THE RECORD

MARCH 23,1977

NO. 39

LYNDON B. JOHNSON SCHOOL OF PUBLIC AFFAIRS, THE UNIVERSITY OF TEXAS AT AUSTIN

EDITOR Hoyt H. Purvis

RESEARCH PROJECT CONSIDERS LIGNITE DEVELOPMENT

The LBJ School Policy Research Project on Texas lignite is studying the implications for state and federal policy of the cumulative environmental, economic, and social impacts associated with development of lignite resources.

The project is being directed by Stephen Spurr with Marlan Blissett. Dr. Charles Groat, acting director of the Bureau of Economic Geology, was participating faculty member on the project during the fall semester. Dr. William L. Fisher, director of the Bureau of Economic Geology and former assistant secretary of the Interior for Energy and Minerals, is associated with the project for its duration.

Potential statewide reserves of near-surface, or strippable, lignite (occurring at depths of up to 200 feet) are estimated at 10 billion short tons. Additional reserves of deep‑basin lignite (occurring at depths from 200 to 5,000 feet) are estimated in excess of 100 billion short tons. More than 100 billion short tons have been mapped, which is equivalent on a Btu basis to 277 billion barrels of oil. Not all of the deep‑basin nor the near-surface lignite is recoverable, but the magnitude of this resource gives it an important position in the future energy supply of Texas.

In response to dwindling reserves of natural gas and petroleum, the Texas Railroad Commission and Federal Energy Administration have required that electric utilities reduce their consumption of these fuels and convert to coal. In 1975, gas and oil accounted for over 90 percent of the fuel used by the electric utilities in Texas. Lignite represented about 9 percent. No plants using western coal or nuclear fuels were in operation. Based on plant construction plans reported by the electric utility industry, it is projected that by 1985 lignite and coal will supply 23 percent and 20 percent, respectively, of the state's electricity needs.

The rate and extent to which lignite resources are actually developed will depend upon the interplay of numerous technological, economic, social, and environmental factors in conjunction with related state and federal policies. This project is aimed at assisting state officials to forecast the probable development of the Texas lignite industry under varying assumptions regarding state and federal actions promoting energy developement and regulating environmental quality, and their responsibility to recommend to the governor and the Texas Legislature actions that will both favor the development of alternate energy sources and, at the same time, safeguard air, water, and land quality. Also under investigation are policy alternatives for local communities affected by lignite development.

During the fall semester, project participants were introduced to the range of factors and issues associated with Texas lignite development. September was devoted to exploratory readings, a field trip to an existing lignite mine/power plant operation, and extensive briefings from the Bureau of Economic Geology, Texas Utilities Company, and the Governor's Energy Advisory Council. In October, the students were divided into six groups to conduct independent reconnaissance studies into (1) electric power industry, (2) surface mining, (3) air pollution, (4) water supply and pollution, (5) transportation and other economic issues, and (6) community impacts. Briefings were continued with presentations from Professor Kenneth Boulding, the Center for Energy Studies, the Texas Railroad Commission, the Texas Air Control Board, and the College of Engineering. The reports were presented in oral and written form in November, after which special topics for further study were isolated and discussed.

ISSUE BRIEFS

For the second phase of the project, the students were asked to select a topic for individual research and prepare an issue brief to be directed toward a specific client such as the Texas delegation to Congress, a committee of the state legislature, or a state agency responsible for planning or regulation. The issue briefs were to focus upon the effects to or from Texas lignite development.

Issue briefs related to lignite extraction dealt with: the Surface Mining and Reclamation Division of the Railroad Commission and the "Texas Surface Mining and Reclamation Act of 1975"; the implications of proposed federal stripmining legislation to Texas lignite development; the policy implications of deep‑basin lignite utilization technology; and, the policy implications of an imminent judicial decision concerning lignite ownership.

Issue briefs related to air and water issues include: analysis of proposed Clean Air Act amendments; air quality issues associated with lignite‑ and coal-based electric power production in Texas; analysis of the impacts to Texas lignite of forthcoming federal water quality regulations; water supply for lignite development in southcentral Texas; and, development of reservoirs over lignite deposits.

Legislation which would grant the power of eminent domain to coal slurry pipelines is presently before Congress and the Texas Legislature. The issues associated with the proposed bills and with rail transportation were examined.

Fiscal policies related to Texas lignite were examined from the perspectives of: alternative means of mineral taxation; the financial implications of lignite development for local governments; and, identification and planning of services for affected communities.

In lieu of an issue brief, analyses of the electric power industry in Texas were updated and refined to serve as a source of baseline information on existing and planned power plants, particularly those utilizing coal and lignite as fuel. One student is conducting an attitudinal survey based on random sampling of individuals in three selected communities where there is a lignite plant nearby in either the operation, construction, or planning phase.

The third phase of the policy research project, which is now in progress, is the preparation of a final report with policy recommendations.

[news item]

Toward New Human Rights, a book resulting from the symposium on the subject held in the LBJ Library last September, has now been published by the LBJ School. The attractive 450‑page volume was edited by David Warner and produced by the Office of Publications. It sells for $5.95, and orders are coming in from across the country.

In the book a number of scholars and policy makers examine the programs of the Kennedy and Johnson Administrations, described how they were initiated and why they developed as they did. These observers evaluate the results of these programs and delineate what remains to be done if many of the objectives of the programs are to be fully achieved.

The book includes chapters by Clifford Alexander, Victor Bach, Douglass Cater, Kenneth Clark, Wilbur Cohen, Karen Davis, Marian Wright Edelman, Bernard Frieden and Marshall Kaplan, Charles Haar, Vernon Jordan, Robert Lampman, Robert Levine, Theodore Marmor, Burke Marshall, Ray Marshall, Arthur Schlesinger, Jr., James Tobin, and David Warner.

Dagmar Hamilton and Beryl Radin of the LBJ School contributed summary sections.

"On the Record"

. A panel discussion featuring the 10 candidates for the Austin mayor's office is scheduled for Wednesday, March 30 at 4 p.m. in the East Campus Lecture Hall. (see page 6) The meeting will be sponsored by LBJ School students and a panel of five students who will question the candidates.

. Dr. Joyce A. Hughes from the Northwestern University School of Law will speak on "The Notions of Equality" at the Law School on Thursday March 24 at 1 p.m. in Townes Hall Auditorium. Dr. Hughes' talk is in conjunction with Law School Week.

. The status of the shale oil industry is the subject of the most recent publication in the LBJ School's working paper series. The paper was authored by Professor David Eaton, who reviews the status of the shale oil industry, with emphasis upon the engineering options for producing synthetic oil from shale. The first section describes alternate technologies to extract and process oil from shale. The second section evaluates resource, environmental, and economic factors which influence the shale oil industry. Copies of the paper are available through the Office of Publications.

. Gurney Breckenfeld, a member of the editorial board of Fortune magazine, spoke on the Sunbelt phenomenon at a brown‑bag luncheon on March 10. Beckenfeld is writing an article on the Sunbelt for the June issue of Fortune. He interviewed several persons at the LBJ School and elsewhere in Austin. The purpose of the article, he said, is to determine "What is the chemistry that makes the Sunbelt work."

. The 23rd Governmental Accounting and Finance Institute is scheduled for April 4‑5. The Institute is sponsored and organized by the LBJ School and the College of Business Administration in cooperation with the Texas Chapter, Municipal Finance Officers Association, and the Texas Municipal League. Scheduled speakers include Jeanna Tully, director, Office of Revenue Sharing, U.S. Department of the Treasury; State Representative Wayne Peveto of Orange, and Robert W. Doty, Municipal Finance Officers Association of the U.S. and Canada.

. Dr. Emma Lou Linn, who is currently seeking re‑election to the Austin City Council, spoke to a student‑sponsored brown‑bag luncheon on March 8. Linn said one of the most important actions taken by the Council was ending refund contracts to developers, a move she supported. She said she hoped to see more federal funds used in the city, not only in historic areas, but to revitalize older neighborhoods. She also discussed the city's growth policies and cited the powerful role of the city manager.

. Among recent visitors to the LBJ School were Jesse Burkhead, the budget and public finance member of the Maxwell School (Syracuse University) faculty, who spoke on public sector productivity and the difficulty of measuring it for economists, and John Callahan, director of a project of the National Conference of State Legislators, who discussed school finance reform.

. Upcoming speakers at the LBJ School:

Bernard Jump, associate director and professor of public administration at the Maxwell School, will speak at a brown‑bag luncheon on Thursday, March 24 at noon. Professor Jump's work over the past five years has been in the field of state‑local finance management and he has done extensive work on public employee pension systems.

A. Alan Post, chief fiscal advisor to the lower house of the California Legislature, will speak at a brown‑bag luncheon on Friday, March 25 at noon.

. Alfred (Al) Giles IV, a 1976 LBJ School graduate, has been appointed as assistant director for the Southwest Region of the Planned Parenthood Federation of America, which has its headquarters in Austin. Giles has been employed by the Governor's Energy Advisory Council.

. Carol McDonald, a second‑year student, has been selected as a Luce Scholar for 1977‑78. She is one of 15 selected in nationwide competition. The award is valued at $9,000 and will include a 10‑month internship in Asia working with an Asian governmental agency, followed by an evaluation and reporting period. She does not yet know in which Asian country she will work. She will report to Princeton, N. J., on August 21 to begin the program.

. Melvin E. Waxler, an LBJ School alumnus, is one of the 104 regional finalists for the 1977‑78 White House Fellowships. Waxler, 26, is currently a student in the UT School of Law. Ultimately 14 to 19 White House Fellows will be chosen from the regional finalists.

BACH TESTIFIES ON BLOCK GRANT STUDY

Professor Victor Bach testified before the Subcommittee on Housing and Community Development of the U.S. House Committee on Banking, Finance, and Urban Affairs on March 1. Bach presented findings of the Policy Research Project on community development block grants.

The project, which is now in its second year, includes a comparative field study of the local dynamics of the block grant program and its resulting outcomes within the center cities of six major metropolitan areas: Baltimore, Birmingham, Hartford, Houston, Kansas City, and San Francisco.

Bach lent support to changes in the allocation formula which are currently under consideration. "It is well recognized that the present formula largely follows the population size of a jurisdiction rather than the extent of income poverty or of community development burdens faced by the jurisdiction. The imminent phase‑out of the hold‑harmless provision would, in the absence of an appropriate formula revision, provide fewer federal resources to many jurisdictions with declining fiscal capacity and increasing development needs," Bach said.

Although Bach pointed out concerns raised by the emerging pattern of local community development efforts, he also noted accomplishments of the program "that argue for its extension."

Bach said, "The advantages of the block grant format are well recognized in the cities—its adaptibility to differing local conditions, the greater autonomy for local priority‑setting, less federal red tape, and a degree of certainty of

funding over successive years. In the cities we have observed, by and large the benefits of the program are being directed within areas of low‑ and moderate‑income residents in compliance with the "maximum feasible priority" provision of the legislation, with only rare exceptions. Most importantly, the CDBG program is channeling federal resources into capital investment—for housing rehabilitation, streets and lights, public facilities, sewage drainage, and so on—in many subareas and neighborhoods that have long been sorely neglected by the cities, as they preferred to make their investments in more tax‑profitable growth areas. These offers are generally responsive to strongly felt needs in the communities involved."

The major recommendations which have emerged from the study are:

Focusing program benefits on the lower‑income sectors of the city. The current designation of low‑ and moderate-income is too inclusive to assure the channeling of block grant funds where they are most needed. We have reason to believe that some Mayors would welcome tighter income‑related restrictions as a way of dealing with local pressures to spread the funds more thinly across a wider constituency. Legislative revisions might specify a more restrictive income threshhold, such as a percentage—somewhere over 100 percent—of the poverty level adjusted by area cost of living indices. Alternatively, the legislation could prescribe that some percentage of the block grant be allocated toward clear low‑income sector needs.

Legislative clarity on the flexible use of the block grant for economic development and human services activities. It is unclear whether the purposes of the CDBG program would be significantly distorted if cities were allowed to decide for themselves on the distribution of funds across hard and soft activities, provided the programs proposed were justifiable in terms of demonstrable development objectives. In our observations, priorities expressed at the community level cut across both neighborhood physical improvements and improved services. To the extent that cities are responsive to the demands of the communities in the formulation of their applications, such responsiveness might ultimately lead to a balance between the two kinds of activities, without erring too much in either direction.

Bach concluded, "We would also recommend that alternative federal initiatives and incentives be considered that go well beyond the CD block grant to support and encourage local innovation in dealing with critical urban problems. Since such innovation is a matter of local will, vision, and capability rather than a matter of entitlement, we would recomment the creation of a parallel federal fund for urban innovation that would make awards to localities selectively, possibly coupled with a portion of the block grant. I understand that HUD Secretary Harris has already taken steps in that direction which deserve support. These initiatives should help create the federal‑local dialogue on fundamental urban issues that has so long been missing.

MEXICAN OFFICIAL DISCUSSES RELATIONS WITH UNITED STATES

Ambassador Antonio Gonzalez de Leon, head of the economics section of the Mexican foreign ministry, spoke on Mexican‑U.S. relations at a schoolwide seminar on March 9.

He noted that from the presidency of Franklin D. Roosevelt until recent times, the two countries had a "smooth relationship." Why did they deteriorate? He said the two major objectives of Mexican foreign policy are:

. Defense and protection of Mexican national interests;

. Contributing to the structuring of a more just international order.

The Mexican official noted that there are differing views about how to accomplish the second goal, which "reflects the interest of a developing nation," and that these sometimes brought the U.S. and Mexico into conflict.

"We want fairer terms of trade and access to the financial resources to develop," he said.

The U.S., he said, is part of the group of industrialized nations which "defend another position, representing their interests."

Gonzalez de Leon said the main problem facing Mexico at present "is a serious economic crisis." He said, "Our model of development, in many senses, has failed. After 40 to 50 years of stability we find ourselves in a critical period."

"We are trying to clarify our problems and possible solutions. This coincides with the change of administrations in the United States and perhaps a changed attitude. Both nations are looking for improved relations," he said.

HUMAN SERVICES CONFERENCE HERE

President Carter's associate assistant for intergovernmental relations opened a two‑day University of Texas conference on human services in Texas communities Monday.

T. M. (Jim) Parham, a member of the White House staff and the former commissioner of the Georgia Department of Human Resources, gave the conference keynote address in the Thompson Conference Center.

The conference was sponsored by the LBJ School in cooperation with the Graduate School of Social Work and the graduate planning program of the School of Architecture.

Purpose of the conference was to improve human services in Texas communities by bringing together persons from cities and counties who plan and deliver services involving child care, youth programs, neighborhood centers, and programs for the aging, among others.

Robert J. Macdonald, associate director of the LBJ School's Office of Conferences and Training, says most human services at the local level "are not imposed from above, so that a program for the aging in one community may differ greatly from that in another."

The UT conference was designed to allow those who work in the area of human services to learn from each other and to examine the possibility of putting together different sources of funding for human services programs.

In addition to Mr. Parham's speech, addresses were given by Hortense Dixon, executive assistant to the mayor of Houston, who spoke on "Human Services in Texas—The Metropolitan Perspective," and by Merle E. Springer, deputy commissioner for financial and social services of the Texas Department of Public Welfare.

Mr. Springer's remarks concerned Title XX of the Social Security Act which calls for the integrated planning and delivery of human services between state and local jurisdictions.

Professors Victor Bach, Lodis Rhodes, and Beryl Radin of the LBJ School faculty were on the program for the conference, along with James E. Hartling, assistant professor of architecture and planning and a participating faculty member at the LBJ School.

CAMPBELL HEADS AWARDS PANEL

Dean Alan K. Campbell of The University of Texas participated in the presentation of the First Annual National Governor's Conference Awards for Distinguished Service to State Government.

Campbell was chosen by the NGC to be chairman of the awards selection committee.

Ten high‑ranking state officials from across the nation received the awards.

Governor Reubin Askew of Florida, chairman of the NGC, made the presentations.

Dean Campbell says the new awards program will give some visibility to individuals who make significant contributions to the quality of state government and will serve as a "small corrective" to the lack of national attention to the roles of state government.

QUALITY OF LIFE FOR OLDER AMERICANS

To improve the quality of life for America's older citizens, basic changes in attitudes and social policies need to be implemented, according to a panel of University of Texas authorities on aging.

With a youth‑oriented society on the wane, Bert Kruger Smith, executive associate in the Hogg Foundation for Mental Health at UT Austin, says she hopes the activities of people of every age will be integrated to the mutual benefit of all.

Such an integration of ages can be achieved without legislation if people proceed on their own initiative to include the elderly in influential activities, explains Mrs. Smith, author of "Aging in America."

Observing that the transition from the work force to retirement may be a traumatic and dramatic experience for retiring Americans, Dr. Jurgen Schmandt, professor in the Lyndon B. Johnson School of Public Affairs, suggests perhaps a "second career" in social or health services can ease the jolt.

People should be allowed to choose their retirement time based on their desires and competence, rather than by force of the law, in his opinion.

Economic, social, and political factors will determine whether the maintenance of older people in the work force will become a reality, according to Dr. Guy Shuttlesworth, associate professor in the University's Graduate School of Social Work.

He believes contributions by the elderly can be made best in terms of their individuality. However, he adds, negative impressions older persons have of themselves must be abandoned first.

The panelists discussed the quality of life for older Americans on "The Next 200 Years," a weekly radio program of the University.

MEAL SYSTEM CONFERENCE SET

A new meal system featuring a prepackaged box of edibles that easily can be turned into a tasty, hot, nutritious meal in 10 minutes has found high favor among its first consumers, the homebound elderly, according to an LBJ School report.

The next question is:

Could such a single meal‑in‑a‑box‑system (which is shelf‑stable and requires no refrigeration or freezing) be expanded for general use?

Could it, for example, serve as standby provisions in hospitals, nursing homes, prisons or schools, or as emergency rations in disasters, or even for the occasional convenience of campers and recreational groups?

The questions will be explored June 6‑7 in Washington, D.C., when the LBJ School and the National Aeronautics and Space Administration (NASA) sponsor a conference to discuss the findings of their recently completed study, "Meal System for the Elderly."

The conference at L'Enfant Plaza Hotel will bring together government and food industry representatives to see if such a meal system might be found commercially feasible to produce by the private sector.

The experimental project, using food technology developed from the space program, was field‑tested in Texas in 1976. A total of 168 elderly persons agreed to participate in the meals program daily or on weekends for periods ranging from 9 to 15 weeks.

The demonstration was conducted in the cities of Waco, Austin, Houston, and Paris and in small communities and rural areas of the counties of San Saba, Falls Wilson, Karnes, Guadalupe, Comal, Atascosa, Bastrop, and Travis.

Professor Jurgen Schmandt of the LBJ School says the program was devised to see if it could work as an alternative meal service (not as a "special occasion" meal) for the many elderly poor who live outside the range of existing home-delivered meals programs or who otherwise are not able to get to communal eating centers in cities for one hot meal a day.

Schmandt directed a faculty‑student policy research project which helped plan and evaluate the meal system for the elderly.

HAZLETON DISCUSSES STRATEGIC MATERIALS

No serious shortage of raw materials will exist in the United States as long as technology is allowed to intervene and the free market price mechanism is allowed to fluctuate to adjust to supply and demand, according to Dr. Jared Hazleton, professor at the LBJ School of Public Affairs.

When a resource begins to dwindle, its price rises, thus inducing consumers to seek substitutes and producers to seek additional deposits of that resource or alternatives offered by technology, he explains.

Changes in technology result in discovery of new resources, Dr. Hazleton continues. Because of this pattern, the unit cost of raw materials has remained low and the supply has been sufficient.

However, problems arise when policies are instigated which prevent the market mechanism from operating normally, he adds.

What are the conditions and policies that effect mineral production and resource development?

The uneven distribution of raw materials in the world results in an involvement of nations in international politics, especially in the area of "critical" resources—those on which there is an immediate dependence, says Dr. William Fisher, professor of geological sciences and director of the Bureau of Economic Geology at UT Austin.

Noting that international trade has expanded significantly in the past 30 years, Dr. Stephen Magee, visiting professor of finance at UT Austin, explains that as nations become more interdependent for resources, they become more vulnerable to "quantitative limitations by any one nation of its raw material."

For instance, dependent countries are subject to supply cutbacks if a large exporting country in the international market decides to get out of the free trading world in an attempt to increase prices to buying countries, he continues.

And international interdependence in world trade sometimes leads a raw material‑producing nation to raise the price of its export if that nation believes it is at the mercy of the developed countries for capital equipment and consumer goods, Magee adds.

Other policies that hinder the market mechanism, thus restricting resource development, are cartels, tariff duties and those policies which make domestic investment in raw material industries unprofitable, Hazleton says.

The panelists discuss the status of U.S. resources on "The Next 200 Years," a weekly radio program of the University. Discussions in the series examine various aspects of American life—past, present, and future.

EATON RECEIVES DEGREE

Professor David Eaton received the Ph.D. in Environmental Engineering Systems from the Department of Geography and Environmental Engineering of The John Hopkins University on March 10, 1977. His dissertation, entitled "A Systems Analysis of Grain Reserves," is an inquiry into the problems of how to size and operate a world grain reserve.

One portion presents background information to structure the issues and frame the contributions of the dissertation. The historical buffer stock paradigms of the Bible (Joseph) and ancient China (Li K'O) Serve as points of departure. Previous economic analyses are evaluated. Techniques that will be emplored in later portions are introduced. One chapter discusses conceptual issues, including the nature of demand for grains, the process of grains production, and the institutional context of a buffer stock.

A second section formulates mathematical methods which can be used to design a world grain reserve to achieve multiple public objectives. One procedure generates synthetic grain production futures. Another insures the reliability of a buffer stock. A third technique develops operating rules. Finally, a series of models are formulated to size a reserve with respect to objectives of supplies stability, price stability, farmer goals, consumer interests, and economic efficiency.

A final section is an illustrative empirical inquiry on the size of a world grain reserve. The mathematical techniques are applied to calculate a lower bound on the size of a global, total grains buffer stock, which stabilizes the supply of grains for the design period of 1975 to 2000.

The purpose of this volume is not to determine some 'optimal' grain reserve size for operating rule. Its goal is to develop procedures which may be used to explicitly elicit the implications of grain reserve policy decisions for all interest groups.

PRESS RELATIONS SUBJECT OF PANEL

A panel composed of Bob Hardesty, George Christian, Harry Middleton, and Liz Carpenter discussed government‑media relations before LBJ School students in the topical seminar on Communications and Public Policy at the LBJ Library on March 21. Several classes from the School of Communications also attended the session.

All four were on the White House staff under President Johnson, and all are former journalists. Christian was White House press secretary and Carpenter was Mrs. Johnson's press secretary. Christian also served as press secretary to Texas Governors Price Daniel and John Connally and Hardesty was Governor Dolph Briscoe's press secretary before becoming associate deputy chancellor for administration of the UT system. Middleton is director of the LBJ Library and Carpenter is working with the LBJ Foundation.

On March 7, Ray Mariotti, who became editor of the Austin American-Statesman last year, was a guest speaker for the topical seminar, which is taught by Hoyt Purvis.

ATTENTION VOTERS!

There will be a

PANEL DISCUSSION

with the

MAYORAL CANDIDATES

Wednesday, March 30

4‑6 p.m.

EAST CAMPUS LECTURE HALL

SID RICHARDSON HALL, ON THE CAMPUS OF THE UNIVERSITY OF TEXAS AT AUSTIN

SPONSORED BY THE STUDENTS OF THE LYNDON B. JOHNSON SCHOOL OF PUBLIC AFFAIRS, THE UNIVERSITY OF TEXAS AT AUSTIN

ALL CITIZENS ARE CORDIALLY INVITED TO ATTEND AND PARTICIPATE