Suchergebnisse

The development of the public power program in the Tennessee Valley area has had marked effects on inter-governmental relations, in some cases creating new relationships and in other cases modifying those already existing. Many of these relations concern coöperative activities of the T. V. A. and the state and local governments, and the results of their joint endeavors have done much to expand and improve governmental services. In its relations with the local governments, the Authority has consistently followed the policy of depending on their coöperative efforts to achieve the social and economic development of the Valley without attempting to impose its will on them. "The rôles of the states, and of cities, counties, districts, and voluntary associations within the states, are enhanced, not diminished, in importance, by this recognition of interest and jurisdiction. Coöperation, not destructive competition; Federal responsibility in Federal and interstate matters, with local initiative and self-reliance in matters of a local nature—these are policies by which the development of the Valley is being and should continue to be guided." These principles have not always been appreciated by the local units, however, and their occasional unwillingness to assume responsibilities or to fulfil obligations to each other have presented problems that have tended to hinder the most successful conduct of the public ownership program. In fact, the readjustments in inter-governmental relations that have sometimes been necessitated, especially in connection with the power program and the resulting loss of taxes, have in some instances been accompanied by painful and significant friction.

The state and county governments in the Tennessee Valley area, particularly in Tennessee, completed 1940 with one of their most pressing financial problems solved or well on the way to solution. The threatened loss of taxes to governmental units, resulting from the program of public ownership of power and the purchase by the Tennessee Valley Authority and the municipalities of the properties of private electrical power companies, had been serious to many counties facing bankruptcy, curtailment of services, or exorbitant taxes. Besides the financial effects, the situation strikingly demonstrated the need for reforms in local government, mainly the consolidation of counties and the introduction of better budgeting and accounting practices. Moreover, the problem has also been significant because of certain issues resulting from the venture into public ownership. Should proprietary agencies of the national government engaged in competition with private business and acquiring existing taxable facilities be responsible for the taxes thereby displaced and replace them as a matter of policy? Are proprietary functions of the national government subject to state and local taxing authority? These issues have demanded widespread consideration not only in the Tennessee Valley area but also in other sections where public power programs are being tried on a large scale. A bill was introduced into Congress on September 30, 1940, to provide for payments to governmental units affected by displacement of taxes arising from the Bonneville Power Project, and a more recent bill applies to the proposed Arkansas Valley Authority Project. The passage of the Norris-Sparkman amendment by Congress in June, 1940, whereby payments in lieu of taxes are being made by the T.V.A., has answered these questions and relieved the pressing financial aspects of the situation. The tax replacement provision has now been in operation more than six months, and an analysis of the period affords an interesting insight into its effects on the various governments concerned.