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in the discretion of the Commission may be necessary for making examinations and surveys, for preparing maps, plans, specifications, and estimates, and for making financial arrangements. Each such permit shall set forth the conditions under which priority shall be maintained and a license issued. Such permits shall not be transferable, and may be canceled by order of the Commission upon failure of permittees to comply with the conditions thereof or for other good cause shown after notice and opportunity for hearing."

SEC. 204. Section 6 of the Federal Water Power Act is amended to read as follows:

“Sec. 6. That Licenses under this Act title shall be issued for a period not exceeding fifty years.

Each such license shall be conditioned upon acceptance by the licensee of all the terms and conditions of this Act and such further conditions, if any, as the Commission shall prescribe in conformity with this Act, which said terms and conditions and the acceptance thereof shall be expressed in said license. Licenses may be revoked only for the reasons and in the manner prescribed under the provisions of this Act, and may be altered or surrendered only upon mutual agreement between the licensee and the Commission after ninety thirty days' public notice. Copies of all licenses issued under the provisions of this title and calling for the payment of annual charges, shall be deposited with the General Accounting Office, in compliance with section 3143, Revised Statutes, as amended (U. S. C., tille 41, sec. 20).'

Sec. 205. Section 7 of the Federal Water Power Act is amended to read as follows:

“Sec. 7. (a) That In issuing preliminary permits hereunder or licenses where no preliminary permit has been issued and in issuing licenses to new licensees under section 15 hereof the Commission shall give preference to applications therefor by States and municipalities;: Provided, The plans for the same are deemed by the Commission equally well adapted, or shall within a reasonable time to be fixed by the Commission be made equally well adapted, to conserve and utilize in the public interest the navigation and water resources of the region; and as between other applicants, the Commission may give preference to the applicant the plans of which it finds and determines are best adapted to develop, conserve, and utilize in the public interest the navigation and water resources of the region, if it be satisfied as to the ability of the applicant to carry out such plans.

(b) That Whenever, in the judgment of the Commission, the development of any project water resources for public purposes should be undertaken by the United States, itself, the Commission shall not approve any application for such any project affecting such development, by any citizen, association, corporation, State, or municipality, but shall cause to be made such examinations, surveys, reports, plans, and estimates of the cost of the projeet proposed development as it may deem necessary, and shall submit its findings to Congress with such recommendations as it may deem appropriate concerning the construction of steh projeet or completion of any projeet upon any Government dam by the United States: such development.

Sec. 206, Section 10 of the Federal Water Power Act is amended to read as follows:

“Sec. 10. That All licenses issued under this Aet title shall be on the following conditions:

“(a) (1) That the project adopted, including the maps, plans, and specifications, shall be such as in the judgment of the Commission will be best adapted to a comprehensive scheme of improvement and utilization for the purposes of Harigation, of water power development, and of other benefieial publie uses; for im. proving or developing a wateray or waterways for the use or benefit of interstate or foreign commerce, for the improvement and utilization of water-power development, and for other beneficial public uses including recreational purposes, and if necessary in order to secure such scheme the Commission shall have authority to require the modification of any project and of the plans and specifications of the project works before approval.

“(b) (2) That except when emergency shall require for the protection of navigation, life, health, or property, no substantial alteration or addition not in conformity with the approved plans shall be made to any dam or other project works constructed hereunder of a an installed capacity in excess of one hundred horsepower without the prior approval of the Commission; and any emergency alteration or addition so made shall thereafter be subject to such modification and change as the Commission may direct.

"(e) (3) That the licensee shall maintain the project works in a condition of repair adequate for the purposes of navigation and for the efficient operation of said works in the development and transmission of power, shall make all necessary renewals and replacements, shall establish and maintain adequate depreciation reserves for such purposes, shall so maintain and operate said works as not to impair navigation, and shall conform to such rules and regulations as the Commission may from time to time prescribe for the protection of life, health, and property. Each licensee hereunder shall be liable for all damages occasioned to the property of others by the construction, maintenance, or operation of the project works or of the works appurtenant or accessory thereto, constructed under the license, and in no event shall the United States be liable therefor.

"(d) (4) That after the first twenty years of operation out of surplus earned thereafter, if any, accumulated in excess of a specified reasonable rate of return upon the settiał, legitimate net investment of a licensee in any project or projects under license the licensee shall establish and maintain amortization reserves, which reserves shall, in the discretion of the Commission, be held until the termination of the license or be applied from time to time in reduction of the net investment. Such specified rate of return and the proportion of such surplus earnings to be paid into and held in such reserves shall be set forth in the license.

"(e) (6) That the licensee shall pay to the United States reasonable annual charges in an amount to be fixed by the Commission for the purpose of reimbursing the United States for the costs of the administration of this Aet title; for recompensing it for the use, occupancy, and enjoyment of its lands or other property, and for the expropriation to the Government of excessive profits until the respective States shall make provision for preventing excessive profits or for the expropriation thereof to themselves, or until the period of amortization as herein provided is raached, and in fixing such charges the Commission shall seek to avoid increasing the price to the consumers of power by such charges, and any such charges for the expropriation of excessive prefits may be adjusted from time to time by the Commission as conditions may require: Provided, That when licenses are issued involving the use of Government dams or other structures owned by the United States or tribal lands embraced within Indian reservations the Commission shall fix a reasonable annual charge for the use thereof, and such charges may be readjusted by the Commission at the end of twenty years after the beginning of operations project is available for service and at periods of not less than ten years thereafter in a manner to be fleseribed in each lieense upon notice and opportunity for hearing: Provided further, That licenses for the development, transmission, or distribution of power by States or municipalities shall be issued and enjoyed without charge to the extent such power is sold to the public without profit or is used by such State or municipality for State or municipal purposes, except that as to projects constructed or to be constructed by States or municipalities primarily designed to provide or improve navigation licenses therefor shall be issued without charge; and that licenses for the development, transmission, or distribution of power for domestic, mining, or other beneficial use in projects of not more than one hundred horsepower installed capacity may be issued without charge, except on tribal lands within Indian reservations; but in no case shall a license be issued free of charge for the development and utilization of power created by any Government dam and that the amount charged therefor in any license shall be such as determined by the Commission. In the event an over payment of any charge due under this section shall be made by a licensee, the Commission is authorized to allow a credit for such over payment when charges are due for any subsequent period.

"(f) (6) That whenever any licensee hereunder is directly benefited by the construction work or another licensee, a permittee, or of the United States of a storage reservoir or other headwater improvement, the Commission shall require as a condition of the license that the licensee so benefited shall reimburse the owner of such reservoir or other improvements for such part of the annual charges for interest, maintenance, and depreciation thereon as the Commission may deem equitable. The proportion of such charges to be paid by any licensee shall be determined by the Commission. The licensees or permittees affected shall pay to the United States the cost of making such determination as fixed by the Commission.

"Whenever such reservoir or other improvement is constructed by the United States the Commission shall assess similar charges against any licensee directly benefited thereby, and any amount so assessed shall be paid into the Treasury of the United States, to be reserved and appropriated as a part of the special fund for headwater improvements as provided in section 17 hereof.

Whenever any power project not under license is benefited by the construction work of a licensee or permittee, the United States or any agency thereof, the Commission, after notice to the owner or owners of such unlicensed project, shall determine and fix a reasonable and equitable annual charge to be paid to the licensee or permittee on account of such benefits, or to the United States if it be the owner of such headwater improvement.

(8) (7) Such other conditions not inconsistent with the provisions of this Act as the Commission may require.

“(h) (8) That combinations, agreements, arrangements, or understandings, express or implied, to limit the output of electrical energy, to restrain trade, or to fix, maintain, or increase prices for electrical energy or service are hereby prohibited.

“(i) (9) In issuing licenses for a minor part only of a complete project, or for a complete project of not more than one hundred horsepower installed capacity, the Commission may in its discretion waive such conditions, provisions, and requirements of this Act title, except the license period of fifty years, as it may deem to be to the public interest to waive under the circumstances: "Provided, That the provisions hereof shall not apply to annual charges for use of lands within Indian reservations."

Sec. 207. Section 14 of the Federal Water Power Act is amended to read as follows:

“Sec. 14. That Upon not less than two years' notice in writing from the Commission the United States shall have the right upon or after the expiration of any license to take over and thereafter to maintain and operate any project or projects as defined in section 3 hereof, and covered in whole or in part by the license, or the right to take over upon mutual agreement with the licensee all property owned and held by the licensee then valuable and serviceable in the development, transmission, or distribution of power and which is then dependent for its usefulness upon the continuance of the license, together with any lock or locks or other aids to navigation constructed at the expense of the licensee, upon the condition that before taking possession it shall pay the net investment of the licensee in the project or projects taken, not to exceed the fair value of the property taken, plus such reasonable damages, if any, to property of the licensee, valuable, serviceable, and dependent as above set forth but not taken, as may be caused by the severance therefrom of property taken, and shall assume all contracts entered into by the licensee with the approval of the Commission. The net investment of the licensee in the project or projects so taken and the amount of such severance damages, if any, shall be determined by agreement between the Commission and the licensee, and in case they cannot agree; by proceedings in equity instituted! by the United States in the district court of the United States in the district within which any sueh property may be loeated: by the Commission after notice and opportunity for hearing. Provided; That, Such net investment shall not include or be affected by the value of any lands, rights-of-way, or other property of the United States licensed by the Commission under this Act, by the license or by good will, going value or prospective revenues; Provided further, That not shall the values allowed for water rights, rights-of-way, lands, or interest in lands shah not be in excess of the actual reasonable cost thereof at the time of acquisition by the licensee: Provided, That the right of the United States or any State or municipality to take over, maintain, and operate any project licensed under this Act at any time by condemnation proceedings upon payment of just compensation is hereby expressly reserved."

Sec. 208. Section 17 of the Federal Water Power Act is amended to read as follows:

“Sec. 17. (a) That All proceeds from any Indian reservation shall be placed to the credit of the Indians of such reservation. All other charges, except charges fized by the Commission for the purpose of reimbursing the United States for the costs of administration of this title, arising from licenses hereunder shall be paid into the Treasury of the United States, subject to the following distribution: Twelve and one-half per centum thereof is hereby appropriated to be paid into the Treasury of the United States and credited to Miscellaneous receipts'; 50 per centum of the charges arising from licenses hereunder for the occupancy and use of public lands, national monuments, national forests, and national parks shall be paid into, reserved, and appropriated as a part of the reclamation fund created by the Act of Congress known as the 'Reclamation Act' approved June 17, 1902; and 374 per centum of the charges arising from licenses hereunder for the occupancy

and use of national forests, national parks, public lands, and national monuments, from development within the boundaries of any State shall be paid by the Secretary of the Treasury to such State; and 50 per centum of the charges arising from all other licenses hereunder is hereby reserved and appropriated as a special fund in the Treasury to be expended under the direction of the Secretary of War in the maintenance and operation of dams and other navigation structures owned by the United States or in the construction, maintenance, or operation of headwater or other improvements of navigable waters of the United States. The proceeds of charges made by the Commission for the purpose of reimbursing the United States for the costs of the administration of this title shall be paid into the Treasury of the United States and credited to miscellaneous receipts.

(6) In the case of delinquency on the part of any licensee in the payment of annual charges, a penalty of 10 per centum of the total amount delinquent shall be added to the total charges, which shall apply for the first month or part of month so delinquent with an additional penalty of 5 per centum for each subsequent month until the total of the charges and penalties are paid or until the license is canceled and charges and penalties satisfied, in accordance with law.

Sec. 209. Section 18 of the Federal Water Power Act is amended to read as follows:

Sec. 18. The Commission shall require the construction, maintenance, and operation by a licensee at its own expense of such lights and signals as may be directed by the Secretary of War, and such fishways as may be prescribed by the Secretary of Commerce. That, The operation of any navigation facilities which may be constructed as a part of or in connection with any dam or diversion structure built under the provisions of this Act, whether at the expense of a licensee hereunder or of the United States, shall at all times be controlled by such reasonable rules and regulations in the interest of navigation, including the control of the level of the pool caused by such dam or diversion structure as may be made from time to time by the Secretary of War; Sueh rules and regulations may include the mainteHanee and operation by such lieensee at its owÀ expense of sueh light and signals ts may be directed by the Seeretary of War, and sueh fishwayo as may be preseribed by the Secretary of Commerce and for willful failure to comply with any such rule or regulation such licensee shall be deemed guilty of a misdemeanor, and upon conviction thereof shall be punished as provided in section 25 hereof."

Sec. 210. Section 23 of the Federal Water Power Act is amended to read as follows:

"Sec. 23. (a) That The provisions of this act title shall not be construed as affecting any permit or valid existing right-of-way heretofore granted or as confirming or otherwise affecting any claim, or as affecting any authority heretofore given pursuant to law, but any person, association, corporation, State, or municipality holding or possessing such permit, right-of-way, or authority may apply for å license hereunder, and upon such application the Commission may issue to any such applicant a license in accordance with the provisions of this set title and in such case the provisions of this Act shall apply to such applicant as a licensee hereunder: Provided: That when application is made for a license under this section for a project or projects already constructed, the fair value of said project or projects determined as provided in this section shall for the purposes of this aet tille and of said license be deemed to be the amount to be allowed as the net investment of the applicant in such project or projects as of the date of such license, or as of the date of such determination, if license has not been issued. Such fair value may, in the diseretion of the eemmiLcion; be determined by mutual Agreement between the commission and the spplieaant or, in case they cannot Agree, jurisdietion is hereby conferred upon the distriet court of the Brited States in the distriet within whieh steh projeet or projeets may be located; upon the application of either party; to hear and determine the amount of sueh fair value shall be determined by the Commission after notice and opportunity for hearing.

"(6) It shall be unlawful for any person, State, or municipality to construct, operate, or maintain any dam, water conduit, reservoir, pouer house, or other works across, along, or in any of the navigable waters of the United States, or upon any part of the public lands or reservations of the United States (including the Territories), or for the purpose of utilizing the surplus water or water power from any Government dam, except under and in accordance with the terms of a permit or valid existing right-of-way granted prior to June 10, 1920, or a license granted pursuant to this Act. That Any person, association, corporation, State, or municipality intending to construct a dam or other project works across, along, over, or in any stream or part thereof, other than those defined herein as navigable waters, and over which Congress has jurisdiction under its authority to regulate commerce between foreign nations and among the several States may in their diseretion shall before such construction file declaration of such intention with the Commission, whereupon the Commission shall cause immediate investigation of such proposed construction to be made, and if upon investigation it shall find that the interests of interstate or foreign commerce would be affected by such proposed construction, such person, association, corporation, State, or municipality shall not proceed with sueh construietion construct, maintain, or operate such dam or other project works until it shall have applied for and shall have received a license under the provisions of this Act. If the Commission shall not 80 find, and if no public lands or reservations are affected, permission is hereby granted to construct such dam or other project works in such stream upon compliance with State laws.

Sec. 211. Section 24 of the Federal Water Power Act is amended to read as follows:

"Sec. 24. That Any lands of the United States included in any proposed project under the provisions of this set tiile shall, from the date of filing of application therefor, be reserved from entry, location, or other disposal under the laws of the United States until otherwise directed by the Commission or by Congress. Notice that such application has been made, together with the date of filing thereof and a description of the lands of the United States affected thereby, shall be filed in the local land office for the district in which such lands are located. Whenever the Commission shall determine that the value of any lands of the United States 80 applied for, or heretofore or hereafter reserved or classified as power sites, will not be injured or destroyed for the purposes of power development by location, entry, or selection under the public-land laws, the Secretary of the Interior, upon notice of such determination, shall declare such lands open to location, entry, or selection, for such purpose or purposes and under such restrictions as the Commission may determine, subject to and with a reservation of the right of the United States or its permittees or licensees to enter upon, occupy, and use any part or all of said lands necessary, in the judgment of the Commission, for the purposes of this aet title, which right shall be expressly reserved in every patent issued for such lands; and no claim or right to compensation shall accrue from the occupation or use of any of said lands for said purposes. The United States or any licensee for any such lands hereunder may enter thereupon for the purposes of this net, title, upon payment of any damages to crops, buildings, or other improvements caused thereby to the owner thereof, or upon giving a good and sufficient bond to the United States for the use and benefit of the owner to secure the payment of such damages as may be determined and fixed in an action brought upon the bond in a court of competent jurisdiction, said bond to be in the form prescribed by the Commission: Provided, That locations, entries, selections, or filings heretofore made for lands reserved as water-power sites, or in connection with waterpower development, or electrical transmission may proceed to approval or patent under and subject to the limitations and conditions in this section contained: Provided further, That all provisions of the laws and regulations affecting permits, rights-of-way, or other authority on lands of the United States or waters under its control for water-power purposes shall be administered by the Commission, ercept as to the authority reserved to the several departments under the provisions of this title.

SEC. 212. Sections 1 to 29, inclusive, of the Federal Water Power Act, as amended, shall constitute title I of that Act, and section 30 of such Act, as amended, is repealed.

Mr. DEVANE. I might say in connection with the proposed amendments to the Federal Water Power Act

Senator HASTINGS (interposing). Is that the second title II?
Mr. DEVANE. That is title II, beginning at page 78 of the bill.

Senator HASTINGS. Are they proposed as amendments to the Water Power Act?

Mr. DEVANE. Yes, sir. Beginning on page 78 of the bill are proposed amendments to the Federal Water Power Act. And these proposed amendments go from page 78 to page 104 of the bill. These amendments are, perhaps I might say, self-explanatory; they are the result of the experience of the Federal Power Commission in the administration of the act.

Senator WHITE. May I ask you a question right there?

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