President Obama's tardy budget proposal suggests the possible sale of all or part of the Tennessee Valley Authority:
"Reform TVA. Since its creation in the 1930s during the Great Depression, the Federally-owned and operated Tennessee Valley Authority (TVA) has been producing low-cost electricity and managing natural resources for a large portion of the Southeastern United States. TVA's power service territory includes most of Tennessee and parts of Alabama, Georgia, Kentucky, Mississippi, North Carolina and Virginia, covering 80,000 square miles and serving more than 9 million people. TVA is a self-financing Government corporation, funding operations through electricity sales and bond financing.
In order to meet its future capacity needs, fulfill its environmental responsibilities and modernize its aging generation system, TVA's current capital investment plan includes more than $25 billion of expenditures over the next 10 years. However, TVA's anticipated capital needs are likely to quickly exceed the agency's $30 billion statutory cap on indebtedness.
Reducing or eliminating the Federal Government's role in programs such as TVA, which have achieved their original objectives and no longer requires Federal participation, can help put the Nation on a sustainable fiscal path. Given TVA's debt constraints and the impact to the Federal deficit of its increasing capital expenditures, the Administration intends to undertake a strategic review of options for addressing TVA's financial situation, including the possible divestiture of TVA, in part or as a whole."
Congressman Brooks' response to President Obama's budget proposal is as follows:
"Article I, Section 8 of the United States Constitution grants the federal government control over America's navigable waterways. The TVA's principal function is to own and operate locks and dams to both protect Tennessee Valley citizens from floods and ensure that the Tennessee River is navigable for commercial and recreational boat traffic. I know of no circumstance that justifies President Obama forcing the TVA to abandon its flood control and navigable waterway roles that it has performed so admirably for more than seven decades.
"President Obama claims he is considering the sale of TVA to "help put the Nation on a sustainable fiscal path.' President Obama's claim is unsupportable and inexplicable for three reasons. First, the TVA is self-sufficient. The TVA receives no federal taxpayer subsidy. The federal government is not responsible for TVA's capital debt. Hence, the TVA does not contribute one dime to America's out-of-control deficits or troubling accumulated debt. Second, there is no indication that the TVA's non-waterway assets, after deduction for capital cost and debt burden, can be sold for a profit. Further, any profit, if any, would be so small as to have no noticeable effect on America's deficits or debt. Third, if President Obama is truly concerned about and motivated by America's "sustainable fiscal path,' the President would be proposing substantial cuts to foreign aid, entitlements, welfare give-away and other programs that drive America's deficits and threaten America with a debilitating insolvency and bankruptcy. The absence of substantive spending cuts in President Obama's Budget suggest the President either has not done his homework or is motivated by something unrelated to America's "sustainable fiscal path.'
"Notwithstanding that the President's proposal to consider selling TVA comes from left field, and apparently with little or no prior consultation with Congress, I am willing to consider the President's proposal to sell TVA assets that are unrelated to TVA's locks, dams, flood control responsibilities and navigable waterway duties provided the President can make that case to Tennessee Valley citizens that doing so will lower the costs of electricity to TVA consumers and is in America's interests. Quite frankly, I am skeptical the President can make that case."