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1924. Mechanical sound recording, etc., in courts of D. C. and Supreme Court.

1929. Marine Band to attend 75th anniversary of Battle of Gettysburg.

1931. Superintendent of Naval Academy to accept gifts, etc., for building.

1941. Deny U. S. citizenship to persons believing in other forms of government.

1942. Disposition of accounts of deceased officers and men of Coast Guard, etc.

1943. Conveying portion of Mahon River lighthouse reservation to Delaware.

1944. Disposition of records in Department of Navy.

1945. Amending longshoremen's and harbor workers' compensation act.

1946. Inclusion of lands in Kaniksu National Forest in State of Washington.

1947. Validating certain conveyances made by Wisconsin.

1948. Certify for payment certain claims of grain elevators and grain firms.

1949. Transportation from Rochester to Alexandria Bay by Canadian vessels.

1950. Merchant marine act of 1938.

1952. Extending public-building area in District of Columbia.

1956. Temporary operation by United States of certain steamships.

1957. Amending law relative to Bristol Bay fisheries of Alaska.

1958. Issuance of certain seamen's certificates by inspectors of hulls, etc.

1959. District of Columbia appropriation bill, 1939.

1960. Bridge across St. Clair River at or near Port Huron, Mich.

1961. Bridge across Ohio River at or near Cairo, Ill.

1962. Extending terms of district judges of Canal Zone and Puerto Rico.

1963. Amending sec. 312 of agricultural adjustment act rel. to Burley tobacco.

1964. Amending sec. 312 of agricultural adjustment act rel. to Burley tobacco.

1965. Veterans' regulation 10, rel. to “line of duty" for peacetime veterans.

1976. Granting pensions to soldiers, etc., for service in War with Spain, etc.

1977. Amend act relative to statistics of cottonseed and cottonseed products.

1978. Funds for United States Constitution Sesquicentennial Commission.

1979. Cooperation in education of Indian children at Lower Skokomish, Wash.

1980. Pensions for disability or death resulting from bombing of the Panay.

1981. Treasury and Post Office departments appropriation bill, 1939.

1982. Extending provisions of commodity exchange act to wool and wool tops.

1983. Granting pensions and increases of pensions to needy war veterans.

1984. Benefits of act to aid in wild-life-restoration projects for D. C., etc.

1985. Amendments to agricultural adjustment act of 1938.

1987. Additional district judge for northern district of Alabama.

1988. Extension of boundaries of Hot Springs National Park in Arkansas.

1989. Present medals to Reginald V. Holt and other officers of British Navy.

3d Session

Part 2

PROVIDING FOR ALLOCATION OF NET REVENUES OF SHOSHONE POWER PLANT OF SHOSHONE RECLAMATION PROJECT IN WYOMING

JANUARY 28, 1938.-Ordered to be printed

Mr. FERGUSON, from the Committee on Irrigation and Reclamation, submitted the following

SUPPLEMENTAL REPORT

[To accompany H. R. 3786]

The Committee on Irrigation and Reclamation, to whom was referred the bill (H. R. 3786) providing for the allocation of net revenues of the Shoshone power plant of the Shoshone reclamation project in Wyoming, having considered the same, recommend that the bill do pass.

On December 5, 1924, after a thorough investigation of conditions existing upon reclamation projects, an act was passed known as the Fact Finders Act, which contained the following provision:

SUBSECTION 1. That whenever the water users take over the care, operation, and maintenance of a project, or a division of a project, the total accumulated net profits, as determined by the Secretary, derived from the operation of project power plants, leasing of project grazing and farm lands, and the sale or use of town sites shall be credited to the construction charge of the project, or a division thereof, and thereafter the net profits from such sources may be used by the water users to be credited annually, first, on account of project construction charge, second, on account of project operation and maintenance charge, and third, as the water users may direct. No distribution to individual water users shall be made out of any such profits before all obligations to the Government shall have been fully paid (U. S. C., title 43, sec. 501).

This act applied to the Shoshone project in Wyoming. The water users in due course organized the Shoshone irrigation district and on November 4, 1926, entered into a contract with the United States of America in which the right of the water users to the profits of the Shoshone power plant, in accordance with the terms of subsection I of the act of December 5, 1924, above quoted, was recognized. Section 31 of this contract reads as follows:

Should any net profits be realized by the United States from any of the various sources named in subsections I and J of said act of Congress of December 5, 1924, the same will be announced and determined each year by the Secretary in a written statement to be sent to the district. The portion of such net profit, if any, as determined by the Secretary, shall be credited each year as follows:

(a) On the annual installment project construction charges (including the construction charges payable by nonconsenting application landowners) of the district beginning with the installment first coming due and continuing with succeeding construction installments as far as such credit will go until the entire construction indebtedness of the district has been paid.

1-31-88

Under the terms of this contract in accordance with the provisions of the act of December 5, 1924, the water users of the Shoshone project were entitled to the net profits of the Shoshone power plant as determined by the Secretary in accordance with the provisions of

that act.

A similar contract was made with the water users on the North Platte project in Nebraska and Wyoming.

In 1929, however, there were introduced amendments to the Interior Department appropriation bill for that year which in effect repealed the provisions of subsection I of the act of December 5, 1924, so far as power revenues are concerned, and abrogated the contracts which were made by the water users and the United States in accordance with the Fact Finders Act. When the appropriation bill was under consideration upon the floor of the House the amendment applying to the North Platte project in Nebraska and Wyoming was stricken upon the point of order that it was legislation attached to an appropriation bill. Through some oversight the point was not raised as to the Shoshone project, so that the act of March 4, 1929 (45 Stat. 692), provides with respect to the Shoshone project:

That the net revenues from the operation of the Shoshone power plant shall be applied, first, to the repayment of construction cost of the power system; second, to the repayment of construction cost of the Shoshone Dam; and third, thereafter such net revenues shall be covered into the reclamation fund.

In other words the act of March 4, 1929, not only repeals the act of December 5, 1924, so far as it relates to the Shoshone project, but abrogates section 31 of the contract of November 4, 1926, between the water users and the United States. Not only that but it discriminates against the water users of the Shoshone project who are deprived of the rights which have been preserved to the water users on the North Platte project.

The Shoshone irrigation district brought suit against the Secretary of the Interior in the District of Columbia for a writ of mandamus to compel him to carry out the provisions of the contract of November 4, 1926. The writ, however, was denied upon the ground that the suit was one against the United States and that the act which it was sought to require the Secretary to perform, was not ministerial nor was it a plain duty.

Justice Jesse C. Adkins, of the Supreme Court of the District of Columbia, in his decision of June 13, 1933, said:

I think the act of 1929 is capable of the construction that it repeals subsection I so far as the entire Shoshone project is concerned. Assuming that plaintiff's construction of its contract is correct and that plaintiff has acquired a right to an interest in the net profits of the power system and to an annual credit thereof, I think the act of 1929 is capable of the construction either that it breached the contract of November 4, 1926, or that it was a taking of plaintiff's contract rights and that therefore the act of 1929 is not constitutional but that plaintiff has a remedy in the Court of Claims either for damages for breach of its contract or for just compensation for the taking of its contract rights.

The purpose of the bill which the committee hereby favorably recommend is to protect the water users of the Shoshone project in the contract rights of which they were deprived by the act of March 4, 1929. The contract provided that the net profits from the power plant should be applied on the project construction charges until the entire construction indebtedness of the district has been paid and thereafter as the water users might direct.

The act of March 4, 1929, provided that the net revenues should be applied, first, to the construction cost of the power system; second, to the construction cost of the Shoshone Dam; and, third, should be covered into the reclamation fund.

This bill preserves the first two provisions of the act of March 4, 1929, and directs that, after the repayment of the proportionate cost of the power system and of the dam, the net revenues should be applied to carry out the terms of the contract.

The Interior Department has submitted an unfavorable report upon the bill. This report, which is hereto attached, recites the act of March 4, 1929, and the adverse decision of the courts of the District of Columbia on the water users' application for a writ of mandamus in opposing the proposed legislation, but the committee is of the opinion that, since the act of March 4, 1929, rendered it impossible for the water users to maintain the suit under their contract, any argument based upon that act is without equitable force. This is particularly true since the water users on the North Platte project were not subjected to the provisions of the act of March 4, 1929. The committee, therefore, recommend the passage of the bill notwithstanding the report of the Department of the Interior.

Hon. COMPTON I. WHITE,

DEPARTMENT OF THE INTERIOR,
Washington, June 25, 1937.

Chairman, Committee on Irrigation and Reclamation,

House of Representatives.

MY DEAR MR. WHITE: I have received your letter of January 28, transmitting for report a copy of (H. R. 3786) a bill providing for the allocation of net revenues of the Shoshone power plant of the Shoshone reclamation project in Wyoming.

The bill proposes the allocation of the power revenues (1) to the unconstructed portions of the project and (2) to the Garland and Frannie divisions, and proposes two different methods of applying the revenues so allocated.

(1) Net revenues allocated to the unconstructed portions are to be applied, first, to the repayment of the proportionate construction cost of the power system; second, to the repayment of the proportionate cost of the Shoshone Dam; and third, thereafter the net revenues shall be paid into the reclamation fund.

(2) Net revenues allocated to the Garland and Frannie divisions are to be applied in accord with the terms and provisions of existing contracts with the water users on said project.

The bill is based upon erroneous premises. It apparently assumes that the water users under the Garland and Frannie divisions have rights under existing contracts to a proportionate share of the net revenues derived from the operation of the Shoshone power system.

The Shoshone irrigation district, the organization of the water users on the Garland division, entered into a contract in 1926 with the United States. In 1932 the district filed in the Supreme Court of the District of Columbia a petition for writ of mandamus against Ray Lyman Wilbur, then Secretary of the Interior, to compel the crediting of Shoshone power plant revenues to the district. The application for the writ of mandamus was denied. In 1933 the district appealed to the Court of Appeals for the District of Columbia, from the judgment of the Supreme Court of the District of Columbia and the judgment of the lower court was affirmed (70 Fed. 2d 771). The district then filed in the Supreme Court of the United States a petition for a writ of certiorari which was denied (293 U. S. 571). No part of the cost of the Shoshone power plant or system is charged to the water users on the Garland division.

A contract has been entered into between the United States and the Deaver irrigation district for the repayment of construction cost of the project allocated to lands in the Frannie division. Pursuant to contract provisions, announcement of such construction cost was given the district on January 24, 1931. This announcement took into consideration the provision of the Interior Department Appropriation Act of March 4, 1929 (45 Stat. 1592), as follows:

* * ** Provided

* **

"Shoshone project, Wyoming: * That the net revenues from the operation of the Shoshone power plant shall be applied, first,

to the repayment of the construction cost of the power system; second, to the repayment of the construction cost of the Shoshone Dam; and, third, thereafter such net revenues shall be covered into the reclamation fund."

The water users of the Frannie division are not obligated to repay any part of the construction cost of the power plant and, therefore, have no contractual right to the net revenues derived from the operations of the plant.

The bill does not mention the Willwood division, which is practically completed. Public notice has been issued announcing the construction charges for lands under this division. In announcing these charges, no part of the construction cost of the power plant was included. As the water users have not assumed repayment of any part of the construction cost of the power plant, manifestly they have no contractual rights to the net revenues derived from the power plant operations. It is obvious from the foregoing that none of the divisions of the Shoshone project now have an interest in the net revenues derived from the operation of the Shoshone power plant. To attempt to vest them by the proposed legislation with an interest in the power profits would be granting a gratuity contrary to the policy set out in the act of March 4, 1929, supra. It is my view that the practice of allowing profits from Government power plants to inure permanently to individual water users or water users' organizations on Federal reclamation projects should not be extended.

There have been three unsuccessful attempts in the past to legislate concerning the subject matter of H. R. 3786: (1) H. R. 15260 (71st Cong., 3d sess.) sought to amend the 1929 statute by striking out the allocation of the revenues to the reclamation fund; (2) H. R. 17 (73d Cong., 1st sess.) repeated the provisions of the latter bill; (3) S. 2286, H. R. 6875 (74th Cong., 1st sess.) were substantially the same as the bill now being considered. Upon each of these occasions, in letters to your committee, dated December 30, 1930, March 31, 1933, and April 8, 1935, the Department recommended that the respective bills be not enacted.

Moreover, I doubt whether this bill really resolves the controversy over the power profits. It authorizes and directs the Secretary to apply the net revenues properly and equitably apportioned or to be apportioned to the Garland and Frannie divisions of said project, in accord with the terms and provisions of existing contracts with the water users on said project. Thus, the bill in effect merely proposes to grant something, providing the contracts grant it. But according to the Department the contracts do not do so, while the districts contend that they do. The Secretary is thus left free to again decide the issue, even though he is required to do so equitably as well as properly.

This report has been submitted to the Acting Director of the Bureau of the Budget, who advises that the proposed legislation would not be in accord with the program of the President.

Sincerely yours,

CHARLES WEST, Acting Secretary of the Interior.

CHANGES IN EXISTING LAW

In compliance with paragraph 2a of rule XIII of the Rules of the House of Representatives, changes in existing law made by this bill are shown as follows (existing law proposed to be omitted is enclosed in black brackets, new matter is printed in italics, existing law in which no change is proposed is shown in roman):

That the net revenues from [the operation of the Shoshone power plant of the Shoshone irrigation project properly and equitably allocable to the unconstructed portions of the Shoshone project from the operation of the Shoshone power plant shall be applied, first, to the repayment of the proportionate construction cost of the power system; second, to the repayment of the proportionate construction cost of the Shoshone Dam; and third, thereafter such net revenues shall be [covered] paid into the reclamation fund, and that the Secretary of the Interior is hereby authorized and directed to apply the net revenues properly and equitably apportioned or to be apportioned to the Garland and Frannie divisions of said project in accord with the terms and provisions of existing contracts with the water users on said project. SEC. 2. All acts or parts of acts in conflict herewith are hereby repealed.

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