"Mr. KING. So that the $140,000,000, then, does not draw interest.

"Mr. PHIPPS. No; it does not all draw interest. The Senator is correct in that regard."

The bill passed the Senate the day following the discussions above quoted.

Just before its passage two amendments, offered by Senator Pittman, were adopted, which further clarified the differentiation of the canal from the dam and power plant project and the question whether interest was to be paid upon advances for construction of the canal. In the earlier discussions, concern had been expressed that the amendments proposed by the committee did not sufficiently segregate the canal and that there was danger that revenues from power might be reached to guarantee or underwrite any deficiency in the moneys received under the reclamation law. to pay for the canal. (Cong. Rec., vol. 69, pp. 9456-7, 9458, 10495; vol. 70, p. 288; see also minority views, Sen. Rept. 592, pt. 2, pp. 25–26.)

Senator Pittman's first amendment (id., vol. 70, p. 575) was to insert in section 1, following the committee amendment that expenditures for the canal should be reimbursable as provided in the reclamation law, the provision—

"and shall not be paid out of revenues derived from the sale or disposal of water power or electric energy at the dam authorized to be constructed at said Black Canyon or Boulder Canyon, or for water for potable purposes outside of the Imperial and Coachella Valleys."

Explaining that amendment he said:

"It has been understood that the cost of building the allAmerican canal will not be imposed as an obligation on the revenues derived from the power developed at the power house at the Boulder or Black Canyon Dam. I desire now to offer an amendment which will make that entirely clear. Although the bill already has a provision of that kind, it is not as yet sufficiently definite."

After the adoption of that amendment Senator Pittman immediately introduced an amendment to section 4 (b), changing it to the form in which it now appears in the law. In explaining that amendment he said (id., p. 576) :

"Mr. PITTMAN. Now, Mr. President, in order to make the bill harmonious, having segregated the all-American canal, the reclamation project, from the Boulder Dam, the Black Canyon Dam, and the power-house project, it is essential to make subdivision (b) in section 4, on page 5, to conform to that."

The amendment was adopted and the bill as so amended passed the Senate on December 14, 1928 (id., p. 603). The House concurred in the Senate amendments and passed the bill on December 18 (id., pp. 830-838) without specific discussion of the interest question.

I have above pointed out that the first paragraph of section 4 (b), as thus amended and passed, requires the Secretary of the Interior to make provision for revenues adequate in his judgment for the repayment of the advances for the dam and power plant "with interest thereon, made reimbursable under this Act," whereas the second paragraph, relating to repayment of the costs of construction of the main canal and appurtenant structures "in the manner provided in the reclamation law" makes no reference to interest. In view of the legislative history and especially of the debates in the Senate immediately preceding the adoption of the amendment to section 4 (b), I can not regard this differentiation as accidental. Its purpose was to harmonize that section with the rest of the bill treating the canal as a purely reclamation project, and the provisions that the sums expended for its construction should be "reimbursable as provided in the reclamation law" were, in my judgment, intended to relieve advances from the Treasury for that purpose from any interest charge.

In view of the legislative history above outlined, I think that the qualification, “except as herein otherwise provided," to the requirement in section 2 (b) of the payment of interest on all sums advanced can not be regarded as referring exclusively to the case of the deferment of interest payments under section 2 (d). In my judgment, Congress must be considered to have "otherwise provided" with respect to interest on the cost of construction of the All-American canal, and the expressions in section 2 (c), (d) and (e), section 5, and section 7, must be deemed to refer only to such interest as is made payable by the Act construed as a whole.

It is my opinion, therefore, that advances from the General Treasury to the Colorado River Dam Fund for construction costs of the All-American Canal are not interestbearing.

With respect to the branch of your question which relates to whether disbursements from the fund for that purpose should be interest-bearing, I understand from your letter of December 11 that the only purpose of that inquiry was to bring up the question of the time from which interest on advances from the General Treasury should be computed if interest is chargeable at all. In view of my opinion, above expressed, consideration of that question is not necessary.

II

Your second question is as follows:

"In fixing the sale rates for power to be generated at Boulder Dam, must provision be made for amortization within fifty years, of the $25,000,000 allocated by the Act for flood control?

The provisions of the Act requiring the Secretary of the Interior to make provision for revenues to insure repayment of sums expended for the various constructions contemplated by the Act are found in section 4 (b). Flood control is one of the purposes recited in section 1 and was to be secured chiefly by means of the dam and incidental works at Black Canyon or Boulder Canyon. The first paragraph of section 4 (b) relates to those works and, if it stood alone, would require the Secretary of the Interior to make provision for revenues by contract adequate in his judgment to insure repayment within fifty years of all amounts advanced from the Treasury under section 2 (b) for their construction.

Section 2 (b) itself, however, after authorizing the Secretary of the Treasury to advance to the fund such sums as the Secretary of the Interior deems necessary for carrying out the provisions of the Act, not exceeding $165,000,000, provides:

"Of this amount the sum of $25,000,000 shall be allocated to flood control and shall be repaid to the United States out of 622 per centum of revenues, if any, in excess of the

amount necessary to meet periodical payments during the period of amortization, as provided in section 4 of this Act. If said sum of $25,000,000 is not repaid in full during the period of amortization, then 622 per centum of all net revenues shall be applied to payment of the remainder.”

The above language provides a plan of repayment of the $25,000,000 allocated to flood control which is different from the method prescribed in section 4 (b). Congress manifestly contemplated that 622 per cent of the excess revenues might not be sufficient to repay this sum within the fifty-year period of amortization therein specified, and provided that in that event 622 per cent of all net revenues should be devoted to its payment. These special provisions are controlling.

The language of section 2 (b) shows clearly that Congress did not regard the $25,000,000 thereby allocated to flood control as falling within the amortization plan embodied in section 4 (b). If this $25,000,000 were regarded as falling within the requirements of the first paragraph of section 4 (b), the revenues which the Secretary of the Interior would thereby be required to provide therefor would be embraced in the words, "the amount necessary to meet periodical payments during the period of amortization, as provided in section 4 of this Act," in section 2 (b), and the provision in the latter section that during this fifty-year period repayment should be made only out of 622 per centum of the revenues, if any, "in excess" of that amount would be meaningless. Section 4 (b) cannot be construed as embracing the sum allocated for flood control without producing plain repugnance between that section and section 2 (b). I am therefore of the opinion that the $25,000,000 allocated to flood control must be regarded as falling outside of the words "all amounts advanced to the fund under subdivision (b) of section 2 for such works" in section 4 (b).

This construction of the Act is confirmed by reference to its legislative history.

The provision of section 2 (b), above quoted, was brought into the Act by an amendment offered only a few days befor the passage of the bill, by Senator Phipps, the chairman of the Committee on Irrigation and Reclamation, which

reported out the bill. Up to that time section 2 (b) had consisted only of the first and last sentences thereof. Prior to the presentation of Senator Phipps' amendment, Senator Ashurst had offered an amendment on the same subject which would have allocated $30,000,000 to flood control and made this sum not reimbursable at all. (Cong. Rec., vol. 69, p. 10466.) The first form of the amendment offered by Senator Phipps, on December 11, 1928, was to insert after the first sentence of section 2 (b) a single sentence as follows:

"Of this amount the sum of $25,000,000 shall be allocated to flood control, and shall not be repaid to the United States except out of revenues, if any, in excess of the amount necessary to meet periodical payments during the period of amortization as provided in section 4 of this act."

In supporting this proposed amendment Senator Phipps said (Cong. Rec., vol. 70, p. 399) :

"I have given my reason for believing that the amount of $25,000,000 included in that figure should be considered as a deferred payment, namely, that the Federal Government certainly has an obligation resting upon it to provide flood control for the lower reaches of the Colorado River territory; and the figure of $25,000,000 is a little less than the figure which has been estimated as the cost of a dam located at the most convenient and available point for the purposes of flood control alone.”

The next day, December 12, the amendment was altered to the form in which it now appears in the Act (id., p. 459). On the day following, December 13, the proposed amendment was debated and passed the Senate (id., pp. 520-522).

In the discussion of Senator Phipps' amendment in both forms, the understanding was expressed by several of the Senators that the proposed $25,000,000 allocation would be substantially a contribution by the United States for flood control (id., pp. 399-401). The amendment was supported not only on the ground that the Government owed an obligation to provide flood control, but on the ground that the amortization plan might not be feasible unless such a contribution were made. The report of the Board of Engineers (Document No. 446, H. R. 70th Cong., 2d sess.), re