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<br />HOOVER DAM ENERGY
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<br />939
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<br />first two Swing-Johnsonbills.97 Those proposals attempted to incorporate
<br />the provisions of the Federal. Power Act with respect to recapture of the
<br />orilJinallicensee's license upon its termination by the United States or mu-
<br />nici'palities.98 The original Swing-Johnson bills, in language similar to
<br />that of the Federal Power Act, provided that the Secretary either could sell
<br />perpetual rights to a certain amount of water for power generation to a
<br />political subdivision, or could lease power privileges to a governmental or
<br />nongovernmental body for a fifty-year period.99 At the end of this period,
<br />the United States could take over the lessee's property upon the payment
<br />of proper compensation or make a lease with a new lessee who would
<br />lIlake the required compensation.lOO Nevada and Arizona point out that
<br />the original proposal, like the Federal Power Act, was intended to grant
<br />the lessee a permanent right to the power subject to these recapture provi-
<br />sions.101 Thus, it was intended that at the end of the fifty-year period, the
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<br />97. There were four Swing-Johnson Bills during the period from 1922 to 1928', the last of
<br />ahicb became the Boulder Canyon Project Act. See DOCUMENTS, supra note 4, at 38-40. The
<br />full two were not reported out of committee. Id. at 39. The third bill was killed by an A~na
<br />ilibuster. It/. at 40. The fourth bill became law as the BCPA in 1928. It/. at 42.
<br />98. See Nevada Brief, supra note 8, at 19. The Federal Power Act, 16 U.S.C. ~ 807(a) (1976)
<br />~nni\S the recapture of the original licensee's property right to operate the project under these
<br />wDditions:
<br />Upon not less than two years' notice in writing from the Commission the United
<br />States shall have the right upon or after the expiration of any license to take over and
<br />thereafter to maintain and operate any project or projects. . . or the right to take over
<br />upon mutual agreement with the licensee all property owned and held by the licensee
<br />then valuable and serviceable in the development, lransmi~sion, or distribution of power
<br />and which is then dependent for its usefulness upon the continuance of the license. . .
<br />upon the condition that before taking possession it shall pay the net investment of the
<br />licensee in the project or projects taken, not to exceed the fair value of the property
<br />taken, plus such reasonable damages, if any, to property of the licensee valuable, service-
<br />able, and dependent as above set forth but not taken, as may be caused by the severance
<br />therefrom of property taken, and shall assume all contracts entered into by the licensee
<br />with the approval of the Commission.
<br />16 U.S.C. ~ 808(a) (1976) authorizes a new licensee to take over the project under the conditions
<br />prescribed in 16 U.S.C. ~ 807 (1976) if the United States does not exercise its ~ 807 right.
<br />99. The original two Swing-Johnson bills provided:
<br />SEC. 4. That the said Secretary is authorized to make leases of the power privileges ~
<br />allocated, limited to fifty years, on such terms and under such regulations liS he may
<br />pres..."libe, and to fix what he may find to be a reasonable compensation therefor. Upon
<br />or after the expiration of any such lease, or renewal thereof the United States may take
<br />over the property of the lessee which is dependent for its usefulness upon the continua-
<br />tion of the lease, and if it shall do so shall pay to the lessee its net investment in the
<br />property taken, not exceeding the fair value thereof at the time it is so taken, with rea-
<br />sonable severance damages to property of the lessee not taken. Such net investment, or
<br />fair value and damages, if not agreed upon, shall be fixed by a proceeding in equity in
<br />the district court of the United States in the district in which such property, or some part
<br />thereof, is situated. If the United States does not exercise its right to take over such
<br />property, the Secretary of the Interior may, by agreement with the lessee, renew the said
<br />lease for not more than fifty years, or in his discretion may make a lease under the terms
<br />hereof to a new lessee. upon the condition that such new lessee shall pay to the former
<br />lessee such net investment and damages determined as aforesaid. If such property is not
<br />taken over by the United States, or such new lessee, or such lease renewed, the said
<br />Secretary shall extend such lease from year to year until such property is so taken over or
<br />such lease renewed.
<br />S~ Nevada Brief, Jupro note 8, at 19-21; supra note 98.
<br />100. See Nevada Brief, .Iupra note 8, at 21; supra notes 98-99 and accompanying text.
<br />2d 101. Hearings on S. 727 Before the Senate COmln. on Irrigation aiUI Reclamation, 68th Cong.,
<br />Sess. 39-40 (1924-1925). /
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