Evening star., 1938-03-13
BY JOHN H. CLINE.

ClOH OF buying up Lne property OF
the latter in the. Tennessee Valley has
brought into the foreground the municipal
power program Of the Public Works Ad-
ministration.
Held in allegiance for more than three
years by an epochal legal battle, the P.
w. A. finally emerged victorious in the
courts and was prepared to go ahead with
its power program when the discussion
with the utility men was initiated.
The utility operators, facing competition
they could not hope to meet successfully,
indicate their willingness to discuss the sale
OF their holdings to T. v. A., but insisted
that the municipal power programs be held
up during the negotiations. Secretary of
Interior Ickes, who is in charge of the P.
w. A. program, has made it clear that he
intends to go ahead with loans and grants
to municipalities unless the latter seek
postponement To date, however, no mu-
nlcipality has rejected any P. w. A. money,
and it looks as though the private utilities
will have to do their bargaining in the
face of this potential competition or not
bargain 1t ALL
When President Roosevelt took Office in
1888 his most important immediate prob
lem was to relieve widespread unemploy-
ment. To that end Congress set up the
Public Works Administration, charged with
the duty OF creating work for those who
could not find jobs in private industry
Money Flows Freely.
Secretary 1ckes was placed in charge Of
the new agency and he and his aides began
spending money on an unprecedented scale,
their prime objective being to encourage
projects offering maximum of employ
ment for each dollar spent Many of these
projects, such as the building of water
works. sewers, schools, etc. went forward
unhindered, but the attempt to advance
money for construction of municipality
owned power systems met with bitter op-
position from private utilities.
Sixty-one out OF a total of 28l power
producing projects we're blocked by injunc-
tions obtained by the private power COM
panies. Located in % States, the enjoined
projects had an estimated construction
cost Of nearly $l47,ooo,oo and offered
more than 100000 man-hours of en-
ployment.
The obstacle presented by these injunc-
tions was broken last January when the
Supreme Court, in passing on suits brought
by the Alabama Power Co., and the Duke
Power Co., ruled that the private utilities
had no legal standing to question the right
Of the Government to advance money to
municipalities desiring to build their own
power plants.
Acclaiming the decision, Secretary Ickes
announced that construction will pro-
ceed,' and moved at once through his
subordinates to have the injunctions dis
solved. Now that these legal barriers have
been removed, p w. A. is prepared to 20
ahead with all projects.
The resumption of the municipal power
program was marked with considerable
ceremony last month by the presentation of
q Government check for $1,000, $685. 66 to
the City Of Memphis, Tenn, which Is
building power system that will cost
$4,000 900, the largest of the municipal
projects.
Clark Foreman. special assistant to Mr..
1ckes, went to Memphis for the occasion
and personally presented the check to the
Mayor.
Shut Federal Purse.
The Memphis project is the first one of
any consequence to receive . P. W. A.
check since the Supreme Courts decision,
the action Of the city in raising money
for the work on its own initiative having
made payment possible The effect of
the injunctions was to prevent the Federal
Government from advancing money to
municipalities and even now that the in
functions have been dissolved, no money
can be disbursed by P. w. A. until con-
struction contracts actually have been
signed. Oflcials of the governmental
agency said, however, that checks will be
sent to other communities just as rapidly
as they can let contracts and begin the
construction work.
Memphis will receive total of s., ,092, 900
from P. w. A., all as an outright grant.
There is no accompanying loan, as the
city is raising the balance of the money
from other sources.
The power projects for which p w. A.
has made allotments fall into four classi-
flcations. The first group includes new
electric generating plants, with or without
distribution systems. In cases where no
distribution system is provided for, the
%oLn
system Of private utility. The second
classification includes additions to or i'm
provement Of generating plants and dis
tribution systems. The third is confined
to the building Of transmission lines,
while the fourth class embraces the con-
struction or improvement Of power plants
In public buildings
Six States Not Participating.
Although these projects are located
principally in the Tennessee Valley and the
Middle Western States, there are but six
states-Maine, Maryland, louisiana, New
Mexico, Wyoming and Montana-that
have no projects at all. Some 125 Of these
projects have been completed, while the
great majority of the others, with the ex-
ceptions Of those cases in which injunc-
tions have intervened, are in various stages
Of construction. It has been pointed out
that q total of more than 1000 applications
for aid on power projects were received by
p. w. A.. every State being represented.
The largest number Of applications came
from Texas, with Illinois, Missouri, Mich
iaan and Minnesota following in the order