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Mr. WOODRUM. Will there be a requirement that they be members of the bar?

Mr. CANNON. Yes, sir.

Mr. WOODRUM. Then you are automatically going to throw out of the Government service a great many of them who are now holding legal positions, who are not members of the bar. That will be a sizable group that will go out, the first shot out of the box.

Mr. CANNON. There may be some recourse to those individuals, through reassigning their duties.

Mr. WOODRUM. Well, that is rather indefinite.
Mr. CANNON. Within the agencies.

Mr. WOODRUM. I may be wrong about this, but I do think that there are a great many lawyers in the Government service who are not members of the bar, who are holding legal positions.

Mr. CANNON. My information is not to that effect.

Mr. WECHSLER. There have been only two cases that have come to our attention. Both of them are in the War Department, and they are now before a committee of the Board to see whether some special dispensation ought not to be made concerning them.

Mr. WOODRUM. You think there are very few of those cases, do you?

Mr. WECHSLER. So far as our present information goes, yes. I think, myself, that retroactivity may be objectionable in these qualifications, just as in any other new rules, and we might have to meet that situation.

Mr. REILLY. If I may say one word, Mr. Chairman; it has been the practice, in making schedule A appointments for the general counsel to be required to submit a certificate of admission to the bar on behalf of the particular appointee.

Mr. WOODRUM. I think it would be well if you would give some thought to that. It seems to me that the Government process ought to be very liberal and very elastic with reference to these people. I know that it has not been so in a great many other departments. I know that in the covering-in process, in some other agencies, under the Ramspeck bill, great hardships have been worked by arbitrary rules imposed on people who were there, who had been there for years, performing a service and performing it satisfactorily, and who now have to face some sort of examination that they cannot pass. And yet they are doing their job and doing it well.

Mr. RAMSPECK. There has been nobody covered in under the Ramspeck bill yet.

Mr. WOODRUM. Not under the Ramspeck bill, but under the Executive order. They have been covering them in and holding examinations.

Mr. RAMSPECK. The bill only became effective the 1st of January. Mr. WOODRUM. I understand that.

Mr. MITCHELL. Mr. Chairman, may I say that the Commission is prepared to be very liberal in giving credit for experience, and if they are doing the job well, there is not going to be much chance of anything like that happening.

Mr. WOODRUM. I know that that ought to be the case, because I know there are very competent people who are doing work, and who have been doing work, especially those who have gotten up into the middle section of life, who are not very good at taking examinations of any kind.

Mr. MITCHELL. That is true, and we are certainly giving that thought.

Mr. HENDRICKS. Mr. Chairman, I appreciate their saying that they are going to do that. . I have seen these things happen before, and there ought to be some way of assuring us that if they get this appropriation those men who are capable, whether they are members of the bar or not, are going to be considered, and are going to be kept in their positions. Unless that assurance is given in some way, I am not at all inclined to vote for this appropriation.

Mr. Houston. You mean those who are already in?

Mr. HENDRICKS. Yes. The fact that they are not members of the bar should not preclude them from holding their positions.

Mr. STARNES. I would like to know why it is necessary to set up this Board and at the same time maintain the Commission's procedure; or why the Commission's procedure was not satisfactory. I have heard no particular complaint in all the years that I have served here, or before I came here, about the Commission's examination of members of the bar and others who wanted to obtain legal positions in the Government. I just cannot understand the necessity of superimposing a board over an old, established, independent agency.

Mr. WOODRUM. The attorneys heretofore have not been under civil service. The President appointed the Board to serve a situation and make recommendations as to what, if anything, should be done; and the Board was divided on two plans, as I recall it. This is one of the plans.

Mr. Houston. Is it still a requirement that as to those getting a salary of $5,000 or more confirmation is required by the Senate, even though the position is under the supervision of the Board?

Mr. Fahy. That is not affected by this.

Mr. STARNES. I was under the impression that a great many of the attorneys in the Federal Government did have a civil-service status.

Mr. WOODRUM. Only in one or two departments, as I recall it.
Mr. WECHSLER. 900 out of 6,000, Mr. Chairman.
Mr. WOODRUM. I think that covers the situation, gentlemen.

THURSDAY, JANUARY 8, 1942. TENNESSEE VALLEY AUTHORITY STATEMENTS OF DAVID E. LILIENTHAL, CHAIRMAN; GORDON R.

CLAPP, GENERAL MANAGER; T. B. PARKER, CHIEF ENGINEER; G. 0. WESSENAUER, ACTING MANAGER OF POWER; NEIL BASS, CHIEF CONSERVATION ENGINEER; A. M. MILLER, DIRECTOR OF CHEMICAL ENGINEERING; ACCOMPANIED BY JAMES P. POPE, DIRECTOR; W. C. FITTS, Jr. GENERAL COUNSEL; E. A. SUNSTROM, COMPTROLLER ; MISS MARGUERITE OWEN, WASHINGTON REPRESENTATIVE; PAUL W. AGER, CHIEF BUDGET OFFICER, AND ARTHUR S. JANDREY, ASSISTANT TO THE GENERAL MANAGER

ESTIMATES AND APPROPRIATIONS

Mr. Woodrum. We now take up the appropriations for the Tennessee Valley Authority. The item is as follows:

Table 1.- Tennessee Valley Authority-Budget summary-Continued

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Table 2 presents the actual and estimated costs under the asset accounts for the navigation, flood control, and power program. Th total requested for 1943 is $143,598,000 which is $25,024,000 less than the estimated amount for 1942. The total reflects requirements for carrying out this program as modified by three supplementary power programs to provide additional power-producing facilities for emergency national defense purposes. The estimates include funds for continuing construction of the Fontana, South Holston, and Watauga Dams, additions to the Watts Bar steam plant, now under construction, and to the existing steam plant near Sheffield, Ala., and 10 hydroelectric generating units at existing projects or projects now under construction, as approved by Congress on December 15, 1941, for beginning of construction in 1942, and for continuation of projects previously authorized. The estimated expenditures for 1942 include $107,283,000 for carrying out the three supplementary power programs and the estimates for 1943 include $82,455,000 for this purpose.

TABLE 2.- Navigation, flood control, and power program, aiset accounts

Major unified system projects

Actual to
June 30,

1940

Actual fiscal year

1941

Estimated Estimated
fiscal year

fiscal year
1942

1943

Estimated

cost to complete

Total estimated

cost

Kentucky Dam and Reservoir

$18, 203, 960 $13, 427, 555 $21, 226,000 $31,878,000 $20, 264, 485 $105,000,000 Pickwick Landing Dam and Reservoir

30. 502, 408 3, 466, 437 Wilson Dam and Reservoir

1, 660,000 30, 517, 539

1, 591, 000 911,000 2, 971, 280

38, 130, 845 Wheeler Dam and Reservoir

5, 155, 000 2, 237, 000 814,000 34, 197, 152

41, 691, 819 Guntersville Dam and Reser1,041, 695 1, 602, 000 1, 767,000 457,000

39, 064, 847 voir

31, 326, 669 106, 071 Hales Bar Damand Reservoir

310,000 1, 426,000 906, 000 34, 074, 740 additions

115, 816 1,012, 911 Chickamauga Dam and Res.

1, 201,000 2, 128, 000 1,542, 273 6,000,000 ervoir

33, 390, 422 368, 613 Watts Bar Dam and Reser

693, 000 2, 295, 000 903, 000 37, 650, 035 voir

8, 973, 108 14,832, 444 Fort Loudoun Dam and Re

8, 496,000 2, 735, 000 863, 448 35, 900,000 servoir

768, 594 3,675, 224 19, 464,000 Hiwassee projects.

17, 073, 000 16,051, 556

3,019, 182 44,000,000

-147. 285 Sorris Dam and Reservoir

32, 974, 000 6,776,000 331, 000 55, 985, 271 30,785, 347

--532
63, 000
8,000

30, 855, 815

pare, but, as will be noted in the subsequent sections of this justification, all normal programs of the Authority have been drastically changed to meet the needs of the present emergency.

For example, under the navigation, flood-control, and power program the schedules for the completion of both the Kentucky and Fort Loudoun projects have been moved forward by a year to assure increased power supply for defense industries, and the scope of the Fort Loudoun project is to be extended, if the 1943 estimate is approved, to include a diversion dam on the Little Tennessee River, thereby increasing by 18,000 kilowatts the ontinuous power available from that project. The estimates for these two projects alone, as revised to meet defense schedules, account for $48,951,000 of the total of $53,645,000 assigned to the so-called normal program.

Under the fertilizer program the Authority is adding to its prosphorus-producing capacity at Muscle Shoals and proposes in the 1943 estimate that $3,000,000 be provided to start construction of a new $4,800,000 phosphorus-producing plant at or near Mobile, Ala. This expansion in phosphorus-producing capacity is made necessary by the present emergency since a large proportion of all existing capacity in the country is needed for direct military purposes and the balance is badly needed for the food programs of the United States and its allies.

The development-activities program has ben substantially revised to meet emergency needs. The major revision has been to step up research efforts on the discovery of new processes for the production of vital defense materials. The Authority recently submitted to the Office of Production Management a complete report of a new process for the production of alumina from clay as a result of research carried on over the past 5 years; in 1943 the major effort will be to perfect

5 a process for the production of magnesium from olivine, of which there are large deposits in the Southeast. Other emergency activities under this program include assistance to the defense-housing and defense-contract services.

The emergency expansion of the Authority's programs has created a serious need for service facilities and equipment at its major permanent work centers. A critical situation exists in the Muscle Shoals area where service roads and railroads, office, laboratory, warehouse, and repair-shop space is woefully inadequate, and a river terminal, used primarily by the Authority's operations, requires major improvements. On the basis of a survey recently completed, the Authority hopes to initiate in the fiscal year 1942 a 3- or 4-year program to adjust this situation and to meet smaller service-facility needs in other areas. Estimates of $2,150,000 and $2,160,000 have been included for this purpose in the fiscal years 1942 and 1943, respectively.

In addition to the programs shown on table 1 and in the supporting tables and statements submitted herewith, which support the 1943 appropriation requests, the Authority is also engaged in modernizing the ammonium nitrate plant at Muscle Shoals for the account of the War Department and has completed the construction of and is managing 250 defense houses in the Muscle Shoals area for the Federal Works Administrator.

The estimates by programs summarized in table 1 are described in some detail in the following sections of this justification. It will be noted that the net cash income from power operations in 1943 is sufficient to finance all the program operations and development activities of the Authority and to leave a margin of $14,959,000 for new construction. This margin exceeds the estimate for 1912 by $9,633,000 and the actual for 1941 by $8,342,000. This large increase is primarily explained by the heavy defense power loads to be carried by the Authority in 1943.

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Table 1.--Tennessee Valley Authority-Budget summary

Actual to
June 30,

Actual, fiscal

year, 1941

Estimated,
fiscal year,

1942

Estimated, fiscal year,

1913

1940

$332, 075, 452
-11, 766, 042

$77, 270,517
-10, 774, 860

$168, 622,000
-10, 162, 000

$143, 598, on
-19, 92,

Programs to be financed:
Navigation, flood control, and power:

Asset accounts

Income and expense accounts, net Fertilizer:

Asset accounts.

Income and expense accounts, net Related property operations: Income and

expense accounts, net Related development activities: Income

and expense accounts, net..

7, 282, 568
9,979, 984

986, 614
1,990, 473

2, 084.000 2,343,000

4. gst. 000 2, 440,000

3. 990, 951

768, 538

756, 000

756, 000

9. 142, 453

1, 398, 447

1, 737,000

1, 737.000

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Table 2 presents the actual and estimated costs under the asset accounts for the navigation, flood control, and power program. The total requested for 1943 is $143,598,000 which is $25,024,000 less than the estimated amount for 1942. The total reflects requirements for carrying out this program as modified by three supplementary power programs to provide additional power-producing facilities for emergency national defense purposes. The estimates include funds for continuing construction of the Fontana, South Holston, and Watauga Dams, additions to the Watts Bar steam plant, now under construction, and to the existing steam plant near Sheffield, Ala., and 10 hydroelectric generating units at existing projects or projects now under construction, as approved by Congress on December 15, 1941, for beginning of construction in 1942, and for continuation of projects previously authorized. The estimated expenditures for 1942 include $107,283,000 for carrying out the three supplementary power programs and the estimates for 1943 include $82,455,000 for this purpose.

TABLE 2.- Navigation, flood control, and power program, a set accounts

Major unified system projects

Actual to
June 30,

1940

Actual fiscal year

1941

Estimated Estimated Estimated
fiscal year
fiscal year

cost to
1942

1943 complete

Total estimated

cost

Kentucky Dam and Reser.

voir
Pickwick Landing Dam and

Reservoir
Wilson Dam and Reservoir
Wheeler Dam and Reservoir.
Guntersville Dam and Reser-

voir
Hales Bar Dam and Reservoir

additions Chickamauga Dam and Res.

ervoir Watts Bar Dam and Reser

voir Fort Loudoun Dam and Re

servoir
Hiwassee projects.
Norris Dam and Reservoir

$18, 203, 960 $13, 427, 555 $21, 226,000 $31,878,000 $20, 264, 485 $105,000,000
30, 502, 408 3, 466, 437 1, 660, 000 1, 591, 000
30, 517, 539

911, 000 38, 130, 845
2, 971, 280 5, 155, 000 2, 237, 000 814, 000
34, 197, 152

41, 691, 819 1,041, 695 1,602, 000 1,767, 000 457,000 39, 064, 847 31, 326, 669 106,071

310,000 1, 426,000 906, 000 34, 074, 740 115, 816 1,012, 911 1, 201,000 2, 128, 000 1, 542, 273 6,000,000 33, 390, 422 368, 613 693, 000 2, 295, 000

903, 000 37, 650, 035 8, 973, 108 14,832, 444 8, 496, 000 2, 735, 000 863, 448 35, 900,000

768, 594 3,675, 224 19, 464,000 17,073, 000 3,019, 182 16, 051, 556 -147, 285

44,000,000 32, 974, 000 6, 776, 000 331, 000 55, 985, 271 30,785, 347 --532 63, 000 8,000

30, 855, 815

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