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said we should have the fee higher but you see that surely if the 

 decision is based upon a technical determination that we would 

 have to move out, there would be a substantial program and I don't 

 know how far that set aside fee would take us. 



Mr. Hughes. Testimony was pretty clear from NOAA this morn- 

 ing that they feel we ought to close down the 12-mile site, move it 

 to a deeper water site. As the chairman has indicated the EPA has 

 come as close as I have heard in a long time, that they preliminar- 

 ily have suggested that I think they are much in accord with 

 NOAA's recommendation that they close the 12-mile site and move 

 it to deeper water. The statute from 1971, as the mayor well knows, 

 has a bias for the deepwater site, sajdng we can disperse a lot 

 better and have less direct impact at the deepwater site. So we are 

 on notice that perhaps we will have to think in terms of alterna- 

 tives other than the 12-mile site. 



I recognize you don't want to have to pay more than you really 

 have to, you don't want to pay any fees if you don't have to. We 

 also have to face the fact that the dumping taking place is very 

 cheap compared to what other communities throughout the coun- 

 try are having to pay to dispose of their sludge. That is because 

 they have made the commitments for long-term solutions. 



Mayor Koch. If I may reiterate. 



Mr. Hughes. We have to begin to put in a structure to do that. 



Mayor Koch. If I may reiterate what the commissioner has said. 

 The city of New York came through a very difficult period of time 

 when we had no capital budget at all and the place was falling 

 apart. Now we are getting back on our feet and in a considerable 

 way and this year our capital budget will exceed $1 billion. That is 

 a lot of money. But it is probably half or less of what we really 

 could use to do what has to be done in the city of New York as it 

 relates to our bridges and sewers and water tunnels and ever5rthing 

 else that relates to its infrastructure. 



What the commissioner was saying and I agree with him, is that 

 we would not want to set aside moneys in advance in sort of a 

 Christmas club that might be used at a later time 



Mr. Hughes. Sludge fund. 



Mayor Koch. We never thought about a sludge fund in New 

 York City. 



Mr. Hughes. Or slush. 



Mayor Koch. So what we would say is without question that 

 should the time arrive — we hope it would not — but should it arrive 

 that in a particular year we had to use parts of our capital budget 

 for this purpose, we would use whatever moneys were necessary 

 but we would not want it collected in advance and deprive us on an 

 annual basis. 



You lose — you are paying twice, you know, you also pay the in- 

 crement in the cost of money. If you are taking money out of your 

 capital budget and you set it aside not to be used, you don't use 

 your capital budget to the full then and you ultimately pay more 

 for that same improvement. 



Mr. Hughes. You probably would have supported repeal of the 

 10-percent withholding tax, too? 



Mayor Koch. No, no, I actually believed that the President had 

 to be commended on his — I wish he would veto it. 



