On April 2, 1937, Ickes moved to the courts, requesting the Department of Justice to file suit to prevent further power sales to Pacific Gas and Electric Company. Events moved quickly. OnApril ii judge Michael J. Roche of the federal district court handed down a decision granting Ickes's wish for an injunction and declaring the 1925 agreement in violation of the Raker Act. However, Roche granted suspended enforcement for six months, until December 28, 1938. On October 17 San Francisco attorney John O'Toole filed an appeal to the Ninth Circuit Court of Appeals, tying up the whole matter in the courts. The appeal forced judge Roche to grant a number of injunction extensions. Ickes felt bedeviled by the snail's pace of the proceed ings, and in March he leaked to the press that the government might take over the Moccasin Creek Power Plant, citing the section 6 provision that if San Francisco violated the Raker Act, "this grant shall revert to the government of the United States."32
On September 13 the Ninth Circuit Court of Appeals overturned judge Roche's decision, concluding that since the voters had refused to pass a bond act for purchase, San Francisco had no choice but to allow PG&E to act as "agent" for the city. Ickes immediately asked the justice Department to appeal to the U.S. Supreme Court. On April 22, 1939, Supreme Court Justice Hugo Black delivered the opinion of the court, reversing the circuit court on the basis that "Congress clearly intended to require-as a condition of its grant-sale and distribution of Hetch Hetchy power exclusively by San Francisco and municipal agencies directly to consumers in the belief that consumers would thus be afforded power at cheap rates in competition with private power companies, particularly Pacific Gas & Electric Company." Therefore, Black wrote, the injunction was both appropriate and necessary. Representing an eight-to-one majority, Black's decision supported Ickes.33
While the case was working its way through the courts, the relationship between Secretary Ickes and Mayor Rossi and the supervisors deteriorated. Ickes, in charge of the massive federal Public Works Administration (PWA), was not above using the carrot of a federal grant to bring the city into compliance with the Raker Act. In early July 1938 a series of "monstrous telegrams"-as Ickes described them-between the two illustrated the growing frustration. Ickes asked Rossi if "The City Intends To Submit As Part Of Its Public Works Program The Proposal For Distribution Of Hetch Hetchy Power?" In response, the mayor argued that the city was doing everything in its authority. In May 1936 the supervisors submitted a proposal to Ickes for $53,127,000 for an electrical distribution center, of which $12,500,000 would be covered by a PWA grant. The city intended to put the $40,580,000 city contribution to a vote in the near future. It would be presented as a revenue bond, requiring only a majority vote. Ickes did not respond. Rossi accused the secretary of delaying tactics, claiming that evidently the application for $12.5 million reposed "In a Pigeonhole in your office." In high dudgeon, Rossi attacked what he considered Ickes's belligerent tone: "I cannot understand your stubborn and dictatorial attitude toward the good people of San Francisco, and particularly our unemployed." Although the mayor had been patient, Ickes had "not properly digested my telegrams," and the secretary was "sadly lacking in . . . knowledge of city and state legislature procedure in this which is one of the largest states in the union." Clearly the mayor could not be easily intimidated. Sensing, perhaps, that he had gone too far, on July 11, Ickes terminated the exchange:
In View of What Appears to Be Your Continued Deliberate Intention to Misrepresent, Based on a Pretended Interpretation of My Language, Which Is Not Justified, I Can See No Point in Replying to Yours of July 9 Further Than This Acknowledgment.34
Ickes denied that he used any sort of intimidation with regard to Public Works Administration monies. He could point to his approval of PWA and WPA funds to assist the city in the project to raise the O'Shaughnessy Dam. Yet Mayor Rossi was not completely off the mark. In his July 16, 1938, diary entry Ickes reviewed the situation, noting that Rossi "pretended that I was threatening him with a refusal to approve any PWA project unless San Francisco decided to build the line. Frankly, this latter conclusion was not entirely an unjustified one. I suppose that there was an implied threat in my telegram, but as a matter of fact I had not decided that I would adopt such a course as that."35
We have no way of knowing whether Ickes did "pigeonhole" the San Francisco WPA application. However, if he did, he seriously undercut his own desire to have San Francisco comply with section 6 and bring the city the benefits of public power. On May 19, 1939, the supervisors once again submitted to the voters a charter amendment to issue $55 million in bonds for public power.The vote was decisive: 50,283 yes to 123,118 110.36 If the bond amount requested had been for $40,580,000, with the understanding that the federal government would kick in another $12, 500,000 inWPA funds, the vote count would have been different, although not enough to allow passage. On the other hand, Ickes accused Rossi and City Attorney O'Toole of failure to seek WPA funds. In 1941 the secretary suggested that had San Francisco sought to build its own electrical infrastructure (thus creating jobs), aWPA grant could have provided 45 percent of the cost.The city then could have funded the remaining 55 percent through a federal low-interest loan.37
The overwhelming vote against public power in 1939 indicated that virtually nothing Ickes, the mayor, or the supervisors could do would change the minds of San Francisco voters. Residents wanted a public water system, but they stood firm with the private power of PG&E. Why? Some believed that a publicly regulated private power company was more efficient than a bureaucratic municipally owned one. For many people the issue seemed to be one of political ideology. Numerous Republicans saw their vote as a protest against the New Deal. Elizabeth Cosby, writing to Ickes on behalf of the Women's City Club of San Francisco, complained that "the old, anti quated Horse and Buggy Raker Act is being used by autocratic, centralized government to circumvent the will of a free community." Cosby noted that "the vote has eight times defeated a political attempt to socialize the electric light business of our city"38 PG&E advertising, aimed at undermining public power, influenced voters. Also, the company worked at establishing a broad ownership of the corporation's stock.Yet many San Franciscans preferred a regulated private monopoly over another government bureaucracy. They argued the efficiency of a profit-motivated company. Finally, a public bureaucracy appeared more economical only because, unlike a private company, it paid no taxes on its property and infrastructure. If one factored in the taxes PG&E paid to the city, the advantages of public power dwindled.39
Secretary Ickes must take some blame for San Francisco's refusal to endorse public power. It was a matter of personality. Many San Franciscans did not oppose public power as much as they did Ickes himself, whom they perceived as a bullying Washington bureaucrat sticking his nose in the city's business. In his determination to win, the secretary pulled no punches, using the courts, federal grants, and an uncompromising interpretation of section 6 to bring the city to its knees. At times Ickes seemed much less interested in civility and solutions than in confrontation, threats, revenge, and triumph. Although he denied it, the secretary seemed to have a personal vendetta against the leaders of San Francisco and even the voters-at least that was the opinion from Mayor Rossi's office and most of the local newspapers. The one political power that residents possessed was the vote, and they used it.
By 1940 the Hetch Hetchy power issue had become a confrontation between Ickes and the federal government, on one hand, and the people of San Francisco on the other. In mid July a San Francisco News headline announced, "S. F DELEGATION GETS READY TO FACE THAT TERRIBLE ICKES MAN ON SUBJECT OF HETCHY" The impression was that Ickes was immovable and impossible. After the delegation of Rossi, City Engineer Cahill, and City Attorney O'Toole returned from another Washington meeting empty-handed, the San Francisco Examiner chastised Ickes, a man who "stubbornly refused to permit SF to act economically and rationally." Journalist Arthur Caylor of the News suggested that since the delegation had returned with "a suitcase full of black eyes," stalling should b
e the new strategy. "The idea is simply that the election of [Wendell] Willkie would mean the end of Ickes." 40 However, most San Franciscans could not count on Franklin Roosevelt losing the election. Perhaps anticipating FDR's victory, City Attorney O'Toole penned a letter to Senator Hiram Johnson, inquiring if he might set up a meeting with President Roosevelt, thus bypassing the secretary of the interior.
The other solution, often bandied about, was to amend the Raker Act, clearing away the obstacle of section 6. When the November election returned Roosevelt, the California congressional delegation introduced House Resolution 5964, which simply said, `Be it enacted . . . that the words `or the electric energy' be . . . stricken from Section 6."After ii days of testimony the House Committee on Public Lands failed to move the bill forward. Issues that pitted public power against private utilities created contro- versy.41 The bill died, and with it the hope of San Franciscans for a solution by amending section 6.
Meanwhile Ickes wrestled with what to do with his Supreme Court decision. There was no question that he would recommend that justice Hugo Black's majority decision be enforced with an injunction. But when? In May 1941 Mayor Rossi, City Attorney John O'Toole, public utilities manager E. G. Cahill, supervisors, and citizens again journeyed to Washington. The party of 12 met with Ickes and four assistants in the interior conference room on the morning of May 21. From the onset the meeting went badly. Ickes expected that the delegation would have a plan, one that would finally meet the conditions of section 6. To his displeasure the delegation had none. He said, "You might just as well have saved your carfare." O'Toole pleaded that "all we are here for is to ask whether you will give us consideration and give us time to work out our plans." Cahill admitted he was working on a 20-year leasing arrangement with PG&E "which will completely satisfy every demand of the Raker Act." Ickes asked how long the lease agreement would take to complete, and Cahill opined that it could be signed in six months. Ickes doubted that estimate in view of San Francisco's track record "of delay, evasion and double-crossing." Ickes believed that "all you want is time enough until I am out of office."42
The secretary, rising to the occasion, lectured the delegation that his relationship with the city in 1933 had been friendly but then it had dawned on him "that cooperation with San Francisco was a one-handed implement, San Francisco holding the handle." Ickes pointedly asked O'Toole when the federal government had filed suit against the city. "April of 1936," came the answer.
SECRETARY ICKES: That was 4 years ago and you started out with judge Roach's [sic] opinion against you, so that any reasonable man might have concluded that he had only a 50-50 chance of winning the case in the Supreme Court, and during those 4 years what has the City of San Francisco done to get ready? All they did, apparently, was to come in to ask for more time, Mr. Cahill.
MR. O'TOOLE: I do not want to interrupt your trend of thought, but the record will show that during those 4 years upon two different occasions we presented to the people an amendment to the charter which, if passed, would have permitted the financing.
SECRETARY ICKES: Mr. O'Toole, you did not want those passed, and you did not raise a finger to cause them to be passed. The very profits that went to P.G.&E., some of it at any rate, went back into the election and went back to some of the organizations represented to help fight that amendment which was proposed.
The hearing continued in this vein, with Ickes commenting to O'Toole that any man can be fooled once, but a man's a damn fool if he allows himself to be fooled the second time, and this isn't even the second time." After Ickes disposed of O'Toole, he quizzed Cahill regarding a lease of the San Francisco electrical infrastructure from PG&E. Cahill reluctantly agreed to try to negotiate a 20-year lease agreement for $So million within 6o days, although he warned Ickes that "I do not think I can succeed."
SECRETARY ICKES: I wish you would go back with less of a defeated attitude.
MR. CAHILL: I do not have a defeated attitude.You are asking me to do something practically impossible.
SECRETARY ICKES: [Turning to Mayor Rossi] If I were you I would send somebody else over to Mr. Black's office [a PG&E negotiator].
The meeting, which focused on personalities more than issues, finally concluded with Representative Frank Havenner, who had worked for many years for some sort of resolution, asking that "we ought to abandon all hostility" and stop "throwing monkey wrenches in the whole machinery." The San Franciscans boarded the train with the understanding that Cahill would attempt to negotiate a lease agreement with PG&E within the next 60 days 43
In late August 1940 Mayor Rossi returned to Washington. Manager Cahill and City Attorney O'Toole stayed home, thus avoiding the secretary's wrath. However, at this particular meeting there were no tongue-lashings. Ickes, Rossi, and representatives Havenner and Richard Welch focused on support for a leasing understanding with PG&E. Ickes was intent on getting the San Francisco Chamber of Commerce, the newspapers, and various other business and civic groups behind another municipal bond election, or at least support of a leasing agreement. Everyone agreed with Mayor Rossi that "the Supreme Count has spoken and that presents a different case to the people." With assurances that city officials and local business associations would help carry out the Supreme Court mandate, Ickes was willing to delay enforcement of the injunction until June 1, T94T.44
By late November 1940 the city had come to a tentative agreement with PG&E. The city would lease the company infrastructure for 20 years at a fixed charge of $4.9 million per annum. Amidst criticism from Ickes and others, Cahill claimed it was the best the city could do. After a number of discussions, Ickes finally declared that the proposed lease was not in the best interests of the city and not in compliance with the Raker Act.45
The secretary continued to wield the threat of an injunction, but he remained flexible. Rossi had indicated that in 1941 the city officials were in a better position to convince the people of the benefits of public ownership. Therefore, if the city scheduled another election, Ickes would recommend a stay of the injunction until June 30, 1942. He warned, however, "the ultimate limits of tolerance, beyond which a government official cannot go, have certainly been reached."Three questions must be answered: Did the city wish to own and operate its own electrical system? Did it want the benefits of public ownership, particularly lower rates? Did the citizens wish to comply with the Raker Act?
The secretary received his answers in November 1941,when again the citizens defeated the bond measure. To be sure, PG&E influenced the election by spending $62,000 on negative advertisements and strategically lowering rates; however, the voters were not going to support public power. Late in the month, the secretary informed Mayor Rossi that he had no choice but to enforce the injunction, with the federal government taking possession of O'Shaughnessy Dam and the Moccasin Creek Power Plant.46
As it happened, he did have a choice. The Japanese attack on Pearl Harbor, December 7, 1941, changed everything. For San Francisco it offered a reprieve from Ickes and a temporary solution to a very old problem. Suddenly the nation needed all available power, and to place an injunction on Hetch Hetchy hydropower would have been both unpatriotic and politically unwise. Ickes found a solution. He wedded wartime needs with Hetch Hetchy, terminating the 1925 power contract with PG&E and selling all available power to an aluminum smelting plant, built by the Defense Plant Corporation (part of the War Production Board) and located near Modesto, at Riverbank on the Stanislaus River. The city received $2,405,000 a year and was finally in compliance with the Raker Act. One San Francisco newspaper commented that "those whose favorite indoor pastime a few months ago was to think up new epithets to apply to Secretary Ickes would do well to recant now"47
Welcomed as it was, the aluminum plant proved to be a fleeting solution. Opened in early July 1943, the Defense Plant Corporation informed the Alcoa Company executives that the plant would close in August 1944. Aluminum was available elsewhere. Furthermore, a pollution damage suit for $580,000 (injury to crops, livestock, a
nd people) gave notice to government officials that the plant had not been a good neighbor to the community.4S In his annual message Mayor Roger D. Lapham addressed the difficulty, opening the old wound that some hoped had been closed:
Last August without notice to the City, this aluminum plant was suddenly shut down and since then, the city has been delivering only a very nominal amount of power for upkeep of the plant. On June 28, 1944, judge Roche of the U.S. Federal Court had given the city until August 28th to produce a plan . . . which would comply with the visions of the Raker Act.49
It was back to the drawing board for Ickes and Mayor Lapham. However, the drama included a new cast of characters. In early 1945 Ickes was still secretary, but Abe Fortas, his assistant, who later would be appointed to the U.S. Supreme Court, carried on the negotiations. Dion Holm, attorney for the San Francisco Public Utilities Commission, and James Turner, chief engineer, assisted Mayor Lapham. These players plus others could be found often at Washington's Carlton Hotel. They worked hard, and on May 14, 1945, the city and PG&E entered a contract whereby the company wheeled Hetch Hetchy power from its Newark substation to various points in the city, to be used for the Market Street railroad, streetlights, and other city-owned facili- ties.The city paid PG&E in cash and on a kilowatt-hour basis and could not be paid in electric energy. Ickes and Fortas believed the contract was in reasonable compliance with the Raker Act. 511
The Battle over Hetch Hetchy: America's Most Controversial Dam and the Birth of Modern Environmentalism Page 24