B-134138, DEC 8, 1958

B-134138, DEC 8, 1958

PRECIS-UNAVAILABLE

SECRETARY OF AGRICULTURE:

BY LETTER OF OCTOBER 29, 1958, THE ACTING SECRETARY OF AGRICULTURE TRANSMITTED FOR OUR INFORMATION YOUR DEPARTMENT'S ANALYSIS OF THE POINTS MADE IN OUR LETTER OF OCTOBER 15, 1958, RELATING TO LOANS MADE BY THE RURAL ELECTRIFICATION ADMINISTRATION, AND STATED THAT YOUR DEPARTMENT DISAGREES WITH OUR CONCLUSIONS IN THIS MATTER.

WE APPRECIATE RECEIVING YOUR ANALYSIS OF THE POINTS INVOLVED, BUT A THOROUGH REVIEW OF THIS ENTIRE MATTER INCLUDING THE FOREGOING ANALYSIS DOES NOT CONVINCE US THAT THE CONGRESS, AS A WHOLE, INTENDED BY ENACTMENT OF THE RURAL ELECTRIFICATION ACT OF 1936 TO AUTHORIZE REA TO MAKE LOANS FOR THE CONSTRUCTION OF POWER LINES TO SERVE AN UNSERVED PERSON LOCATED, IN EFFECT, ON, I.E., ALONG SIDE OF EXISTING POWER LINES THE OWNER OF WHICH WAS READY, WILLING AND ABLE TO FURNISH ADEQUATE CENTRAL STATION SERVICE TO SUCH UNSERVED PERSON AT A REASONABLE PRICE.

IN OUR LETTER OF OCTOBER 15, 1958, WE SAID THAT THE LONG CONTINUED PRACTICE OVER THE PAST 22 YEARS AS REPORTED IN ACTING SECRETARY MORSE'S LETTER OF AUGUST 7, 1958, IF CARRIED ON WITH CONGRESSIONAL KNOWLEDGE, WOULD TEND TO SUPPORT THE DEPARTMENT'S POSITION, OR AT LEAST INDICATE CONGRESSIONAL ACQUIESCENCE IN THE PRACTICE FOLLOWED BY THE DEPARTMENT; AND THAT IN VIEW OF THIS, WE WOULD TAKE NO ACTION TO RECOVER THE SPECIFIC LOAN UNDER CONSIDERATION BUT WOULD REPORT THE MATTER TO THE CONGRESS FOR WHATEVER ACTION THE CONGRESS DEEMS APPROPRIATE. UNDER THESE CIRCUMSTANCES WE WILL NOT ATTEMPT TO RECOVER ANY FUTURE SIMILAR LOANS NOR TAKE OTHER ACTION CONCERNING THE PRESENT ADMINISTRATIVE PRACTICE IN THE ABSENCE OF AN EXPRESSION OF CONGRESSIONAL INTENT TO THE CONTRARY.

WE ASSUME THAT THE ANALYSIS OF THE POINTS INVOLVED WAS TRANSMITTED TO US FOR OUR INFORMATION AS INDICATED IN THE ACTING SECRETARY'S LETTER. HOWEVER, WE WILL TAKE THE ANALYSIS INTO CONSIDERATION IN PREPARING OUR NEXT AUDIT REPORT ON REA ACTIVITIES.