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Mr. RAULSTON, $3,000,000-and-odd.
Mr. FADDIS. I have the figures; what is the percentage?
Mr. RAULSTON. As against $5,000,000, I would say 40 percent.

Mr. Faddis. That is what I assumed, about 40 percent. How much power, approximately, is sold in your county? Have you any idea about that?

Mr. RAULSTON. I do not know, Mr. Faddis.

Mr. F Addis. How much will this increase the average per capita tax in Marion County?

Mr. RAULSTON. Well, as I stated, the rate will go to $4.12, is the estimation. I could not say just offhand what to predict.

Mr. ARENDS. That would be a 40-percent increase?
Mr. RAULSTON. Yes, sir.

Mr. Fadds. Do you believe the utility rates have been decreased enough by this paternalistic program to compensate you for that increase?

Mr. RAULSTON. I can only speak for my own, sir. My rate has not been reduced; I pay the same rate I did before. I was in error. My light bill is reduced about 25 percent, T. V. A. charges $7.50 for 400 kilowatt-hours and 4 mills per kilowatt-hour above 400. I use about 800 to 900 per month. Tennessee Electric Power Co. collected $7.50 for the first 400 kilowatt-hours, as I am informed by local agents of T. V. A.

Mr. Faddis. You pay the same rate, but you are going to pay more taxes?

Mr. RAULSTON. I am going to pay more taxes; yes, sir.
Mr. MERRITT, Do you get your power from T. V. A.?
Mr. RAULSTON. Yes, sir.

Mr. FADDIs. Well, it seems to me to be obvious that this paternalistic program is putting some of the counties in the State of Tennessee, and probably in some of the neighboring States, in a very embarrassing position. Of course, if we do not help them out, somebody is going to help them out, probably, and the only way I see to do it is to do it with the proceeds from the sale of power by T. V. A.

Mr. RAULSTON. I think that is correct.

Mr. Faddis. I do not see any other way to do it. I do not think it would be fair to take it out of the pockets of the taxpayers of the nation at large.

Do you believe the people of Marion County would object to an increase in the rates for power furnished by T. V. A., in order to make up this deficiency in taxes?

Mr. RAULSTON. I think they would welcome it.
Mr. FADDIs. You think they would welcome it!
Mr. RAULSTON. Yes, sir.

Mr. Faddis. I have introduced a bill along that line, as a solution for this problem, because I see no other solution except to increase the rates for power of T. V. A. I have always believed this was a mistake—T. V. A.; but I believe the United States Government is in the same position as the father of a family. When the father of a family is convinced he has made a mistake in dealing with some of his children, I believe he should attempt to rectify his mistake insofar as possible. And I believe the United States Government has made this mistake, and they cannot afford to allow the farmers and small business people throughout the United States to suffer on account of a mistake in a socialistic program that was put on by perhaps too much enthusiasm. And I am glad to see that you approve of a raise in the rates to do this.

Mr. RAULSTON. Now, I want to qualify that statement about welcoming it. I say that those people who really understand this situation that we are confronted with in Marion County will welcome it. There will be many dissenters and others who will complain about it.

Mr. FADDIS. Of course you would not welcome it, but it is more as an alternative?

Mr. RAULSTON. Well, they would welcome that in preference
Mr. Faddis. To a raise in taxes?
Mr. RAULSTON. To a raise in taxes.
Mr. FADDIS. Exactly.

Mr. RAULSTON. For this reason: We who use the power and get the use of it, of course, should not let this man out here in the country, who gets no benefit from it, bear the burden; his burden should not be increased. And that is 50 percent of our property owners.

Mr. Faddis. He is going to get his taxes increased, although he does not have the benefit of any electricity of any kind ?

Mr. RAULSTON. That is a true picture.
Mr. Faddis. Not even at the old price, much less a reduced price?

Mr. RAULSTON. That is exactly right. Now they say they will put power out there to him. That may be true; still, he has a new commodity, something he has never used before, and he has that cost, and, in addition to that, has increased taxes. So that does not solve the problem.

Mr. FADDIS. That is true.
The CHAIRMAN. It is a hard problem to solve, is it not?
Mr. RAULSTON. I am afraid so.

Mr. THOMASON. If it is not necessary to raise the rate, you would not favor it?

Mr. RAULSTON. Certainly, if it is not necessary.

Mr. THOMASON. If this 12.5 percent they say is being collected as tax money, assuming that those speaking for T. V. A. have given us the true picture of it, and that is included in the present set-up, then it is not necessary; therefore, there would be no necessity for the raising of the rate, would there?

Mr. RAULSTON. No, sir; there would not.

Mr. Faddis. But the fact remains you have been deprived of the taxes, and your rates have not been reduced, so far?

Mr. RAULSTON. Yes, sir; that is correct.

Mr. SCHAEFER. Mr. Raulston, I was just interested in the fact that one industry in the locality pays 40 percent of the taxes. I have never heard of that before. What

What is the reason for that? Mr. RAULSTON. That is true.

The CHAIRMAN. That is on a utility in a county where they own vast property holdings.

Mr. RAULSTON. Yes, sir.

Mr. MERRITT. Mr. Raulston, you said you did not notice any difference in your electric-light bill, or electric bill: Do you mean in the gross amount?

Mr. RAULSTON. Well, my rate-I mean my electric bill with T. E. P. ran around $10 a month.

Mr. MERRITT. And under the other what is it?

Mr. RAULSTON. I have not noticed it recently, but it is notwif anything, the reduction is slight, because I have to pay an amortization charge.

Mr. MERRITT. Do you mean you are using more electricity?
Mr. RAULSTON. How is that?

Mr. MERRITT. Is that because you are using additional appliances that you did not use before?

Mr. RAULSTON. No, sir.

Mr. MERRITT. You are using additional appliances you did not use before?

Mr. RAULSTON. I do not use any I did not use before, no.
Mr. MERRITT. Well, maybe your wife has a washing machine?
Mr. RAULSTON. No, sir; she does not have a washing machine.
Mr. MERRITT. There is no difference in the appliances you use?

Mr. RAULSTON. No, sir; I have the same appliances I had. I have cut off the water heater during the winter, and that has made some reduction in my bill, but I attribute it to the water heater.

Mr. MERRITT. Do you use the same kilowatt-hours each month?

Mr. RAULSTON. I suppose I do. I have not looked at my bill to see, but I surely do.

Mr. SPARKMAN. Mr. Raulston, as a matter of fact, you are just going by the gross amount of the bill, are you not?

Mr. RAULSTON. Yes, sir.

Mr. SPARKMAN. Of course, you do not know what the charge is now per kilowatt-hour, do you?

Mr. RAULSTON. I do not.
Mr. SPARKMAN. And you do not know what it was under T. E. P?
Mr. RAULSTON. No, sir.
Mr. SPARKMAN. Is Hales Bar Dam in your county?
Mr. RAULSTON. Yes, sir.

Mr. SPARKMAN. And that is the reason that this heavy loss occurs to your particular county?

Mr. RAULSTON. That is true.
Mr. THOMASON. What is the county seat of that county?.
Mr. RAULSTON. Jasper.

Mr. SPARKMAN. Mr. Raulston, you said the county-wide tax rate was $2.56?

Mr. RAULSTON. Yes. That includes the State levy of 8 cents.
Mr. SPARKMAN. That includes the State levy of 8 cents ?
Mr. RAULSTON. Yes, sir.
Mr. SPARKMAN. But that is the county-wide levy?
Mr. RAULSTON. Yes, sir; that is the county-wide levy.

Mr. SPARKMAN. Then, in addition to that, in incorporated towns, there is an additional municipal rate?

Mr. RAULSTON. Of something over $2.
Mr. SPARKMAN. Of something over $2?
Mr. RAULSTON. Yes, sir.

Mr. SPARKMAN. So that your total rate, when you include the municipal tax, will run over $4.50 ?

Mr. RAULSTON. Our rates will be $4.12, the way they figure it.

Mr. SPARKMAN. I am not talking about your prospective rate; I am talking about your present rate, State, county, and municipal, in the incorporated towns.

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Mr. RAULSTON. Well, I get excited here. Just a minute. Will you state that question again?

Mr. SPARKMAN. Your county rate is $2.48, is it not?
Mr. RAULSTON. Yes.
Mr. SPARKMAN. Your State rate is 8 cents?
Mr. RAULSTON. The State rate is 8 cents.

Mr. SPARKMAN. And in incorporated towns it is something over $2 additional ?

Mr. RAULSTON. That is true.

Mr. SPARKMAN. So that would make a little better than $4.56 for all three purposes in an incorporated town?

Mr. RAULSTON. No; in an incorporated town, if the tax rate is $2 and it goes--yes; that is right, now.

Mr. SPARKMAN. That is, in the incorporated town it would be $4.56?

Mr. RAULSTON. Yes.

The CHAIRMAN. In other words, the tax rate is $2.56 plus, in the towns, whatever they have for municipal purposes.

Mr. SPARKMAN. That is right.
The CHAIRMAN. But in the county it is $2.56 ?

Mr. SPARKMAN. That is right. Mr. Raulston, you do want to see this bill enacted into law with an amendment providing for direct payment to the counties?

Mr. RAULSTON. Yes, sir; I most assuredly do.

The CHAIRMAN. In other words, you want to see it done that way if it will work the problem out and pay those losses; but, if it won't, you would not want it, would you !

Mr. Raulston. If it will pay the losses ?

The CHAIRMAN. Yes; if the bill will provide revenue enough to pay for this county's loss of $82,000, you would be for it; otherwise

Mr. RAULSTON. Otherwise I would want to provide for it some other way. Certainly we think we should have full replacement.

The CHAIRMAN. What you are interested in is some sort of legislation along this line, but you want it figured out so that it will cover those losses?

Mr. RAULSTON. Yes, sir; that is exactly the position we are in.

Mr. ARENDS. I do not want to take up the committee's time with a repetition, but I am at a loss and hope the witness can clarify some things for me. Now, let us assume you are an average citizen in an average small town in a State and county, will you give me just an approximate idea of your monthly light bill before the advent of T. V. A. coming into your town?

Mr. RAULSTON. About $10 a month.
Mr. ARENDS. What was it after T. V. A. in this small town,

in your average home?

Mr. RAULSTON. In my home?
Mr. ARENDS. Yes.

Mr. RAULSTON. I get my whole bill and in that bill there is an amortization charge and there is so much for electricity, and I do not know, but the bill varies very little; it is very little under the other, if any. It might be some slight amount under, but my wife pays the bill and I just don't know about it.

Mr. THOMASON. We will finally get at the truth of this matter. (Laughter.]

Mr. ARENDS. The point I am trying to get at is there is very little difference in your consumption rate now and before T. V. A.?

Mr. RAULSTON. That is true, sir. That is the way I see it.

Mr. ELSTON. Mr. Raulston, I would like to ask you about how your county compares with some other county that is purely a rural district, so far as income is concerned. You have had a considerable income because of the presence of this private utility in your county, have you not?

Mr. RAULSTON. Yes, sir.

Mr. ELSTON. Now, there are other counties that are quite similar to yours, except they do not have any utility property of any consequence ?

Mr. RAULSTON. That is true.
Mr. Elston. How do they get along ?

Mr. RAULSTON. Well, they have not—now, a little neighboring county, Sequatchie, just north of us, did not build any roads of their own; they did not float any bonds to build roads; the State built their roads under the gasoline-tax program, or whatever program the State had. They have State-aid highways and their schools are not up to the standard of our schools, and it may be we have some other county functions that we have had and continue to have at present, that they do not have. And they get along with a rate, I think, of two—I am not sure of their rate, but it is not much above ours, if any.

Mr. ELSTON. In other words, the presence of this utility in your county has given you some things that it would not have had if they had not been there?

Mr. RAULSTON. Yes, sir; we built four high schools in the county. We have four high schools. And we have built roads and done various other things which, of course, resulted in our bonded indebtedness.

Mr. ELSTON. Is your bonded indebtedness any greater than the indebtedness of other counties with which you make comparison?

Mr. RAULSTON. Yes; I do not think they have any—very little, if any, bonded indebtedness.

Mr. ELSTON. Then, have your improvements come about by reason of the fact that you have gone in debt for them, or by reason of the fact that you have had a private utility for your county that made a great contribution to the taxes?

Mr. RAULSTON. They came about by the county going in debt for them, but we would not have gone in debt if we had not expected to pay those bonds out of the taxes paid by this private utility, in part.

Mr. Elston. In other words, you just anticipated that they would keep on paying those taxes? That is why you went into debt ?

Mr. RAULSTON. Yes, sir. And we thought we had every right in the world to assume that that would be true. Mr. ELSTON. Of course, you are a lawyer, are you not? Mr. RAULSTON. Yes, sir.

Mr. ELSTON. You understood that when the Federal Government took over these private utilities, the principle that the Federal Government would not pay taxes would apply, did you not?

Mr. RAULSTON. Yes, sir; I understand that. I understood that was the situation; yes, sir.

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