This is in response to your letter of April 26, asking additional questions for the record in connection with your April 20, 1989 hearing on S.318, the Coal Distribution and Utilization Act.

My responses are attached

With thanks for giving me an opportunity to testify before your committee, I am

Questions from Senator Johnston

(1) Why do you think this bill is good for labor?

Answer: The bill clearly is good for those working men and women who will build, operate and maintain pipelines. And it is good for that part of the work force employed in the production of valves, pumps, steel pipe and heavy equipment.

Other jobs would be generated in the construction support sector, including jobs in the travel, food service, hotel and motel, insurance and other industries.

A Bechtel Corporation study of the jobs impact of the seven pipelines proposed in 1983 concluded that a total of 500,000 jobs would be created.

We also believe the railroad industry has greatly exaggerated the alleged adverse impact of pipelines on railroad jobs.

In 1985, the Energy Information Administration of the Department of Defense published an economic assessment of four proposed coal pipelines.

The study, entitled Coal Slurry Pipelines: Impact on Coal Markets, projected a 230 million ton rise in coal production from 1984 to 1995, and estimated that the four pipelines could transport about one-third of that increase.

The EIA study concluded that, if these four coal pipelines were in operation by 1995, "Railroad revenues from coal transportation would still be almost 60 percent higher and railroad ton-miles nearly 30 percent higher in 1995 than in 1984." (Emphasis added.)

If business increases, we ask, how can jobs be lost?

Furthermore, in its 1978 analysis, the Office of Technology Assessment concluded that "...Railroad economic performance will benefit from increases in coal and other commodity transportation revenues even in the presence of pipelines." (Emphasis added.)

(2) Do you think eminent domain legislation is necessary in order for pipelines to be built.

Answer: Mr. William Dempsey, president of the Association of American Railroads, recently told a House committee that "eminent domain is a power to be exercised only when the public's need is a compelling

I couldn't agree more with that statement and I submit that the "public's need" has been clearly demonstrated by the behavior of the railroads themselves.

They have refused for many years to allow pipeline builders to cross railroad tracks anywhere in the country. And in pursuit of that objective, they have entered into a conspiracy to violate the antitrust laws of this nation which are there to protect all America citizens from the ill effects of just such a concentration of economic power.

A Federal court in Beaumont, Texas and another in South Dakota have found railroads guilty of conspiracy to violate antitrust laws while in the very process of blocking construction of a 1,400 -mile pipeline from Wyoming to Arkansas and Texas.

If the bill we have before us had been enacted into law, those conspirators would not have been able to manipulate state laws to their own narrow purposes.

Thus, by their own actions they have demonstrated the public necessity that must be present for exercising the right of eminent domain.

The public deserves and expects in the United States of America to have and to benefit from a free market and fair competition.

But, they can expect neither where coal transportation is concerned unless we pass this bill.

The courts must and have heavily penalized the railroads financially for their conspiracy--over two billion dollars.

But, the same opportunities for conspiracy will still be there unless we can pass eminent domain legislation.

(3) Do you support pipeline legislation solely because of your interest in jobs?

Answer: It is my responsibility to protect and promote the best interest of the 330,000 members of the United Association. Our support of S.318 is certainly compatible with that responsibility.

However, our determination to fight for enactment of this legislation, however long it takes, is founded upon our conviction that the implications of this struggle go far beyond the narrow needs of our own membership.

We believe that all American citizens live under a Damocles sword insofar as energy security is concerned.

Our continuing, and growing, dependence on foreign oil to power our homes, offices and industries provides a glaring "window of opportunity" for those nations who would do us harm.

We are in total accord with that long line of U.S. presidents who have supported increasing coal production and use in order to move the nation closer to energy independence.

We believe eminent domain legislation will open the way to an alternative system for hauling coal which, because in certain circumstances it is faster and cheaper, will encourage more use of American coal and less use of foreign oil.

We also believe it is in the national interest to maintain a free competitive market and to respect antitrust laws precisely because they serve the. national interest.

We believe, in sum, that this bill is in the best interest of the United States of America. If so, it is in the best interest of our members even apart from any job considerations.

Questions from Senator McConnell

If this bill is passed what is the likelihood of a slurry line being built West to East?

Where do you think the lines are most likely to be built?

Answer: To the best of my knowledge there are no proposed pipelines that would carry Powder River Basin coal into markets served by Kentucky coal.

Nor is it likely that such a pipeline will be proposed. In previous years potential pipeline builders made it clear that pipelines of that length, into the eastern market, were not economically feasible.

Furthermore, boilers in plants served by Kentucky coal require a higher BTU content than Powder River coal can supply.

It should also be noted that we now have available a clean coal technology that will allow the slurry mixture to be fired directly into a boiler like fuel oil.

With minor retrofitting, plants now importing foreign oil could switch to clean coal and open up that market to coal from Kentucky, thereby serving both the national interest and the interst of the coal industry in Kentucky.

It is difficult to say where coal pipelines would be built if S.318 passes Congress. There are no specific projects pending at the present time.

Obviously pipelines will only be built if they can offer an economically more attractive alternative to rail and barge transportation.

Competitive factors, too hard to predict, will determine whether pipelines will be built and where they will be located.