Senator DILL. I know they granted one last summer for a low-water dam on the Columbia, but it is the high-power dam that I am speaking about.

Mr. BONNER. I think we have only two pending. One is the Kettle Falls.

Senator DILL. Yes; and I passed a resolution through the Senate forbidding the commission to grant that, and I understand the Secretary of War has written a letter to my colleague that no permit will be recommended there until after this investigation is completed, for the reason that they do not know what they will do on the Grand Coulee Dam site.

Mr. BONNER. I do not recall exactly what was in that letter.

The CHAIRMAN. Have you that list of projects in which are disputed items?

Mr. BONNER. Yes. The second part of the order of the committee. I would like to submit this report which was prepared by Mr. King, together with a brief summary which I have prepared for your information, just showing briefly how the cases line up.

(The summary prepared by Mr. Bonner and the report prepared by Mr. King are here printed in the record in full, as follows:)

Summary of project accounts regarding which items are questioned by accounting division

516 Lexington Water Power Co.

346 Minnesota Power & Light Co.

16 Niagara Falls Power Co..

Northern States Power Co..

5,259, 736. 81

646, 040. 31

500,000.00

Formal claim to be filed Mar. 1, 1930.
Formal claim to be filed Mar. 2, 1930.
Formal claim to be filed Apr. 1, 1930.
Formal claim requested.

Proposed disallowance protested and hearing set
tentatively for Apr. 2, 1930.

Company advised of proposed disallowance and action suspended pending opinion of Attorney General.

82, 319.02 Proposed disallowance protested and now awaiting legal opinions.

456, 007. 12

769, 105. 05

1,500,000.00 11, 050, 000. 00

108

588

Proposed disallowance protested and hearing set tentatively for Mar. 27, 1930.

Claim filed Dec. 18, 1929, now being investigated by auditor.

Hearing before commission arranged for immediate future.

Adjustments deferred pending fair value deter.
mination.

Awaiting early hearing by commission.
Awaiting specific recommendation by accounting
division.

Cost statement recently audited and proposed
disallowance not yet served on licensee.
Cost claim recently filed; valid amount of ques-
tioned item will be investigated.

Awaiting formal cost statement from company.
No specific action as yet by accounting division.

Deferred pending decision as to whether license
will be issued to this company.

Suspensions awaiting explanation by company; project barely started."

Determination deferred pending completion of project.

Statement of proposed disallowance served on company Feb. 8, 1930.

This is merely an application for license which has been held for rejection if applicant fails to comply with requirements by May 1, 1930.

This project has not been started and may be postponed for some time.

Statement of items of prelicense cost or construction cost appearing in accounts of water power projects or in cost statements of licensees and applicants questioned in whole or in part by the accounting division, February 23, 1920

Project No. 82: State of Alabama. Cost of original project. Licensee of applicant, Alabama Power Co. (Mitchell Dam project):

Items questioned

1. Charges by Alabama Traction, Light & Power Co.,
Montreal, Canada, for alleged services, expenses,
etc..

2. J. T. Newcomb for alleged services and expenses of
which $12,775 can be identified as charged
to Mitchell Dam....

3. Henry J. Pierce, services at Washington, D. C.,
during pendency of Federal water power legis-
lation.

4. Traveling expenses of various officers and employees
of Alabama Power Co., mostly to Washington,
D. C., and eastern points, part questioned...

5. General administration, Alabama Power Co., and
Dixie Construction Co., part questioned...

6. Fee paid Dixie Construction Co.__

7. Water rights and other alleged values_

Total.

Administrative action taken: Licensee has never filed sworn statement of investment in project. Accounts for Mitchell Dam project have been formally investigated by Alabama Public Service Commission, but no decision rendered. Licensee has been directed to file sworn statement of cost of project with Federal Power Commission. Such report is due March 1, 1930.

Project No. 432: State of North Carolina. Prelicense cost. Licensee or applicant, Carolina Power & Light Co. (Waterville project):

Total claimed...

Items questioned

1. Payments to an engineer and a financier associated
with the original promoters. Seems to repre-
sent promotion fees or fees for services which
were never performed due to change in control.
2. Additional item of same character understood to
have been made to one of these parties after
license was issued__.

3. Cash payment made in 1924 by Pigeon River Power
Co. to 3 corporations controlled by original pro-
moters; under this contract present licensee is
liable for large additional payments and costs.
Further information desired.

4. Payment to Great Mountain Co. for lands and
water rights ($27,000).

5. Payment to individual, an officer of Great Moun-
tain Power Co., to see that the deal with that
corporation for purchase of lands and water
rights went through..

6. Payments to Electric Bond & Share Co.

For salaries and bonuses of its employees at
New York and Washington ($32,243.68).
Added as overheads and fees, ranging from
80 per cent to 130 per cent of monthly
salary charges_ .

$10, 968, 364. 19

122, 000. 00

21, 731. 00

7, 000. 00

17, 000. 00

561, 124. 69+ 186, 177. 89 3, 500, 000. 00

4, 415, 033. 58

917, 500. 26*

76, 750.00

40, 000. 00€

275, 000. 00

20, 000. 00

31,856. 90

Project No. 432-Continued.

Items questioned-Continued.

7. Payments to Phoenix Utility Co.

Field expenditures for preliminary surveys
of lands, locations for structures, etc.
($97,061.58).

Added, fee of 15 per cent. $14, 559. 24
Steam shovel purchased

($13,590).

Added, fee of 4 per cent...___

543. 60

$15, 102. 84

8. Attorneys' fees, telegraph and telephone tolls, and
other expenses incurred by Electric Bond &
Share Co. interests in connection with joint
resolution (S. J. Res. 35) introduced in Senate
by Senator Norris on Jan. 4, 1926

9. Interest prior to beginning of construction_

Total...

Administrative action taken: Accounts and records examined on basis of informal claim presented by licensee. Request has been made upon licensee for a sworn statement of prelicense cost or further information concerning several items appearing in the project accounts. Such statement

is due on Mar. 2, 1930.

Project No. 637: State of Washington. Prelicense cost. Licensee or applicant, Chelan Electric Co. (Chelan Lake project):

Total claimed..

Item questioned

1. Interest charges on cost of lands ($262,197.97) ac-
quired in 1907 by licensee company for which
stock was issued, and on advances of $858,-
991.57 by Great Northern Railway Co. through-
out period from 1907 to May 7, 1926...

Administrative action taken: Prelicense claim investigated by correspondence only. Agreement on item of interest could not be reached. Licensee has been requested to file sworn statement of total cost of project (now completed). Such statement is due Apr. 1, 1930.

Project No. 309: State of Pennsylvania. Cost of original project. Licensee or applicant, the Clarion River Power Co. (Piney project):

Total claimed.

Items questioned

1. Par value of stock issued to J. R. Paull in payment
for services and expenses of organized corpora-
tion, preliminary investigations, studies, etc.
(inflated at least to the extent that the par value
of stock exceeded the money value thereof) – .

Charges by R. D. Walbridge & Co., paid
in securities of Clarion River Power Co.;
charges represent par value of securities-
2. Engineering surveys and exploration work, includ-
ing drilling to disclose foundation conditions.
Charges applicable to constructed plant and
the two proposed developments on which active
work has not yet been started, part questioned..
3. Services securing contract with General Construc-
tion Corporation (which Walbridge & Co. con-
trolled) for construction of plant_ _ _

1, 988. 94 62, 828. 06

522, 919. 84

2,266, 547. 49

852, 167. 64

11, 032, 816. 57

451, 000. 00

1, 119, 897. 20

200, 000. 00

Project No. 309-Continued.

Items questioned-Continued.

4. Services securing contract with Penn Public Serv-
ice Corporation (which Walbridge & Co. con-
trolled)-

To purchase output of plant

To guarantee payment of principal and in-
terest on Clarion River Power Co. bonds_
5. Services and expenses in connection with issuance of
securities by Clarion River Power Co. and famil-
iarizing local investors with the merit of the
Clarion River developments, part questioned___

Total charges by H. D. Walbridge & Co for
alleged services and expenses_

Charges by General Construction Corpora-
tion "for expenditures and services, includ-
ing salaries of general officials, expenses
of New York office and contractor's over-
head and profit, in addition to promotion
and financing services"-

6. Fee for general engineering and supervision (paid
in securities) -

7. Unidentified item apparently included in balance
with total security issues-

Total charges by General Construction Cor-
poration for alleged services and expenses__

Total_

* *

*

*

*

Administrative action taken: Joint examination of project accounts and records made in 1925, by accountants for Public Service Commission of Pennsylvania and Federal Power Commission. * * * Access to certain records refused by H. D. Walbridge & Co. * * Report submitted by auditors. * Control of licensee corporation passed to Associated Gas & Electric Co. * New owners upon request submitted informal claim for project investment and promised access to all pertinent records. Accounts and records again examined by auditor for Federal Power Commission in 1927, but necessary records for verification of claim were not produced. * * Another report submitted by auditor. * * * Request now pending with licensee for formal sworn statement of actual legitimate investment in project, with details and reference to couvhers and other evidence of cost.

*

Project No. 485: States of Georgia and Alabama. Cost of original project. Licensee or applicant, Columbus Electric & Power Co. (Bartletts Ferry project):

Total claimed..

Items questioned

1. Interest on cost of lands and legal expenses to Dec.
31, 1924 ($188,717), prior to beginning construc-
tion_.

2. Interest on cost of investigations, surveys, etc., re-
lating to lands to Dec. 31, 1924 ($19,989), prior
to beginning construction_.

$300, 000. 00

200, 000. 00

394, 102. 80

2, 214, 000. 00

2, 550, 000. 00

44, 736. 81

2, 594, 736. 81

5, 259, 736. 81

7,688, 544. 12

177, 753. 00

11, 154. 00

Less interest at 6 per cent per annum from May 1,
1924 (beginning of construction), to Dec. 31,
1924 (on $208,706).

188, 907. 00

8, 348. 24

Total interest deductions on account of land__

180, 558. 76

Project No. 485—Continued.
Items questioned-Continued.

3. Taxes on land acquired prior to Dec. 31, 1924.-
4. Fee paid to Stone & Webster (Inc.), under contract
effective on Jan. 1, 1924__.

Total___

Administrative action taken: Accounts and records examined and accounting report served on licensee. Protest filed by licensee. Application for intervention filed by Stone & Webster. Hearing requested but no date for hearing fixed as yet.

Project No. 389: State of Kentucky. Preliminary cost of project. Licensee or applicant, Cumberland Hydro-Electric Power Co. (Cumberland Falls project):

Total claimed___.

Items questioned

1. Obligation of Cumberland River Power Co. under
contract of Oct. 8, 1928, to advance monies to
the Kentucky State Park Commission for pur-
chase of lands for park purposes and improve-
ments thereon in the vicinity of Cumberland
Falls. Objected to as not being a proper pre-
liminary cost for the reason that payment has
not been made, and the amount to be paid
under contract is indefinite. Considered to be
a proper cost to project if and to the extent paid
in the future_
2. Obligation of Cumberland River Power Co. under
article 6 (a) of agreement of Oct. 12, 1925, to
issue Middle West Utilities Co. and Cumber-
land Hydro-Electric Power Co. 30,000 shares of
nonpar common stock of Cumberland River
Power Co. This appears to be an arbitrary
promotion fee for alleged services of promoters
and of officers of Middle West Utilities Co----

Total_____

Administrative action taken: Accounting report and solicitor's opinions Nos. 1, 2, and 4, served on applicant Aug. 5 and 9, 1929. Further action deferred awaiting opinion by Attorney General on certain legal questions. Project No. 324: State of Missouri. Preliminary cost. censee or applicant, the Empire District Electric Co. (Table Rock project):

Total claimed..

Items questioned

Li

1. Overhead expense of the Empire District Electric
Co., Joplin, Mo., covering executive salaries,
salaries of stenographers and clerks, together
with cost of stationery, office supplies, and office
rent, light, and heat (arbitrary charge)-

2. Taxes paid on lands acquired for the Table Rock
development (questioned as to any expenditures
for lands in excess of actual reasonable cost at
time of acquisition by licensee) –

$6, 232. 00

459, 249. 55

646, 040. 31

921, 163. 57

250,000

250,000 500,000

290, 725. 47

28, 260. 00

1, 924. 87

3. Interest on actual expenditures prior to beginning
actual construction___

29, 825. 08

4. Preliminary engineering fees of Henry L. Doherty
& Co., New York office.--.

22, 309. 07

Total...

Administrative action taken: Applicant's claim investigated, conferences had with its representatives, accounting report served on applicant, to which protest has been filed and hearing requested. No date fixed for hearing as yet.

82, 319. 02