sonality and its right to intervene in the application of the law to the extent that it may be reasonable, we do not see why they cannot meet wholly or partially the objections already set forth by the Governor, which tend to bring about the following:

(a) That the institutions or persons who will provide the money necessary for the projects contemplated under the bill be guaranteed that politics shall not penetrate through visible or invisible cracks to cause losses that might affect the administration of those moneys.

(b) That there be raised the maximum limit set for compensating the services of the Administrator of the Water Resources Authority proposed to be created so that there may be guaranteed the selection and holding of an honest and competent officer.

(c) That there be eliminated from the bill conditions that would prevent the functioning of the Authority, and which are incompatible with the "normal corporate functions" and which "would destroy the efficiency of the Authority." (d) That there may not be prevented the fusion of the Services of the Guayama Irrigation Service, Guayama Additional District, and the Isabela Irrigation Service so that there may be developed an administration and functional direction of all the water resources of the island in one single system necessary for efficiency and economy.

(e) That they shall not place limitations on the governing body (on which there shall rest the responsibilities of the institution to be created) which would annul the fundamental purposes of the act.

In all these objections of the Governor, we do not see a single one trying to take away from the Puerto Rican Legislature any of its constitutional prerogatives, and much less to impair its representative dignity.

The caricature of democratic system by which our country is governed establishes clearly the division of powers; and the Legislature shall have no reason, if it should show that it proposes to reserve for itself the right to intervene in the institution which it is proposed to create, for the purpose of assuming administrative functions which belong and should correspond to the executive power.

Over these objections of the Governor, which are more or less important from the local point of view, but not fundamental from the standpoint of the dignity and the personality of the country, we understand that the Honorable President of the Senate and the Puerto Rican Legislature should place and consider the plans of having Federal legislation imposed upon us from beyond, in order that we may have the same institution which this bill of the President of the Senate and of the Puerto Rican Legislature tends to create.

And such plans of the Federal Government, which the Puerto Rican Legislature can readily avoid by taking the Governor's word, they, yes, might well be considered if they were not reasonable, fundamentally obnoxious, to the dignity and the representative personality of the Puerto Rican Legislature.

[From La Correspondencia De Puerto Rico, Miercoles, Marzo 13, 1940, English Section]

EDITORIAL-WHY DOES NOT THE GOVERNOR INTERCEDE?

The prerogatives of the Insular Legislature, its rights and privileges, its attributes and the respect due to it, have under all conditions and circumstances been sustained and defended by us against all odds and without taking into consideration party lines.

Our record in this respect, as sponsors of everything good that pertains to Puerto Rico, is clear and sound. We have always overcome the political passions of our narrow environment, and have unconditionally taken sides with those who seek the welfare of our beloved country.

When the creation of a Tennessee Valley Authority for Puerto Rico was being discussed at Washington, we took sides with the Federal Government because we thought the Tennessee Valley Authority project was greatly beneficial for the whole island. Later on, however, we asked that the objections raised by Mr. Martínez Nadal against it should be heeded, and at length we came to the conclusion that we should sacrifice the benefits to be derived from such Federal legislation if said legislation was to be obtained at so high a cost as the humiliation of our Legislature.

Our position today is the same as before.

But let us be frank with ourselves, and point out the case that so far, during the discussion of this matter, we have not heard a single argument tending to prove that the Federal Government wants to humiliate in this case the Legislature of Puerto Rico.

On the contrary, the information we have had from Washington is that the Federal Government wants to help Puerto Rico economically for the establishment of a Puerto Rican Tennessee Valley Authority.

What Washington merely wants is our guaranty that the Tennessee Valley Authority will not be liable to fall into the sinful hands of unscrupulous politicians. What Washington wants is to avoid the failure of the project.

The reasons that the Federal Government may have for insisting on this guaranty are perhaps futile, and prejudiced. (At least we, as Puerto Ricans, On the other side,

should not entertain the idea that such a suspicion exists.) we cannot believe that the leaders of our Legislature, specially Mr. Martinez Nadal, may desire to keep for themselves certain privileges that might give them a political advantage in the use of the Puerto Rican Tennessee Valley Authority resources.

What we need, therefore, is an amicable and intelligent mediation from some one who, as the Governor of Puerto Rico, is in a position to bring the opposing parties together into a reasonable agreement that would uphold the rights and privileges of all concerned: The Legislature of Puerto Rico to legislate for Puerto Rico, and the Federal Government to have the required guaranty in the expenditure of its money here.

This is the only feasible way that would keep Puerto Rico from losing the benefits of this wonderful enterprise.

We do not sponsor the passing of this measure by the United States Congress against the objection of our Legislature.

But we ask our Legislature and especially the President of the Senate to make arrangements for an honorable and reasonable transaction, thus avoiding the tremendous moral responsibility that rests upon them on this occasion.

[Translations made by Mr. Antonio Lucchetti and certified by him to be correct.]

Mr. CRAWFORD. You don't mean to say, however, that the newspaper editorials and the editors who prepared them should be given more credit than the sentiment of the people through their representative in Congress. You don't mean to say that do you?

Mr. SPECK. Well, that is a very difficult question. I think it is possible at times for a legislature not to reflect the will of the people. Mr. CRAWFORD. I think it is too. I think it was possible during the Colonial days for certain of our papers to support the British Government too. Mr. Chairman, I have a report here which I am not going to ask to be copied in the record.

Mr. ROBINSON. Before you go into that, it is not clear in my mind about the Legislature in Puerto Rico yet. A bill as I understand it, with the same principles involved that this bill has, was passed by the legislature and vetoed by the Governor.

Mr. SPECK. That is correct.

Mr. ROBINSON. Now, this bill has for its purpose the correcting of the objections that the Governor had to that bill.

Mr. SPECK. Imperfection of details.

Mr. ROBINSON. Now, the bill as perfected, has it gone back to the legislature for its approval?

Mr. SPECK. Yes. Of course, when the Governor sent his message he returned the bill. The next move is to pass it by a two-thirds vote over his veto, in which case it has to go to the President of the United States.

Mr. ROBINSON. But that has not been done?

Mr. SPECK. So far as I know it has not.

Mr. HAWKS. Mr. Chairman.

The CHAIRMAN. Mr. Hawks.

Mr. HAWKS. Mr. Chairman, I understood from the testimony the objections stated in the veto message of the Governor were not entirely as to imperfections in detail.

Mr. SPECK. Perhaps that was not the best phrase I might have used. Certain provisions were defective in his judgment. I think I have outlined them in my testimony generally.

Mr. ROBINSON. I just haven't gotten clear yet this proposition. I don't understand why you can say the Legislature of Puerto Rico is opposed to this bill. Why aren't they in favor of it?

Mr. SPECK. Well, I think this, that in the course of the legislative history of the bill now before the Insular Legislature, a draft of a bill in the form of this one was introduced and it was amended in the course of being enacted, so I don't think you can say honestly that they approve this bill.

They approve the policy of setting up a corporate agency to take over the Utilization of Water Resources and develop it through the issuance of revenue bonds.

Mr. ROBINSON. But they haven't approved or rejected this bill? Mr. SPECK. It has just occurred to me that they have adjourned so the question is moot.

The CHAIRMAN. In other words, it is dead?

Mr. SPECK. Yes.

Mr. CRAWFORD. Mr. Chairman.

The CHAIRMAN. Mr. Crawford.

Mr. CRAWFORD. Could you supply the committee members-I don't know how long it will be before these hearings are printedwith copies of your amendments?

Mr. SPECK. Yes. We propose to have mimeographed the bill showing the suggested amendments in brackets and underlining the same way you would report it.

Mr. CRAWFORD. Now, can you supply us with a copy of the 1938 bill to which you have referred, which I believe you said was sent to Puerto Rico, and a copy of the messages which were sent along with that bill?

Mr. SPECK. If any message was sent along.

Mr. CRAWFORD. There must have been.

Mr. SPECK. I don't know whether the bill was introduced by c message or whether the Governor had it introduced.

Mr. CRAWFORD. Let me ask you this, if I have the correct approash on this. The P. R. R. A. was created by an Executive order and the Governor called for some legislation—a bill, and requested the departments up here to draw a bill?

Mr. SPECK. Yes.

Mr. CRAWFORD. A bill was sent to the Governor and there must have been some kind of communication that went along with it. Will you furnish the committee with a copy of the bill?

Mr. SPECK. You mean a communication from the Secretary?

Mr. CRAWFORD. Yes.

Mr. SPECK. Oh, certainly, I will be glad to do that.

Mr. CRAWFORD. With a copy of the bill.

Mr. SPECK. Yes, sir.

Mr. CRAWFORD. And that is the inception of this whole program, isn't it?

Mr. SPECK. Yes, I will be glad to do that.

Mr. CRAWFORD. That is all.

(The statement of the Secretary of the Interior and copy of the bill is as follows:)

THE SECRETARY OF THE INTERIOR,
Washington, February 28, 1938.

Hon. BLANTON WINSHIP,
Governor of Puerto Rico,

San Juan, P. R.

MY DEAR GOVernor WinsHIP: I am transmitting herewith a draft of a bill for the creation of a Puerto Rico Water Resources Authority, which Mr. Antonio Lucchetti, Chief Engineer of the Utilization of Water Resources, considers essential for the future development of hydroelectric resources in Puerto Rico. I understand that Mr. Lucchetti has discussed this matter with you and that his request for legal assistance from the Solicitor's Office of the Department of the Interior had your approval.

Legislation of this type would, I believe, further the development and utilization of the natural water resources of Puerto Rico and work to the economic and social benefit of the people of the island. I recommend that the proposed bill receive your careful consideration. Neither I nor members of my staff have had the opportunity to study fully the legal or administrative problems involved in the bill in the light of the existing laws of Puerto Rico and the organic act, or to decide the fundamental question whether or not the financing of public improvements in the manner contemplated by the bill would be subject to the debt limitations applicable to the insular government. This bill should, therefore, receive full and careful study by the administrative and legal officials of the insular government and should not be considered as presented herewith in its final form. I want to make clear, therefore, that this letter should not be considered as indicating my approval of the exact form of this bill or as discouraging any modifications or changes in the bill which you and Mr. Lucchetti may deem proper in order to effect its general purposes. The bill is being sent to you at this time and in this form only because of the urgency due to the fact that the Puerto Rican Legislature is now in session and that to be acted upon this year the bill will have to be introduced within the next few weeks.

Sincerely yours,

Enclosure 692499.

HAROLD L. ICKES,

Secretary of the Interior.

AN ACT creating the Puerto Rico Water Resources Authority, providing for its powers and duties; trans ferring to it all the powers, rights, duties, and obligations of the utilization of water resources, authorizing it to acquire, construct, maintain, operate, improve, and extend revenue producing undertakings to continue to completion the development of the water resources of the island; providing for the fixing and collecting of rates, fees, and other charges for the services of such undertakings and for the segregating or combining and the pledging, charging, and otherwise encumbering of the revenues thereof; authorizing it to accept grants and loans from the United States or any agency or instrumentality thereof, to borrow money and to issue negotiable bonds, and providing for the payment of such bonds and the rights of the holders thereof; authorizing the people of Puerto Rico to grant the use of its lands and to acquire real property and dedicate the same to the use of the Authority, and for other purposes;

Be it Enacted by the Legislature of Puerto Rico:

SECTION 1. Short Title of Act. This Act may be cited as the "Puerto Rico Water Resources Authority Act."

SEC. 2. Definitions. Whenever used in this Act, the following terms shall have the following meanings:

(a) The term "Authority" shall mean the Puerto Rico Water Resources Authority.

(b) The term "Board" shall mean the Board of Directors of the Authority. (c) The term "bonds" shall mean the bonds, temporary bonds, debentures, notes, interim bonds, receipts, or certificates and other evidences of indebtedness which the Authority is authorized to issue pursuant to this Act.

(d) The term "project" shall mean any one or a combination of two or more of the following for continuing to completion the development of the water resources of Puerto Rico; water, irrigation, electric, heat, light or power works, facilities, structures, plants or systems from which revenue may be derived, together with all parts thereof, appurtanances thereto and lands, rights in lands, rights and privileges in connection therewith and including, but not limited to, irrigation and hydroelectric supply and distribution systems, generating plants and stations, reservoirs, dams, canals, tunnels, conduits, transmission lines and ways and means, necessary, useful or customarily used and employed in the production, diversion, collection, storage, conservation, utilization, transportation, distribution, sale or other disposition of water or electric energy.

SEC. 3. Creation of Authority.-There is hereby created a body corporate and politic to be known as the Puerto Rico Water Resources Authority, which shall be a public corporation and governmental instrumentality of the People of Puerto Rico.

SEC. 4. Board of Directors.

(a) Members. The powers and duties vested in or imposed upon the Authority by this Act or any other law shall, except as herein otherwise provided, be exercised and performed by the Board of Directors of the Authority, consisting of five (5) members, who shall be the following:

(i) The Governor of Puerto Rico, who shall act as Chairman of the Board; (ii) The Commissioner of Interior of Puerto Rico;

(iii) The Attorney General of Puerto Rico;

(iv) The Public Service Commissioner of Puerto Rico; and

(v) An Executive Director, who shall be a resident of Puerto Rico and shall be appointed by the Governor by and with the consent of any two other members of the Board.

(b) Executive Director. The appointment and approval of the Executive Director shall be made exclusively upon the basis of merit as determined by technical skill, experience, and other qualifications best suited to carrying out the purposes of the Authority. The Executive Director shall be removable by a vote of at least three of the remaining members of the Board, but only for cause and after he has been given notice and an opportunity to be heard.

(c) Compensation and Expenses.-The members of the Board, with the exception of the Executive Director, shall not be entitled to compensation for their services as such members, but shall be entitled to reimbursement for their actual and necessary expenses incurred in the performance of their official duties as members. The Executive Director shall be entitled to such compensation as may be fixed by the Board, and to such reimbursement for travel and other expenses incurred in the performance of his official duties as the Board may from time to time authorize or approve.

(d) Officers for the Board. The members of the Board shall appoint a Secretary who need not be a member of the Board and may choose from their number a Vice chairman.

(e) Exercise of Powers. The Board shall act only by vote of a majority of the members then in office, and may delegate such of the powers and duties of the Authority as it may deem proper to any one or more of its members or to the officers, agents, and employees of the Authority.

Section 5. Powers of the Authority. The Authority is hereby vested with the following rights and powers:

(a) To have perpetual succession as a corporation;

(b) To adopt, alter, and use a corporate seal which shall be judicially noticed; (c) To prescribe, adopt, amend, and repeal bylaws governing the manner in which its general business may be conducted and the powers and duties granted to and imposed upon it by law may be exercised and performed;

(d) To prescribe, amend, and repeal such rules and regulations as may be necessary or proper for the exercise and performance of the powers and duties of the Authority.

(e) To sue and be sued, implead and be impleaded, complain and defend in all courts of law and equity;

(f) To make contracts and to execute all instruments necessary or convenient in the exercise of any of the powers of the Authority;

(g) To prepare or cause to be prepared plans, designs, and estimates of costs for the construction of projects in connection with the development of the water resources, and from time to time to modify such plans, designs, or estimates;

(h) To acquire by purchase, lease, devise, gift, or by the exercise, subject to and to the extent only permitted by law, of the power of eminent domain, and to construct, reconstruct, extend, improve, enlarge, repair, hold, maintain, and operate any project as that term is defined in Section 2 of this Act.

(i) To acquire by purchase, lease or otherwise, produce, impound, develop, manufacture, treat, hold, conserve, and to use, transmit, distribute, exchange, sell, and otherwise dispose of water or electric energy;

(j) To purchase, lease as lessee, or otherwise acquire, and to hold and use any property, real, personal or mixed, tangible or intangible, or any interest therein necessary or desirable for carrying out the purposes of the Authority and (subject to the limitations contained in this Act) to sell, lease as lessor, transfer, exchange, and otherwise dispose of any property or interest therein, at any time acquired by it;