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Opinion of the Court.

Footnote 15—Continued.

337 U.S.

amended, was reported by the Committee on Interstate and Foreign Commerce of the Seventy-fourth Congress, second session, with a recommendation that it pass. If enacted, the present bill would for the first time provide for the regulation of natural-gas companies transporting and selling natural gas in interstate commerce. It confers jurisdiction upon the Federal Power Commission over the transportation of natural gas in interstate commerce, and the sale in interstate commerce of natural gas for resale for ultimate public consumption for domestic, commercial, industrial, or any other use. The States have, of course, for many years regulated sales of natural gas to consumers in intrastate transactions. The States have also been able to regulate sales to consumers even though such sales are in interstate commerce, such sales being considered local in character and in the absence of congressional prohibition subject to State regulation. (See Pennsylvania Gas Co. v. Public Service Commission (1920), 252 U. S. 23.) There is no intention in enacting the present legislation to disturb the States in their exercise of such jurisdiction. However, in the case of sales for resale, or so-called wholesale sales, in interstate commerce (for example, sales by producing companies to distributing companies) the legal situation is different. Such transactions have been considered to be not local in character and, even in the absence of Congressional action, not subject to State regulation. (See Missouri v. Kansas Gas Co. (1924), 265 U. S. 298, and Public Utilities Commission v. Attleboro Steam & Electric Co. (1927), 273 U. S. 83.) The basic purpose of the present legislation is to occupy this field in which the Supreme Court has held that the States may not act.

The bill takes no authority from State commissions, and is so drawn as to complement and in no manner usurp State regulatory authority, and contains provisions for cooperative action with State regulatory bodies. . . .

"Your committee believes that this legislation is highly desirable to fill the gap in regulation that now exists by reason of the lack of authority of the State commissions." H. R. Rep. No. 709, 75th Cong., 1st Sess., pp. 1–3.

During the debate on the bill in the House, its sponsor, Chairman Lea of the Committee on Interstate and Foreign Commerce, made the following explanatory statements:

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Opinion of the Court.

Footnote 15—Continued.

"The primary purpose of the pending bill is to provide Federal regulation, in those cases where the State commissions lack authority, under the interstate-commerce law. This bill takes nothing from the State commissions; they retain all the State power they have at the present time. This bill would apply to the transportation of natural gas in interstate commerce and to the sale of natural gas in interstate commerce for resale or public consumption. ·

"The bill does not apply to the production and gathering of gas." 81 Cong. Rec. 6721.

Likewise on the floor of the Senate, Chairman Wheeler of the Committee on Interstate Commerce gave a similar interpretation to the Act:

"Mr. AUSTIN. Mr. President, may I ask the Senator from Montana [Mr. Wheeler] a question concerning this bill? Does the bill undertake to regulate the production of natural gas, or does it undertake to regulate the producers of natural gas?

"Mr. WHEELER. It does not attempt to regulate the producers of natural gas or the distributors of natural gas; only those who sell it wholesale in interstate commerce. . . .

"Mr. AUSTIN. Mr. President, will the Senator yield for one other inquiry?

"Mr. WHEELER. Yes.

"Mr. AUSTIN. Is the bill limited in its scope to the regulation of transportation?

"Mr. WHEELER. Yes; it is limited to transportation in interstate commerce, and it affects only those who sell gas wholesale.

"Mr. KING. Mr. President, I should like to obtain information from the Senator as to the implications that arise from the bill, and what States it would affect. As an illustration, if gas is produced in Wyoming and is transported for consumption into the Senator's State or my State, would the Federal Power Commission have to do with such an activity?

"Mr. WHEELER. No; and let me say to the Senator that, as a matter of fact, the bill does not interfere with the State regulation, in any way, shape, or form." 81 Cong. Rec. 9312..

"Mr. CONNALLY. Is it not also true, even though the utility commissioners advocate it, that whenever a Federal agency takes over an activity such as this the State authorities begin to shift or lose

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16

of this Act is replete with evidence of the care taken by Congress to keep the power over the production and gathering of gas within the states. This probably occurred because the state legislatures, in the interests of conservation, had delegated broad and elaborate power to their

their responsibility? If we turn this over to the Interstate Commerce Commission, essentially what they do will be reflected all over the country, because the interstate rates will be superimposed on the State commissions and they must necessarily be governed by them. Did not that happen to the railroads?

"Mr. WHEELER. There is no doubt about that, but this is an entirely different situation.

"Mr. CONNALLY. Yes; one involves the railroads and the other involves gas.

"Mr. WHEELER. No. There is no attempt and can be no attempt under the provisions of the bill to regulate anything in the field except where it is not regulated at the present time. It applies only as to interstate commerce and only to the wholesale price of gas." 81 Cong. Rec. 9313.

"Mr. AUSTIN. Then, it would leave to the future the right to meet any effort on the part of the central government to acquire the natural resources of the State of Montana, or the State of Vermont, or any other State?

"Mr. WHEELER. Oh, yes. It does not touch it in any way, shape, or form, except to require the furnishing of information.

"Mr. AUSTIN. I have great fear of these occult methods of acquiring the natural resources of our several States." 81 Cong. Rec. 9314. 16 While Congress was considering the passage of the Natural Gas Act, a bill (H. R. 5711 and S. 1919, 75th Cong., 1st Sess.) was introduced in both houses of Congress on March 17, 1937, which provided that "this Act shall apply to the procurement of natural gas for the purpose of its transmission through pipe lines and its sale, exchange, transmission, or distribution in interstate commerce "The jurisdiction of the Federal Power Commission was defined as follows:

"The [Federal Power] Commission shall have jurisdiction over all facilities for the procurement of natural gas for its transmission through pipe lines and its sale, or for exchange, or distribution in interstate commerce, and over the transmission of natural gas in pipe lines in interstate commerce and over the sale, or exchange of natural gas in interstate commerce, and over all facilities connected

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regulatory bodies over all aspects of producing gas." The Natural Gas Act was designed to supplement state power and to produce a harmonious and comprehensive regulation of the industry.18 Neither state nor federal regulatory body was to encroach upon the jurisdiction of the other.19 Congress enacted this Act after full consideration of the problems of production and distribution. It considered the state interests as well as the national interest. It had both producers and consumers in mind. Legislative adjustments were made to reconcile the conflicting views.

The District Court found as a fact, and the finding is undisputed by the Commission, that, "It has been the practice in the natural gas industry for companies to trade freely in gas leases, and the Commission has never heretofore asserted the right to regulate transfers of such leases." Thus for over ten years the Commission has never claimed the right to regulate dealings in gas acreage. Failure to use such an important power for so long a time indicates to us that the Commission did not believe the power existed.20 In the light of that history we should

therewith as parts of a system of natural-gas transmission operated in more than one State."

The provisions of this bill, however, failed of adoption; instead Congress enacted § 1 (b) with its specific exemptions from the coverage of the Act.

17 See, for example, Kansas Gen. Stat., §§ 55-701 to 55-713 (1947 Supp.); Mich. Stat. Ann., c. 97, §§ 13.138 (1)-13.140 (10) (Supp. 1947); Okla. Stat. Ann., tit. 52, c. 3, §§ 81-247; Texas Rev. Civ. Stat., tit. 102, Art. 6008 et seq. (Vernon, 1925, with Supp. 1948); La. Gen. Stat. §§ 4766-4826.2.

18 Public Utilities Comm'n v. United Fuel Gas Co., 317 U. S. 456, 467.

19 Interstate Natural Gas Co. v. Federal Power Comm'n, 331 U. S. 682, 690.

20 Federal Trade Comm'n v. Bunte Brothers, 312 U. S. 349, 352; Norwegian Nitrogen Prod. Co. v. United States, 288 U. S. 294, 315.

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not by an extravagant, even if abstractly possible, mode of interpretation push powers granted over transportation and rates so as to include production. If possible, all sections of the Act must be reconciled so as to produce a symmetrical whole." We cannot attribute to Congress the intent to grant such far-reaching powers as implicit in the Act when that body has endeavored to be precise and explicit in defining the limits to the exercise of federal power.22

The Commission sought by injunction to enforce its order halting the transaction between Panhandle and

21 Colorado Interstate Gas Co. v. Federal Power Comm'n, 324 U. S. 581, 602.

22 Section 5 (b) reads:

"(b) The Commission upon its own motion, or upon the request of any State commission, whenever it can do so without prejudice to the efficient and proper conduct of its affairs, may investigate and determine the cost of the production or transportation of natural gas by a natural-gas company in cases where the Commission has no authority to establish a rate governing the transportation or sale of such natural gas."

When the provisions of the bill which became the Natural Gas Act were being read for amendment on the floor of the House, § 5 (b) was amended by inserting the italicized words. Mr. Boren, a member of the House Committee on Interstate and Foreign Commerce, who submitted this amendment, explained the purpose of it as follows:

"Mr. BOREN. Mr. Chairman, my amendment has been agreed to by the committee. I offer the amendment in order to keep the jurisdiction of the Federal Government as clearly defined as possible from the jurisdiction of the State government in cases arising under the provisions of this bill.

"During the hearings I offered this amendment and made the following statement:

"Mr. Chairman, I would like to make this observation for the record and as a challenge to the proponents of this bill: That subsection B of section 5 provides for a growth and for the extension of the influence of a Federal bureau, or commission, in a realm

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