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of the Attorney General or other executive officer as binding and conclusive on the General Accounting Office, or gave such opinions determinative effect.

But even in the absence of such express statutory provisions requiring the determinations of this Office to be independent of the executive branch, it would be doubtful whether the opinion of the Attorney General would necessarily be regarded as conclusive or determinative. Section 354, Revised Statutes, requires the Attorney General to "give his advice and opinion upon questions of law, whenever required by the President," and section 356, Revised Statutes, provides that the head of any executive department “may require the opinion of the Attorney General on any questions of law arising in the administration of his department,” but the statutes do not give the effect of judicial decisions to such advice and opinions or make them final and conclusive even on the administrative officers requesting them. In their recent historical work, Federal Justice, by Attorney General Homer Cummings and Special Assistant to the Attorney General Carl McFarland it is pointed out, pages 517–518:

"Nevertheless, it is a constantly mooted question whether public officers must, or should, follow the opinions of the Attorney General on questions of law. There is an obvious desirability of uniform interpretation of the laws in the management of public business, only attainable, in the words of ('ushing, 'under the guidance of a single department of assumed special qualifications and official authority.' This was the early practice of the Government, although the attorneys general usually considered their opinions advisory only. "The duty of the Attorney General is to advise, not to decide,' said Black to Secretary of the Navy Toucey who had been Attorney General 9 years earlier. You may disregard his opinion if you are sure it is wrong. He aids you in forming a judgment on questions of law; but still the judgment is yours, not his. You are not bound to see with his eyes, but only to use the light which he furnishes, in order to see the better with your own.'

"The Department of Justice was created in 1870, however, to secure uniformity of legal opinion. Thereafter, the chief law officers took the position that opinions on questions of law were authoritative until withdrawn or overruled in the courts. In addition, this general rule has been prescribed by order of the President and recommended by congressional committee."

But whatever the present administrative practice in this respect may be, the distinction has long been generally observed that the Attorneys General will not render opinions on matter primarily for determination by the accounting officers, and while this Office gives careful consideration to the vic ws of the Attorney General and does not hesitate to be guided by his exposition of the law in proper cases, it has consistently maintained that such opinions may not properly be accepted as conclusive or binding on this office under the statutory mandate that its proceedings and determinations shall be independent of the executive branch. These phases of the matter were discussed at length in decision of March 5, 1926 (5 Comp. Gen. 688, 691), in part as follows:

"Careful consideration has been given the opinion of the Attorney General, referred to in your letter, supra, but I find therein nothing to require or justify any change in the former decision of this Office on the question involved.

"Whatever may have been the effect of opinions of the Attorney General on questions relating solely to the legality of proposed expenditures of appropriated moneys, prior to the enactment of the Dockery Act of July 31, 1894 (28 Stat. 205), the evident purpose and effect of said statute was to rest in the Comptroller the exclusive jurisdiction and plenary authority to determine such questions. This is clearly indicated by the report of the joint committee which drafted the provisions of said act. See report as printed in House Report No. 637, Fiftythird Congress, second session, in which it is stated that the duties of the Comptroller will be mainly to determine finally the construction of statutes,' and that the act 'will concentrate in one head all the legal direction in the settlement of accounts.' In this connection attention is invited to the opinion of Attorney General Richard Olney, rendered May 22, 1895 (21 Op. Atty. Gen. 178), in which he declined to render an opinion on certain questions involving the legality of expenditures from appropriated moneys, referring to the fact that while such questions ‘prior to October 1, 1894 (effective date of the Dockery Act), could properly be asked of the Attorney General,' they could now be subInitted to the Comptroller under the provisions of said act and that they ‘are questions which the comptroller, by his greater experience, is better qualified to pass upon, and it is desirable to avoid any possible conflict of precedents.' This



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opinion was quoted from and followed by Attorney General Judson Harmon in an opinion of August 31, 1896 (21 Op. Atty. Gen. 405), in which he refused to express an opinion on the question there presented, stating:

" This is a question which may be asked of the Comptroller of the Treasury. (Act of July 31, 1894, ch. 174, sec. 8.) It belongs to a class of questions which require for their decision a special knowledge of our appropriation acts and the course of decisions thereunder.

"See also opinion of Attorney General Joseph McKenna, rendered May 6, 1897 (21 Op. Atty. Gen. 531), in which he said:

It has been repeatedly held by Attorneys General that on questions of disbursement of money or payment of claims, so by law relegated to the Comptroller, the Attorney General should not render opinions.

"To the same effect is an opinion of August 10, 1922 (33 Op. Atty. Gen. 268), which concludes as follows:

“Section 8 of the Dockery Act of July 31, 1894 (ch. 174, 28 Stat. 207), provided that the balances certified by the auditors of the Treasury, or upon revision by the Comptroller of the Treasury, should be final and conclusive upon the executive branch of the Government, and that where disbursing officers, or the head of any executive department, applied to the Comptroller of the Treasury for his decision upon any question involving a payment, the decision, when rendered, should govern the case. Construing these provisions of law, my predecessors have uniformly held that a question of pay for the determination of the Comptroller cannot be submitted to the Attorney General for his opinion merely because it may incidentally involve some power or the effect of some power claimed to exist in the head of a department. (See, for example, 25 Op. 301, 28 Op. 129.) The same rule necessarily applies to the Comptroller General, in whom is vested all the power formerly conferred by law upon the Comptroller of the Treasury (act of June 10, 1921, ch. 18, sec. 304, 42 Stat, 20, 21).

“ 'I have the honor, therefore, to advise you that I do not deem it proper to express my opinion upon the question submitted by you.'”

For these reasons it is clear that while the opinion of the Attorney General in the present matter may be accepted as authoritative by the Secretary of the Treasury on the question of his authority to issue a warrant to pay appropriated funds in the Tennessee Valley Authority, it may not legally be accepted or proprrly relied on by this Office as conclusively determining the duty of this Office to issue the certificate on which any such warrant must be founded, contrary to the independent determination of this Office that such disposition of appropriated funds is not authorized by law.

Mr. WARREN. Now, there is one thing which I would like to call to your attention, gentlemen. In the letter that the Tennessee Valley Authority recently submitted to Congress in answer to my letter of June 2, they say:

One unfamiliar with the facts would infer from the Attorney General's letter that the Authority stands alone in its attempt to maintain its corporate independence. But exactly the opposite is the truth. The General Accounting Office has not been permitted to extend the settlement and adjustment procedure to such corporate enterprises as the Reconstruction Finance Corporation, the Federal Deposit Insurance Corporation, the Inland Waterways Corporation, the Panama Railroad (0., the Home Owners' Loan Corporation, the Federal Savings and Loan Corporation, and the War Finance Corporation.

Let us see how right they are about that. Let iis see just how terribly wrong they are about that. I hold in my hand the independent offices appropriation bill, approved April 5, 1941. That bill provides appropriations for the Tennessee Valley Authority, for the General Accounting Office, for the Reconstruction Finance Corporation and all other agencies under the Federal Loan Agency. Why, this bill provides that the Reconstruction Finance Corporation shall be subject to the Budget and Accounting Act in the audit of its administrative expenses. A careful and great Administrator as Jesse Jones no doubt wanted that provision. And although he comes under it the Tennessee Valley Authority seeks to get out of it.

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Let us see how else they are wrong in what I have just quoted. Why, they say that the Home Owners' Loan Corporation is not under the Budget and Accounting Act. Why, we are auditing and settling those accounts. They say that the Federal Savings and Loan Insurance Corporation does not come under it. Why, of course, they are under the jurisdiction of the General Accounting Office. And we are consistently auditing and settling their accounts.

Of course, there was no reason why we should audit the War Finance Corporation because Congress merely provided for the capital stock and turned it all over to them. But they say that the Reconstruction Finance Corporation is out, and the Home Owners Loan and the Federal Savings and Insurance Corporation are out. And they are all in.

Now, gentlemen, I have endeavored to confine myself simply to the point in controversy. I have associates here who are prepared to answer such questions as the committee might care to ask them. But in conclusion I wish to repeat and reiterate what I said in my letter to you of June 2, 1941. I said this:

I hold the view that any governmental agency charged with the responsibility of conducting operations of the character of those of the Tennessee Valley Authority should have some latitude of authority beyond that needed and usually granted by the Congress to the regular departments and establishments of the Government. This I have offered to do. However, I strongly oppose the view, sometimes expressed, that the only route to such necessary latitude of authority is through exemption entirely from regular accountability under the Budget and Accounting Act for the disposition of public moneys.

Wbile it is inconceivable to me that any agency entrusted with the expenditure of mammoth amounts of funds collected from the people of the United States should desire to evade responsible accounting and scrutiny by an independent office created for that purpose, I make no further comment at this time with respect to the situation here presented other than to urge the early enactment of legislation which will definitely settle the question, as in the wisdom of the Congress, it should be settled.

Now, Mr. Chairman and gentlemen of the committee, we are in a period of the greatest expenditures ever known. Just back two years ago we could not even conceive of what we are now appropriating. After we have passed from the scene the history of these times will be written. Eagle eyes will search the records to ascertain how well the public funds were used. No doubt there will be attempts to besmirch the reputations and characters of some. If I were the head of an agency or any board or commission I would welcome and crave and seek an independent audit by an independent agency of the Government as to the legality of their expenditures.

So, gentlemen, we have brought to you both contentions in bill form. Admitting that the T. V. A. is right, which I do not do, but admitting that they are absolutely right that the only account or audit they are required to have is a commercial audit under section 9 (b) of the Tennessee Valley Authority Act, then certainly there is not legal authority as it is now written to let them out. If you think that is the only kind of audit that is required or that should be required, then you should pass the other alternative that we have submitted here. If you think they should be accountable and that the legality of their expenditures should be audited and settled by the General Accounting Office then in the interest of the taxpayers and the public I think that you should pass the May bill. In any event, gentlemen, I urge and beg you to pass one or the other of these

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propositions because our present situation in respect to this agency
will soon become more or less intolerable.

The CHAIRMAN. Thank you, Mr. Warren.
Mr. Kilday. May I ask a question?

Mr: KILDAY. You stated for the first time the Reconstruction Fi. nance Corporation had been placed under the General Accounting Office. Can you give us at this time the provision of law which had previously exempted them?

Mr. WARREN. Under the original act, Mr. Kilday, in 1932 they were entirely exempt because it was a bank proposition.

Mr. Kilday. Was it by specific language?
Mr. WARREN. Oh, yes; by the law itself.

Mr. Kilday. That they were not to be audited and controlled by the General Accounting Office?

Mr. WARREN. Yes; because at that time there was deemed to be no reason for it, you see, because it was a banking proposition and their affairs were audited. Now, this brings them under the General Accounting Office, that is, the audit of their administrative expenses. So far as the record shows there was no objection whatever on the part of the Reconstruction Finance Corporation or Mr. Jones to that provision being written in the law.

Mr. Kilday. Does the U. S. H. A. also come under that at this time? Are you auditing their accounts! Mr. WARREN. As to the U. S. H. A., I think we are. I am not

I will have that put in later. I am not sure. Mr. KILDAY. That is all.

Mr. SPARKMAN. I want to get clear on one thing. As I understand there are two different kinds of auditing that the General Accounting Office carries on. How do you describe them? Let me say this: You referred at one time to accounts being adjusted and accounted. And at another time to being accounted and settled or settled and audited or something like that. Are there two separate audits?

Mr. WARREN. Only in very, very few rare cases. This is one of them where we audit under section 9 (b) which we say is merely supplemental to the regular audit that we are required to make.

Mr. SPARKMAX. What I wanted to get is the exact position that you take. Did the original Tennessee Valley Authority Act exempt the T. V. A. from audit and control?

Mr. WARREN. I would rather have one of my associates to answer that phase of it.

Mr. SPARKMAN. Section 9 (b) was put in the 1935 act?

Mr. WARREN. That is my impression : Section 9 (b) was put in in 1935.

Mr. SPARKMAN. Prior to section 9 (b) do you contend that it was subject to audit and control; or would you rather someone else answer that?

Mr. WARREN. Oh, we have always been satisfied that from the very beginning they come under section 305.

Mr. SPARKMAN. Section 305, that is.

Mr. WARREN, Section 305 of the Budget and Accounting Act. Nor is there any question about it in our mind on that phase of it here.


Mr. SPARKMAN. It is your contention then that section 9 (b) was simply to supplement what was already provided in section 305 of the Budget and Accounting Act?

Mr. WARREN. Absolutely. Because an audit under section 9 (b) can give Congress practically no information, that they may desire,

Mr. SPARKMAN. Now, as to the Reconstruction Finance Corporation, as a matter of fact this is the first time, that is the budget that goes into effect, I mean, this appropriation goes into effect July 1, in other words, of 1942. That will be the first time?

Mr. WARREN. They come under an audit for their administrative expenses. I might say we did not ask them to come under it.

Mr. SPARKMAN. For their administrative expenses?
Mr. WARREN. Yes. They did it absolutely of their own accord.

Mr. SPARKMAN. But during all of the years it has been in existence their administrative expenses have not been audited ?

Mr. WARREN. I think probably this is about the end of the first year that Mr. Jones has headed the Federal Loan Agency; is it not? I give him full credit for bringing them under.

Mr. SPARKMAN. But he has headed the Reconstruction Finance Corporation for a good many years?

Mr. WARREN. Yes.

Mr. SPARKMAN. But here is the question I have been interested in. You say in your letter and also in your statement this morning that you believe that a corporation functioning as the Tennessee Valley Authority is doing should have some flexibility more than an ordinary department of government.

Mr. WARREN. Absolutely.
Mr. SPARKMAN. Now, how would you give them that flexibility?

Mr. WARREN. Well, in the general conduct of their business and their general operations. Here they are running a great power concern with long transmission lines and all that. We would not be as technical with them as we would be with one of the departments of the Government and it would entitle them to a type of audit in keeping with the business that they are operating just as we give the Maritime Commission a different type of audit according to the well-known practice of shipping operations and shipbuilding, etc.

Mr. SPARKMAN. In other words, that flexibility would be set up under your own rules and regulations?

Mr. WARREN. Absolutely.
Mr. SPARKMAN. You do not have just one set method of doing it?

Mr. WARREN. No. Mr. Sparkman, I say this: If the Tennessee Valley Authority today would come in and withdraw their challenge to the authority and jurisdiction of the General Accounting Office there is not any doubt in my mind but that we could agree upon a procedure that would be mutually satisfactory:

Mr. SPARKMAN. Your contention seems to be two-fold. First, you contend that the T. V. A. is liable, is accountable to the General Accounting Office just the same as any other department of the Government.

Mr. WARREN. Absolutely.

Mr. SPARKMAN. The second is you say that even if it should not be held so by the Attorney General or whoever might be the one to pass upon it that it ought to be; is that right?

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