member agencies of the Federal Advisory Council; and the various agencies within the Commerce Department. These efforts produced a fully-developed regional economic development plan which was forwarded in final draft for Federal review by the Council in December 1970. By participating in the Federal review, the Council is discharging one of its most important responsibilities, as provided for in Executive Order 11386. The Council serves as the mechanism which links Federal agencies responsible for major domestic economic programs with the six multi-state regional economic development commissions: Appalachia, Coastal Plains, Four Corners, New England, Ozarks, and Upper Great Lakes. The Commis- sions were formed in recent years under the provisions of the Public Works and Economic Development Act of 1965 and the Appalachian Regional Development Act of 1965. As provided for under the Public Works and Economic Development Act, final approval of the plan rests with the Secretary of Commerce, after the Coastal Plains Commission revises it to reflect the recommendations of the Council. Once the Secretary approves the plan, it is then forwarded to the President. COASTAL PLAINS ECONOMIC DEVELOPMENT REGION VI MEMBERS OF THE FEDERAL ADVISORY COUNCIL ON REGIONAL ECONOMIC DEVELOPMENT Maurice H. Stans, Chairman and Secretary of Commerce Clifford M. Hardin Secretary of Agriculture Stanley R. Resor Secretary of the Army Elliot L. Richardson Secretary of Health, Education, and Welfare George Romney Secretary of Housing and Urban Development Rogers C. P. Morton Secretary of the Interior James D. Hodgson Secretary of Labor John A. Volpe Secretary of Transportation Frank Carlucci Director, Office of Economic Opportunity Thomas S. Kleppe Administrator, Small Business Administration George J. Pantos, Executive Secretary and Special Assistant to the Secretary for Regional Economic Coordination George Sharrock Chairman, Federal Field Committee for Development Planning in Alaska Donald Whitehead Federal Cochairman Appalachian Regional Commission G. Fred Steele, Jr. Federal Cochairman Coastal Plains Regional Commission Stanley Womer Federal Cochairman Four Corners Regional Commission Chester M. Wiggin, Jr. Federal Cochairman New England Regional Commission E. L. Stewart, Jr. Federal Cochairman Ozarks Regional Commission Thomas F. Schweigert Federal Cochairman Upper Great Lakes Regional Commission VI 1 vm ATTENDEES AT THE FEDERAL ADVISORY COUNCIL ON REGIONAL ECONOMIC DEVELOPMENT March 17, 1971 The meeting was called to order and presided over by Mr. George J. Pantos, Special Assistant to the Secretary for Regional Economic Coordination and Executive Secretary of the Council. G. Fred Steele, Jr. Federal Cochairman Coastal Plains Regional Commission Chester Wiggin, Jr. Federal Cochairman New England Regional Commission Thomas Schweigert Federal Cochairman Upper Great Lakes Regional Commission Orville H. Lerch Alternate Federal Cochairman Appalachian Regional Commission Robert Stottlemyer Council on Environmental Quality Henry L. Ahlgren Deputy Assistant Secretary for Rural Development and Conservation Department of Agriculture Richard Hertzler Chief, Office of Civil Functions Department of the Army Lawrence E. Imhoff Deputy Assistant Secretary for Administration Department of Commerce Fred Eaton Deputy Director, Office of Regional Economic Coordination Department of Commerce Alexander N. Christakis Consultant Department of Commerce Victor Kimm Senior Policy Analyst Office of Policy Development Department of Commerce Kenneth L. Deavers Director, Office of Planning and Program Support Economic Development Administration Department of Commerce David Kinley Deputy Assistant Secretary for Community and Field Operations Department of Health, Education, and Welfare Andrew S. Bullis Assistant Director, Inter-Governmental Relations Department of Housing and Urban Development Warren Clayman Urban Planner Office of Comprehensive Planning Department of Housing and Urban Development Bruce Blanchard Staff {Assistant Poli: I Planning and Research Dep^tment of the Interior IX James Flannery Staff Assistant Office of Assistant Secretary for Water and Power Resources Department of the Interior Joseph Epstein Chief, Economic Development Group Office of Research and Development Manpower Administration Department of Labor Harold Bailin Deputy Director for Field Coordination Division Office of Economic Opportunity Jack Eachon, Jr. Associate Administrator for Financial Assistance Small Business Administration Robert Binder Deputy Director for Policy and International Affairs Department of Transportation Marion Forrester Economist, Office of the Secretary Department of Transportation Charles Coss Executive Director Coastal Plains Regional Commission Charles Smith Coastal Plains Regional Commission Ward Miller Coastal Plains Regional Commission Joseph Gabbard Coastal Plains Regional Commission William Anders Coastal Plains Regional Commission Joseph McCabe Coastal Plains Regional Commission Norris Ellertson Regional Planning Officer Four Corners Regional Commission Donald J. Skinner New England Regional Commission Jack Donahue Special Assistant New England Regional Commission Sidney Jeffers Special Assistant Ozarks Regional Commission Roy Fingerson Special Assistant Upper Great Lakes Regional Commission AGENDA FOR THE SIXTH MEETING OF THE FEDERAL ADVISORY COUNCIL ON REGIONAL ECONOMIC DEVELOPMENT Chairman: Mr. George J. Pantos, Executive Secretary of the Council and Special Assistant to the Secretary for Regional Economic Coordination Time and Place: 9:30 a.m., March 17, 1971 Secretary's Conference Room (Room 5855) I. Introductory Remarks: Honorable James T. Lynn, General Counsel II. Development of the Coastal Plains Regional Commission Plan: Honorable G. Fred Steele, Jr., Federal Cochairman, Coastal Plains Regional Commission III. Individual Agency Comments on the Coastal Plains Regional Commission Plan: Discussion Leader, Mr. Pantos A. Department of Health, Education and Welfare B. Department of the Army C. Department of the Interior D. Department of Transportation E. Department of Labor F. Department of Housing and Urban Development G. Department of Agriculture H. Office of Economic Opportunity I. Small Business Administration J. Department of Commerce IV. Discussion on Implementation of Regional Plans: Mr. Fred Eaton, Deputy Director, Office of Regional Economic Coordination XI James Lynn, General Counsel, welcomes par- ticipants to the Federal Advisory Council Meeting George J. Pantos, Executive Secretary of the Federal Advisory Council (left), and Fred Eaton, Deputy Director, Office of Regional Economic Coordination, follow discussion of Coastal Plains Plan. XII OPENING REMARKS MR. PANTOS: Good morning. My name is George Pantos, Special Assistant to Secretary of Commerce Stans, and I would like to welcome you again to the meeting of the Federal Advisory Council. It is a pleasure to have you all here again. I believe, if we don't accomplish anything else, at least we have an interagency exchange here that may be lacking in other forums. The purpose of today's meeting, as you know, is to discuss the Coastal Plains Regional Commisssion plan. As you all know, this is the second Commission plan to be taken up in a meeting of the Council. The November meeting permitted us to review the five-year plan of the Upper Great Lakes Commission. I believe that meeting was useful, for it provided guidance to the Upper Great Lakes Commission and also started us thinking about the issue of implementation of regional plans. We will have more to say about this later in the meeting. I would like to offer a few other remarks here to start us, but before doing so, perhaps we could just quickly go around the main table here to have everyone introduce himself and identify the agency he is representing. Maybe we could start right here. (Introductions.) MR. PANTOS: I believe we will have a few more people coming as we proceed with the meeting. Also around the room are members of the Special Assistant's staff as well as members of the Coastal Plains staff, whom you will be meeting later. 1 believe we will also have joining us later in the morning some representatives from the White House as well as from the Office of Management and Budget. As you all know, we have had a change in leadership at the Department of Commerce. Our Undersecretary, Rocco Siciliano, who presided over the last meeting, is leaving Government to return to private work, and the nominee for succession is James Lynn, the present General Counsel of the Department of Commerce. I would now like to introduce Mr. Lynn, who has just come in, and have him offer a few introductory remarks. Jim, I have already asked everyone around the table to introduce himself, so you can make your remarks and then we will go right into the discussion of the plan with Fred Steele, the Federal Cochairman of the Coastal Plains. Jim? MR. LYNN: George, I look upon only one excuse for being late as sacrosanct and that is being over at the White House. That is my excuse this morning, and I apologize for it, but I just couldn't help it. These are interesting times for a meeting of this kind. The special revenue sharing and general revenue sharing proposals put a new complexion, 1 think, on consideration of regional commission problems, on EDA, on many other areas of grant and planning programs, and the like. However, I think, no matter where we come out in the course of the next six months, or year, or year and a half on special revenue sharing programs and the like, a meeting of this kind is extremely valuable because the plans being considered at these meetings are extremely valuable. Any one of three things can happen to our initiatives on special revenue sharing: One, I suppose it could end up on the cutting room floor of the Committee. If I have my way, however, I"m going to do everything possible to see that that doesn't happen. Second, we could have special revenue sharing alongside other initiatives if the Hill so decides. Third, we could get both general and special revenue sharing, which is the way I want to see it done, if we can. But even if we do have revenue sharing, both special and general, the plan that is being developed for the Coastal Plains region and the plans for the other regions such as the Upper Great Lakes, and so on, would be extremely valuable, I believe, to the states that are involved in these efforts. I think the fact that so many of you are willing to come to this kind of meeting is a pretty good sign you share that view. These are important things. A lot of money is going to be spent, one way or another, in these areas, over the course of the next two, three, four, six, eight, ten years. And what is done here can affect drastically how that money is spent. We appreciate your coming and taking the time to participate in this kind of an exercise. I know what your schedules are like, after two years in Government. We do appreciate very much your participation and help in these efforts. The combination of this kind of a review, along with the kind of consideration afforded the plan by the Regional Council, and the rather intensive intradepartmental reviews— among which, I might add, there is not complete unanimity of views-helps frame and formulate this kind of a plan in the best possible way. Again, our thanks to you for coming. We appreciate your help, and I know that goes for everyone sitting at this table. Now, George, I would like to pass on to the substantive part of the meeting. MR. PANTOS: Thank you very much, Jim, but you are not going to get away that easily because the question of implementation is on our minds as we proceed through the review process. This is the second of five plans to reach this level. And, of course, after the completion of the review process by this Interagency Committee, the next question to be resolved— one which has some very neat considerations to it— is the question of imple- mentation. We have prepared a paper on that subject for consideration and comment by the members of this Council and will discuss it further later in the meeting. Jim has mentioned the Special Revenue Sharing Message. 1 believe you all have before you copies of the President's Special Revenue Sharing Message, which proposes that the Regional Commission program and EDA, two Department of Commerce programs, be merged into special revenue sharing; but this now becomes a question for the Congress to decide. And as you all may know, hearings are under way at present in the House on the question of extensions of the Title V Regional Commission, Appalachian, and EDA programs and consideration is also being given to creating an Accelerated Public Works program. Last week the Senate passed a provision calling for a one-year extension of the Title V Regional Commission and a four-year extension of the Appalachian Regional Commission programs. So, regardless of the outcome of these programs, as Jim has indicated, the work being done here is important because it becomes a blueprint for action, a blueprint which will point the way of public investments in these lagging areas. A few late arrivals have joined us. We've gone around the table once. Perhaps we could just pick up the people who have not introduced themselves, starting on this side. (Further introductions.) MR. PANTOS: Anyone else? Okay. At this point, I would like to introduce Fred Steele, who is the Federal Cochairman for the Coastal Plains Regional Commission. Fred will make a few general remarks, and he has a prepared statement which, I think, will lay out some of the background as to how the Coastal Plains has gone about preparing this plan. Then we will go quickly into the reviews, and hopefully, we can finish our reviews by quarter of twelve, take ten minutes between quarter of twelve and twelve to have a brief discussion on implementation, and have you all out by twelve noon just as we did last time. 2 DEVELOPMENT OF THE COASTAL PLAINS REGIONAL COMMISSION PLAN MR. STEELE: Thank you, George. I want to add my thanks to each and every one of you for being here this morning. It is a privilege for me to be here to receive your comments. The developing of a comprehensive plan is a very serious matter with us, in spite of the events that might happen. In fact, just last night I was in another Washington— in North Carolina we refer to this as the original Washington— that's Washington, North Carolina, where I had an opportunity to address the Annual Meeting of the Chamber of Commerce. The topic of my discussion was revenue sharing and my support of the President's program. It seems to me a little weird that some of the people couldn't understand why I wanted to give up my job, but, nevertheless, I think the President is right. I've testified officially before the Senate Public Works Committee, and endorsed the Administration's view of asking for a one-year extension. With the action in the Senate, I'm sure we will have one more year anyhow. So— we want to move along. I have prepared remarks but am going to do something unusual— I am going to call on one of my staff members to read these remarks for me. I developed an infection in my eye last week and find it is extremely difficult to read. And while I am talking about our staff, I would like to introduce the members of the Coastal Plains staff that are here. These people have done a magnificent job, as you will find as we proceed. We have had some outside assistance in the development of this plan, but the idea, the concept, the strategy was done by our own staff and they are proud of it. We have Charlie Coss, who is our Executive Director. Charlie, stand up and take a bow so everybody will know who you are. Charlie Smith, our Assistant Director, who has taken the lead role in the development of this plan. He has been the man who has coordinated the entire effort. This has been about a two-year effort. Now, we have Ward Miller and Joe McCabe, who is going to do the reading a little later. We have a brand new member of our staff, Bill Anders, who has just been on board about two weeks, I guess; and Tony Magoulas. And if you will allow me this privilege, I am going to ask Joe to take over and read my statement. Then I will come back and let you fire some questions at us. MR. MC CABE: Members of the Federal Advisory Council, it is a great privilege for me to be able to read Mr. Steele's statement. I am just sorry that his eye problems are preventing him from reading it himself. We are aware that the plan that is before you has weaknesses. It does not, for example, have an executive summary. And the opening remarks that Mr. Steele prepared are somewhat longer than usual, since they are designed both to serve in part as such a summary, and also to set the tone and to sketch out the context in which this plan can be discussed most profitably. The relevant socio-economic data developed from the 1970 Census was not available when this draft was prepared. We will incorporate this 1970 Census data in the final draft of the plan. We are working closely with both the Census Bureau and the Office of Business Economics so that our staff analyses can benefit from the latest available data. We are confident, however, that the differences between the 1960 and the 1970 data will not require any significant change in the strategy or programs described in this plan. This review of the draft plan, while it is still subject to change, is an essential step in the development of programs for the years ahead. The Federal and state agencies have been urged to give the draft the most serious consideration and to be liberal in their suggestions for strengthening and improving the plan. A number of agencies have given us useful suggestions for improvement of the draft. We have already benefited from constructive suggestions made by officials in the U. S. Department of Commerce, the Federal Field Committee in Atlanta, and by State officials in the Carolinas and Georgia. We have been flattered by the comments of many of these men. When we met recently in Atlanta with the Federal officials in the field, the representative from EDA said that our plan could serve as a textbook for economic development planning. The representative from HEW picked up that comment and said that he had read hundreds of plans, but had never seen one that compared with ours. In fact, he was using it as a text for a course he teaches in planning. We also learned recently that this plan is being used as a text for a graduate level course in planning at the University of North Carolina. Although I think many people think the terms "economic development" and "economic growth" are interchangeable, it has become important for us to distinguish between them. "Economic growth" means "more of the same." It is the process of increasing gross product and total personal income along previously established trends. Our analyses of the Coastal Plains region have convinced us that "more of the same" would never be enough. Accordingly, we reject simple economic growth as a strategy. Regional economic development is a process which entails structural changes, technological advances, and resource discoveries. Only the first of these three factors can, in any real sense, be planned. Technological advances and resource discoveries can be fostered but not planned. In the document before us today, are programs which foster both technological advances and resource discoveries. The required structural change has been planned, described, and costed out in this draft. We also realized early in the planning process that no amount of Federal funds alone could truly develop the economy of the region. In a free enterprise economy, most economic activities are conducted by the private sector. Public funds can stimulate economic development through programs designed to induce private investment to create the desired economic structure. The Commission's strategy has been to identify and bring about those public investments which are required to facilitate and stimulate the private investment required to develop the region's economy. We particularly welcome suggestions of specific means by which the programs of these agencies can be brought into a practical working relationship with those of the Commission in support of the regional goals of economic development. This draft is the third and most comprehensive planning document issued by the Commission since it was founded in 1967. It is based on extensive research into regional problems and potentialities, and on the experience of three years of intergovernmental cooperation for regional development. The first task of the new Commission after its organization was to make a preliminary analysis of the economic problems of the region and to develop an initial action planning program. In this undertaking, the Commission anticipated the October 1967 amendment to the Public Works and Economic Development Act, which required that each Regional Commission shall develop a comprehensive long-range economic plan. In these first studies, the Commission attempted to take the measure of the region as it was; its characteristics, needs, basic resources, aspirations, plans, and potential. In addition to data analysis, representatives of the Commission interviewed government and quasi-public agency officials and civic, educational, and business leaders at the state and local levels, in an effort to gain further insight into the needs, opportunities, plans, and hopes for the economic development of the region. The result was the Commission's adoption, on January 19, 1968, of its Initial Action Planning Program, which established a goal for the region, defined a strategy for the achievement of that goal, and designated priority target areas for program development. The goal adopted was to bridge the income gap; to narrow and eventually close, or even surpass, the lag which exists between the region's per capita income average and that of the Nation. The gap was found to be 3.8 billion dollars in gross amount, or $769 per capita, and growing. Today the gap is nearly $1,000 per person, or 5 billion dollars in aggregate. To generate enough economic activity to close this gap, the Commission realized it would have to employ a strategy that went beyond the investment of Federal funds in useful public works and services. Means would have to be found to raise the skill levels of the people who lived in the region and to stimulate industrial growth of the right kinds, and on a sufficient scale, to provide employment income in the required amount. Purposeful leadership, the elevation of technical competence, and the procurement of private investment capital were seen as the key factors in development of the regional economy. The initial areas adopted by the Commission as those demanding priority attention, from the standpoint of development programming, were industrial development, marine resources, education and manpower training, tourist industry, and agriculture. At later times, transportation and housing were added as target areas, and health as an area warranting special attention. With a goal established, a strategy agreed upon, and initial priorities set, the Commisssion proceeded to implement its program of activities. At the same time, it began the preparation of a comprehensive, long-range plan which would establish economic objectives consistent with the central goal, express those objectives in quantitative terms to the extent possible, demonstrate how the overall strategy applied in each program area, and describe program purposes and procedures in all necessary detail. The first documentation of a comprehensive development plan was unanimously approved by the Commission on December 19, 1968. The Regional Development Plan, in accordance with this action, was submitted to the Secretary of Commerce on May 2, 1969, the first to be completed by a Title V Commission. On January 28, 1970, the Secretary informed Mr. Steele of his approval of the plan as an interim document, while pointing out that substantial enlargement of the plan was needed. Concurrently with the evolution of the Coastal Plains comprehensive planning process, investment planning in each of the states was being strengthened through the interaction of the Commission activities and financial support from the Commission. Improvement in the substance of the individual state investment plans, including the identification of areas of potential growth, has been significant. The State investment plans are an essential ingredient to the regional plan inasmuch as they provide a systematic projection of the state's needs and priority programs to meet those needs in the regional portions of each state. The present revision of the plan draws from a combination of information sources, including staff studies, state investment plans, contract research in individual program areas, and an extensive overall analysis of the region's economy conducted for the Commission by the Research Triangle Institute of North Carolina. These studies have provided insights into the industrial mix which can provide jobs and wages at required levels; other sources of income necessary for balanced development; the most efficient distribution of economic activity among growth centers and rural areas; and the most favorable environmental balance. In this connection let me point out that, although the plan is intended to stand on its own, it summarizes and is supported by numerous analyses and reports which are available to anyone who cares to investigate any aspect more deeply. The final draft will have several appendices that are not included in the present draft. The draft now under review is, in effect, an expansion and refinement of the Regional Development Plan approved by the Commission in December 1968. It reiterates the regional goal of closing the income gap. It employs the principles of operation and development strategy that have guided Commission operations in the past. It maintains the program priorities which have been established. This revision goes beyond the initial plan in developing the implications of goal and strategy, in the quantification of objectives, and in setting forth a more detailed and sharply defined program for achieving these objectives over a ten-year planning period. In preparing this draft, we carefully followed the Secretary's guidelines for comprehen- sive planning. They were helpful to us and we feel that we responded to them creatively. This draft goes beyond the initial plan in many respects. It examines the relationship between the regional goal and national goals and policies, finding a high degree of consistency. It sets forth certain subgoals or objectives which are implied by or closely related to the central goal of closing the income gap, these being: the reduction of migration from the region; the improvement of the structure of the region's economy; raising the skill of the regional work force; supporting sound community development; and maintaining the quality of the environment. A major element of the revision is the detailed analysis of the region; its natural, human, and capital resources, its technology, and most importantly, its economic structure. Among the many innovative features of this plan, perhaps the most significant is the determination of alternative economic configurations which it would be feasible for the region to achieve by 1980. We do not contend that one of these structures is what the Region must have for 1980. We offer them as examples of how the Region could achieve equality with the nation, in terms of per capita income, over the next ten years. Techniques employed in the plan are those authorized by the statute governing Commission operations, and include: sponsorship of innovative projects to demonstrate the most feasible solution to a problem; use of technical assistance funds to provide the research and analyses necessary to assure success of programs undertaken; and supplemental funding to federal grant-in-aid programs to assist local and state governments to take maximum advantage of federal programs requiring a matching share. Utilization of these techniques, in accordance with an accepted plan, can stimulate entrepreneurs to create income-producing enterprises in the region. It can help in creating an institutional structure that will permit the regional labor force to take advantage of opportunities created by these enterprises. The Commission can also assist state and local governments in providing required supporting services. Beyond this, the success of the Commission's efforts to bring about economic development in the region will be determined by its ability to enlist the support of governmental officials at all levels, as well as citizen leaders in business, industry, and public institutions. It must be able to influence national, state, and local policies in order to achieve its objectives. Development of a meaningful, realistic plan for the region is of major importance, but the plan and its strategy must gain acceptance from those individuals and groups who comprise the region's leadership. Even more, the Commission must secure a commitment from this leadership to the goals and objectives set forth in the plan and then bring about their full involvement in the implementation of the plans and programs. Gentlemen, 1 thank you. Mr. Steele thanks you, on his own behalf and on behalf of his fellow Commissioners, for the cooperation and assistance you and your agencies have given us to date. Right now we ask: How can this draft be substantially improved? What have we left out that should have been included? How can we better express what needs to be done? MR. STEELE: Thank you, Joe. I realize that was a bit lengthy, but I felt that it would be important to give you a little bit of insight as to how we went about the development of the strategy, and the development of our draft. I notice that the next item on the agenda is "Agency Comments," and HEW is first. Federal Cochairman Steele takes questions on the Coastal Plains Plan. Mr. McCabe of Coastal Plains Commission describes formulation of Coastal Plains Plan. GENERAL DISCUSSION BY EXECUTIVE AGENCY PARTICIPANTS Statement by Department of Health, Education, and Welfare MR. KINLEY: Fred, that portion of the plan related to HEW programs deals with adult basic education, and we have reviewed that, both at Washington and at the regional level. We concur with the analysis of the plan. We, as previously stated, think it is excellent. And it is certainly consistent with our objectives in the Southeast and in the Coastal Plains region. We will continue to support the Commission's efforts, as you know, and stand ready to assist you and your staff in any way we can in the implementation of the plan. Other than that, we have no comments. MR. STEELE: Dave, we appreciate that very much. I want to take this opportunity to thank you and your Department for the assistance that was rendered. We had one full day session in Atlanta with your regional people, in the early stages of the development of this draft, and it has been most helpful. The Army is next. Statement by Department of the Army MR. HERTZLER: Thank you. First of all, we believe this is a well thought out, well prepared, well organized, systematic plan for economic development. And on behalf of the Department of the Army, I want to commend the Commission and its staff, and all those that participated in preparing this document. I think, if there is any one comment we would have to make that might help, particularly in the implementation of the plan, it would be on the question of environmental matters rather than economic development. We, in the Department of Army, have gone through some rather traumatic experiences here in the last year or so, and many of the plans had been pretty well formulated, we thought. This was because they had an impact on the environment and a reaction which was not anticipated several years ago. So, I believe anything that you might do, any economic development, almost without exception, will be subject to detailed scrutiny on the part of those who are concerned with the environment. The thought occurred to me that you people in the Commission might want to set up, what I would call, a regional CEQ, Council on Environmental Quality, which would very carefully work out the environmental aspects of anything you do, at least physically, in the region; because, as we see it, this always was important but never quite recognized as it is today. So, this is something you have to watch very carefully. As for the rest of the plan, on the industrial development program, we feel that the Department of the Army's programs, particularly in flood control, would be useful in developing and protecting industrial sites by the kind of water resources program that we are engaged in. Also, it could help to focus on growth centers, particularly, the water resources project, because of their impact on such things as municipal and industrial water supply, and as the document mentions, in the development of waterways. So far as the marine industries are concerned we are also involved. I would again caution you on the coastal environment which is very important these days. The Department of Army has programs such as erosion protection, beach and shore protection, and programs of that sort. Along with the development of the marine industries, we are also engaged in ports and waterways, and there, so far as the ports are concerned, we aren't involved in determining where along the East Coast, for example, these ports should be. They are not the kind of ports that we have now. They are very deep draft ports, and if the Federal Government is to participate in developments of this kind, there must be some kind of a general plan that links in the whole East Coast. Obviously, unless there is some very important reason, we should not deepen each port along the coast. Now, the question of just where these are is a very important program, and part of the planning, which not only involves your region but all— the whole East Coast. And leisure industries, which is part of the marine industries, we again have such programs as beach protection, and that is a very important aspect of maintaining the leisure industries along the coast. On your general topic of leisure industries, again we have the possibility of water-based recreation. Wherever the Federal Government has a program for a waterway or a reservoir, it creates a potential for water-oriented recreation that didn't exist before. The law requires that this be developed as part of one of the purposes of water resources development, and it also requires that the states and local interests pay part of the cost for this, and operate and maintain it. There is a potential created by the Federal Government which ought to be seized by the states in cooperation with the Federal Government— another opportunity for the water program to contribute to the economic development, as well as the environmental development, of the region. You also mentioned the foreign trade zone in the Department of Army. The Secretary of the Army is a member of that Board and is always interested, concerned, and willing to help along those lines. As for the community facilities and services, again, we have such things to offer as water supply, waste water management, and the production of hydropower. You have another category in your report of regulatory policies. Here is another one that is going to have a very important impact on economic development; and that is the attention that has been paid in recent months to the implementation of the Refuse Act of 1899. This will have a very strong impact on where, and how, and what is done in economic development in attracting industry to the region. This also applies to such things as any dredging and filling in the waterways of the Nation. So again, the Department of the Army welcomes the opportunity of working with the Commission. I am merely pointing out that a number of changes really have taken place that might have an impact in your plans for development. We appreciate the opportunity of making these comments. MR. STEELE: Yes, sir. George— MR. PANTOS: Yes. I would just like to add one comment on the environmental impact point which you raised, Mr. Hertzler. 10 We have become increasingly aware of the need to look at the other side of the development coin which is the environmental consideration. As a matter of fact, the Upper Great Lakes Commission is now giving serious thought to developing an appendix to its own plan, which would set out the environmental impact which its plan would produce. And we have begun discussions on our staff with several of the other Commissions about doing the same thing. We are aware of the fact that economic development is faced with constraints which the environmental community is raising, and that in order to move forward with the kinds of plans that have been developed by the Commissions, we will have to give increasing attention to the matter of environmental impact. One of the things that we really don't know too much about is how you measure precisely the environmental impact of an industrial park, or a marina, or the transport system, or of any other type of infrastructure— water and public sewer works or any other kind of a public system— which would be incorporated as part of an economic development plan. At the present time, we are discussing with outside contractors the possibility of more research in this area. As I mentioned, the Upper Great Lakes is moving in this area. I believe the other Commissions will turn their attention increasingly to doing this, because we are hoping that we can strike some sort of balance between development proponents and the proponents of environmental constraint. I think this is incumbent upon a Department such as Commerce, and particularly in light of these plans. So, I think your points are well taken. I think the establishment of agencies like EPA and CEQ at a point later than the development of this program is one reason why they have not been included as part of the review process, but we will add CEQ and EPA to this Federal Advisory Council so that their comments can also be made part of the record. MR. STEELE: I would like to make just one general comment. We are constantly aware of the tremendous asset that we have in our region— our God-given resources. In our efforts to develop, we certainly don't intend to destroy. We have also given considerable time and thought to ways that we might undertake some additional studies so that we can learn more about how we can develop without destroying the environment. I don't think we have anything specific. We are not ready to sign a contract, but it is a matter that is under consideration. MR. HERTZLER: I might just point out that much can be done in very general terms, like the impact of the proposals in this report on the environment. The problem would be one where a specific plant, or development, or anything physical is proposed. Then you will have to beam in on that particular installation. MR. SMITH: Fred, may I just make a comment on that? MR. STEELE: Chuck. MR. SMITH: I would like to underscore what Fred said about our concern for this factor in all the development plans. As a follow-on of the work that we are currently doing on the comprehensive plan, we intend to go intensively into what would be the appropriate system of evaluation of proposals made for economic development in the states and through the programs of the Commission. The impact on the environment must be a major factor in the evaluation of any project to be undertaken. I don't think that we would yield to anyone in the sincerity of our concern for that. It is— this concern for preservation and enhancement of the quality of environment— stated, in one sense, as subgoal of our effort, and also as a constraint on everything undertaken. In many places in the program section of the plan, it is not spelled out explicitly, though it is given some recognition. 11 In the course of revising the plan, after reviewing all of the abundant suggestions that we are receiving now, that aspect of the plan, I think, will be distinctly strengthened, and we appreciate your comments. Incidentally, I might just say this, that the plan, concurrently with your review of it, has been going through very intensive review among agencies and institutions in the three states. Their concern for the environment and the suggestion that the element of our plan be strengthened in its final revision, is a constant theme in their comments. We are very well aware of this and we intend to do everything that we can to make that concern explicit in the plan. MR. STEELE: The next agency on the agenda is the Department of the Interior, and 1 imagine we might continue on this same thing. Statement by Department of the Interior MR. BLANCH ARD: Speaking for the Department of the Interior, we would also like to compliment you on the intricacies of the analysis, on understanding the necessary interrelationships and interindustries matrix, and how to achieve the interrelationships of the different kinds of industries which are needed in your economic development pattern, and taking account of the trends, and putting the pieces together is a rather interesting and, we think, fruitful way of reallocating the employment force and encouraging growth in the area. We are a little concerned that it is very heavily oriented toward employment and income, and possibly to the exclusion of the basic resource input. If it is all secondary industries, manufacturing goods, and things for which the base resources come from elsewhere and go elsewhere, this can form a viable community; but in most of the areas there is a base, and here I know your plan relies upon the marine resource states, to a certain extent, and their other base input. In the report, itself, it is interesting that there is very little information on the condition of your natural resources. So we see that as possibly a constraint. This environmental quality is certainly another, and I will come back to that. As far as incentives go, there are some underutilized natural resources in the area that may become incentives for growth. There, of course, is the marine resources side, but you downplay the mineral side, and our mineral requirements experts take exception here. We can see the growth of certain industries along the coast in that area now, in the mineral areas, and we've got real environmental problems with them. And lastly, there are the financial incentives. I think you have some unique and possibly very fruitful ideas in your policy alternatives that lend emphasis to financial incentives for encouraging private growth in the area. Coming back to our environmental concern, we see that the basic handle on shaping of development from an environmental standpoint is planning either in a broader sense or in a more detailed sense, where you get into smaller areas. So we see the broad development plan for the location of highways, airports, power plants, industrial complexes, urban areas, as all being crucial in the preservation of what can be important environmental areas— your storage sites, cultural or scenic values— and the plan is devoid of any schematic or maps to indicate where such complexes might go, so that a Department like ours concerned with the environment, might be able to give you authoritative remarks back. There just aren't any locational specifications to be able to respond to. 12 Again, we see the key as being land use planning in that area— and power plant siting is an area that might be looked at a little more. Your plan takes account of both highway and airport patterns, but these huge energy complexes are growing, and their need for fuel, their need for cooling, creates trade-offs in lengths of transmission lines, the size of the plant, or the length of the load center. Does it go to the ocean for salt water, or does it go to the mine for fuel? These are all complicated power plant siting problems. But the environmental impact comes up, not just on air and water, but on the whole neighborhood— the community which you put it in. In addition to these questions of scenic and unique sites, we are all very much concerned with the wildlife which, as it has been established, goes right with it. But it is slowly being destroyed across the Nation. Our coastal wetlands are unique in their very own way, and over the last fifty years, this land has been developed very rapidly in basically a haphazard pattern, county by county, state by state, across the southeast of the country. We would hope that in your land use pattern, industrial development will grow and be encouraged in ways that will be compatible with the resources of the land. The last item is something that Dick Hertzler mentioned, and that is the question of the quality control. There are tremendous investments required. There are investments under way in the area which provide water quality, sewer treatment plants, and air quality controls. This area in many ways has been a little farther advanced than in some parts of the country in its water pollution control. Just as it is in its recreation problems, a pretty good basic plan to work on. But the question of quality control comes down to a particular plant, a particular industry, a particular manufacturing site, and the proprietor is going to have to understand these controls before he even starts. The key to the whole thing in planning is to get in on the ground floor so that the concern can be incorporated into investment planning schedules and the necessary environment controls are constructed right from the beginning. MR. STEELE: George? MR. PANTOS: Yes, let me also comment on the problem of location, because this is, I think, going to be brought up increasingly, and we are concerned about it as it cuts across all of the commissions. As you know, these plans are primarily economic documents— economic development planning documents. They are not physical planning documents. They don't cross the line of demarcation between economics and physical planning. Obviously for a Regional Commission to make spatial decisions is thoughtless, and since most of the decision-making on growth centers will be made at the state level anyway, even within the regional context, this we recognize as possibly a new area of concern for the commissions, now that they have gone through the first cut of planning. But the point you raised about making physical decisions, or spatial decisions within the framework of the land use planning policy, is, I think, the next type of intensive study which the commissions will have to take to make these plans meaningful and relevant. While I would agree with you that it is very difficult to make environmental impact assessments in the absence of locational considerations, because you must look at an industrial park or power plant in the context of a specific location-what it would do to that location— we are of the opinion that some generalities can be made about the alternative impact of certain public investments in a general sense. There are common characteristics, let's say, between marinas, whether they be in New England, or whether they be in the Coastal Plains. And this is about the point we are at right now— to make an attempt to identify these alternative impacts, recognizing full well that they will not be as valid as those which are made based on specific locations. I believe that this will concern the Commissions in the ensuing year in a detailed way, and we have made a start in that direction. 13 I think what we've got here is the product of a planning effort which started three years ago, where these concerns were not as uppermost in the minds of Federal officials as they are today. So, this may explain in part the lack of definition on these subjects. But, again, as I mentioned before, we don't really know enough about this subject, nor do we know enough about how to measure it, and so we are going to do what we can to advance the state of the art in this and other agencies. Interestingly, these meetings do show the interrelationship of interest between agencies on all of these subjects, and 1 think they help all of us in our own respective bailiwicks, but we would be— those of us who are in this business of regional planning— most interested in any advice and suggestions which could be made outside the context of this specific plan, so that we might, perhaps, not proliferate our efforts. We would be glad to join with you or have you join with us. MR. BLANCHARD: Let me make two points, George. One is that the Department of Interior has been on environmental matters long before the current concern, for many years preceding it. We are rather delighted to see the rest of the Government seeing it. The second point is that it is not possible for us to arrive at the environmental impact of economic growth in the area until vagueness of where development is going to take place— or the exact locations of growths and things— are given more attention. We now have a National Environmental Policy Act in many states— many states have now moved into this area and some have the equivalent. Mr. Hertzler made a suggestion of some form of possible environmental quality in the area. But there may be a solution in that vein, or idea, to guide the actual development. MR. SMITH: Just a brief comment. The so-called underdeveloped regions of the country, in our view, have a magnificent opportunity, of a negative sort of character, to avoid some of the demonstrated evils that have grown up in the unplanned development of some of the other parts of the country. But the intensely urbanized areas of the country are paying heavy social costs for their inability— and I think it is a genuine inability— to foresee some of the consequences of the kind of economic development that they experience. And in the Coastal Plains, we are very much aware of the fact that the present lack of development offers us opportunity to follow a course that could avoid some of those ills. This is perhaps not made as explicit as it should be in the philosophy expressed in the plan, but it is something that is going to be strengthened, and I think that the suggestions made so far will be immensely valuable to us. As we get into the problem of restructuring the states, we will be coming to you for more specific help. MR. STEELE: I guess we better be moving along. We are going to give everybody a chance to comment. Transportation, 1 believe, is next. Statement by Department of Transportation MR. BINDER: Thank you. Just before the meeting started, my good friend, Chuck Wiggin, from the New England Commission, asked me whether our Department today was going to be as hard as it was last November. 14 I want to comment on that. We hope that another word might be added to that. We do view this as a process of consultation, and to the extent that we take a position which may be somewhat at odds with some assumptions or premises on which the planning has been conducted, we would hope that they be taken into account. We are available to discuss these matters with all Commissions. In fact, we had a meeting with panels arranged with a number of the Chairmen since the last meeting. We can look forward to another. As we understand it, the plan that we have before us is not yet finished, that you are still considering making changes. We think that is very healthy, and it is in that spirit that we offer these thoughts. I would point out to those present that the printed version of last November's Council meeting contained Secretary Volpe's comments at the back and noted that they were received after the deadline and too late to be included in the table of contents. And while I am sure that is true and to avoid that problem this time, the Secretary's letter, commenting on this plan, was dated the 8th of March and it is on the table at the back of the room. 1 am not going to try today to cover all the points in the Secretary's letter since it is available to you all, but there are some thoughts I would like to present. First, let me join with those who have commended the staff of this Commission for their obvious careful and lengthy efforts. We commend the staff for grappling with many difficult economic development problems that are illustrated and discussed in the plan. We think this is a significant improvement over the 1968 plan which, as we then viewed it, merely discussed the general outlook of the Commission toward development in the Coastal Plains area. The revised plan's emphasis on the public investments and growth centers, or the sites with the highest payoffs, and private investment as the fulcrum for reaching the objectives of the plan, we think are fine. I would say that we were somewhat disappointed that the Commission has not yet set criteria for growth centers, specific criteria, and we think the establishment of these criteria would mark a further great step forward. Since the 1968 edition, we note some planning has taken place in the transportation section of the plan, particularly that involving development highways with a price tag of roughly one and a half billion dollars. I am sure the Commission is aware that at present, at least, there is no way for the Department of Transportation, nor, particularly, for the Federal Highway Administration to become involved in this proposal, except as a state may wish to spend Federal Aid funds allocated to it under the Federal Aid Highway Act, under Title 23, of the Code. But this is where, I guess, we were thought to be hard the last time around. We are still most reluctant to endorse the theory that massive investments and transportation facilities in a mature industrial economy such as ours is as forceful a mover of economic growth as it might be in a developing country. We think there are many towns and cities in the United States, in virtually all size ranges, which are well served by transportation. They have an airport, rail line, decent highway access, and yet so far as we can see, they are not developing. That leads us to the thought that there are other factors which must be responsible for the lack of growth in these areas, and this is why we suggested in our written comments that if the Commission would select a few small urban centers whose growth potential appears to be great and use them for pilot demonstrations, investigating and identifying the factors which may be impeding economic development, or encouraging it, then such pilot projects might provide the necessary impacts for developing an integrated plan for the entire region, particularly with reference to the role of transportation in that development. 15 Within the framework of such an experiment, the Commission would be able to test its own productive capabilities for identifying those centers, and by varying its approaches, it could test their respective merits. If such an experiment would show that certain types of transportation support are critical to the successful exploitation of growth center potentials, the Commission could calculate the cost of putting such support in future economic development proposals. Now, I want also to call to your attention Section 127 of the Federal Aid Highway Act of 1970, which amends Title 23 of the United States Code by adding Section 143, titled Economic Growth Center Development Highways. It appears to us that under the provisions of Section 143 it is potentially possible, at least, to contribute to the testing of the demonstration. That Section of the Act establishes a program for demonstrating the effectiveness of planning and building economic development highways to serve economic growth centers. I would add, however, that the Act applies to all fifty states, and as yet, no appropriation has been made. Consequently, we are in no position to indicate the actual magnitude and scope of the application of this program, but we have begun consideration of criteria, program procedures, financial planning, and other details that will be necessary for the implementation of the Act. 1 appreciate the chance to address these questions today. 1 say, again, we are available to continue this discussion with the Commission, or other Commisssions, in the days to come. Thank you very much. MR. STEELE: Okay, Charlie. MR. COSS: I would like to respond on two of the comments that you made with regard to transportation. One is your point that the Commission does not set criteria for growth centers, and I should add, at all levels. This is one of the more difficult problems. It is one of the problems that we are wrestling with now. The second point you made, in which you said that transportation may not be the most significant item in development. I think the Commission has taken this attitude from the very beginning. All of our transportation studies have been undertaken in relationship with the other major program areas of the Commission. And lastly, I think that perhaps in consideration of growth areas, we have the strongest case for those which are designated as regional growth centers. The two priority corridors selected in our transportation studies actually involve the major growth areas of the Commission. I am speaking of the coastal corrider running from Norfolk, which is outside the Commission, actually, to Charleston and Savannah, and then the Georgia beltway, which runs from Columbus to Macon to Augusta. These are the major growth points in the region. MR. STEELE: At the hearings held by Senator Montoya's Subcommittee in Raleigh recently, this matter came up. We tried to explain to Senator Montoya our problems with transportation, or lack of adequate transportation. In our region, we feel our problems are entirely different from those they might have in New Mexico. There they have areas that are remote, without any means of access. Access roads 25 or 30 miles in length may be what is needed. On the other hand, our Coastal Plains region is interlaced with roads, and has an abundance of towns. Traditionally in the South, we've had a town every five miles along the railroads, and we built the highways parallel to the railroads. This is not the kind of road system needed for a fast industrializing region. Because of this inadequacy, it is easier to move our products to New York, than to our own ports. I feel that our problems are unique. I think the Commission has put the proper priority in that our first need would be highways capable of carrying the products of industry in the major corridors, not necessarily the access roads. 16 And it would be awfully hard to meet this need through a demonstration project. You can't have just a leg of a major corridor. If it is not a corridor, it would really be of very little use to us. We don't feel that you will have economic development or prosperity just because of the highways. But we feel that where the other factors are favorable, adequate transportation can play a very important role in the development of our area. I hope we can have some further discussion of this because, as Charlie said, it is very important to our program. MR. JEFFERS: Fred, is it permissible for one of the other Commissions to ask a guidance question at this time? MR. STEELE: Yes, sir. MR. JEFFERS: Because our plan will be up for review very shortly, I'd like to ask Mr. Binder if there has been a change, historically, in the attitude of the Department of Transportation on the economic effect of highways from the time that the interstate road program was first suggested? I recall, not having been a Federal employee at that time, that when that program was first presented by the then Highway Administration— I think it is the Department of Transportation now— that the economic benefits of interstate road programs were the major impetus for gaining the authorization appropriation. Has there been some disenchantment with the interstate highway program being an economic impetus for regions which it covered, or points it covered? MR. BINDER: Well, there are two things I would like to say, if I may. I think this is your question. First, historically, there was no Department of Transportation. MR. JEFFERS: Yes, I may have been mistaken. MR. BINDER: So that whatever the view was in 1966, it was the view of the Federal Highway Administration, or whatever the officials may have been at that time. What we are concerned with now is the view of the Department as a whole, of which the Highway Administration is a part. But let me say, also, I think that there is another distinction, and that is that the interstate system, as I understand it, was designed to connect developed centers of the country. This is the major purpose of the interstate system. It was not to produce development along these major highways, but to connect different parts of the country that were already developed, to improve access. I think that that is a valid distinction between the rationale of the interstate system, if I understand its rationale, and the application of it, or the use of highways for the particular purpose of promoting development all through an underdeveloped region. MR. STEELE: I notice Appalachia is represented. Mr. Lerch, you've had considerable experience. Would you have a comment? MR. LERCH:, Nothing other than that in the year and a half that I've been on deck, Fred, I've been out and seen the development that has occurred. Of course, our attitude in Appalachia has been a little different in that we feel— or they felt during the early period -that transportation should be given first priority. I've seen enough of it to believe that it really works. MR. STEELE: As you may have noticed, the entire trend of our plan is that we cannot have more of the same in our region. If we do, we are going to be in the same relative position ten years from now that we are in now. We are trying to build a new structure. So we obviously feel that this is a very vital part in our overall plan. If we can't say that we could justify a highway now based on present travel, we could justify it based on the travel that would follow if we had that highway and if we could go ahead with the other phases of our plan. It is something that is important. I hope we can have more discussion on this. I use an expression often, and facetiously, in my staff, "All I want is for everybody to be reasonable and see it my way." Maybe we could have some more discussion. 17 MR. PANTOS: I just want to add one point on this subject. In the Senate discussion that took place last week on the continuation of the regional program, there was inserted a provision authorizing 127 million dollars for the one year extension. Of course the appropriation has been much less than that as you all know. But for the first time now, we are going into a new fiscal year and the Commisssions have five year plans. The first year of those five year plans is the basis upon which the Commissions are requesting budget approvals to go ahead with the implementation of the plans. So this is not an academic subject. It is one which I think will come up higher in terms of decision-making as we see what happens on the House side. And if the Commission concept is endorsed— if the Congress moves that way and the Administration supports it, I think these plans and the actions they call for will be taken into consideration in the light of the monies required to implement these plans. I don't know what your first year figures are— do you recall? MR. STEELE: I don't recall that. MR. PANTOS: But they are substantial figures. I guess this is a point that we shall get into later in the implementation, but I think it is relevant to this discussion at this point. MR. BINDER: I wonder if I just might make a short comment in reply to the comment about the Appalachia region. I am glad to know your conclusion. I think that that is worth having. I think as far as we view these details with respect to development of roads in the Applachian region, it should be pointed out that at the moment only a fraction of the original plan has been completed. It would be fair to say the amount completed is something in the nature of 26 percent of the authorized mileage, or 36 percent of the approved mileage. I think we have also concluded that only one out of 21 possible state border cities with highway junction points within those cities has been completed on both sides of the border. So, I think where we come out today is that it is too early to reach a frank analysis of practical transportation consideration. MR. SMITH: May I ask, just on a point of information; on the new section having to do with growth center demonstration highways, how much is included in the budget for implementation of that? MR. BINDER: The figure of 50 million sticks in my mind as— MR. SMITH: About 50 million. I think it is written into that section that there should be consultation with Regional Commissions regarding the implementation where it would occur in those regions. I had hoped that we might explore the possibility you suggested of making some use of that in testing out these potentials here. MR. STEELE: We better move along. Comments from Labor? Statement by Department of Labor MR. EPSTEIN: I would like to add my own commendation to those already expressed about the document as a whole. I think it is really a step upward in terms of sophistication of this kind of document. I suppose each agency looks at the problem from its own perspective or its own tunnel vision. I was pleased to find out that such heavy emphasis was given to the questions of employment and economic development. And I suppose, like others, one just assumes that the infrastructure and the physical base resources are there. I think the concern with the quality of manpower in the program has been enunciated in the project for the reason that the skill and education levels of the people there, we think, are terribly important to us. I think, in the past, most economic theory has emphasized considerations such as the use for energy, cost, resource base facilities, and so on. It has always assumed that the labor force was a residual to this sort of thing— they were derivatives to the subject, but that with the others in place, the labor force could beat it off easily. The fact that the quality of manpower is now being recognized in the Coastal Plains region as an important and independent feature of the program, I think, is a very different attitude and a very welcome attitude from our point of view. I'm thinking particularly of New England where high level educational attainment sort of helped that area come back out of its recession earlier in the postwar period. I think with a little bit of political urging the states could show straightforward- mindedness to the question of the increasing of quality consciousness of the labor force. I think that attention to cost and efficiencies are the ingredients that will make the economic development, particularly on the part of cost-conscious industries, very important. It would have been much easier to just repeat the platitudes about having additional education, without the kicker that it really was an increased attitude and awareness of efficiency that was the prime requisite in bringing this change about. So we are very pleased about that. We were also pleased with the fact that there was a Center for Industrial Technological Services to assist the industries in finding out about the area. This is still a difficult subject. We feel that the more that can be developed from data and the more analysis that can be given to the question of plant location and relative efficiencies and relative advantages, are all terribly important. Without that kind of structure, the system always seems to be depending on subjects. I think the emphasis in this case about making sure that the subject is only a part, and perhaps only a temporary part, of the aspect and that the real goal be on self-sufficient industry, again, is a step up in much of this kind of discussion. In connection with hopes for employment, I have some comments. Agriculture may like to talk about this later, but we were in agreement with the fact that agricultural employment is likely to decline in this area. We were a little bit disappointed that the potential for mischief that might occur in the tobacco employment area wasn't strongly stressed. And at this point, I am not sure that we have all the facts, but we think that the mechanization of the farm area, in the tobacco farm area, could explode quickly. If it does, it might present the country with a similar situation as occurred in the cotton fields when cotton chopping became mechanized. If that were to happen, I think that the point, possibly in the paper might be understated, so far as tobacco farming is concerned. The other thing which I wanted to add a note of caution about was the hope of reaching some 86,000 employment in general industry on one alternative and 107,000 on the other. That is dependent, of course, on bringing manufacturing up to a more sophisticated level and a more general level in the importance of industry in the area. However, there may be an inconsistency between trying to get too much employment and high per capita income. Typically, labor intensive industries don't enjoy high wages, and those that are not terribly labor intensive, because of the high productivity, do enjoy high wages, so that the twin goal of getting per capita up and employment up may be more difficult than appears at the outset from the discussion. I guess, in connection with that, we were a little concerned about the tax credit. We recognize that tax credits are essential to give some incentive. The real question is, what kind of industries are attracted by what kind of tax credit. 19 I submit there are certain industries in this country that wouldn't go near a place with a heavy tax credit because they feel that the infrastructure and the education system of that town would not be the kind that they would want their officers and employees to be living in. So the question of what kind of industry is really tied up with expected hopes of per capita income and employment, I think, is well stated here. I think the tenor of the report recognizes the problems here, but I am certain those problems are going to be with us as you develop your programs. 1 think, as 1 said earlier, though, it is a sophisticated paper, and 1 think the Department of Labor is only too willing to help with regional training plans and state training plans. I am sure also that our fine service offices throughout the region are only too happy to do what they can to help development of manpower knowledge and programs in the area. Thank you. MR. STEELE: Thank you. You know, you hit on a couple of my favorite subjects. You see, I am not a professional. I am not an expert. So I can make statements that sometimes make our economists shudder. But I think that you are probably right as to the impact that we are going to have. I am afraid we will see a rather sharp decline in tobacco. We are already seeing that now, but, of course, when our economists put something down on paper, they want to be able to justify this, not just fly by the seat of their pants as I am prone to do. My home is in Durham, North Carolina, and I am sure all of you are already aware of the fact that 1 support the industry. As I see one part of my job as being the Federal member of the Federal-state partnership, I have to take into consideration national goals, and, of course, one of the things we are concerned with, as a national goal, is the balance of trade. And not only are we finding a declining market in domestic use of tobacco, but our position in world trade is dropping very rapidly. Almost every country in the world now produces tobacco, and some countries are producing fairly good leaf, but not nearly as good as our bright leaf from down in the Coastal Plains. We are losing our position, and this is something we have given a great deal of thought to, even though we didn't have specific emphasis on that problem. Another thing we have in declining industry is textiles. This is happening. But I am fairly optimistic about our chances of restructuring our industry. We are seeing now that the major corporations that have come into the South are well-pleased. It is true that our attained educational level is very low, but still I feel our greatest asset is our people. Our people are productive in spite of the handicaps they might have. They do very well in an industrial atmosphere. A very high percentage of our underemployed are in agriculture, and these are people with a very low per capita income, and these are people that are basically fourth, fifth, sixth generation of agricultural workers. And it does require some specific effort. A man who has not grown up in an industrial atmosphere is a little hesitant even to walk into a big building, even to apply for a job. We have spent about 80 percent of our available funds in manpower training, and we hope that we are relating our training efforts to jobs that will be created in our region. We prefer to keep our people at home, not give them a skill so they have to go somewhere else to utilize the skill. I think we had better move along. I believe HUD is next. 20 Statement by Housing and Urban Development MR. CLAYMAN: My vantage point is the 701 Comprehensive Planning Assistance Program. Mr. Bullis is with the Office of Intergovernmental Relations. One of our major concerns is that the Commission exercise its potential to build the capability in state planning to help in the various stages of planning. We would like to see a more explicit analytical framework for the selection of projects and the programs. One of these, for instance, would be how the Commission intends to relate to the other state planning efforts. That is essentially a major concern in the planning program. MR. STEELE: This is something that I personally am very proud of. I think we have made some major contributions to state planning. We are compelled by law to produce a long-range comprehensive plan, and the states having their input into the planning has helped upgrade their planning efforts. We have doubled our effort financially this year in assisting state planning, and also the Department of Commerce has moved in, offering some real assistance. I, personally, would like to see state planning be real comprehensive planning, and not just a matter of taking everybody's laundry list, as you go around, from each agency. And I frankly have been concerned— and this is just my own personal thinking again-I don't qualify myself; Em not an expert in this area; Em just a politician— but I am afraid that sometimes the effort of Federal Government in each of the agencies and departments to indicate specifically what should be in a state investment plan contributes to the result that we come up with just a stack of state agency-oriented plans. They put that together and call it a plan. Maybe it is not wise to make this statement, but I still feel that a great deal of state planning is no more than trying to determine how much Federal money might be available, and where the states would have to come up with matching funds, and just itemizing it and showing where your matching funds come from, and having some general idea of what revenues are available— not planning and not assessing priorities based on real long-range plans with a specific goal, an overall goal, of where a state would like to go. MR. PANTOS: One point that might be made in terms of your comment is that there is an uneveness about state planning, as you are well aware. It has been our observation that those states which have been participants in the Regional Commission program— some 20 states, excluding Appalachia-because of increased funding assistance from the Commissions, have had a more substantially successful state planning effort in carrying out this particular function and also they have been directing their efforts toward assisting in the regional development effort. So, we feel that one of the positive accomplishments of this program has been to support state planning and to make it more effective. There is still a long way to go, however, in doing comprehensive planning, intersectoral planning, which is not as advanced in some places as it is in others. But we also note that in the President's Special Rural Revenue Sharing Message rural revenue sharing would require the development of a state plan— not for Federal approval- just a state plan which would be the basis upon which revenue sharing funds would be made available. It does have a consultative process built into it, whereby local planning district officials participate in the development of a state plan. So, in partial answer to your question, at least, we think that those 20 states that participate in the Title V program have made a good record in state planning, because of the coaxing which the Commissions have given them, plus the financial support. MR. CLAYMAN: Our Central Office memo was not on the table. I made a few suggestions about some activities: coordination of state housing efforts; use of surplus 21 Federal land; analysis of Federal and state programming impact on regional policies; environmental management planning; and human resources planning. MR. SMITH: Fred- MR. CLAYMAN: Those are the kinds of things that we were— MR. SMITH: All right, Fine. We would like to have your paper, and I assume that we will have it. MR. BULLIS: Our paper, unfortunately, is not like Transportation's, dated the 8th of March. It is dated the 15th of March. I hope it gets to you on time. (Laughter.) MR. SMITH: I would just like to make a comment as one who for some 15 years was a member of the program that you represent here today, and that goes back to some eight or ten years before the Act of 1954 was passed, which inaugurated the 701 Program. I have followed the 701 with very great interest, both as someone involved in it and subsequently as someone who continues to have an interest in comprehensive planning and saw it in relation to other things going on. And I think it should be recognized that whatever handle we use to grab this entity of planning, we are grabbing the whole thing, and that what we are concerned with is comprehensive planning. I have been encouraged to see some signs that the administrators of 701 are beginning to assign greater weight to economic planning as a component of comprehensive planning and, at the same time, I think we can assure you that we see economic planning as a part of comprehensive planning which includes other elements as well. I think that environmental planning, land use planning, all are part of the same planning approach, and that they cannot be seen as separate entities. We would welcome from HUD a more explicit interest and assistance in the development of economic planning consistent with the tenets of comprehensive planning. MR. BULLIS: I have additional comments to make on behalf of HUD, and I think what you have said fits in with one of the most overriding things that I think we feel about this plan, and perhaps the other plans that are being developed by the Title V Commissions. The other side of the coin you described is that there is a great need for a wider scope of concern beyond the purely economic in these plans and that a viable interstate planning approach should build on planning of the several states in all of the areas of planning that have regional impact. We know that under the legislation which we operate, and the charge that the Commissions had growing out of that legislation, is that these plans must necessarily be limited to that which is economic. So, we feel that the broader approach on interstate basis into areas of housing, government management, building local government infrastructure, and government services, will have a pronounced economic multiplier effect, too; and it is a chicken and egg situation, and I am not going to say which comes first, the economic development or the community development. Let them both happen together and be part of the same planning process. Our regional office sent in some comments which were sent in in time to be on the table, and I would just like to highlight one of the things they pointed out because I think it might have some merit. They pointed to the possible need for stronger labor organizations within the areas to close wage differential gaps between this region and other regions. I know this is a two-edged sword, but operating in a highly surplus labor area with our very weak base of labor organizations, there are, I think, grave risks which develop, both a sort of neo-Colonialism in your economic development and also attracting industries which are among the most transient and perhaps provide the least adequate wage levels, so that 22 you get the additional multiplier from industrial development that comes with development of a strong services-oriented sector in your economy. I think that it is legitimate for a Regional Commission to look at ways to attract industry. It can also look at ways to improve the bargaining position of its labor base in dealing with that. That may sound rather radical and far-fetched and working against yourself, but it is something that I think could at least be a legitimate role for the Commission to look at, to see what could be done to strengthen the bargaining position. MR. STEELE: Could I just make one brief comment on that? In attracting new industry to our region, in the large part, we are bringing in major corporations that are union. The South is no longer that haven for someone who wants to set up a sweat shop. With the kind of industry we have had, two-thirds of the people employed in manu- facturing are employed in the four lowest job skills and lowest wage. We haven't had the proper blend. Our efforts are bringing in better industrial plants, and we're finding more and more organized labor in our facilities. One thing, too, that I would just like to point out; our problem has never been unemployment, but underemployment. We now run about half the national average in our unemployment rate. This is something that is unique to our region— I think every region has its own problems. And now we had better move along to Agriculture. Do you have another— MR. EPSTEIN: I was just going to second your feeling that high wages and high wage industry will come about, in part at least, because of the recognition of the need to invest more money and to invest the labor force with skills that previously were absent and, therefore, industries which could really do something for the people in the area were unwilling to locate there. Again, it's the chicken and the egg. True, I think that the final kind of skill training has to wait until some better conception of the industries are available. But I think once the decision is made to go into a good educational program, a good training program, I think there will be many more industries willing to locate there because this then becomes an attractive place for them to locate, rather than one that they are not certain about. MR. BULLIS: Our Regional Office, in fact, pointed out that they feel that some of your population projections may have to be revised in light of the data from the 1970 Census. It is their feeling that, certainly, there is rural to urban migration, but that the net result has been growth in your region; that you will come out with a more urbanized population, but a higher net population than in 1960. MR. STEELE: It's unfortunate, but we couldn't wait until the '70 Census data was available. And really now we just have totals as population, but not with the breakdowns that we want. Our staff is working constantly with OBE and Census, and what we have seen to date has not required any change in the direction in our overall program effort. MR. SMITH: We did feed into our studies the preliminary population figures, recognizing that they would have to be adjusted. MR. STEELE: We'll move on to Agriculture. Statement by Department of Agriculture MR. AHLGREN: Well, I want to say first for the Department of Agriculture that we want to commend the Commission and staff for a very impressive plan. We are particularly 23 impressed with the documentation and the economic rationale investigation that went into the preparation of this plan. In our review, we have also commented, as have several others here, on the environmental quality problem and the need for some kind of judgment, at least, as to the potential impact of economic development on that particular item. I think in general comment on several of the other things that have been discussed here I might point out two or three that have not come to your attention until now. We note that the development strategy is focused on the growth center concept, and the point is made that the small towns in the region could not be expected to support large scale manufacturing. Indications were that this was a factor in projecting plant locations. 1 guess we suggest, but no more than that, that the plan recognize the possibility of groups of towns being able to support the plants. The multi-town development approach could be con- sidered along with the concept of selecting existing large centers for plant locations. Also, something was said here this morning about the importance of a land use plan. We certainly subscribe to the need for that. Actually, the present major land use in your region is agriculture and forestry. You have indicated in your report that these are making a very substantial contribution to the economy of the area. Much of the potential for development of the region will be directly related to the future land use patterns. Some reference in the report as to how land use changes now taking place have been guided and contribute to the economic development process might be helpful. I will simply say to you that our Soil Conservation Service stands ready to assist in any way it can in this particular effort. One other point, and if it was present in the plan, we missed it. The report seems to be weighted pretty much towards the concept that the Commission, with cooperation of the State and Federal agencies, would bring about development. We would like to make the point that since development begins with local communities, we suggest that more recognition be given in the report to the necessity of local community participation. Thank you very much. MR. STEELE: Thank you, sir, very good points. Any comment? MR. SMITH: No, except to recognize the validity of what you've said. The relationships in which we work make us, to a large extent, dependent upon State leadership for the involvement of their subordinate political jurisdictions. But this does not mean that we don't see the necessity of this local involvement, or that we are not working continuously with the States to increase that kind of participation. The development of the State investment plans, which increasingly are becoming an important factor in comprehensive regional planning, does proceed out of localties and the development districts in unison with state-wide agencies. And increasingly in recent months, I think we have had the opportunity to talk with people at the local level about their planning effort, and the relationship to overall State and regional planning. So we are keenly aware of that and we welcome your stressing it. MR. STEELE: We will move on. OEO, I believe, is next. Statement by Office of Economic Opportunity MR. BAILIN: Well, Mr. Pantos asked for briefness just as I am prepared to speak. I assume that he does want a very brief statement, and I'll throw out my ten-page speech. Our paper presented our general views, and I am sure those interested have read them and considered them. I wish to underscore just one under-emphasized facet of the plan as 24 we see it. If your plan is implemented, and I hope that it will be, it will measurably affect a lot of people. And we believe that the representatives of those who will be most affected should take part in the planning of their future. It bothers us that the Commissions have not taken their plans to the people of their areas. After seven years of experimentation, proving the value of participation of those most concerned and least able to protect their own interests, such participation should now, we feel, be automatic. MR. STEELE: SBA is next. Statement by Small Business Administration MR. EACHON: First of all, I think Ed just like to say that we have a new Administrator aboard, and he's very familiar with this kind of thing and certainly sanctions it. You can be sure that our Agency will participate in any way we can. I think probably our remarks are more pertinent in the area of implementation, than they would be in terms of planning. I think the comments we sent to you are along these lines; our thrust is certainly parallel. Our goals are pretty much the same, although we address ourselves almost entirely in the area of small business. I think when we get into implementation we would have some more specific comments there. We did have some concern, without putting it into the paper here, in terms of community participation and community involvement, and this type of thing in terms of your overall planning. One of the other things, and I would hope you have this already, is a complete inventory of what might be available in terms of implementation by the various agencies that spoke here today, and not in terms of theory, but more in terms of specifics— what can be done on a day-to-day basis. And that, in the final analysis, will prove whether this kind of planning can be successful. With that, thank you very much. MR. STEELE: Thank you, sir. As Charlie Smith just said, we have recognized the importance of getting more community participation. And I've noticed that we are getting a great deal more support through the Governor's Office, and better lines of communication have been established, particularly with the District programs that are set up within the State. This is a step. We hope we are moving in the right direction. And last on the agenda is Commerce. Statement by Department of Commerce MR. CHRISTAKIS: Well, the Department of Commerce has carried out an extensive review of that plan in various intradepartmental agencies like EDA, the Office of Business Economics and others. The Office of Regional Economic Coordination has already generated reviews and those reviews are also on the table at the back of the room. So I don't want to elaborate on those points. But I would like to take a few minutes and comment on what I would call the planning approach that has been adopted by the Coastal Plains Regional Commission, which happens to coincide with my own bias toward economic development planning. 25 I think the Commission addressed itself to the basic question confronting a lagging region; namely, given the characteristics of the Coastal Plains region, would it be possible under reasonable assumptions to reallocate the labor force among the economic sectors in such a way as to raise the regional per capita income to a level equal to or approaching the national average? This is really the problem that the Commission staff had to address, and I think they did that in what I would call a normative way. Essentially, what they did was to search among 27 alternative employment structures and to try to identify that employment structure which would satisfy the objective of closing the income gap, and at the same time be reasonable and realistic in terms of conventional economic logic. My prejudice towards development planning is mainly that, if you just work on baseline projections or the extrapolation of trends, you can never come up with the answer to your problems. In other words, really, when you talk about the future it is important to realize that you cannot predict the future, you have to vv/7/ the future. This is the approach that the Coastal Plains Commission adopted, and 1 think this is the approach which is very responsive to the mission of those Commissions as established by Congress. Those Commissions have been set up as planning bodies and more specifically to address the issues confronting lagging economic regions (big regions) of the Nation. And, again, the interesting point about this approach, the normative approach to planning, is that having identified the employment structure, that could satisfy the requirement of closing the income gap, they tried to derive, by working backwards in time, the policy and action implications of those employment structures for the present. For example, they tried to identify the educational and manpower program require- ments so that the proper labor force will be available in 1980 for the selected employment structure. Now, there is one issue, however, which I think a number of people today have addressed, and has not yet been taken into account by the present draft plan. And this is what I would call the distributional aspect, and I think the OEO people and other reviewers have addressed themselves to the distributional aspect. And what I mean by that is both the social and economic distributions as well as the geographical distribution, i.e., both the spatial and the socio-economic aspects. For example, the Commission is talking about the regional per capita income, which is a good indicator of poverty in an area, but it can be misleading if one has a very skewed income distribution. Similarly, we have been talking about employment structure for the year 1980, but it is preferable if we could— if the Commission in its next plan or in a revised version— try to identify specific locations for those employment opportunities on the basis of specific industries. Both those distributional aspects are very important in terms of what I would call desirability and feasibility considerations in the evaluation and selection of alternative employment structures. For example, both the desirability and the feasibility of alternative geographical (land use) distributions should enter into evaluating the alternative employ- ment structures for the future.' And, of course, land-use planning and land-use utilization and all those things that have been mentioned today, I think, should be the next order of business for the plan. Another point, which has been touched, and I would just like to emphasize, is the issue of developing a procedure for the evaluation of programs and projects within the context of a regional plan. It is, I think, in the evaluation procedure that one can incorporate environmental impact safeguards and considerations. When one has to deal with a specific plant location one can make better judgments. 1 am sure that the Commission, as Charlie Smith has mentioned, is moving in that direction. 26 Well, I think the general consensus among the people that reviewed the plan from the Department of Commerce is that this is a very good plan, and it's a good draft and, of course, there are improvements to be made. But planning is a continuing process and as the Commission continues its activities it should be able to incorporate some of those comments. MR. STEELE: Thank you, sir. MR. SMITH: Fred, may I make just a comment on the distributional factor in planning. I don't mean to quarrel with you at all, Alex, on this. I think you are addressing yourself to the lack of explicit treatment of this in the plan. I think that, implicitly, we do deal with the distributional factors in the priorities that are established in programming to meet the need recognized for the up-grading of the capacities of the people who are now relatively low in capacity. The whole thrust of the plan and its implementation is to get a broader distribution of the benefits of employment, and employment at a higher level generally than now exists in the region. So we think that without adopting, let's say, constraining measures to assure the distribution, we are in the kind of development that will encourage and promote the better distribution of income among the people in the region. The geographical distribution is an extremely difficult one. The Act requires that we take into consideration of any activity certain criteria of economic development or program development. And among those is the relationship to an area of potential growth as identified by the States. This is one aspect of planning that has not gone nearly as far as we would like it to go. The States have identified growth areas. The maps were not included in this particular draft, although we do have them at hand. Some of the States are refining their own approach to the identification of growth areas and actually we hope to have a more systematic and definitive treatment of growth areas for inclusion in the final version than anything that was available at the time we put this together. There has been a good deal of study, listed in the Appendix, as to the locational advantages that the region offers for particular types of industries. That could be carried to the point of designating certain areas that would be hospitable to certain types of industries, and our program could include measures to attract these industries to those specific areas. There's a certain danger in being too specific there because the decisions that industry makes as to where it sees an advantageous location are pretty hard to ascertain or to predict, and we want to stay fluid on this. Nevertheless, the geographical distribution of industry is something on which we will continue to work, and refine, and reflect in the continuous revision of the plan. MR. STEELE: I notice we have some people from EDA. I didn't see them on the list here, but do we have some comments from EDA? MR. DEAVERS: Fred, most of our comments were made at the intradepartmental meetings that we have had. I might make one comment that comes to mind. There's a lot of discussion, both in the plan and the meeting we had before, about the impact of migration on the Coastal Plains region. One thing it seems to me worth noting is that, while the net figures are clearly contrary to what the Commission would probably like to have, the nets, in themselves, are rather deceiving because there is an interesting compositional thing that you overlook when you look at the nets. Specifically, while it is true that the out-migrants from the region are, by and large, better educated, higher skilled, younger, more able to participate in the regional development than the residual labor force left behind; it's also true, and there is more evidence coming along all the time, that the in-migration stream is not only better than the residual labor force, it's also better than the out-migrant stream. 27 So that the terms of trade-off for the region, in terms of migration, are not as bad as you would think if you looked simply at the nets or at the out-migration stream itself. I would be a little uncomfortable with making decisions about labor force policy that looked only within the region and the composition of the regional labor force as being the one that is, in fact, going to participate in industrial development for the region. It's quite clearly not that. There's a substantial in-flow of migrants who are better skilled than the residual labor force there, and who are going to have a very important role in the kind of development that you are planning. MR. STEELE: I notice that we have some of the other Commissions represented. Any comments? MR. WIGGIN: Well, Fred, I'd like to be heard on a point of personal privilege. I think your plan is excellent. I won't go beyond that. I think it really comes very close to measuring up to what New England will produce. (Laughter.) I do think I should respond to the opening remarks of the distinguished representative from the Department of Transportation. 1 am concerned that my jocular question to my good friend, Bob Binder, and he is that, for whom I have great respect and admiration, should not be misconstrued. There may be some sharp differences of attitude and opinion between the Department and ourselves. Bob, but we certainly welcome and look forward with anticipation to hearing your well-considered, well-conceived, and well-articulated remarks. So, please don't construe my thought as suggesting that you stay away. And while I have the floor, Fred, I would like to say this. In my short tenure in this job, one of the real pleasures has been the cooperation, courtesy, understanding, and help that we have had from all the Federal agencies, both here and in Boston. It really makes you feel that things bode well for the bureaucracy if it is really this good at the working level. Coming back to Bob, we look forward to your critique of our plan. Bob, I'll duck as best I can and just hope I can go the full 15 rounds. (Laughter.) MR. STEELE: Just one other little personal comment. I had on my desk a clipping from one of the daily's down in our region and I wanted to tell you what is happening to the Maine lobster. The harvest down in the Coastal Plains has been very good. They are running between 10 and 12 pounds. MR. WIGGIN: We are trying to bring them back. (Laughter.) MR. PANTOS: Thank you very much. MR. COSS: Could I just pose one question here before you start to wrap-up. I noted with a great deal of interest the number of responses from the various departments on the environmental issue. I'd just like to take advantage of an opportunity here to propose a proposition. We've been wrestling with what to do in this area for some time. About a year and a half ago, on a much smaller scale, we were attempting to put together a study of what we called at that time, a "Marine Use Profile" which would have covered only the very narrow coastal area of the region. We attempted to put a study together with one of the major departments, but for various and sundry reasons, we were unable to do so. Since then, we have spent a great deal of time thinking about the region-wide environmental base line study, or land-use study, of selected areas within the region. It is a most difficult type of project to put together because of our limited expertise. But in view of all of the conversations today, and all the interest expressed in this particular issue, I was just wondering if we could take this opportunity to ask that an interdepartmental committee be set up so we could work with you on this. Perhaps we 28 could enter into a joint effort to sponsor a project which would be acceptable to both the region and the various departments here. MR. PANTOS: Anticipating that this situation would come up, we have asked a representative from the Council on Environmental Quality to sit in on today's meeting. I believe Mr. Robert Stottlemyer, who is sitting over here, is from the Council on Environmental Quality at the White House, and 1 think that we would like to pursue this suggestion further and work out an appropriate way of involving the Commissions and the interested agencies in Government on the environmental question. Now, the time is running out, and we do have a wrap-up here, which shouldn't take very long. And as I said at the beginning of the meeting, we were concerned about involvement of the Federal Advisory Council in decision-making on implementation. Here is where we stand now. As you know, the Upper Great Lakes Plan has been reviewed and is now awaiting final approval by the Secretary. It's still a draft plan until he gives it his final approval based on the statute and the comments that were made by the agencies. Today, we have formally reviewed the Coastal Plains plan and soon we will turn our efforts to the New England plan. The Four Corners and the Ozarks plans will be taken up later in the year. 29 Mr. Hertzler of Army (right) comments on environmental aspects of plan. Agency participants at FAC meeting on Coastal Plains Plan. 30 DISCUSSION OF IMPLEMENTATION OF REGIONAL PLANS MR. PANTOS: So with your permission, 1 would like to take the closing 15 minutes and have the Deputy of the Special Assistant's Office, Fred Eaton, who has been doing a lot of work on the subject, just give you a quick explanation of this implementation question. 1 believe a paper on the subject was distributed at the start of the meeting. We would like to get your comments on the implementation of these plans so that they can become a part of the package that is transmitted finally by the Secretary to the White House as called for by the statute. So, Fred, would you please say something now on this? MR. EATON: This will be a very quick 15 minutes, George. I think all of you have a copy of the paper. For those around the walls, I believe there are some additional copies back on the rear table. This is the paper that we mentioned at the November meeting we were going to prepare on the question of how regional plans can be implemented. Now, when we say"Implemented," I think what we are talking about here is how we take these plans and run them up the administrative flagpole. How do they get from the Commission to the Federal Advisory Council, to the Secretary of Commerce, to the President, et cetera, and what is said in connection with these approvals as they go along. We also want to know— want to figure out— how the Federal Government, particularly, can help the Commissions and the States involved to implement their plans once the plans are approved by the Secretary. The Public Works Act isn't too helpful in giving us guidance on this matter. The Act says, "The Secretary shall present such plans and proposals of the Commissions as may be transmitted and recommended to him; first for the review of the Federal Agencies primarily interested in such plans and proposals, and then, together with the recommendations of such Agencies, to the President for such action as he may deem desirable." So this doesn't help us too much. We have been struggling with the question for a couple months now, and in developing this paper that you have in front of you, we have gone to all the Commissions for ideas. We did not talk to Appalachia because Appalachia, as you know, doesn't have a requirement for an overall regional plan. But we have talked to all of the Title V Commissions. And we have also talked to people over in OMB, who are familiar with the program. And we have talked to staff people on the Public Works Committees on the Hill. The paper considers two possibilities; one, that revenue sharing will supersede or supplant the Regional Commission program. That possibility is examined in the paper. The possibility that the Commission program will continue in pretty much its present form is also considered. It lists a number of options as to which way we can go in this procedure. It doesn't make any final recommendations so we are asking you now, as members of the Federal Advisory Council, to read the paper, consider the options, tell us if we have missed any of the possibilities, tell us whether the options make sense to you, and finally, tell us what your recommendations are. We are not going to call a special meeting to get together on this again because these meetings are time-consuming. You people are awfully busy in your own endeavors. So, what we would like to do is have each agency give us a short, written comment and recommendation within the next two weeks. So, if it is all right with the members of the 31 Council, we would like to get written comments back on this, they don't have to be very long, let's say by April 1 . We will try to make a judgment, based on the collective ideas of the Council, and make our recommendation to the Secretary as to how we proceed in pushing the plans up the flagpole. Any questions on that procedure? Any objections to it? MR. BINDER: I haven't got any. It is a related question, and that is with reference to the Upper Great Lakes plan that we met on last November, and which is now before the Secretary of Commerce for decision. Is it contemplated that the various agencies on the Council are going to be made privy to whatever recommendations are being sent to the Secretary of Commerce for direction? MR. PANTOS: Yes, on that point I might just add, Fred, that we will express the reservations that have been expressed to us, so that when the package goes forward, all of the agency points are included, so that if, for example, the Department of Transportation has problems with the Upper Great Lakes plan, which it does, it will be clearly flagged, so that everybody knows it. Otherwise, I think this process would not have been relevant. And, so that is why we particularly want to know what your comments now are in general on implementation, because there are various and sundry implications of implementation. MR. BINDER: Thank you. MR. EATON: Well, if the procedure is okay, we would like to follow it, and if we could get your written comments and recommendations in by April 1, we would be very appreciative; and, of course, we will let you know what recommendations we are making to the Secretary. If there are any problems with that recommendation, we will list those reservations and problems. MR. BINDER: Thank you. MR. PANTOS: Before closing, it just occurred to me that we neglected at the outset to make appropriate reference to the day. I guess we could consider this the Southern Strategy on Saint Patrick's Day. So, a belated happy Saint Patrick's Day, and I think Fred has some kind of certificate here he would like to talk about. MR. STEELE: I do, George. From time to time, we make presentations. The Coastal Plains Commission has a regional bird. This is the Golden Nit-Picker, and we brought a few of these along anticipating that somebody might be entitled to such a presentation. The way things worked out, it seems that nobody really deserves this, but we do have a few of them. You might want to take them along, to make some little award yourself. You will note that— of course, we have a Federal-state partnership— so we have a two-headed bird. We have three states, and I think you might find some significance in the fact that our regional bird has three feet. I might add one other item, this was not printed at Government expense. (Applause.) MR. PANTOS: Thank you very much. The meeting is adjourned. (Whereupon, the meeting was adjourned at 1 1:53 o'clock, a.m.) 32 APPENDIX A WRITTEN STATEMENTS OF EXECUTIVE AGENCIES 33 THE APPALACHIAN REGIONAL COMMISSION 1666 CONNECTICUT AVENUE WASHINGTON, D.C. 20235 OFFICE OF FEDERAL COCH AIRM AN March l6, 1971 MEMORANDUM TO: Honorable Maurice H. Stans, Secretary of Commerce Chairman, Federal Advisory Council for Regional Economic Development FROM: Donald W. WhiteheadtJ'Federal Cochairman Appalachian Regi^&l Commission SUBJECT: Comments on the Regional Development Plan of the Coastal Plains Regional Commission The November 30, 1970 Regional Development Plan of the Coastal Plains Regional Commission appears to provide an excellent ana- lytical framework within which specific plans for development of the Coastal Plains region can be prepared by the states and multi-county development districts. The Commission has taken pains to assure consistency of its objectives with national objective. Necessarily, its goals at this stage are quite general and must remain so until a full set of sub-state planning and development districts has been established within the region. Until such local units exist, operational goals cannot be fully developed without running the risk of "top down" planning. President Nixon has quite rightly drawn attention to the dangers of Federal policies which assume that "Daddy knows best." He has pointed, in his recent message on rural development, the need for "grass roots" planning from the bottom up. I believe several of the procedures with respect to reviewing plans and administering the Title V Commissions create the impression that the Federal Advisory Council for Regional Economic Development is attempting top-down planning and Federal domination of the regional planning process. Since this is inimicable to the thrust of this Administration as set forth by President Nixon, 34 -2- I believe the Committee should thoroughly review its present procedures and bring them into line with the President's proposed approach. The Coastal Plains analysis places first priority emphasis upon industrial development, as indeed will most regional development plans. But in terms of programs which might be carried out by the various Commissions it should be recognized that with the exception of identifying and helping to develop industrial sites, recommending financial incentives for industrial locations in the region, and assisting in promotion, the Commissions will have most direct impact on the supportive public services to which, ironically, they assign lower priority. These include improvement of the health and skills of the labor force, improvement of basic public services and utilities, improvement of transport, and improvement of the environment, including the housing environment and the cultural environment. This warp in the de facto priorities results I believe from the attitudes prevailing in the Federal Advisory Council for Regional Economic Development. There was an early tendency to define economic development almost exclusively in terms of industrial site development and industrial promotion. By now, it should be clear to all of us that at the local level community development and economic development are indistinguishable. A community, its locational advantages, and its labor force must be upgraded before economic development is likely to occur. We should recognize these realities and develop priorities in the plans which accurately reflect those factors over which the Commissions can exert influence. Industrial development will follow orderly community development in most cases and it is community development that can be most effectively fostered by the Commissions. The experience of the Appalachian Regional Commission indicates that the Coastal Plains Commission might be wise to avoid involving itself directly in industrial promotion. This is a highly competitive field among the states and there are internal dangers to the Commission itself if it is directly involved in this competition. Equally important, many members of Congress from other sections of the country would not look kindly upon the use of Federal funds for sectional industrial promotion. There is a legitimate continuing concern in Congress over the dangers of "industrial piracy." 35 -3- Finally, we read with considerable interest the section of the plan dealing with the availability of capital for development and the proposal for a Regional Development Bank. This subject should be carefully studied. If the experience in Appalachia is any guide, the Coastal Plains Commission may discover that ample private capital already exists in the region, but that it is being exported from the region be- cause it will yield higher returns if invested elsewhere in the country. We believe there are simpler ways to divert these out- flows back into the region than creating a Regional Development Bank. A variety of "pooling arrangements" at the local and state levels are being tested in Appalachia. Some of this experience may prove helpful in the Coastal Plains . 36 DEPARTMENT OF AGRICULTURE OFFICE OF THE SECRETARY WASHINGTON. D. C. 20250 March 15, 1971 SUBJECT: Coastal Plains Plan TO: G. Fred Steele, Federal Co-Chairman Coastal Plains Commission We appreciate the opportunity to review and comment on the revised draft of the development plan for the Coastal Plains area. We find the plan impressive in its documentation and the economic rationale and investigation that went into its preparation. The document was viewed as the general framework or strategy for the develop- ment of the region. It was assumed that specific assistance that can be offered by the various Federal, State, and local agencies in the develop- ment of the areas will be included in other documents. The Department shares the stated goal of the plan to bridge the income gap, to narrow and eventually close the lag that exists between the regions' per capita income average and that of the nation. Since agriculture and forestry will continue to be a significant component in the region, the Commission can continue to expect the fullest coopera- tion from the Department. We suggest that a continuing work relationship be established between the Commission and the Department's State Rural Development Committees which are composed of the major USDA agencies. We feel this relationship can be mutually beneficial in achieving the goals contained in the plan. The observations and comments which we have at this time are as follows: USDA Observations and Comments 1. Since the environmental quality could be a significant factor in whether or not the projected goals with respect to the future employ- ment structure are met, we suggest that the report contain some judgments of the potential environmental impacts resulting from the introduction of heavy industry as called for in the plan. 2. The report refers to the desirability of shifting in the forestry industry from lumbering to paper and paper board manufacturing. Although the paper mills have higher capital-to-labor ratios than 37 2 - G. Fred Steele the sawmills, if the future needs for houses are to be met, the production of lumber must increase in the region rather than decline. We are not certain that technological improvements in the sawmill industry will meet the time schedule for Employment Structure Number 25 referred to in the report. The Forest Service and cooperating State Foresters will provide assistance to individual mill owners in redesigning and improving their mills. Since the region contains 57 percent of the total commercial forest land and 64 percent of the sawtimber within the three States of the region, the inclusion in the plan of additional information on the forestry resources and the industries engaged in the processing of these resources might be helpful. 3. We note that the development strategy is focused on the growth center concept. The point was made that the small towns in the region could not be expected to support large scale manufacturing. Indications were that this was a factor in projecting plant loca- tions. We suggest that the plan recognize the possibility of groups of towns being able to support plants of a size that individually a single small town could not handle. The multi-town development approach could be considered along with the concept of selecting existing large centers for plant locations. 4. The present major land use in the region is agriculture and forestry, As indicated in the report this is making a substantial contribution to the economy of the area. Much of the potential for the develop- ment of the region will be directly related to the future land use patterns. Some reference in the report as to how land use changes now taking place can be guided to contribute to the economic develop- ment process might be helpful. Our Soil Conservation Service can provide information regarding this item. 5. More explicit recognition in the plan of the need for adequate electric power and modern telephone service as basic requisites to development is suggested. Contacts with the organizations financed by the Rural Electrification Administration now providing electric and telephone service in the rural areas of the region should prove mutually beneficial. 38 3 - G. Fred Steele 6. The report seems to be weighted toward the concept that the Commission with cooperation from State and Federal agencies can bring about development. Since development begins with local communities, we suggest that more recognition be given in the report to the necessity for local community participation. Sincerely yours, HENRY L. AHLGREN Deputy Under Secretary for Rural Development 39 DEPARTMENT OF THE ARMY WASHINGTON, D.C. 20310 •W ! Mr„ G. Fred Steele, Jr. Federal Cochairman Coastal Plains Regional Commission 2000 L Street, N. W. Washington, D. C. 20036 Dear Mr. Steele: The Regional Development Plan sent to us by Mr. George J. Pantos on behalf of the Coastal Plains Regional Commission has been reviewed. From the viewpoint of water resources development, the plan is primarily concerned with harbor and waterway development, including development of container facilities; promotion of more recreational use of waterways and the development of a general water resources plan to meet the needs of the region as envisioned in your development plan. The Department of the Army, through the Corps of Engineers, is desirous of working with the Commission in developing the water resources of the Coastal Plains Region. We are involved directly or indirectly in several studies which should be of assistance to your Commission,, Our field offices are making a number of navigation, harbor, beach erosion and flood control studies in the region. Also, the Corps of Engineers Institute for Water Resources is, currently in the process of initiating a rather comprehensive study regarding the needs for deep draft ports. This study will include an analysis of foreign trade and the impact experienced by several foreign deep draft harbors . The Regional Development Plan briefly mentions the needs for balanced development and environmental studies. Corps permit authorities and recent policy revisions will have considerable impact on industrial and other developments in coastal areas. Without extensive environmental studies, permits for water front development will be extremely difficult to obtain. The Department's field representative, the Division Engineer, U. S. Army Engineer Division, South Atlantic, has previously furnished you comments on the plan. As a member of the Regional Advisory Council for the Coastal Plains, he will work out specific actions to be carried out cooperatively with the Commission. 40 Mr. G. Fred Steele, Jr. The Commission's development plan to change the economy so as to bring the regional income gap into line with the national average income by 1980 is an ambitious goal. I wish you success in meeting the goal and will be pleased to work and cooperate with you and the Commission wherever possible. Sincerely, J^y Robert E. 'Jordan^7lII Special/ Assistant to the Secretary of the Army (Civil Functions) 41 DEPARTMENT OF THE ARMY South Atlantic Division, Corps of Engineers 510 Title Building, 30 Pryor Street, S.W. Atlanta, Georgia 30303 SADYE 15 January 1971 Mr. G. Fred Steele, Jr. Federal Cochairman Coastal Plains Regional Commission 2000 L Street, N. W. Washington, D. C. 20036 Dear Mr. Steele: Reference is made to your memorandum dated December 17, 1970, inclosing a draft revision of the "Regional Development Plan." We have reviewed the draft and offer the following comments. We note from our review that major problems in the Coastal Plains Region have been identified and that broad programs to solve these problems have been proposed. The various proposals should help toward achieving income parity with the nation. Several of our projects and programs could perhaps be directed toward greater emphasis on attainment of the Commission objectives. There could be, for example, a regional evaluation of the need for more small boat navigation facilities to be provided by local governments in conjunction with our Federal projects such as the Atlantic Intracoastal Waterway and various inland waterways. These have potential for greater recreational use. They are a part of the economic structure and could be mentioned in Section III. Our many small-boat harbors are of significance in implementing the Commission's industrial development program in the areas of Marine Industries and Leisure Industries. There is a potential of providing fishing walkways on our jetties as part of the program. We could make special studies of these matters if this would be helpful. The report could include additional reference maps showing the Coastal Plains Region, State and County boundaries, as well as major urban centers. 42 SADYE 15 January 1971 Mr. G. Fred Steele, Jr. Projected 1980 average income figures are considerably higher than those developed by Office of Business Economics (OBE) , U. S. Department of Commerce for the Water Resource Council to be used by Federal agencies in planning water resource development. OBE has projected a 1980 per worker earnings of $8,080 for the U. S. and about $6,300 for an area approximating the Coastal Plains Region. This compares to a projected 1980 average income per employee of over $14,000 as shown on Tables 4 and 5. We will look forward to the pending meeting and will be pleased to cooperate wherever possible in your program. Sincerely, R. P. TABB Colonel, Corps of Engineers Deputy Division Engineer 43 DEPARTMENT OF HEALTH, EDUCATION. AND WELFARE OFFICE OF THE SECRETARY WASHINGTON, DC 20201 FEB J> Btf Mr. G. Fred Steele, Jr. Federal Co-chairman Coastal Plains Regional Commission 2000 L Street, N.W. Washington, D. C. Dear Mr. Steele: We have reviewed the draft revision of the Coastal Plains Regional Commission Regional Development Plan with con- siderable interest. We note that it has been revised in line with prior discussions with both this office and our Regional Office in Atlanta, Georgia and in its present form we see no conflict with priorities and schedules established in DHEW. Thank you for the opportunity of seeing this material. Sincerely^yours, (Mrs.) Patricia Reilly Mitt Assistant Secretary for Community and Field Services 44 DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE REGION IV 50 7TH STREET N.E. ATLANTA, GEORGIA 30323 n _ _ 1 OFFICE OF THE January 11, ly/l regional director Mr. G. Fred Steele, Jr. Federal Cochairman Coastal Plains Regional Commission 2000 L Street, N. W. Washington, D. C. 20036 Dear Mr. Steele: We have undertaken a review of the draft revision of the Regional Development Plan . We are favorably impressed with the quality of the report and the obvious insight into the economic development process that was required to produce it. We have no essential comments concerning your develop- ment priorities or your strategy of plan implementation. There are, however, key references that we believe would have greater influence on investors and public officials if they were consolidated in the form of a brief Executive Summary . Attached is an outline of the types of information that we recommend for inclusion in an Executive Summary . We appreciate the opportunity to review and comment on the revised plan and trust that our recommendations will serve a constructive purpose. Sincerely, Attachment Cary Regionjal Director / 45 Coastal Plains Regional Development Plan: Executive Summary (Proposed Outline of Comment) I. Statement of Regional Development Objectives . II. Regional Inventory of Demand, Supply and Needs for Jobs and Resources to Stimulate Economic Development (Graphic Analysis by Major Sector of the Regional Economy) . III. Plan Formulation, Programming and Budgeting . A. Selection and Ordering of Development Priorities (Investment Opportunities). B. Analysis of the Most Effective Development Alternatives . C. Plan for Financing Development. D. Schedule of Development. 1. Short Term 2 . Long Term IV. Plan Implementation . A. Needed Legislation. B. Technical and Financial Assistance Needs. C. Research, Education and Public Information Needs . D. Coordination Arrangements. 46 =>•• * o DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT * WASHINGTON, D. C. 20410 OFFICE OF THE ASSISTANT SECRETARY FOR IN REPLY REFER TO: COMMUNITY PLANNING AND MANAGEMENT • MAR 1 5 197T Mr. G. Fred Steele, Jr. Federal Cochairman Coastal Plains Regional Commission 2000 L Street, NW Suite ink Washington, D. C. 20036 Dear Mr. Steele: We reviewed the draft revision of the Regional Development Plan for the Coastal Plains Regional Commission transmitted to us by Mr. Pantos' memorandum of January 1% , 1971. We offer the following comments. The Plan is particularly strong in its descriptive analysis which sheds light on the Region's problems and past economic development. The Plan document should clearly identify and analyze major issues, oppor- tunities or problems; set goals and specific objectives to be accomplished; schedule work tasks in logical sequence; and spell out expected results of proposed action programs. The Plan appears to lack an explicit analytical framework for the selection of action projects and programs. For instance, the recommendations on planning organization and work program activities should include specific ways to coordinate Commission planning with State and areawide planning. One of our major concerns is that the Regional Commission exercise its potential to build state capabilities in planning; this would complement (with an economic development orientation) rather than duplicate "701" assistance and program goals. The Commission might consider the following planning activities for 701 assistance, (l) coordination of state housing efforts; (2) use of surplus federal lands; (3) analysis of federal and state program impact on regional 47 new communities policies; (5>) environmental management plans, and; (6) human resources development. The Plan would be more useful if the key concepts were presented in a summary in the initial section of the plan document. If I can be of any further assistance to you, please call me. -^c/<^ 48 6 * M.Ai. * ° DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT