Interior Secretary James G. Watt said yesterday that large agribusiness firms should have unlimited access to federal irrigation water, but he called for their subsidies to be substantially reduced.
In the Reagan administration's first official pronouncement on the long-simmering issue of irrigation policy, Watt told a congressional panel that the 160-acre limitation contained in the Reclamation Act of 1902 was "outmoded" and created "artificial restraint" on farm ownership. The limitation has been systematically violated over the years.
Watt proposed that any farming operation be allowed to lease federally owned water to irrigate an unlimited acreage, as long as it pays the full cost of the water for all over the first 960 acres, which under present law is federally subsidized. The full price may be more than 10 times the subsidized price.
Under the Reclamation Act, subsidized irrigation water is being provided to about 47,000 farms totaling about 12 million acres in 17 western states, transforming them from desert areas into agricultural gold mines. This land represents just 1 percent of the total farmland in the country but it produces 10 percent of the dollar value of all major crops.
Over the years, the 160-acre limitation has been widely ignored, and in 1976 a federal court ruled that the law had been administered illegally in favor of large growers, who had found ways to circumvent it to receive full subsidies for all their acreage. The court said that unless Congress revised the statute, the Interior Department would have to enforce the old acreage limitation.
Watt's testimony on the adminstration's proposed changes in the law before the House Interior subcommitee on water and power resources, which is considering legislation that incorporates many of these proposals, drew immediate fire from small growers.
The secretary's approach would "gut the reclamation program" by continuing to permit the conglomeration of large landholdings in the hands of a few, said George Ballis, coordinator of National Land for People, a grassroots group dedicated to the perpetuation of the family farm.
Ballis wants what he called "welfare water" to go only to resident farmers who own or lease no more than 640 acres.
But Watt's proposals drew praise from some unlikely quarters, including Democrats who said he had steered a workable middle course on a politically explosive issue that has come before Congress in a variety of forms since 1976. Committee Chairman Morris K. Udall (D-Ariz.), a frequent critic of Watt, said the administration's position was "positive, constructive, and something we can work on."
John Lawrence, an aide to Rep. George Miller (D-Calif.), the leading congressional proponent of making large growers pay the full freight for irrigated water, said he was "very pleased" with the pricing formula Watt proposed.