Mr. BONNER. I think it may be said that that is the only outstanding case that involves an actual valuation as distinguished from cost accounting.

Senator DILL. Have all accounts of these different companies been gone over where they are complete?

Mr. BONNER. No, sir; that is something different. I was distinguishing between cost accounting and valuation.

Senator DILL. Then do I understand you to say that all valuations have been taken care of that can be taken care of except the Niagara Falls case?

Mr. BONNER. In order to have no misunderstanding in that matter I should like to point out that there is one plant in Minnesota which by the terms of the license provides for a fair value proceeding, but all of the evidence in the case is based on a cost determination, so that in reality the Niagara Falls case is the only one.

Senator DILL. How many licensees have filed their demand and their cost accounting has not been completed?

Mr. BONNER. Well, I think-would you like for me to give you the detals?

Senator DILL. Just tell me roughly, 5 or 10 or 15 or 20?

Mr. BONNER. Roughly speaking, I should say that of the 100 major licenses I would judge that about 75 are completed, and of those about 25 have had their value or cost settled.

Senator DILL. That is, the company has agreed and the Federal Power Commission has agreed on a settlement of the accounts? Mr. BONNER. Yes, sir.

Senator DILL. And there are about 50 of the 75 that they have been over but that have not been agreed upon?

Mr. BONNER. Yes, sir.

Senator DILL. Are there disputed cases among those?

Mr. BONNER. Yes, sir.

Senator DILL. How long have those disputes been going on? Mr. BONNER. Some of them date back to the origin of the commission.

Senator DILL. When are you going to bring those to settlement? Mr. BONNER. Well, that is what I have been doing. You understand that I have only been in this position for six months and have not had a chance to make much progress on those as yet.

Senator DILL. How many have you brought to complete settlement since you came in, or have you been able to get the commission to do it; I will put it that way?

Mr. BONNER. I should say that in the last six months we have gained a settlement of four or probably five, but that we have made a lot of progress on some of the rest.

Senator DILL. How much money is involved in those that have been settled, or I will put my question this way: How big are they? Mr. Bonner. They are all small.

Senator DILL. Well, that is somewhat indefinite. Are they $5,000 or $100,000 or $1,000,000?

Mr. BONNER. They would range, I should say, from $40,000 to half a million dollars apiece. As I recall, there have been none settled where the amount involved was in excess of half a million dollars.

Senator DILL. Does your statement that you are going to give us here show which ones were settled?

Mr. BONNER. Yes, sir.

The CHAIRMAN. The request made of you at our last meeting was for a list of projects in relation to which the accounting department has questioned items of prelicense cost or construction cost, giving the name of each applicant or licensee, the amount, the items questioned, and their general character. That is, all in excess of $5,000. Mr. BONNER. I have a full report on that that I will present to the committee in a few moments, if you will permit me to go ahead.

The CHAIRMAN. You may proceed with your statement. Mr. BONNER. There is one other point I should like to go into, and that is simply this: I find it very distressing to discuss personalties before this committee. It does not seem to be the proper place to try out such issues. But these matters have been raised here, and I find in self-justification I must have something to say in reply. I refer to some statements in your record that have been made by Mr. Russell that cast some reflection upon my integrity and my motives. Senator WHEELER. What statements made by Mr. Russell do you have reference to?

Mr. BONNER. That my official actions were too sympathetic toward the power companies. The Senator from Montana [Mr. Wheeler] will recall that he asked me several days ago when I was before this committee as to whether I had recommended or suggested the desirability of eliminating Mr. Russell from the service. Senator WHEELER. Yes.

Mr. BONNER. You failed to ask, however, the reason behind my suggestion of such a course. In order that your record may be complete and the committee may be advised of all the facts, it seems important that this point be cleared up.

Senator WHEELER. All right.

Mr. BONNER. We have been learning a lot about this man recently. He has been with the Federal Power Commission only a short time and we are just beginning to find out something about his past record. The investigation is still incomplete, but it has gone far enough to demonstrate his unreliability and lack of fitness for the public service.

Senator WHEELER. Who is doing the investigating?

Mr. BONNER. A Government agent in Montana.
Senator WHEELER. What Government agent?

Mr. BONNER. An employee of the Forest Service.
Senator WHEELER. What is his name?

Mr. BONNER. Fred E. Thieme. It reveals a most unusual situation for any man in responsible public position; seriously reflects uponSenator WHEELER (interposing). Does what?

Mr. BONNER. Seriously reflects upon him.

Senator WHEELER. In what way?

Mr. BONNER. He left Montana owing about $3,000 in scattered merchandise accounts and although he has now enjoyed a good salary in the public service for some years he has not liquidated them, and his attitude toward his creditors has been indifferent if not contemptuous. Several judgments stand of record here in the District of Columbia which, apparently, he has not attempted to settle.

Apparently there is justification for the bitter feeling of the creditors and I quote this:

Great indignation that a man should continue to draw public money and disregard his liability to those who befriended him when he needed merchandise or services.

The CHAIRMAN. That statement is from Mr. Thieme?

Mr. BONNER. No, sir.

The CHAIRMAN. Who is that from?

Mr. BONNER. I am going to introduce that letter, from Mr. Tupper, of the Tupper Mercantile Agency, in fact, I think it is already in the committee's file, although I am not sure of that.

The mounting files of complaints against Mr. Russell's past activities is causing no little concern and bringing the commission into some disrepute.

It has been found that Mr. Russell made a false and improper claim for withdrawal of $664.18 from the retirement fund, which was paid to him, and so far Mr. Russell has flatly refused to return that money.

Senator WHEELER. What is that?

Mr. BONNER. Do you care for the details?
Senator WHEELER. Certainly.

Mr. BONNER. The committee may be assured that these matters are not being overlooked by the commission.

Senator WHEELER. It is not fair to a man to come up here and make a general broad statement against him and not let us know what the situation is.

Mr. BONNER. I realize that it is a very grave charge, and it is thoroughly supported; I assure you.

Senator FESS. Mr. Chairman, I was just wondering whether a statement of that kind ought to be made here in open meeting.

The CHAIRMAN. I might say to the Senator from Ohio (Mr. Fess) that Mr. Russell was quite free in making his statements here in open meeting, and it seems to me that it is fair to both sides.

Senator FESS. All right.

Mr. BONNER. That occurrence is all covered by two memoranda prepared by the chief clerk of the Federal Power Commission. Do you care to have these read or shall I just introduce them for your record?

Senator DILL. Let us hear them.

The Chairman. Yes; and speak out loud so all of the members of the committeee may hear you.

Mr. BONNER. The first memorandum is:

In the position of principal attorney, $6,000 per annum, Interstate Commerce Commission, Mr. Russell held a classified civil-service status, having been appointed in August, 1925, to the position of attorney as result of competitive examination, and later promoted. His resignation from this position to accept appointment to the position of solicitor in this commission took effect at the close of June 30, and his appointment here became effective the following day, July 1, 1929.

Mr. Russell was informally tendered a transfer to this commission. He declined the transfer, preferring to make his separation from the Interstate Commerce Commission absolute, and to accept original appointment from this commission to the excepted position of solicitor, giving as his reason dissatisfaction with the necessity for contributing to the retirement fund, and desire to secure refund of the amounts previously diverted from his salary to that fund.

The appointment as solicitor was approved by the Civil Service Commission on July 11, 1929, under Schedule A, Subdivision I, paragraph 4, of the civilservice rules

"with the understanding that the appointee does not by such appointment acquire a competitive status, or become eligible for any other position or duties, It is requested that the inclosed duplicate be given to the appointee to prevent misapprehension which otherwise occur.'

Mr. Russell in his memorandum of July 16 protesting against retirement-fund deductions being made from his salary, confirms his complete understanding of the above.

Shortly before June 30 Mr. Russell filed an application for refund of retirement deductions to his credit, amounting to $664.18. Without special investigation and apparently misunderstanding the facts the Interstate Commission personnel authorities approved the claim and forwarded it to the Pension Office, where it was later paid. In the affidavit, page 1 of the application form (copy herewith) Mr. Russell stated that on June 30, 1929, he became absolutely separated from the civil service of the United States because of resignation. By the resignation he did separate himself from his position in the Interstate Commerce Commission, but he did not at any time separate himself from the civil service of the United States, nor did he intend to do so. Consequently his statement in the affidavit above-mentioned is contrary to the facts. The retirement claim should not have been approved or paid. In order to comply with the ruling governing this class of cases the amount so paid must be collected from Mr. Russell. (See Department of the Interior ruling No. 23, retirement, in the J. Everett Will case, in the attached status file.)

Senator DILL. Let us get this clear: This application made by Mr. Russell was passed on by the retirement board, was it not? They knew all the facts?

Mr. BONNER. It was paid by the retirement board on the basis of this affidavit.

Senator DILL. They knew then whether the affidavit was true or not, did they not?

Mr. BONNER. I doubt it.

Senator DILL. Well, it seems to me that this is a case of a ruling of one kind at one time, and then a reversal of that ruling at another time.

Mr. BONNER. I doubt it.

Senator DILL. That is a fact, is it not?

Mr. BONNER. They paid it on the basis of this false affidavit. Senator DILL. Well, it is not a matter of being false as I see it but a change in ruling.

Mr. BONNER. It was false in his saying he was separating himself from the civil service of the United States.

Senator DILL. The retirement board must have had the record at the time. We Senators know from our experience with the Veterans' Bureau, coming up all the time, where at one time a ruling is made and money is paid out, and then at a later time another ruling is made and the money is demanded back. If that is the case here it is simply a matter of difference of opinion.

Mr. BONNER. Well, I think it is governed by a case already in the files.

Senator DILL. That may be true, but this is also true and it is a pretty broad charge to say that a man makes a false affidavit-it is an affidavit upon which some people differ. It must have been agreed upon by somebody or the money would not have been paid in the first place.

Senator WHEELER. You say that Mr. Russell says he separated himself from the civil service. It was undoubtedly his opinion that he did separate himself from the civil service, or that was undoubtedly his intention, was it not?

Mr. BONNER. I doubt it.

Senator WHEELER. How is that?

Mr. BONNER. I doubt it.

Senator WHEELER. You are making the statement here that a man makes a false affidavit when he says he separated himself from the civil service. Now, if his intention was to separate himself from the civil service, and then he made an affidavit that he did it, it would be a question of opinion as to whether or not he actually did separate himself from the civil service, it would seem to me.

Mr. BONNER. It is all covered in this one case.

Senator WHEELER. I don't care whether it was covered in that one case or not. If I make an affidavit that I am separating myself from the Government service and I am of opinion that I am separating myself from the Government service, it seems to me that is the object of the affidavit. There may be some ruling by some department that as a matter of fact I did not separate myself from the civil service, but you can not say that I have made a false affidavit because of the fact that some ruling by some department says that I did not separate myself, when my intentions were to do so and I honestly believed that I did.

Mr. BONNER. In other words, you say it would be a matter of opinion?

Senator WHEELER. Of course.

Senator PINE. As a matter of fact, did not Mr. Russell resign his position with the Interstate Commerce Commission?

Mr. BONNER. Yes, sir.

Senator PINE. He did not transfer from the Interstate Commerce Commission to the Federal Power Commission?

Mr. BONNER. No, sir.

Senator PINE. But in fact did separate himself completely from the Government service, did he not?

Mr. BONNER. No, sir.

Senator WHEELER. Perhaps not from the Government service, but you meant from the civil service, did you not, Senator Pine?

Senator PINE. What was Mr. Russell's position in the Government service after his resignation of his position with the Interstate Commerce Commission?

Senator DILL. Yes; before he became the solicitor of the Federal Power Commission.

Senator PINE. Yes; before he became connected with the Federal Power Commission.

Mr. BONNER. This affidavit was made after he became connected with the Federal Power Commission.

Senator HASTINGS. Speak a little bit louder, please.

Mr. BONNER. I say, the affidavit was made after Mr. Russell became connected with the Federal Power Commission.

Senator DILL. The employees of the Federal Power Commission are under the civil service, are they not?

Mr. BONNER. The most of them are.

Senator DILL. But this one employee is not?

Mr. BONNER. This one is an excepted position. It is not in the classified service.

Senator DILL. Of course.