redefines the act of 1933, you still put any faith in the appropriation amendment, which was passed before the T. V. A. amendment? Mr. TULLOSS. It does seem that such a construction would indicate that the Congress had enacted a law on August 12, and then it immediately so amended as to nullify it, and I prefer the construction that the authority indicated by the appropriation was in the original act, and wasn't disturbed by the enactment of the amendment in the same month. Mr. BIDDLE. That is the construction that appropriations are not, and this was not used to amend the fundamental act? Mr. TULLOSS. That the appropriation wasn't. Mr. BIDDLE. You prefer that construction to the construction that I have stated? Mr. TULLOSS. I don't admit that ruling. Mr. BIDDLE. You prefer your construction to the other one? Mr. TULLOSs. Yes. Mr. BIDDLE. After all, these acts speak for themselves, but I want to be very sure what they were, and what each of these two offices, how they construed them. Do you know who proposed the language in the clause of the appropriation act of 1935 that you referred to, wasn't it proposed by the T. V. A. in order to permit the simplification of putting all of its accounts into one single account? Mr. TULLOSS. You mean the appropriation act? Mr. BIDDLE. Yes; the one that you rely on as amending. Mr. TULLOSS. I don't know, I don't recall, I may have read the history of it but I don't remember. Mr. BIDDLE. Chairman Morgan testifying before the committee in the second deficiency appropriation bill of 1935, the hearings on the bill, page 594, testified as follows: The CHAIRMAN. Dr. Morgan, I notice in House Document No. 181, there is some new language that you want. Personally, I think it would be advantageous to have it. This is the language: "General public works: Provided further, That all appropriations, allotments and other funds made available hereafter to the Tennessee Valley Authority including any unexpended balances remaining from the appropriation of $50,000,000 made to the Tennessee Valley Authority by the Fourth Deficiency Act, fiscal year 1933, the allocation of $25,000,000 made to the Tennessee Valley Authority, under the Emergency Appropriation Act, fiscal year 1935, and the receipts of the Tennessee Valley Authority from all sources, except as limited by section 26 of the Tennessee Valley Authority Act approved May 18, 1933 (48 Stat. 58), shall be covered into and accounted for as one fund to be known as the 'Tennessee Valley Authority Fund' and shall remain available until expended." In other words, that is exactly as the appropriation bill was passed. And then he continues: That would save a lot of bookkeeping? And then Chairman Morgan answered: Dr. ARTHUR E. MORGAN. It would save an enormous amount of bookkeeping. I will ask Mr. Ager to explain that to you. Mr. AGER. The situation we are confronted with at the present time is that we have a revenue fund, an original appropriation of $50,000,000 to account for, and a second appropriation of $25,000,000 to account for. This new appropriation would be a third appropriation. Mr. TULLOSS. No; it describes our method of procedure of settling regular accounts. Mr. BIDDLE. But the answer is "no," that it does not add anything, that sentence, to your power with respect to settling accounts? Mr. TULLOSs. No. Mr. BIDDLE. Well, take the next sentence: The expenses for each such audit shall be paid from any appropriation or appropriations for the General Accounting Office, and such part of such expenses as may be allocated to the cost of generating, transmitting, and distributing electric energy shall be reimbursed promptly by the corporation as billed by the Comptroller General. That certainly does not add anything with respect to your powers to settle, does it? Mr. TULLOSS. There is some doubt in my mind about that, because that invokes the use of our regular appropriation, which was made for the settlement and adjustment of accounts. Mr. BIDDLE. It simply says that you will pay for it except for the power end of it, doesn't it? Mr. TULLOss. Yes. Mr. BIDDLE. That has nothing to do with powers, that has nothing to do with anything but who pays for it. Mr. TULLOSS. That is what we always-we always or generally pay for our own audit. Mr. BIDDLE. That says who is going to pay for it? Mr. TULLOSS. The provisos there come more in line with what we were doing with reference to the regular audit. Mr. BIDDLE. It may come more in line, but it doesn't give you any further power with respect to settling accounts? Mr. TULLOss. I wouldn't be sure about that. Mr. BIDDLE. Well, we will have to judge the language then. The Comptroller General shall make special report to the President of the United States and to the Congress of any transaction or condition found by him to be in conflict with the powers or duties entrusted to the corporation by law. That was found specifically in the original act of 1933, was it not? Mr. TULLOSs. I won't be sure about that. Mr. BIDDLE. It is; I will tell you that it is, and you can take my word for that. That is the only language in the amendment which I can find with respect to any added powers of the Comptroller General. Do you find any further language in the amendment? Mr. TULLOSS. No; I think that you have correctly read the amendment. Mr. BIDDLE. And you still base your powers to settle and audit on the Appropriation Act passed before this act of 1935? Mr. TULLOSS. No, sir; I said it goes back beyond that, my answer on that was assuming that the original act didn't give us the power, my answer before that was in my opinion the original act gave us that authority. Mr. BIDDLE. Assuming that the original act doesn't give you any authority, and assuming that the 1935 act amending the original act redefines the act of 1933, you still put any faith in the appropriation amendment, which was passed before the T. V. A. amendment? Mr. TULLOSs. It does seem that such a construction would indicate that the Congress had enacted a law on August 12, and then it immediately so amended as to nullify it, and I prefer the construction that the authority indicated by the appropriation was in the original act, and wasn't disturbed by the enactment of the amendment in the same month. Mr. BIDDLE. That is the construction that appropriations are not, and this was not used to amend the fundamental act? Mr. TULLOSS. That the appropriation wasn't. Mr. BIDDLE. You prefer that construction to the construction that I have stated? Mr. TULLOSS. I don't admit that ruling. Mr. BIDDLE. You prefer your construction to the other one? Mr. TULLOss. Yes. Mr. BIDDLE. After all, these acts speak for themselves, but I want to be very sure what they were, and what each of these two offices, how they construed them. Do you know who proposed the language in the clause of the appropriation act of 1935 that you referred to, wasn't it proposed by the T. V. A. in order to permit the simplification of putting all of its accounts into one single account? Mr. TULLOSS. You mean the appropriation act? Mr. BIDDLE. Yes; the one that you rely on as amending. Mr. TULLOSS. I don't know, I don't recall, I may have read the history of it but I don't remember. Mr. BIDDLE. Chairman Morgan testifying before the committee in the second deficiency appropriation bill of 1935, the hearings on the bill, page 594, testified as follows: The CHAIRMAN. Dr. Morgan, I notice in House Document No. 181, there is some new language that you want. Personally, I think it would be advantageous to have it. This is the language: "General public works: Provided further, That all appropriations, allotments and other funds made available hereafter to the Tennessee Valley Authority including any unexpended balances remaining from the appropriation of $50,000,000 made to the Tennessee Valley Authority by the Fourth Deficiency Act, fiscal year 1933, the allocation of $25,000,000 made to the Tennessee Valley Authority, under the Emergency Appropriation Act, fiscal year 1935, and the receipts of the Tennessee Valley Authority from all sources, except as limited by section 26 of the Tennessee Valley Authority Act approved May 18, 1933 (48 Stat. 58), shall be covered into and accounted for as one fund to be known as the 'Tennessee Valley Authority Fund' and shall remain available until expended." In other words, that is exactly as the appropriation bill was passed. And then he continues: That would save a lot of bookkeeping? And then Chairman Morgan answered: Dr. ARTHUR E. MORGAN. It would save an enormous amount of bookkeeping. I will ask Mr. Ager to explain that to you. Mr. AGER. The situation we are confronted with at the present time is that we have a revenue fund, an original appropriation of $50,000,000 to account for, and a second appropriation of $25,000,000 to account for. This new appropriation would be a third appropriation. The CHAIRMAN. The only question in my mind, about which I would like to hear you, is whether or not the revenue fund ought to be lumped with the appropriation. In other words, whether or not it would not be good policy and good business to show the receipts and expenditures in the revenue fund, which is under the absolute discretion of the Tennessee Valley Authority. That would seem, I should think, rather clearly that it was made at the suggestion of the Tennessee Valley Authority, in order to have the funds lumped in one account, rather than the bookkeeping in a number of accounts. The Barbour amendment was rejected, was it not? Mr. TULLOSS. I didn't recall that until I read it, but I so understand. It was rejected, and I don't recall Mr. BIDDLE. Do you recall the amendment offered by Mr. Hill to the McSwain bill, which Mr. McCarl suggested? Mr. TULLOSs. No. Mr. BIDDLE. You don't recall that? Mr. TULLOss. No. Mr. BIDDLE. In any event, the two amendments, to amend the T. V. A. Act, would clearly put the T. V. A. under the authority of the General Accounting Office, to settle accounts, and they were rejected in 1935, were they not? Mr. TULLOSS. Rejected in committee Mr. BIDDLE. In committee? Mr. TULLOss. Yes. SUGGESTION OF STOPPING FUNDS TO TENNESSEE VALLEY AUTHORITY Mr. BIDDLE. What was the basis under which the General Accounting Office suggested that it would have to cut off funds to the T. V. A. by refusing to countersign Treasury warrants unless the T. V. A. would comply with your interpretation of the law, do you remember? Mr. TULLOSS. The authority for that action was the act of July 31, 1894, permitting the accounting office to disapprove requisitions for funds, for any reason whatever. Mr. BIDDLE. Wasn't the action taken by the General Accounting Office based on this amendment to the appropriations bills? Mr. TULLOSS. I believe it is so stated in the correspondence. Mr. BIDDLE. Well, now, since January of 1936, has the T. V. A. sent its accounts and supporting data to Washington? Mr. TULLOSS. Partially. Mr. BIDDLE. Always under protest? Mr. TULLOSS. I don't know whether they have protested as to that manner of rendition, they have protested to practically all, if not all, exceptions taken. PROTESTS FROM TENNESSEE VALLEY AUTHORITY Mr. BIDDLE. They have protested on the ground, haven't they, as I have tried to indicate here, that they thought that you had no right to require them to send to Washington their contracts and vouchers, and that your only right was to audit their accounts at the end of every fiscal year? Mr. TULLOSS. I think so as to the latter, but I don't recall as to the former. Now, if you read that photostat on top there, you will get their protest, as to our exceptions. Mr. BIDDLE. Their protest is contained in their letter of July 20, 1935. Mr. TULLOSS. That letter is a form that is being used by T. V. A. to reply to the exceptions, and I won't say that that form is used in every case, but it is used in a great many cases. Mr. BIDDLE. They protest on your right to make these requirements, under the existing statutues? Mr. TULLOSs. Yes. Mr. BIDDLE. I won't Mr. TULLOSS. I will say, however, that that includes the requirement of rendering the account, and they did that voluntarily so far as I know. Mr. BIDDLE. I am not talking about the rendering of the account, I am talking about rendering this material to Washington, that is the protest as to that. Mr. TULLOSs. Yes. Mr. BIDDLE. Your office has taken a good many exceptions to the T. V. A. accounts, has it not? Mr. TULLOSs. Yes. Mr. BIDDLE. Now, have you ever brought any action to hold any disbursing officer of the T. V. A. liable for any disbursement? Mr. TULLOSs. Not other than to withhold credit for the account for the expenditures that we have questioned. Mr. BIDDLE. What exactly is withholding credit, the money has been paid out by T. V. A.? Mr. TULLOSS. The procedure is that the treasurer of the T. V. A.the treasurer renders an account in which a charge is made for all advances, and credit is claimed for all disbursements, and we examine the record now, mind you, the treasurer is already charged with the disbursements. Mr. BIDDLE. The money is paid out of the treasury, and it is a question of withholding credit in settling the account of the distributing officer? Mr. TULLOSS. It is advanced to the disbursing officer, and charged to his account, on the bond. Now, when he renders the account, he claims credit for the expenditures made or deposits, and in examining that account we pass on whether or not we shall give credit, as claimed. Now, if we decide that any transaction should not be credited to his account, we take exception to it, and notify him, and give him the reasons why we take exception, and that credit is denied until it is satisfactorily adjusted. Mr. BIDDLE. Does the T. V. A. Act require that you make an annual audit? Mr. TULLOSS. Yes, sir. Mr. BIDDLE. How many have you made to date? Mr. TULLOSS. For each year, each fiscal year. Mr. BIDDLE. Have you made any complete audit with the exception of the audit for the fiscal year June 30, 1935? Mr. TULLOSS. The audit has been made, but the reports have not been rendered. Mr. BIDDLE. You mean the field audit has been made? Mr. TULLOSs. Yes. 115943-39-pt. 10- -24 |