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courage the most widespread use thereof at the lowest possible rates to consumers consistent with sound business principles," applies also to power marketed from reclamation projects under reclamation law. Letter

575

of Secretary Udall to Representative Aspinall, May 15, 1965, in re basis for establishing power rates for the Colorado River Storage Project.

Sec. 7. [Rate schedules to be based on cost of production of energy-Computation of costs.]-It is the intent of Congress that rate schedules for the sale of electric energy which is or may be generated at the Bonneville project in excess of the amount required for operating the dam, locks, and appurtenant works at said project shall be determined with due regard to and predicated upon the fact that such electric energy is developed from water power created as an incident to the construction of the dam in the Columbia River at the Bonneville project for the purposes set forth in section 1 of this Act. Rate schedules shall be drawn having regard to the recovery (upon the basis of the application of such rate schedules to the capacity of the electric facilities of Bonneville project) of the cost of producing and transmitting such electric energy, including the amortization of the capital investment over a reasonable period of years. Rate schedules shall be based upon an allocation of costs made by the Federal Power Commission. In computing the cost of electric energy developed from water power created as an incident to and a byproduct of the construction of the Bonneville project, the Federal Power Commission may allocate to the costs of electric facilities such a share of the cost of facilities having joint value for the production of electric energy and other purposes as the power development may fairly bear as compared with such other purposes. (50 Stat. 735; 16 U.S.C. § 832f)

Allocation of costs 2
Repayment 1

1. Repayment

NOTES OF OPINIONS

Neither the Hayden-O'Mahoney amendment nor the power marketing statutes involved in the power operations of the Bonneville Power Administration (section 7 of the Bonneville Project Act, section 9(c) of the Reclamation Project Act of 1939, and section 5 of the Flood Control Act of 1944) require that the costs of each project to be met from power revenues have to be amortized on the basis of a fixed annual obligation. The legal requirements are satisfied if such costs are returned within a reasonable period of years whatever accounting procedure is applied. Statement furnished by Assistant Secretary Holum in regard to statutory authority for revised procedure for presenting Bonneville Power Administration rate and repayment data on a consolidated system basis, printed in Hearings on H.R. 2337, to Provide for the

Construction of the Lower Teton Division, Teton Basin Federal Reclamation Project, Before the Irrigation and Reclamation Subcommittee of the House Committee on Interior and Insular Affairs, 88th Cong., 2d Sess. 36-38 (1964).

2. Allocation of costs

In allocating costs for the McNary Project, the Federal Power Commission should allocate part of the joint facility costs to recreation, both because recreation is authorized as a part of the project under the general authority of section 4 of the Flood Control Act of 1944, and because section 7 of the Bonneville Project Act specifically directs the Commission to take into account the use of the project for recreation. Memorandum of Solicitor Barry, July 22, 1965, in re authority of FPC under Section 7 of Bonneville Project Act to allocate part of joint facility costs to recreation at McNary Dam.

Sec. 8. [Advertising required on contracts for supplies or services.]-Notwithstanding any other provision of law, all purchases and contracts made by the administrator or the Secretary of War for supplies or for services except for

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personal services, shall be made after advertising, in such manner and at such times, sufficiently in advance of opening bids, as the administrator or Secretary of War, as the case may be, shall determine to be adequate to insure notice and opportunity for competition. Such advertisement shall not be required, however, when (1) an emergency requires immediate delivery of the supplies or performance of the services; or (2) repair parts, accessories, supplemental equipment, or services are required for supplies or services previously furnished or contracted for; or (3) the aggregate amount involved in any purchase of supplies or procurement of services does not exceed $500; in which cases such purchases of supplies or procurement of services may be made in the open market in the manner common among businessmen. In comparing bids and in making awards, the administrator or the Secretary of War, as the case may be, may consider such factors as relative quality and adaptability of supplies or services, the bidder's financial responsibility, skill, experience, record of integrity in dealing, and ability to furnish repairs and maintenance services, the time of delivery or performance offered, and whether the bidder has complied with the specifications. (50 Stat. 735; 16 U.S.C. § 832g)

Sec. 9. [Accounts to be maintained-Independent commercial audit required Expenditure of funds.]—(a) The administrator, subject to the requirements of the Federal Water Power Act, shall keep complete and accurate accounts of operations, including all funds expended and received in connection with transmission and sale of electric energy generated at the Bonneville project, and in the maintenance of such accounts, appropriate obligations shall be established for annual and sick leave of absence as earned. The Administrator shall, after the close of each fiscal year, obtain an independent commercial-type audit of such accounts. The forms, systems, and procedures prescribed by the Comptroller General for the Administrator's appropriation and fund accounting shall be in accordance with the requirements of the Federal Water Power Act with respect to accounts of electric operations of public utilities and the regulations of the Federal Power Commission pursuant thereto.

(b) The administrator may make such expenditures for offices, vehicles, furnishings, equipment, supplies, and books; for attendance at meetings; and for such other facilities and services as he may find necessary for the proper administration of this Act. (50 Stat. 736; Act of October 23, 1945, 59 Stat. 547; 16 U.S.C. § 832h)

(c) [Annual report to Congress.]—Repealed.

EXPLANATORY NOTES

Provision Repealed. The Act of June 14, 1966, 80 Stat. 200, repealed subsection (c) of section (9) which read as follows: "In December of each year, the administrator shall file with the Congress, through the Secretary of the Interior, a financial statement and a complete report as to the transmission and sale of electric energy generated

at the Bonneville project during the preceding governmental fiscal year." The 1966 Act appears herein in chronological order.

1945 Amendment. The Act of October 23, 1945, 59 Stat. 546, amended subsection 9(a) by adding to it all that follows the words "Bonneville project" in the subsection.

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577

Sec. 10. [Appointment of officers and employees-Voluntary and uncompensated services.]-(a) The Secretary of the Interior shall appoint, without regard to the civil-service laws, an Assistant Administrator, chief engineer, and general counsel and shall fix the compensation of each in accordance with the Classification Act of 1949, as amended. The Assistant Administrator shall perform the duties and exercise the powers of the Administrator, in the event of the absence or sickness of the Administrator until such absence or sickness shall cease and in the event of a vacancy in the office of Administrator until a successor is appointed.

(b) The Administrator, the Secretary of War, and the Federal Power Commission, respectively, are authorized to appoint, subject to the civil-service laws, such officers and employees as may be necessary to carry out the purposes of this Act, the appointment of whom is not otherwise provided for, and to fix their compensation in accordance with the Classification Act of 1949, as amended. The Administrator may employ laborers, mechanics, and workmen in connection with construction work or the operation and maintenance of electrical facilities (hereinafter called 'laborers, mechanics, and workmen'), subject to the civil-service laws, and fix their compensation without regard to the Classification Act of 1949, as amended, and any other laws, rules, or regulations relating to the payment of employees of the United States except the Act of May 29, 1930 (46 Stat. 468), as amended, to the extent that it otherwise is applicable. The Administrator is further authorized to employ physicians, under agreement and without regard to civil-service laws or regulations, to make physical examinations of employees or prospective employees who are or may become laborers, mechanics, and workmen. The Administrator, the Secretary of War, and the Federal Power Commission, respectively, are also authorized to appoint, without regard to the civil-service laws, such experts as may be necessary for carrying out the functions entrusted to them under this Act.

(c) The Administrator may accept and utilize such voluntary and uncompensated services and with the consent of the agency concerned may utilize such officers, employees, or equipment of any agency of the Federal, State, or local governments which he finds helpful in carrying out the purposes of this Act; in connection with the utilization of such services, reasonable payments may be allowed for necessary travel and other expenses. (50 Stat. 736; Act of October 23, 1945, 59 Stat. 547; Act of October 28, 1949, 63 Stat. 972; 16 U.S.C. § 832i)

EXPLANATORY NOTES

1949 Amendment. The Act of October 28, 1949, substituted the "Classification Act of 1949" for the "Classification Act of 1923" in the text, and by its operation eliminated the provision at the end of subsection "(b)" which read: "and to fix the compensation of each such expert without regard to the Classification Act of 1923, as amended, but at not to exceed $7,500 per

annum.

1945 Amendment. The Act of October

23, 1945, 59 Stat. 547, amended section 10 in its entirety. Before amendment, the section read as follows:

"Sec. 10. The administrator, the Secretary of War, and the Federal Power Commission, respectively, shall appoint such attorneys, engineers, and other experts as may be necessary for carrying out the functions entrusted to them under this Act, without regard to the provisions of the civilservice laws and shall fix the compensation

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BONNEVILLE PROJECT

of each of such attorneys, engineers, and other experts at not to exceed $7,500 per annum; and they may, subject to the civilservice laws, appoint such other officers and employees as may be necessary to carry out such functions and fix their salaries in ac

cordance with the Classification Act of 1923 as amended."

Reference in the Text. The Act of May 29, 1930 (46 Stat. 468), referred to in the text, deals with the retirement of employees in the classified civil service.

Sec. 11. [Receipts from transmission and sale of electric energy.]-All receipts from transmission and sale of electric energy generated at the Bonneville project shall be covered into the Treasury of the United States to the credit of miscellaneous receipts, save and except that the Treasury shall set up and maintain from such receipts a continuing fund of $500,000, to the credit of the administrator and subject to check by him, to defray emergency expenses and to insure continuous operation. There is hereby authorized to be appropriated from time to time, out of moneys in the Treasury not otherwise appropriated, such sums as may be necessary to carry out the provisions of this Act, including installation of equipment and machinery for the generation of electric energy and facilities for its transmission and sale. (50 Stat. 736; 16 U.S.C. § 832j)

1. Continuing fund

NOTES OF OPINIONS

The primary purpose of the continuing fund for the Bonneville Power Administration, as of the continuing fund first established for the Southwestern Power Administration and the emergency fund created by the Act of June 26, 1948, for the Bureau of Reclamation, is to insure continuous operation of transmission facilities in the face of emergencies that cause or threaten interruption (as distinguished from curtailment) in power service. Dec. Comp. Gen. B-105397 (September 21, 1951).

A seasonal reduction in rainfall and consequent decrease in the output of electrical energy from federal dams on the Columbia River does not constitute such an emergency or interruption of service as to justify expenditure of money from the continuing fund, created by section 11 of the Bonneville Project Act, for artificial nucleation and cloud modification services to increase precipitation. Dec. Comp. Gen. B-105397 (September 21, 1951).

Sec. 12. [Authority of the Administrator with respect to claims against the United States-Power to sue in the name of the United States.]—(a) The Administrator is hereby authorized to determine, settle, compromise, and pay claims and demands against the United States which are not in excess of $1,000 and are presented to the Administrator in writing within one year from the date of accrual thereof, for any losses, injuries, or damages to persons or property, or for the death of persons, resulting from acts or omissions of employees acting within the scope of their employment pursuant to this Act. The Administrator is also authorized to determine, compromise, and settle any claims and demands of the United States for any losses, injuries, or damages to property under the Administrator's control, against other persons or public or private corporations. The Administrator's determination, compromise, settlement, or payment of any of the claims referred to in this subsection shall be final and conclusive upon officers of the Government, notwithstanding the provisions of any other Act to the contrary. When claims presented to the Administrator under this subsection arise, in whole or in part, out of any damage done to private property, the Administrator may repair all or any part of such damage in lieu of making such payments.

all

BONNEVILLE PROJECT

579

(b) The Administrator may, in the name of the United States, under the supervision of the Attorney General, bring such suits at law or in equity as in his judgment may be necessary to carry out the purposes of this Act; and he shall be represented in the prosecution and defense of all litigation, affecting the status or operation of Bonneville project by the United States attorneys for the districts, respectively, in which such litigation may arise, or by such attorney or attorneys as the Attorney General may designate as authorized by law, in conjunction with the regularly employed attorneys of the Administrator. (50 Stat. 736; Act of October 23, 1945, 59 Stat. 547; Act of July 26, 1946, 60 Stat. 701; 16 U.S.C. § 832k)

EXPLANATORY NOTES

1946 Amendment. The Act of July 26, 1946, 60 Stat. 701, amended subsection 12(b) to read as it appears above. Before amendment, the subsection read as follows:

"(b) The Administrator may, in the name of the United States, bring such suits at law or in equity as in his judgment may be necessary to carry out the purposes of this Act; and he shall be represented in the prosecution and defense of all litigation, including condemnation proceedings, affecting the status or operation of the Bonneville project by his attorneys: Provided, however, That such attorneys shall supply the Attorney General with copies of the pleadings in all such cases and that the handling of litigation which, in the Attorney General's opinion, involves interpretation of the Constitution of the United States or which involves appearance in any United States circuit court of appeals or the United States Supreme Court shall be subject to the Attorney General's direction or supervision. The Administrator may compromise and make final settlement of such litigation and

pay the amount due under any compromise or judgment. Complaints in condemnation proceedings permitted by section 2(c) and 2(d) of this Act shall be signed, verified, and filed by the Administrator."

1945 Amendment. The Act of October 23, 1945, 59 Stat. 547, amended section 12 in its entirety. Before amendment, the section read as follows:

"Sec. 12. The administrator may, in the name of the United States, under the supervision of the Attorney General, bring such suits at law or in equity as in his judgment may be necessary to carry out the purposes of this Act; and he shall be represented in the prosecution and defense of all litigation affecting the status or operation of Bonneville project by the United States Attorneys for the districts, respectively, in which such litigation may arise, or by such attorney or attorneys as the Attorney General may designate as authorized by law, in conjunction with the regularly employed attorneys of the administrator."

Sec. 13. [Savings clause.]—If any provision of this Act or the application of such provision to any person or circumstances shall be held invalid, the remainder of the Act and the application of such provision to persons or circumstances other than those as to which it is held invalid shall not be affected thereby. (50 Stat. 736; 16 U.S.C. § 8321)

EXPLANATORY NOTES

1945 Amendments Not Included. The Act of October 23, 1945, 59 Stat. 546, which amended several sections of this Act, also amended certain sections of the Internal Revenue Code and the Social Security Act. These amendments deal with employees of the Bonneville Power Administration.

Editor's Note, Annotations. Annotations

of opinions are included only to the extent deemed relevant to activities of the Bureau of Reclamation.

Legislative History. H.R. 7642, Public Law 329 in the 75th Congress. H.R. Rept. No. 1090. H.R. Rept. No. 1217 (on H. Res. 277). S. Rept. No. 919 (on S. 2092). H.R. Rept. No. 1507 (conference report).