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B-134973, APR. 24, 1958

B-134973 Apr 24, 1958
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4.46 ACRES OF LAND ON WHICH THE SUBSTATION IS LOCATED. THIS PROPERTY WAS TRANSFERRED TO THE UNITED STATES BY THE RECONSTRUCTION FINANCE CORPORATION BY DEED DATED JUNE 23. YOU SAY THAT THE TROUTDALE SUBSTATION AND ITS FACILITIES WERE ACQUIRED PURSUANT TO SECTION 2/C) OF THE ACT OF AUGUST 20. YOUR LETTER CONTINUES IN PERTINENT PART: "THE PARTICULAR FACILITIES INVOLVED IN THIS CASE WERE ORIGINALLY CONSTRUCTED BY THE DEFENSE PLANT CORPORATION IN ACCORD WITH BPA DESIGNS TO SERVE A WARTIME INDUSTRIAL PLANT. THESE FACILITIES WERE OPERATED BY BONNEVILLE POWER ADMINISTRATION PERSONNEL. WHEN THE DEFENSE PLANT CORPORATION INDUSTRIAL FACILITIES WERE PUT UP FOR DISPOSAL THE SUBSTATION FACILITIES WERE NOT INCLUDED AS PROPERTIES TO BE DISPOSED OF BY THE GOVERNMENT BUT WERE TRANSFERRED TO BONNEVILLE POWER ADMINISTRATION AND HAVE BECOME AN INTEGRAL PART OF THE ADMINISTRATION'S SYSTEM IN ACCORDANCE WITH THE ESTABLISHED POLICY OF OWNING AND OPERATING FACILITIES OF THIS TYPE SERVING THE CUSTOMERS.

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B-134973, APR. 24, 1958

TO MR. J. E. PERRY, AUTHORIZED CERTIFYING OFFICER, DEPARTMENT OF THE INTERIOR:

YOUR LETTER OF JANUARY 17, 1958, REQUESTS OUR DECISION AS TO WHETHER YOU MAY CERTIFY FOR PAYMENT UNDER PUBLIC LAW 388, 69 STAT. 721, 40 U.S.C. 521- 524, THE ENCLOSED VOUCHER FOR $1,328.10 IN FAVOR OF MULTNOMAH COUNTY, OREGON, COVERING A PAYMENT IN LIEU OF TAXES ALLEGEDLY DUE FOR THE 1956- 1957 TAX PERIOD ON CERTAIN PROPERTY DESCRIBED AS TAX LOT 21, SECTION 23, TOWNSHIP 1 NORTH, RANGE 3 EAST.

THE PROPERTY IN QUESTION, A PART OF THE FORMER DEFENSE PLANT CORPORATION PLANCOR 300, CONSISTS OF THE BONNEVILLE POWER ADMINISTRATION'S TROUTDALE SUBSTATION AND TRANSMISSION LINES CONNECTING THE SUBSTATION WITH THE ADMINISTRATION'S TRANSMISSION SYSTEM, TOGETHER WITH EASEMENTS, LAND RIGHTS, AND 4.46 ACRES OF LAND ON WHICH THE SUBSTATION IS LOCATED. THIS PROPERTY WAS TRANSFERRED TO THE UNITED STATES BY THE RECONSTRUCTION FINANCE CORPORATION BY DEED DATED JUNE 23, 1948, AND TITLE HAS BEEN HELD BY THE UNITED STATES CONTINUOUSLY SINCE THAT DATE.

YOU SAY THAT THE TROUTDALE SUBSTATION AND ITS FACILITIES WERE ACQUIRED PURSUANT TO SECTION 2/C) OF THE ACT OF AUGUST 20, 1937, 50 STAT. 732, AS AMENDED, 16 U.S.C. 832A/C). THIS SECTION AUTHORIZES THE ADMINISTRATOR OF THE BONNEVILLE POWER ADMINISTRATION TO ACQUIRE, BY LEASE, PURCHASE, CONDEMNATION OR DONATION, PROPERTY HE FINDS NECESSARY TO CARRY OUT THE PURPOSES OF THE ACT AND PROVIDES THAT TITLE TO ALL PROPERTY ACQUIRED SHALL BE IN THE NAME OF THE UNITED STATES. YOUR LETTER CONTINUES IN PERTINENT PART:

"THE PARTICULAR FACILITIES INVOLVED IN THIS CASE WERE ORIGINALLY CONSTRUCTED BY THE DEFENSE PLANT CORPORATION IN ACCORD WITH BPA DESIGNS TO SERVE A WARTIME INDUSTRIAL PLANT. HOWEVER, FROM DATE OF COMPLETION, APRIL 29, 1942 TO DATE OF ACTUAL TRANSFER TO BPA ON JUNE 23, 1948, THESE FACILITIES WERE OPERATED BY BONNEVILLE POWER ADMINISTRATION PERSONNEL. WHEN THE DEFENSE PLANT CORPORATION INDUSTRIAL FACILITIES WERE PUT UP FOR DISPOSAL THE SUBSTATION FACILITIES WERE NOT INCLUDED AS PROPERTIES TO BE DISPOSED OF BY THE GOVERNMENT BUT WERE TRANSFERRED TO BONNEVILLE POWER ADMINISTRATION AND HAVE BECOME AN INTEGRAL PART OF THE ADMINISTRATION'S SYSTEM IN ACCORDANCE WITH THE ESTABLISHED POLICY OF OWNING AND OPERATING FACILITIES OF THIS TYPE SERVING THE CUSTOMERS. IN THIS RESPECT THE FACILITIES ARE NO DIFFERENT FROM SIMILAR FACILITIES WHICH WERE CONSTRUCTED BY BPA FOR SERVICE TO OTHER INDUSTRIAL OR UTILITY CUSTOMERS.'

SECTION 703 OF PUBLIC LAW 388 DIRECTS THE VARIOUS DEPARTMENTS AND AGENCIES OF THE FEDERAL GOVERNMENT TO MAKE PAYMENTS IN LIEU OF TAXES BECOMING DUE BETWEEN JANUARY 1, 1955 TO JANUARY 1, 1959, ON CERTAIN PROPERTIES TRANSFERRED TO THEM FROM THE RECONSTRUCTION FINANCE CORPORATION ON OR AFTER JANUARY 1, 1946, IF TITLE HAS BEEN CONTINUOUSLY IN THE UNITED STATES SINCE THE DATE OF TRANSFER. HOWEVER, SECTION 704 (B) OF THAT PUBLIC LAW, UNDER THE SUBHEADING "LIMITATIONS" , PROVIDES, IN PERTINENT PART, AS FOLLOWS:

"/B) NO PAYMENT (IN LIEU OF TAXES) SHALL BE MADE UNDER SECTION 703 WITH RESPECT TO ANY REAL PROPERTY OF ANY OF THE FOLLOWING CATEGORIES:

"/3) REAL PROPERTY USED OR HELD PRIMARILY FOR THE RENDITION OF SERVICE TO OR ON BEHALF OF THE LOCAL PUBLIC, INCLUDING (BUT NOT LIMITED TO) THE FOLLOWING CATEGORIES OF REAL PROPERTY: COURTHOUSES; POST OFFICES AND OTHER PROPERTY USED FOR PURPOSES INCIDENTAL TO POSTAL OPERATIONS; AND FEDERALLY OWNED AIRPORTS MAINTAINED AND OPERATED BY THE CIVIL AERONAUTICS ADMINISTRATION.'

THE QUOTED PROVISION PRECLUDES OR PROHIBITS PAYMENTS IN LIEU OF TAXES ON REAL PROPERTY USED OR HELD PRIMARILY FOR THE RENDITION OF SERVICES TO OR ON BEHALF OF THE LOCAL PUBLIC. YOU SAY THAT THIS SUBSTATION IS A LOAD CENTER FOR THE DISTRIBUTION OF POWER TO THREE OF THE ADMINISTRATION'S MAJOR CUSTOMERS, ONE INDUSTRIAL CUSTOMER AND TWO UTILITIES WHICH IN TURN DISTRIBUTE POWER TO THE LOCAL PUBLIC. YOU ALSO SAY THAT THIS SUBSTATION HAS BECOME AN IMPORTANT SECTIONALIZATION SUBSTATION FOR THE ADMINISTRATION'S 230 KV GRID. WE HAVE BEEN INFORMALLY ADVISED BY A REPRESENTATIVE OF THE BONNEVILLE POWER ADMINISTRATION THAT THE INDUSTRIAL CUSTOMER IS THE FORMER WARTIME INDUSTRIAL PLANT LOCATED IN TROUTDALE ADJACENT TO THE SUBSTATION. WE WERE ALSO ADVISED THAT THE PEOPLE IN TROUTDALE (WHICH IS APPROXIMATELY 15 MILES FROM PORTLAND, OREGON) RECEIVE POWER FROM ONE OF THE TWO UTILITIES TO WHICH THE SUBSTATION DISTRIBUTES POWER. THE REPRESENTATIVE FURTHER ADVISED THAT BOTH OF THE UTILITIES FURNISH POWER TO, AMONG OTHERS, THE PEOPLE OF PORTLAND AND VICINITY.

FROM THE FOREGOING IT APPEARS THAT THE TROUTDALE SUBSTATION IS NOW USED OR HELD PRIMARILY FOR THE PURPOSE OF RENDERING SERVICE TO OR ON BEHALF OF THE LOCAL PUBLIC. THEREFORE NO PAYMENT IN LIEU OF TAXES MAY BE MADE ON THE PROPERTY UNDER PUBLIC LAW 388. CF B-132847, SEPTEMBER 4, 1957. ACCORDINGLY, THE VOUCHER WHICH IS RETURNED HEREWITH MAY NOT BE CERTIFIED FOR PAYMENT.

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