Mr. LILIENTHAL. May I say this: While we believe those percentages of deferment requested are low for any kind of enterprise, the special character of a lot of this personnel is something that affects our problem a great deal. Almost all these men are either chemical engineers, or chemists, or engineers of one kind or another, whose replacement presents a real problem. If I may have your permission to put our letter to you in the record, I think that will amplify it as well as we could do.

Mr. STARNES. I think you are to be commended as a Government agency for the most excellent record you have in that connection. (The correspondence referred to follows:)

Hon. EVERETT M. DIRKSEN,

House Office Building,

Washington, D. C.

JANUARY 2, 1943.

DEAR MR. DIRKSEN: This is in response to your questions contained in your letter of December 3, 1942. We were not able to forward the material prior to January 1 as you requested because the questionnaire required tabulations and classifications different from those in which our records are kept. When you review the material submitted with this letter I am sure you will understand why it could not have been assembled and submitted sooner.

In interpreting the Authority's record of occupational deferments and deferment requests under the provisions of the Selective Service Act, it is important to have in mind the nature of the Authority's work. Almost all of the Authority's 38,000 employees are engaged in work more comparable with that of private industry than with the work of the usual Government department. This fact has been recognized, for example, by the National War Labor Board and the War Manpower Commission in their application of wage rates and manpower directives and regulations where distinctions between Government service and private industry are involved. The problems we face in meeting the requirements of the Selective Service Act as an employer and in helping to achieve the purposes of that Act are comparable with the problems faced by such private organizations as the du Pont industry, the Commonwealth and Southern Corporation, or the Stone & Webster engineering firm.

The Authority is designing and building several large dams, powerhouses, and reservoirs requiring relocation of roads, bridges, railroads, and other structures. It is operating and maintaining the second largest power system in the country in point of power generation. More than 70 percent of the power produced by the Authority goes into war-production industries and operations. This system serves some 128 municipalities and rural electric cooperatives as well as a unmber of major chemical and electrometallurgical industries, notably aluminum. The Authority is designing, building, and operating chemical and munitions plants to produce phosphates for fertilizer, elemental phosphorus for military uses, and ingredients for synthetic rubber. Our engineering forces are also mapping several strategic areas in the Northeast and Southwest at the request of the War Department. We are building and operating housing facilities for war workers. The Authority's research engineers and chemists are carrying on highly technical investigations in pilot-plant operations to develop new ways of processing minerals and metals.

These operations and activities, like similar operations in private industry, require highly trained technical men, skilled operators, and supervisors who cannot be trained or replaced quickly. Furthermore, many of these operations require men who are young and tough and physically able to meet the hazardous and arduous demands of heavy construction in rough terrain and isolated areas, maintenance and patrolling of transmission lines in mountainous country, operation of complicated machines and equipment, and handling of dangerous materials. These circumstances explain why a large percentage of the Authority's male employees are in the age groups from which the Selective Service System normally makes heavy demands. The general age distribution of the Authority's employees has shifted toward the use of older men in recent years wherever possible, but the requirements of our operations are such that physical requirements of the work have forced a natural selection from among the younger age groups.

I hope ths information will be helpful in interpreting the specific answers to your questions. In summary the Authority had 37,529 employees as of Decem

ber 1, 1942; of these 35,021 were males. As of that same date 525 or 1 percent of all male employees were in deferment status; all requests for deferments for occupational reasons from the inception of the Selective Service Act of 1940 to December 1, 1942, totaled 1,627 or 4 percent of all employees. During that same period a total of 836 employees or 2 percent of the total were deferred at one time or another for occupational reasons. As of December 1, 1942, 6,463 employees had left the Authority to enter military service. This group constitutes 18 percent of the total.

The answers to your numbered questions follow:

1. The total number of employees of the Authority on December 1, 1942, was 37,529.

2. Of this number, 35,021 were males.

3. Of the Authority's male employees

30,238 were between the ages of 18 and 45. 14,645 were between the ages of 18 and 30. 15,593 were between the ages of 31 and 45. 24,783 were between the ages of 18 and 33. 5,455 were between the ages of 38 and 45.

The last two figures were not requested in your letter but may be of interest to you in view of the recent decision of the War Department to halt the drafting of men 38 years of age and above.

4. Since the inception of selective service in 1940, the Authority has requested deferment for a total of 1,627 employees. Assuming the total number of male employees as of December 1, 1942, to be a fair average since 1940 (the real average is probably higher), the number of employees for whom deferments have been requested is 4 percent of the total number of employees. Of this number only 525 were to our knowledge in deferment status as of December 1. 1942. This number is approximately 1 percent of the total number of T. V. A. 5. The reasons for the deferment request in each case are given on individual statements for each employee concerned, which are transmitted herewith. As will be apparent upon examination of these statements, the Authority has requested deferments in two general types of cases. The first type has included, principally, engineers, chemists, skilled workers, and other technical personnel engaged in designing, building, and operating dams, power facilities, munitions, and chemical plants. Men of this type require long periods of training to attain proficiency in their respective fields. This class of personnel is virtually irre placeable under existing conditions, and the Authority has requested both initial 6-month deferments and continued deferments for employees in this group.

The second type of case has involved employees who are replaceable but whose departure for military service before a replacement could be obtained and trained would seriously interfere with the work of the organization. In some instances, it has been possible to avoid requesting deferments for this class of personnel by training replacements in anticipation of their induction into military serv ice. During recent months, however, local boards in the Tennessee Valley area have been inducting married men, and in some cases have called married men with children, in order to fill their quotas. As a result, men whom we expected to be deferred on grounds of dependency have been called for service, and requests for temporary deferments have therefore been necessary to permit the obtaining of replacements.

6. We have definite information concerning a total of 525 employees who were in occupational deferment status on December 1, 1942. There were undoubtedly a considerable number of additional employees who had been placed in such status by local Selective Service Boards which have not advised us of the fact We have no accurate information concerning the number of employees deferred on that date because of dependents, physical unfitness, and other reasons not connected with their occupational status.

7. We have definite information concerning a total of 836 employees deferred on occupational grounds between the inception of selective service and December 1, 1942. Thus the total number of employees deferred for occupational reasons since the inception of the Selective Service System is 2 percent of the total number of employees. The length of and reason for the deferment in each case are indicated on the individual statements transmitted herewith. As indicated in the answer to question 6, we have no accurate information concerning deferments on other than occupational grounds.

8. The nature of the duties performed by each employee for whom deferment has been requested is shown on the statements which are transmitted herewith. While your letter did not so indicate, you may also be interested in the number of employees who have left the Authority to enter military service. On December 1, 1942, this figure was 6,463.

If you wish any further information, please do not hesitate to call upon us. Very truly yours,

Mr. DAVID E. LILIENTHAL,

Chairman of the Board,

TENNESSEE VALLEY AUTHORITY,
GORDON R. CLAPP,

General Manager.

WASHINGTON, D. C.,
December 3, 1942.

Tennessee Valley Authority,

Knoxville, Tenn.

DEAR MR. LILIENTHAL: Can you supply me with a personnel summary of your agency showing (1) total number of employees as of December 1, 1942; (2) total number of male employees; (3) total number of male employees between the ages of 18 and 45 showing also the total number between 18 and 39 and the total number between 30 and 45; (4) total number of employees for whom deferment has been requested since the inception of selective service in 1940; (5) reasons assigned to support the request for deferment; (6) total number of employees who have been deferred whether for occupational or other reasons; (7) total number of employees who have been deferred since the inception of selective service in 1940, length of such deferment, and the reason therefor; (8) a brief statement showing the nature of the duties performed in each case by an employee for whom deferment was requested?

Questions concerning these and related matters will doubtless arise in connection with hearings on appropriation bills for the fiscal year 1944 and I would be grateful if this information could be supplied on or before January 1, 1943. Sincerely,

(s) EVERETT M. DIRKSEN, Everett M. Dirksen, M. C.

PAYMENTS TO STATES AND MUNICIPALITIES IN LIEU OF TAXES

Mr. DIRKSEN. Now, in connection with payments to States and municipalities in lieu of taxes, I wonder if you could bring that down to date?

Mr. LILIENTHAL. Yes.

(The statement requested follows :)

Taxes and tax equivalents paid by the Tennessee Valley Authority and its distributor contractors for the year ended June 30, 1942

1 Amounts are average of levies for last 2 years properties were in private ownership.

Taxes and tax equivalents paid by the Tennessee Valley Authority and its distributor contractors for the year ended June 30, 1942-Continued

TAX AND IN-LIEU PAYMENTS BY TENNESSEE VALLEY AUTHORITY AND CONTRACTORS, 1942

? Amounts are levies for the last year properties were in private ownership.

AUDIT OF T. V. A. ACCOUNTS

Mr. DIRKSEN. May I ask at this point: Your difficulties, if any, with the General Accounting Office, I take it, have been more or less composed now, and the Federal audit is being made from time to time?

Mr. LILIENTHAL. I am very glad to say that the relations between T. V. A. and the General Accounting Office, the Comptroller General, are excellent at the present time, and we have every reason to believe will continue to be.

TREND OF COMMERCE ON THE TENNESSEE RIVER

Mr. DIRKSEN. With respect to water-borne commerce on the river, are there any figures on tonnages now?

Mr. LILIENTHAL. Yes.

Mr. DIRKSEN. I wonder if you can insert them in the record?
Mr. LILIENTHAL. I will be glad to do that.

(The statement requested follows:)

TREND OF COMMERCE ON THE TENNESSEE RIVER IN RECENT YEARS

Since 1937 the general tendency of traffic on the Tennessee River has been sharply upward. Especially significant are the data on ton-miles, since they describe the actual amount of transportation service involved. As is shown in table A, the ton-miles of commercial traffic (excluding Government construction material and car ferry traffic) increased in every year except 1940, and in 1942 the volume was almost four times as great as that of 1937. The fact that the

upward trend in ton-miles is much sharper than that in tons means that the proportion of long-haul traffic has grown progressively larger and the proportion of short-haul traffic, such as sand and gravel, has grown progressively less. Thus the river has become more and more an arterial waterway. It should be emphasized that this trend is independent of any influence that the movement of T. V. A. construction materials have.

Further particulars for the period 1940 to 1942 are shown in table B. The most spectacular gains were in coal and coke and petroleum products. Substantial movements of barge coal from South Pittsburg to Muscle Shoals began in April 1942 and to Huntsville Arsenal in August 1942. The movement of grain also continued an established upward trend. While miscellaneous traffi remained comparatively small because of the recency of the river improvements and the lack of public-use terminals, the 1942 total was well above the 1941 and far above the 1940. The 1942 decline in automotive equipment came from the cessation of civilian production. Late in 1942, however, a large number of military vehicles were moved on the river, partially replacing the former traffic. The 1942 reduction in sand and gravel comes from the diminished requirements of T. V. A. dam construction on the main river. This decline in Government material more than accounts for the decline in total tonnage from 1941 to 1942. Most significant in the appraisal of long-term commercial prospects of the waterway are the data on commercial tonnage exclusive of sand and gravel traffic. Such tonnage amounted to 353,000 in 1940; increased to 455,000, or 29 percent, in 1941; and increased to an estimated 691.000 in 1942, or 52 percent above 1941. In this significant kind of traffic 1942 tonnage was almost twice as great as that of 1940.

TABLE A.-Tennessee River tonnage and ton-mileage

Projected to full-year basis from reports through November 30.

TABLE B.-Commerce on Tennessee River, 1940-42 (including all freight traffic

but not car ferries)