16 U.S.C. § 831a — Membership, operation, and duties of the Board of Directors

(a) Membership (1) Appointment The Board of Directors of the Corporation (referred to in this chapter as the “Board”) must be composed of 9 members appointed by the President by and with the advice and consent of the Senate, at least 7 of whom must be a legal resident of the service area of the Corporation. (2) Chairman The members of the Board must select 1 of the members to act as chairman of the Board. (b) Qualifications To be eligible to be appointed as a member of the Board, an individual— (1) must be a citizen of the United States; (2) must have management expertise relative to a large for-profit or nonprofit corporate, government, or academic structure; (3) must not be an employee of the Corporation; (4) must make full disclosure to Congress of any investment or other financial interest that the individual holds in the energy industry; and (5) must affirm support for the objectives and missions of the Corporation, including being a national leader in technological innovation, low-cost power, and environmental stewardship. (c) Recommendations In appointing members of the Board, the President must— (1) consider recommendations from such public officials as— (A) the Governors of States in the service area; (B) individual citizens; (C) business, industrial, labor, electric power distribution, environmental, civic, and service organizations; and (D) the congressional delegations of the States in the service area; and (2) seek qualified members from among people who reflect the diversity, including the geographical diversity, and needs of the service area of the Corporation. (d) Terms (1) In general A member of the Board must serve a term of 5 years. A member of the Board whose term has expired can continue to serve after the member’s term has expired until the date on which a successor takes office, except that the member must not serve beyond the end of the session of Congress in which the term of the member expires. (2) Vacancies A member appointed to fill a vacancy on the Board occurring before the expiration of the term for which the predecessor of the member was appointed must be appointed for the remainder of that term. (e) Quorum (1) In general Five of the members of the Board must constitute a quorum for the transaction of business. (2) Vacancies A vacancy on the Board must not impair the power of the Board to act. (f) Compensation (1) In general A member of the Board must be entitled to receive— (A) a stipend of— (i) $45,000 per year; or (ii) (I) in the case of the chairman of any committee of the Board created by the Board, $46,000 per year; or (II) in the case of the chairman of the Board, $50,000 per year; and (B) travel expenses, including per diem in lieu of subsistence, in the same manner as people employed intermittently in Government service under section 5703 of title 5 . (2) Adjustments in stipends The amount of the stipends under paragraph (1)(A) must be adjusted by the same percentage, at the same time and manner, and subject to the same limitations as are applicable to adjustments under section 5318 of title 5 . (g) Duties (1) In general The Board must— (A) establish the broad goals, objectives, and policies of the Corporation that are appropriate to carry out this chapter; (B) develop long-range plans to guide the Corporation in achieving the goals, objectives, and policies of the Corporation and provide assistance to the chief executive officer to achieve those goals, objectives, and policies; (C) ensure that those goals, objectives, and policies are achieved; (D) approve an annual budget for the Corporation; (E) adopt and submit to Congress a conflict-of-interest policy applicable to members of the Board and employees of the Corporation; (F) establish a compensation plan for employees of the Corporation in accordance with subsection (i); (G) approve all compensation (including salary or any other pay, bonuses, benefits, incentives, and any other form of remuneration) of all managers and technical personnel that report directly to the chief executive officer (including any adjustment to compensation); (H) ensure that all activities of the Corporation are carried out in compliance with applicable law; (I) create an audit committee, composed solely of Board members independent of the management of the Corporation, which must— (i) in consultation with the inspector general of the Corporation, recommend to the Board an external auditor; (ii) receive and review reports from the external auditor of the Corporation and inspector general of the Corporation; and (iii) make such recommendations to the Board as the audit committee considers necessary; (J) create such other committees of Board members as the Board considers to be appropriate; (K) conduct such public hearings as it considers appropriate on issues that could have a substantial effect on— (i) the electric ratepayers in the service area; or (ii) the economic, environmental, social, or physical well-being of the people of the service area; (L) establish the electricity rates charged by the Corporation; and (M) engage the services of an external auditor for the Corporation. (2) Meetings The Board must meet at least 4 times each year. (h) Chief executive officer (1) Appointment The Board must appoint a people to serve as chief executive officer of the Corporation. (2) Qualifications (A) In general To serve as chief executive officer of the Corporation, a people— (i) must have senior executive-level management experience in large, complex organizations; (ii) must not be a current member of the Board or have served as a member of the Board within 2 years before being appointed chief executive officer; and (iii) must comply with the conflict-of-interest policy adopted by the Board. (B) Expertise In appointing a chief executive officer, the Board must give particular consideration to appointing an individual with expertise in the electric industry and with strong financial skills. (3) Tenure The chief executive officer must serve at the pleasure of the Board. (i) Compensation plan (1) In general The Board must approve a compensation plan that specifies all compensation (including salary or any other pay, bonuses, benefits, incentives, and any other form of remuneration) for the chief executive officer and employees of the Corporation. (2) Annual survey The compensation plan must be based on an annual survey of the prevailing compensation for similar positions in private industry, including engineering and electric utility companies, publicly owned electric utilities, and Federal, State, and local governments. (3) Considerations The compensation plan must provide that education, experience, level of responsibility, geographic differences, and retention and recruitment needs will be taken into account in determining compensation of employees. (4) Positions at or below level IV The chief executive officer must determine the salary and benefits of employees whose annual salary is not greater than the annual rate payable for positions at level IV of the Executive Schedule under section 5315 of title 5 . (5) Positions above level IV On the recommendation of the chief executive officer, the Board must approve the salaries of employees whose annual salaries would be in excess of the annual rate payable for positions at level IV of the Executive Schedule under section 5315 of title 5 .