I 

108TH CONGRESS 

1ST SESSION H. R. 3044

To amend the Tennessee Valley Authority Act of 1933 to modify provisions 

relating to the Board of Directors of the Tennessee Valley Authority, 

and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 9, 2003

Mr. COOPER introduced the following bill; which was referred to the 

Committee on Transportation and Infrastructure 

A BILL

To amend the Tennessee Valley Authority Act of 1933 to 

modify provisions relating to the Board of Directors of 

the Tennessee Valley Authority, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. CHANGE IN COMPOSITION, OPERATION, AND 

4 DUTIES OF THE BOARD OF DIRECTORS OF 

5 THE TENNESSEE VALLEY AUTHORITY. 

6 (a) IN GENERAL.—The Tennessee Valley Authority 

7 Act of 1933 (16 U.S.C. 831 et seq.) is amended by strik8 ing section 2 and inserting the following: 
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1 ‘‘SEC. 2. MEMBERSHIP, OPERATION, AND DUTIES OF THE 

2 BOARD OF DIRECTORS. 

3 ‘‘(a) MEMBERSHIP.—

4 ‘‘(1) APPOINTMENT.—The Board of Directors 

5 of the Corporation (referred to in this Act as the 

6 ‘Board’) shall be composed of 9 members appointed 

7 by the President by and with the advice and consent 

8 of the Senate, a majority of whom shall be legal resi9 dents of the service area. 

10 ‘‘(2) CHAIRMAN.—The members of the Board 

11 shall select 1 of the members to act as chairman of 

12 the Board. 

13 ‘‘(b) QUALIFICATIONS.—

14 ‘‘(1) IN GENERAL.—To be eligible to be ap15 pointed as a member of the Board, an individual—

16 ‘‘(A) shall be a citizen of the United 

17 States; 

18 ‘‘(B) shall have widely recognized experi19 ence or applicable expertise in the management 

20 of or decisionmaking for a large corporate 

21 structure, preferably in the electric power in22 dustry; 

23 ‘‘(C) shall not be an employee of the Cor24 poration; 

25 ‘‘(D) shall have no substantial direct finan26 cial interest in—
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1 ‘‘(i) any public-utility corporation en2 gaged in the business of distributing and 

3 selling power to the public; or 

4 ‘‘(ii) any business that may be ad5 versely affected by the success of the Cor6 poration as a producer of electric power; 

7 and 

8 ‘‘(E) shall profess a belief in the feasibility 

9 and wisdom of this Act. 

10 ‘‘(2) PARTY AFFILIATION.—Not more than 5 of 

11 the 9 members of the Board may be affiliated with 

12 a single political party. 

13 ‘‘(c) RECOMMENDATIONS.—In appointing members 

14 of the Board, the President shall—

15 ‘‘(1) consider recommendations from such pub16 lic officials as—

17 ‘‘(A) the Governors of States in the service 

18 area; 

19 ‘‘(B) individual citizens; 

20 ‘‘(C) business, industrial, labor, electric 

21 power distribution, environmental, civic, and 

22 service organizations; and 

23 ‘‘(D) the congressional delegations of the 

24 States in the service area; and 
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1 ‘‘(2) seek qualified members from among per2 sons who reflect the diversity and needs of the serv3 ice area of the Corporation. 

4 ‘‘(d) TERMS.—

5 ‘‘(1) IN GENERAL.—A member of the Board 

6 shall serve a term of 5 years, except that in first 

7 making appointments after the date of enactment of 

8 this paragraph, the President shall appoint—

9 ‘‘(A) 2 members to a term of 2 years; 

10 ‘‘(B) 1 member to a term of 3 years; and 

11 ‘‘(C) 2 members to a term of 4 years. 

12 ‘‘(2) VACANCIES.—A member appointed to fill a 

13 vacancy in the Board occurring before the expiration 

14 of the term for which the predecessor of the member 

15 was appointed shall be appointed for the remainder 

16 of that term. 

17 ‘‘(3) REAPPOINTMENT.—

18 ‘‘(A) IN GENERAL.—A member of the 

19 Board that was appointed for a full term may 

20 be reappointed for 1 additional term. 

21 ‘‘(B) APPOINTMENT TO FILL VACANCY.—

22 For the purpose of subparagraph (A), a mem23 ber appointed to serve the remainder of the 

24 term of a vacating member for a period of more 
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1 than 2 years shall be considered to have been 

2 appointed for a full term. 

3 ‘‘(e) QUORUM.—

4 ‘‘(1) IN GENERAL.—Six members of the Board 

5 shall constitute a quorum for the transaction of 

6 business. 

7 ‘‘(2) MINIMUM NUMBER OF MEMBERS.—A va8 cancy in the Board shall not impair the power of the 

9 Board to act, so long as there are 6 members in of10 fice. 

11 ‘‘(f) COMPENSATION.—

12 ‘‘(1) IN GENERAL.—A member of the Board 

13 shall be entitled to receive—

14 ‘‘(A)(i) a stipend of $30,000 per year; plus 

15 ‘‘(ii) compensation, not to exceed $10,000 

16 for any year, at a rate that does not exceed the 

17 daily equivalent of the annual rate of basic pay 

18 prescribed under level V of the Executive 

19 Schedule under section 5316 of title 5, United 

20 States Code, for each day the member is en21 gaged in the actual performance of duties as a 

22 member of the Board at meetings or hearings; 

23 and 

24 ‘‘(B) travel expenses, including per diem in 

25 lieu of subsistence, in the same manner as per-
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1 sons employed intermittently in Government 

2 service under section 5703 of title 5, United 

3 States Code. 

4 ‘‘(2) ADJUSTMENTS IN STIPENDS.—The 

5 amount of the stipend under paragraph (1)(A)(i) 

6 shall be adjusted by the same percentage, at the 

7 same time and manner, and subject to the same lim8 itations as are applicable to adjustments under sec9 tion 5318 of title 5, United States Code. 

10 ‘‘(g) DUTIES.—

11 ‘‘(1) IN GENERAL.—The Board shall—

12 ‘‘(A) establish the broad goals, objectives, 

13 and policies of the Corporation that are appro14 priate to carry out this Act; 

15 ‘‘(B) develop long-range plans to guide the 

16 Corporation in achieving the goals, objectives, 

17 and policies of the Corporation and provide as18 sistance to the chief executive officer to achieve 

19 those goals, objectives, and policies, including 

20 preparing the Corporation for fundamental 

21 changes in the electric utilities industry; 

22 ‘‘(C) ensure that those goals, objectives, 

23 and policies are achieved; 

24 ‘‘(D) approve an annual budget for the 

25 Corporation; 
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1 ‘‘(E) establish a compensation plan for em2 ployees of the Corporation in accordance with 

3 subsection (i); 

4 ‘‘(F) approve the salaries, benefits, and in5 centives for managers and technical personnel 

6 that report directly to the chief executive offi7 cer; 

8 ‘‘(G) ensure that all activities of the Cor9 poration are carried out in compliance with ap10 plicable law; 

11 ‘‘(H) create an audit committee, composed 

12 solely of Board members independent of the 

13 management of the Corporation, which shall—

14 ‘‘(i) recommend to the Board an ex15 ternal auditor; 

16 ‘‘(ii) receive and review reports from 

17 the external auditor; and 

18 ‘‘(iii) make such recommendations to 

19 the Board as the audit committee con20 siders necessary; 

21 ‘‘(I) create such other committees of Board 

22 members as the Board considers to be appro23 priate; 

24 ‘‘(J) conduct public hearings on issues that 

25 could have a substantial effect on—
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1 ‘‘(i) the electric ratepayers in the serv2 ice area; or 

3 ‘‘(ii) the economic, environmental, so4 cial, or physical well-being of the people of 

5 the service area; and 

6 ‘‘(K) establish the electricity rate schedule. 

7 ‘‘(2) MEETINGS.—The Board shall meet at 

8 least 4 times each year. 

9 ‘‘(h) CHIEF EXECUTIVE OFFICER.—

10 ‘‘(1) APPOINTMENT.—The Board shall appoint 

11 a person to serve as chief executive officer of the 

12 Corporation. 

13 ‘‘(2) QUALIFICATIONS.—To serve as chief exec14 utive officer of the Corporation, a person—

15 ‘‘(A) shall be a citizen of the United 

16 States; 

17 ‘‘(B) shall have management experience in 

18 large, complex organizations; 

19 ‘‘(C) shall not be a current member of the 

20 Board or have served as a member of the Board 

21 within 2 years before being appointed chief ex22 ecutive officer; and 

23 ‘‘(D) shall have no substantial direct finan24 cial interest in—
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1 ‘‘(i) any public-utility corporation en2 gaged in the business of distributing and 

3 selling power to the public; or 

4 ‘‘(ii) any business that may be ad5 versely affected by the success of the Cor6 poration as a producer of electric power; 

7 and 

8 ‘‘(3) TENURE.—The chief executive officer shall 

9 serve at the pleasure of the Board. 

10 ‘‘(i) COMPENSATION PLAN.—

11 ‘‘(1) IN GENERAL.—The Board shall approve a 

12 compensation plan that specifies salaries, benefits, 

13 and incentives for the chief executive officer and em14 ployees of the Corporation. 

15 ‘‘(2) ANNUAL SURVEY.—The compensation plan 

16 shall be based on an annual survey of the prevailing 

17 salaries, benefits, and incentives for similar work in 

18 private industry, including engineering and electric 

19 utility companies, publicly owned electric utilities, 

20 and Federal, State, and local governments. 

21 ‘‘(3) CONSIDERATIONS.—The compensation 

22 plan shall provide that education, experience, level of 

23 responsibility, geographic differences, and retention 

24 and recruitment needs will be taken into account in 

25 determining salaries of employees. 
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1 ‘‘(4) SUBMISSION TO CONGRESS.—No salary 

2 shall be established under a compensation plan until 

3 after the compensation plan and the survey on which 

4 it is based have been submitted to Congress and 

5 made available to the public for a period of 30 days. 

6 ‘‘(5) POSITIONS AT OR BELOW LEVEL IV.—The 

7 chief executive officer shall determine the salary and 

8 benefits of employees whose annual salary is not 

9 greater than the annual rate payable for positions at 

10 level IV of the Executive Schedule under section 

11 5315 of title 5, United States Code. 

12 ‘‘(6) POSITIONS ABOVE LEVEL IV.—On the rec13 ommendation of the chief executive officer, the 

14 Board shall approve the salaries of employees whose 

15 annual salaries would be in excess of the annual rate 

16 payable for positions at level IV of the Executive 

17 Schedule under section 5315 of title 5, United 

18 States Code. 

19 ‘‘(j) LIMITATION.—The Board may not take any ac20 tion regarding appointment or dismissal of the Inspector 

21 General of the Corporation, or both, or any action that 

22 has the effect of interfering with a duty of the Inspector 

23 General.’’. 

24 (b) CURRENT BOARD MEMBERS.—A member of the 

25 Board of Directors of the Tennessee Valley Authority who 
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1 was appointed before the effective date of the amendment 

2 made by subsection (a)—

3 (1) shall continue to serve as a member until 

4 the date of expiration of the member’s current term; 

5 and 

6 (2) may not be reappointed. 

7 SEC. 2. CHANGE IN MANNER OF APPOINTMENT OF STAFF. 

8 Section 3 of the Tennessee Valley Authority Act of 

9 1933 (16 U.S.C. 831b) is amended—

10 (1) by striking the first undesignated paragraph 

11 and inserting the following: 

12 ‘‘(a) APPOINTMENT BY THE CHIEF EXECUTIVE OF13 FICER.—The chief executive officer shall appoint, with the 

14 advice and consent of the Board, and without regard to 

15 the provisions of the civil service laws applicable to officers 

16 and employees of the United States, such managers, as17 sistant managers, officers, employees, attorneys, and 

18 agents as are necessary for the transaction of the business 

19 of the Corporation.’’; and 

20 (2) by striking ‘‘All contracts’’ and inserting 

21 the following: 

22 ‘‘(b) WAGE RATES.—All contracts’’. 

23 SEC. 3. CONFORMING AMENDMENTS. 

24 (a) The Tennessee Valley Authority Act of 1933 (16 

25 U.S.C. 831 et seq.) is amended—
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1 (1) by striking ‘‘board of directors’’ each place 

2 it appears and inserting ‘‘Board of Directors’’; and 

3 (2) by striking ‘‘board’’ each place it appears 

4 and inserting ‘‘Board’’. 

5 (b) Section 9 of the Tennessee Valley Authority Act 

6 of 1933 (16 U.S.C. 831h) is amended—

7 (1) by striking ‘‘The Comptroller General of the 

8 United States shall audit’’ and inserting the fol9 lowing: 

10 ‘‘(c) AUDITS.—The Comptroller General of the 

11 United States shall audit’’; and 

12 (2) by striking ‘‘The Corporation shall deter13 mine’’ and inserting the following: 

14 ‘‘(d) ADMINISTRATIVE ACCOUNTS AND BUSINESS

15 DOCUMENTS.—The Corporation shall determine’’. 

16 SEC. 4. EFFECTIVE DATE. 

17 The amendments made by this Act take effect, and 

18 7 additional members of the Board of Directors of the 

19 Tennessee Valley Authority shall be appointed so as to 

20 commence their terms on, the first date following the date 

21 of enactment of this Act on which the term of a member 

22 of the Board of Directors of the Tennessee Valley Author23 ity expires.

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