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Show 607 Act.608 In the absence of a statutory specification of an inter- est rate, 2^2% has been adopted in practice, a rate sufficient to cover the actual cost of money to the United States.607 Fifty years has been selected as the "reasonable period" specified in the above statute.608 Only a few months after enactment of the foregoing general provision, Congress directed that surplus energy generated at the new hydroelectric plant, St. Mary's River, Michigan, shall be sold by the Secretary of the Army upon such "terms and conditions as he shall determine."609 (Reclamation Projects)-The 1939 Reclamation Project Act authorizes the Secretary of the Interior to enter into contracts for the "sale of electric power or lease of power privileges," for such periods, "not to exceed 40 years," and at such rates as in his judgment will produce:610 power revenues at least sufficient to cover an appropri- ate share of the annual operation and maintenance cost, interest on an appropriate share of the construction in- vestment at not less than 3 per centum per annum, and such other fixed charges as the Secretary deems proper * * *. In the first place, it should be noted that the provision re- specting interest has been administratively construed to pro- vide a perpetual 3% rate of the "appropriate share of the con- struction investment," regardless of the portion of that invest- ment previously returned.611 The interest element in the rate standard for reservoir projects under control of the Army, on 606 See supra, pp. 295-296. 607 See, e. g., Re Bonneville Project, Columbia, River, Oregon-Washington, Allocation of costs, Docket No. IT-5955, 4 F. P. C. 950, 955 (1945). 808 Hid. 609 Act of March 2,1945, § 2, 59 Stat. 10, 20. m Act of August 4,1939, § 9 (c), 53 Stat. 1187,1193, 43 U. S. C. 485h (c). *" Unpublished opinion of the Solicitor of the Department of the Interior concerning power-rate schedules and minimum-rate requirements for Grand Coulee, Opinion M-33473, January 29, 1944, and its Supplement, September 10, 1945. In this connection, see also Act of May 9, 1938, § 1, 52 Stat. 291, 322, 43 U. S. C. 392a. 911611-51------40 |