TABLE OF CONTENTS AMENDING THE TENNESSEE VALLEY AUTHORITY ACT WEDNESDAY, JUNE 18, 1941 HOUSE OF REPRESENTATIVES, Washington, D. C. The committee met at 10:30 a. m., Hon. Andrew J. May (chairman) presiding. The CHAIRMAN. The committee will please be in order. While we do not have a full committee present, I think they will be in shortly. I would like to make a very brief statement of what I understand the issue here this morning is, for the benefit of those members of the committee who have not been on the committee from the beginning of the organization of the Tennessee Valley Authority. We have for consideration this morning H. R. 4961, a bill which I introduced in pursuance to the request of the Comptroller General of the United States to further amend section 9 (b) of the Tennessee Valley Authority Act. The question arises as to whether or not the T. V. A. is subject to the supervision and control by the Comptroller General's office. As I understand the situation, there is some question about it. The Comptroller General wants to be advised exactly as to the intent of Congress, so that in the disbursement of public funds he will know exactly what his responsibility is. And, in order that the matter be definitely and unquestionably settled, I have introduced this bill so that the committee might have a hearing on it and determine just what they want to do about it. I have asked the Comptroller General to appear here today for that purpose, and he is here with a number of witnesses; and representatives of the T. V. A. are also here. Mr. Fitts, the General Counsel of the T. V. A., and others are here. And at their request I have set tomorrow for a hearing of their testimony in opposition to the bill if they oppose it. We will start the hearing this morning. I shall call at this time the Honorable Lindsay C. Warren, Comptroller General of the United States and former Member of the House, whom we all know. We will be glad to have a statement from you, Mr. Warren, as to your position in this matter. You may proceed as you prefer. (The bill referred to reads as follows:) [H. R. 4961, 77th Cong., 1st sess.] A BILL To amend section 9 (b) of the Tennessee Valley Authority Act, as amended by section 14 of the Act of August 31, 1935 Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 9 (b) of the original Tennessee Valley Authority Act, as amended by section 14 of the Act of August 31, 1935 (49 Stat. 1080), be, and the same is hereby, further amended by adding at the end of 1 section 14 thereof the following: "Nothing in this Act shall be construed to relieve the Treasurer or other accountable officers or employees of the Corporation from compliance with the provisions of existing law requiring the rendition of accounts for adjustment and settlement pursuant to section 236, Revised Statutes, as amended by section 305 of the Budget and Accounting Act, 1921 (42 Stat. 24), and accounts for all receipts and disbursements by or for the Corporation shall be rendered accordingly." STATEMENT OF HON. LINDSAY C. WARREN, COMPTROLLER GENERAL OF THE UNITED STATES OF AMERICA Mr. WARREN. Mr. Chairman and gentlemen of the committee, the record in this case consists of a decision rendered by me on December 21, 1940, and my report to Congress on June 2, 1941. Since then the T. V. A. has also addressed a communication to the Congress; and they also have an opinion of the Attorney General. I do not come before this committee today seeking any additional power whatsoever. There is no desire on my part to increase the corporate limits of the General Accounting Office or of the Comptroller General. We have all the work we can possibly attend to, and the authority to do it. And I am sure that you gentlemen can visualize what a tremendous task we have when you look back over the appropriations that have been made in the last few years. On the pending bill there will be no lobby or influence brought to bear either on my part or on the part of any employee of the General Accounting Office, although we will always be available to answer any inquiry from the Congress about it. I wish to keep the controversy on a high plane; to see it disassociated from collateral matters; to have it acted upon solely on its merits; and then to accept your decision, whatever it may be. I will correct the chairman just to this extent: I think probably that he was in error when he said that I asked him to introduce this bill. He saw the alternate drafts that I sent up here; and later I was informed that he agreed with our view of it and offered it at that time. The CHAIRMAN. That is a proper correction, Mr. Warren. Mr. WARREN. In my report of June 2 I impartially submitted two drafts of legislation, one upholding the view of the Tennessee Valley Authority and the other that of the General Accounting Office. I am, however, wholeheartedly in favor of the bill offered by the chairman of this committee, believing it carries out the intent and purpose of Congress; that it is conducive to responsible and effective accounting of public funds; and that it is highly in the interest of the public welfare. Now, at the outset, gentlemen, I wish to dispose of finally, if possible, the old familiar red herring. It seems that whenever any question ever arises between the Tennessee Valley Authority and the General Accounting Office a phony issue of prejudice and animus is injected. I do not know what may have happened in the past, But I can speak with absolute authority of what has happened since November 1, 1940. If there ever was any prejudice there has certainly been none since that time. Why, I have been one of the most consistent friends that the T. V. A. has had in Congress during all these years. My friendship for it dates back to the old Muscle Shoals days, and I actively supported it through many of those stormy battles in the House. I have not looked it up, but just within the last 18 months there was a question, I believe, on some dam in Kentucky that I cast my first vote against it, and it was defeated in the House, as I now recall, by a 4 or 5 majority. Later on, about 2 weeks after it came back again for another vote. I was so satisfied at that time that my position was wrong that I changed my vote; and it was passed then by a 5 or 6 majority. Some of the very strong advocates of it were kind enough to say on account of expressions I had made to many Members it had greatly aided them in overcoming that unfavorable vote. I merely say that to show there could be no possible feeling whatever on my part. But no matter how friendly I may feel, gentlemen, I cannot condone its attempt to evade responsibility and effective accounting of its expenditures. Nor can I acquiesce in its desire that I say such accounting shall not be made. Within a day or so after I was appointed, and that was on July 31, 1940, although I only took office on November 1, 1940, a conference was sought by the T. V. A. and there was a series of letters prior to my assuming office on November 1. I replied I would be delighted to discuss their problems as soon as I took office, and within a week after I did assume office the first conference was held. While I knew nothing whatever of past differences I tried to impress the officials of the T. V. A. of my sympathetic interest and of my very earnest desire to adjust those differences so far as I was legally empowered to do it. There were, I believe, two conferences, both of which were attended by Senator Pope, one of the directors of the Authority. And I would like to say here and now that on account of the high esteem that I formed for Senator Pope when he was a member of the Senate, which today goes on unabated, if he had been let alone in this matter there is no doubt whatever in my mind but the whole thing could have been satisfactorily adjusted. In the midst of the second conference there was handed to me across the table a memorandum challenging the jurisdiction of the General Accounting Office-right at the point where we were sitting down and trying to adjust differences and to work out a harmonious relationship. I will never believe that it was intended for me to get that memorandum; but that it was handed to me in error. I am fortified in saying that on account of a paragraph in a letter to me from Senator Pope dated August 23, 1940, which I quote: I think it would be helpful for us to talk with you about these matters and to leave with you at the time a very carefully prepared memorandum covering briefly the history of our relations with the General Accounting Office, the matters that have already been adjusted, and the few matters that remain to be adjusted. Then we, of course, told the T. V. A. that before any decision could be made it must be submitted to us in writing. And this they did, in a letter to me dated November 23, 1940. Well, of course, with this challenge of jurisdiction, this put an entirely new phase on the matter, and after several weeks of study and discussion and collaboration I rendered my decision of December 21, 1940. The first 261⁄2 pages of it dealt with the question of jurisdiction upon which I had fully satisfied myself. That I consider to |