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DEPARTMENT OF AGRICULTURE
HEARINGS - DEBSITOWY
BEFORE THE CT
SUBCOMMITTEE ON AGRICULTURE
Ross P. POPE, Executive Secretary to Subcommittee
COMMITTEE ON APPROPRIATIONS
CLARENCE CANNON, Missouri, Chairman JOHN H. KERK, North Carolina
JOHN TABER, New York GEORGE H. MAHON, Texas
RICHARD B. WIGGLESWORTH, Massachusetts HARRY R. SHEPPARD, California
CHARLES A. PLUMLEY, Vermont ALBERT THOMAS, Texas
ALBERT J. ENGEL, Michigan MICHAEL J, KIRWAN, Ohio
KARL STEFAN, Nebraska W. F. NORRELL, Arkansas
FRANCIS CASE, South Dakota ALBERT GORE, Tennessee
FRANK B. KEEFE, Wisconsin
BEN F. JENSEN, Iowa
WALT HORAN, Washington
GORDON CANFIELD, New Jersey JOE B. BATES. Kentucky
IVOR D. FENTON, Pennsylvania
JOHN PHILLIPS, California
CLIFF CLEVENGER, Ohio
GEORGE Y. HARVEY, Olerk
MONDAY, JANUARY 30, 1950. RURAL ELECTRIFICATION ADMINISTRATION
CLAUDE R. WICKARD, ADMINISTRATOR, RURAL ELECTRIFICATION
ADMINISTRATION GEORGE W. HAGGARD, DEPUTY ADMINISTRATOR, REA WILLIAM C. WISE, ASSISTANT ADMINISTRATOR, REA ROBERT T. BEALL, EXECUTIVE OFFICER, REA EVERETT C. WEITZELL, PROGRAM ANALYST, REA ROBERT MacCLINCHIE, ADMINISTRATIVE OFFICER. REA K. WILDE BLACKBURN, ASSOCIATE SOLICITOR, OFFICE OF THE
SOLICITOR RALPH S. ROBERTS, DIRECTOR OF FINANCE AND BUDGET OFFICER,
DEPARTMENT OF AGRICULTURE
Mr. WHITTEN. The committee will come to order, please.
We are glad to have with us today Mr. Wickard, head of the Rural Electrification Administration, and his associates.
At this point in the record, I would like to have inserted page 468 of the justification, pages 1, 2, and 3 of the supplemental justification material, and the tables on pages 384 and 387 of the committee print.
(The material referred to is as follows:)
The Rural Electrification Administration was established by Executive Order 7037 of May 11, 1935, to make loans for the extension of central station electric service to unserved rural people. The agency was continued by the Rural Electrification Act approved May 20, 1936, and became a part of the Department of Agriculture, effective July 1, 1939, under Reorganization Plan II. Although on June 30, 1949, service had been extended by REA borrowers to 2,778,180 farms and rural establishments, approximately 3,400,000 rural dwellings and an additional number of other rural establishments did not have central station service, and it is expected that about 85 percent of these will be electrified through the rural-electrification loan program.
Loans for construction of electric facilities are self-liquidating within a period of not to exceed 35 years, and they bear interest at the rate of 2 percent. Loans for consumer facilities are also at 2-percent interest but for shorter periods.
Fifty percent of the funds available for loans in any given year are reserved for loans in the various States on the basis of the proportion that each State's unelectrified farm bears to the total number of farms in the country which are without central-station electric service. The other 50 percent and unobligated balances from prior years may be loaned at the discretion of the Administrator, but not more than 10 percent may bo loaned in any one State or all of the Territories.
The principal borrowers of this Administration are cooperative associations formed solely for the purpose of making electricity available in rural areas. The Administration gives technical review and approval to construction plans and approves the completed construction of the electric systems. Selective