Total personal services paid from funds available to Bonneville Power Administration, 1960 estimate, are distributed as follows: The administrative provisions of the appropriations act provide that not to exceed 12 percent of the appropriation for construction shall be available for construction work by force account or on a hired-labor basis. The estimated obligations in fiscal year 1960 for construction work by force account is $1,510,000, which includes all objects. The personal services component of this amount is estimated at $1,050,000. ENGINEERING COSTS Dr. FENTON. I would also like you to supply for the record the amount of contract engineering or other work performed during each of the past three fiscal years, of the type that had previously been performed by Bonneville personnel. (The matter referred to follows:) Engineering designed and survey work performed by contract which had previously been performed by Bonneville personnel is as follows: Dr. FENTON. Also furnish for the record the total cost of engineering, design, supervision, and administration of the construction program of BPA for each of the past 3 years. Include contract work cost requested above with proper note. (The matter referred to follows:) Engineering costs covering design, supervision, and administration are as follows: Fiscal year: 1957 1 Includes $313,700 for architect-engineer and survey contracts. 2 Includes $176,400 for architect-engineer and survey contracts. 3 Includes no architect-engineer and survey contracts. CONSTRUCTION PROJECT FEASIBILITY Dr. FENTON. In connection with the proposed construction by Bonneville of new facilities for serving existing customers, will the average annual incremental revenue over a 10-year period exceed the average annual fixed and operating costs of the new facilities? (The matter referred to folows:) Yes; it is expected that incremental revenue of the first 10 years will equal or exceed incremental annual costs of the additional transmission facilities. This is the test set forth in our feasibility policy. CONSTRUCTION BY UTILITIES Dr. FENTON. Have any of the non-Federal utilities, public or private, proposed or indicated a desire to construct any transmission lines or substations that would have made any of the proposed Bonneville construction work unnecessary? (The matter referred to follows:) No. All proposed budget items are reviewed in advance with our customers. We do not request funds for any item they wish to build. FEDERAL AND NON-FEDERAL CONSTRUCTION OF GENERATING FACILITIES Dr. FENTON. It is my understanding that considerable non-Federal generating capacity has been or is being constructed in the Pacific Northwest, and I think the records should show what the area people are doing to supply their own power needs. Will you furnish for the record the amounts of new generating capacity that has been constructed in the Pacific Northwest in each of the past 5 years and that is now under construction or actually scheduled for future construction, breaking this down between Federal and non-Federal construction? (The matter referred to follows:) 1 Pacific Northwest area includes all of the States of Oregon and Washington and that part of the States of Idaho, Montana, and Wyoming in the Columbia River Basin. COMPTROLLER GENERAL'S REPORT Dr. FENTON. I have here a copy of a letter dated December 31, 1958, from the Comptroller of the United States to the Secretary of the Interior, relative to the results of the fiscal year 1958 audit on the Columbia River power system. I ask that it be included in the record at this point. This report notes several deficiencies and inconsistencies in the accountancy practice on the Columbia River power system and concluded that Accordingly we have concluded that we cannot report that these financial statements present fairly the financial position of the Columbia River power system and related activities at June 30, 1958, and the financial results of power operation for the fiscal year then ended. I would like to ask the Bonneville representatives if they want to comment at this time on this criticism by the Comptroller General. (The Comptroller's letter and agency's comment follow :) The Honorable the SECRETARY OF THE INTERIOR: COMPTROLLER GENERAL OF THE UNITED STATES, Washington, D.C., December 31, 1958. In DEAR MR. SECRETARY: The General Accounting Office has made audits of the activities of the Bonneville Power Administration and the Bureau of Reclamation, Department of the Interior, and the Corps of Engineers (Civil Functions), Department of the Army, pursuant to the Budget and Accounting Act, 1921 (31 U.S.C. 53), and the Accounting and Auditing Act of 1950 (31 U.S.C. 67). connection with these audits, we examined the accounts and records pertaining to the Columbia River power system and related activities for the fiscal year ended June 30, 1958, and the accompanying financial statements were prepared from those accounts and records, some of which are maintained specifically for this purpose. Insofar as the accompanying financial statements are concerned, our examination was made in accordance with generally accepted auditing standards and included such tests of the accounting records and such other auditing procedures as were considered necessary in the circumstances. The Columbia River power system consists of the Bonneville Power Administration and the generating facilities for commercial power purposes of the multiple-purpose projects built and operated (or under construction) by the Bureau of Reclamation and the Corps of Engineers in the Pacific Northwest, for which the Administration acts as the transmitting and marketing agency. The transmission system of Bonneville Power Administration and the hydroelectric plants of these multiple-purpose projects are operated as an integrated power system. In addition to the generation of electric energy, other activities of these projects include the operation of irrigation, flood control, and navigation facilities. The accompanying financial statements present, in accordance with the accounts and records maintained for this purpose, the combined assets and liabilities at June 30, 1958, and the financial results of commercial power operations for the year ended on that date of Bonneville Power Administration and the multiple-purpose projects (including those under construction) for which it is the power marketing agent. These financial statements are deficient in the following important respects. 1. Insofar as they relate to commercial power activities, the accompanying financial statements were prepared from accounts and records that have been maintained generally in accordance with the uniform system of accounts prescribed by the Federal Power Commission under the Federal Power Act. To achieve conformance with the uniform system of accounts and to permit a more consistent financial presentation of assets, liabilities, and results of operations, special memorandum accounts have been maintained for the purpose of this report by the Bureau of Reclamation. The memorandum accounts differ from the official accounting policies and practices of the Bureau. Officials of your Department have informed us that they do not consider the accompanying |