1. Defalcation of Funds From the Association of Bay Area Govern

ments.

(a) Summary.-The subcommittee conducted an investigation into the defalcation of approximately $500,000 in Federal moneys which had been received by the Association of Bay Area Governments in Berkeley, Calif., by grant from the Department of Housing and Urban Development (HUD). Investigators were dispatched to the locale and conferences were held with the regional director and other officials of HUD, the district attorney, officials of the association and representatives of private auditing firms. A number of reports were subsequently received from the Department of Housing and Urban Development, including certain suggested changes in procedures for handling grant funds.

(b) Benefits. It is not possible to estimate the benefits which will accrue from this investigation. It can be said, however, that a number of changes have taken place in HUD procedures as a result of this incident and our investigation. They are designed to reduce the likelihood of a repetition of such defalcation on the part of numerous recipients of HUD grants.

2. Acquisition of Apartment Building by the Annapolis (Md.) Housing Authority.

(a) Summary.-A preliminary inquiry was continued concerning the acquisition of an apartment building by the Annapolis (Md.) Housing Authority, participated in by the Department of Housing and Urban Development, to determine whether the intent of the authorizing legislation was followed and whether an excessive amount of Federal funds was expended in connection with the transaction. Information received from the Secretary of HUD was studied. It was determined that no formal investigation should be made.

(b) Benefits. No estimate of benefits is possible.

3. The Budget Process in the Federal Government.

(a) Summary.-The subcommittee has been engaged in a continuing study of the budget process in the Federal Government in an effort to determine if changes should be made in the Budget and Accounting Act to improve the system. One immediate result of this continu

ing study has been the compilation of descriptive and explanatory material on the budget process and the instructions on budgeting issued by the Bureau of the Budget to the various Federal agencies. These all require careful study by the subcommittee members and staff. The compilation is listed among committee prints (see IV.1., below).

One phase of the budget process is being given special attention: that relating to the fiscal year and whether or not it should be changed to coincide with the calendar year or with some other period. There is also under consideration a further overall study of the structure and operation of the Bureau of the Budget in lieu of the adoption of a resolution (H. Res. 350) pending before the Committee on Rules.

(b) Benefits.-The continuing study referred to above has not yet. reached a point where benefits may be calculated. However, since this goes to the heart of the vast expenditures by the Federal Government, it can be expected that the benefits will be substantial.

4. Payments in Lieu of Taxes.

(a) Summary.--The subcommittee has been engaged in a study of the feasibility of extending Public Law 388 of the 84th Congress to allow payments to local communities to be made in lieu of taxes on properties owned by the Government but transferred from the Reconstruction Finance Corporation. This is a complex and difficult subject and must relate to overall Government policy with regard to payments to local communities where Federal properties are found. This study has become merged with pending legislation to continue such payments inasmuch as the scope of our review is still confined to RFC properties. (See II.8., below).

(b) Benefits.-No estimate of benefits can be made at this time. 5. President Nixon's Proposed Realinement of Certain Regional Boundaries.

(a) Summary.-A special study was conducted into the President's announcement on the restructuring of regional boundaries and locations for five Federal departments and agencies engaged in social or economic programs. Hearings were held on May 8, 1969, followed by consultation and conferences with officials of the Bureau of the Budget. the affected agencies, Members of Congress, and representatives of local communities. The investigation resulted in a considerable change in boundary alinement and regional office locations. These changes were contained in a statement issued by the President on May 21, 1969. The subcommittee's efforts produced a far more efficient and rational arrangement, which proved satisfactory to virtually all of the interested parties. Transcript printed.

(b) Benefits. These efforts by the subcommittee were clearly productive in benefits. One of the major weaknesses of the original plan of the President was the cost of travel by Federal employees within the new regional boundaries. This cost should be substantially reduced by the revised program. However, as the President's plan was only to be put into effect gradually, these savings have not yet been revealed. 6. General Accounting Office Procedures in Processing Audit Reports. (a) Summary.-On the basis of a protest made by a Member of Congress, the subcommittee began an inquiry into the procedures followed by the General Accounting Office in the preparation of audit

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reports and the timing of their submission to Congress. One of the major questions involved is whether or not the GAO should seek agency comments on its findings and recommendations and then make revisions before the reports are transmitted to Congress. This requires detailed study and careful analysis, and such is being attempted. (b) Benefits.-Inasmuch as this study is not completed, no estimate of benefits is possible.

7. General Accounting Office Report on Contract Overruns.

(a) Summary.—An investigation was begun into serious allegations of contract overruns in the Department of Defense and other agencies. This study, however, became merged with pending legislative proposals requiring reports by GAO to Congress on such overruns. After the full committee reported a bill to establish a Commission on Government Procurement and such legislation was subsequently enacted into law, we decided not to proceed further with this investigation inasmuch as contract overruns would, undoubtedly, be an important aspect of the new Commission's study.

(b) Benefits.-No estimate of benefits is available at this time. 8. Reorganization by Plan and by Statute.

(a) Summary. The subcommittee has undertaken a compilation of reorganizations that have taken place in the Federal Government by statute and by reorganization plan from 1946 through 1968. This compilation is being made with the cooperation of the Legislative Reference Service of the Library of Congress. The compilation is practically complete and a committee print is being prepared for printing.

(b) Benefits. This compilation will be extremely helpful to Members of Congress and to this committee, for it will enable a more ready evaluation of the results of such reorganizations. No estimate of the benefits is possible at this time.

II. Legislation

1. S. 1058, to extend the period within which the President may transmit to the Congress plans for reorganization of agencies of the executive branch of the Government.

(a) Report number and date.-House Report 91-80, March 13, 1969. (b) Summary of measure. The purpose of S. 1058 was to extend for approximately 2 years the authority granted to the President in the Reorganization Act of 1949, now codified in title 5, United States Code, sections 901-913, to submit reorganization plans to the Congress. The authority, which lapsed on December 31, 1968, was requested by President Nixon in a special message to Congress dated January 30, 1969.

(c) Legislative status.-After hearings on this bill (and nine related House bills), the subcommittee favorably reported S. 1058 to the full committee on March 10, 1969. It was reported by the full committee to the House on March 13, 1969. After floor debate, the bill passed the House and was approved by the President on March 27, 1969, thus becoming Public Law 91-5.

(d) Hearings.-March 10, 1969. Transcript printed.

2. H.R. 337, to increase the maximum rate of per diem allowance for employees of the Government traveling on official business, and for other purposes.

(a) Report number and date.-House Report 91-111, March 20, 1969. (b) Summary of measure.-This bill was introduced to amend the then existing travel expense legislation for Government employees to increase the maximum per diem in lieu of subsistence and the maximum amounts which could be reimbursed when actual expenses are paid to more nearly reflect the costs of official travel.

(c) Legislative status. After hearings, the subcommittee approved the bill, with amendments, and reported it to the full committee on March 19, 1969. The full committee adopted the bill, as amended by the subcommittee, and reported it favorably to the House on March 20, 1969. Following a hearing on the measure before the Committee on Rules on March 25, 1969, an open rule with 1 hour of debate was granted. After floor debate, the bill passed the House on March 26, 1969. In the Senate, it was amended. The House agreed to the Senate amendments on October 30, 1969, after which the legislation was approved on November 10, 1969; thus becoming Public Law 91-114. (d) Hearings.-March 19, 1969. Transcript printed.

3. H.R. 14517, to provide temporary authority to expedite procedures for consideration and approval of projects drawing upon more than one Federal assistance program, to simplify requirements for the operation of those projects, and for other purposes. (a) Report number and date.-House Report 91-659, November 19, 1969.

(b) Summary of measure.-H.R. 14517, the Joint Funding Simplification Act of 1969, is a clean bill introduced in lieu of H.R. 6654. It has as its purpose to facilitate the consideration and approval of project applications for Federal assistance from State or local public and private agencies under ongoing Federal grant-in-aid programs when the projects must draw upon two or more such Federal grant programs.

(c) Legislative status.-Hearings were held by the subcommittee on H.R. 6654. The subcommittee, meeting in executive session on October 22, 1969, considered H.R. 6654 and decided that a clean bill be introduced to incorporate several changes made during the markup of the original bill. H.R. 14517 was subsequently introduced and reported favorably to the full committee. It was approved by the full committee on November 12 and reported to the House on November 19, 1969. Under suspension of rules, the measure was called up on the House floor and passed on December 1, 1969. No action by the Senate has been taken.

(d) Hearings.-March 24, 1969. Transcript printed.

4. H.R. 15165, to establish a Commission on Population Growth and the American Future.

(a) Report number and date.-House Report 91-738, December 10, 1969.

(b) Summary of measure.-H.R. 15165 is a clean bill introduced in lieu of S. 2701 and related House bills to incorporate several amendments adopted by the subcommittee. It would establish a Commission on Population Growth and the American Future to conduct and spon

sor studies and research and make necessary recommendations regarding a broad range of problems associated with population growth and their implications for America's future.

(c) Legislative status.-After hearings on S. 2701 and related House bills, the subcommittee met in executive session on December 9, 1969. and considered S. 2701, making amendments thereto. H.R. 15165 was subsequently introduced as a clean bill, approved by the subcommittee, and reported to the full committee. It was amended by the full committee and reported to the House on December 10, 1969. The bill is pending on the Union Calendar.

(d) Hearings.-November 19 and 20, 1969. Transcript to be printed. 5. S. 740, to establish the Cabinet Committee on Opportunities for Spanish-Speaking People, and for other purposes.

(a) Report number and date.-House Report 91-699, December 4,

1969.

(b) Summary of measure.-S. 740 would establish the Cabinet Committee on Opportunities for Spanish-Speaking People, which, in turn, will help carry out the bill's basic purpose: "to assure that Federal programs are reaching all Mexican-Americans, Puerto RicanAmericans, Cuban-Americans, and all other Spanish-speaking and Spanish-surnamed Americans and providing the assistance they need, and to seek out new programs that may be necessary to handle problems that are unique to such persons.

(c) Legislative status.-S. 740 and related House bills were rereferred to the Committee on Government Operations, and subsequently to this subcommittee, from the Committee on Foreign Affairs. Following hearings on the bills, the subcommittee met in executive session, adopted S. 740, with amendments, and reported it to the full committee on November 26, 1969. The full committee adopted the bill, as amended by the subcommittee, and reported it favorably to the House on December 4, 1969. On December 8, 1969, a hearing on this measure was held by the Committee on Rules, after which an open rule was granted with 1 hour of debate and waiving points of order against section 9 of the bill. The legislation was called up on the House floor on December 16 where, after debate, it was passed. The Senate accepted the House amendments on December 18, clearing the bill for the President. The President signed the bill December 30, 1969, becoming Public Law 91-181.

6. H.R. 6037, to establish a Department of Consumer Affairs in order to secure within the Federal Government effective representation of the interests of consumers; to coordinate the administration of consumer services by transferring to such Department certain functions of the Departments of Commerce; Labor; Agriculture: and Health, Education, and Welfare; and for other purposes. (a) Report number and date.-This bill is pending before the subcommittee; therefore, it has not been reported.

(b) Summary of measure.-H.R. 6037 was introduced to establish a new Department of Consumer Affairs to which would be transferred certain consumer functions of the Departments of Health, Education, and Welfare, Agriculture and Labor and all functions under title I of the Truth-in-Lending Act; to set up an Office of Consumer Information and a National Consumer Information Foun