10. The Foreign Agricultural Service's Program in South America. and the Far East for Market Development.

Summary. The subcommittee continued its study of the Foreign Agricultural Service's market development program, concentrating its attention on the areas of South America and Asia, although European and Mediterranean areas were examined also. The study indicated slippages on the part of the agency in the control of cooperator organization expenses for entertainment purposes, as well as in program funding, as sales of commodities and products overseas declined. Additional information is being gathered for possible hearings.

11. Status of Accounting Systems in Government Agencies and Departments to Date.

Summary. The study of the efforts being undertaken by the departments and agencies to modernize their accounting systems and submit them to the Comptroller General for approval continues. By the end of December 1968, 62 systems in civil departments and agencies have been approved out of a total of 143 then subject to approval. In addition, since January 1969, a total of 16 complete systems, have been approved. In the process of approval, as of the end of December 1970, are 31 complete systems designs.

Not much progress has been recorded for Department of Defense systems. There are still only four complete systems that have been approved. However, 26 statements of principles and standards (a necessary first step in obtaining approval of a system) have been approved, as well as two system segment designs. As of December 1970, two statements of principles and standards and three system segment designs were being processed for approval.

On November 25, 1970, the Comptroller General announced changes in Title 2 of the General Accounting Office Policy and Procedures Manual for Guidance of Federal Agencies. Parts of section 27 thereof ("Improvement of Accounting Systems") are revised to provide more nearly complete guidance in the development and approval of Federal agency accounting principles and standards and accounting systems designs.

12. Presidential Commission on Obscenity and Pornography.

Summary-A study was initiated on the contracts let by the President's Commission on Obscenity and Pornography to determine how the decisions were made as to selection of contractor and types of human motivation studies to be undertaken. The study is continuing.

13. The U.S. Coast Guard and the Patuxent River Bridge.

Summary.-The State of Maryland had submitted an application to the Coast Guard for a permit to construct a bridge across the Patuxent River between Charles and St. Mary's Counties. The State of Maryland had sold a bond issue for the construction of the bridge in the belief that the permit would be issued in a perfunctory manner. The Coast Guard, however, despite repeated calls from the director

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of the Maryland State Roads Commission, delayed issuing the permit for 8 months. Finally, the Fifth Coast Guard District, headquartered in Norfolk, Va., sent the application to Coast Guard Headquarters, Washington, D.C. for final approval. The State of Maryland was then advised that approval would perhaps take an additional 8 months.

A Member of the State's congressional delegation called the chairman of the subcommittee to investigate the matter, stating that more than $1 million in interest payments had been lost to the State as a result of the delay. The subcommittee took the matter up with Coast Guard officers and the application was quickly expedited.

14. Federal Responsibility for Retail Price Increases for Beef.

(a) Summary.-Because the Federal Government is the Nation's largest purchaser of beef, through purchases made by the armed services, the Federal prisons, Public Health Service, and VA hospitals, the food stamp program, et cetera, the subcommittee felt that it was important to determine whether there is excessive pricing anywhere along the meat production line.

Involved in the subcommittee's study was an examination of the manner in which the Bureau of Labor Statistics collects retail prices on selected cuts of beef for the monthly cost-of-living index; how the Department of Agriculture compiles its various statistics on beef and determines a composite per pound price and the way it then uses such statistics; and the mechanics by which the State Department and the Department of Agriculture arrive at voluntary beef import agreements.

A report was prepared but not issued.

(b) Benefits.-Not ascertainable at this time.

15. Review Made of Criteria Used for Placement of District of Columbia Traffic Lights.

(a) Summary.-At the request of the chairman, a review was made of the criteria used by the District of Columbia Bureau of Traffic Engineering and Operations for installation of traffic lights. Accident information for 1968 and 1969 for all intersections listed by the Bureau as locations which warrant traffic signals, but where signals have not yet been installed, was studied. A similar study on pedestrian traffic for the same locations also was reviewed. The study found instances where, based on the Bureau's criteria, traffic lights were warranted at certain intersections, but had not been placed on the approved list for immediate or eventual installation.

(b) Benefits.-The subcommittee study pointed up the inefficiency of the Bureau which promised immediate remedial action.

16. Federal Employees Health Insurance-Washington, D.C.

(a) Summary.-Investigation was begun March 1970 into the effect on Federal employees from the Washington metropolitan area participating in Federal employees health insurance program because of termination of the contract by Group Hospitalization, Inc., local

Blue Cross plan, with Washington Hospital Center. WHC handles a large percentage of Federal employees health insurance cases. Investigation showed that WHC refused to accept contract terms made available to other hospitals in the area under which GHI claims the right to determine hospital costs rather than paying hospital charges as billed. WHC claimed it handles more welfare patients than other hospitals, and, therefore, its cost per patient are higher. The subcommittee asked WHC to provide it figures on the number of welfare cases it handles vis-a-vis its regular patient load. The dispute was settled after 6 weeks, with WHC accepting basically the original offer by GHI of a 1-year contract, terminating April 30, 1971. WHC wrote the subcommittee that its interest brought about early resolution of the dispute.

(b) Benefits.-No estimate of dollar savings possible.

17. FHA Supplemental Rental Housing Projects in West Virginia. (a) Summary. This continuing investigation began in spring of 1970 into seven supplemental rental projects handled for various nonprofit sponsors by one consultant and one builder. In two cases, it appears that consultant controlled ownership of land sold through builder to nonprofit sponsor, although he, the consultant signed the form stating he had no interest in seller of land. This fact was known to FHA before the initial closing of mortgage insurance on these two projects. In addition, the feasibility of one project is in doubt, since the builder is eliminating 35 of 250 units to be covered by mortgage because of site conditions. In another project, time for construction since initial closing has expired without commencement of construction. Over $100,000 has been drawn down under the mortgage at initial closing, imposing liability on FHA. It is considered impossible to begin construction because topography prevents the construction of an access road. Upon completion of investigation, it is planned to hold hearings.

(b) Benefits.-Not possible to estimate benefits. now since investigation is still underway.

18. Retail Coffee Prices-International Coffee Quota Agreement. (a) Summary.--In late fall of 1969, an investigation was begun into rising retail coffee prices set off by a sharp rise in import and wholesale prices. The coffee quota for 1969-70, under international agreement, was set at a lower figure than the preceding year even though a freeze had occurred in Brazil just before the quota was established. Import prices ran up sharply in a short period of time and the escape clause of the quota authorizing release of more coffee-5 million bags more did not stem this. The 1970-71 quota adopted in August 1970 began at a figure well above the previous year and the escape clause has already been invoked to release over 2 million bags additional in an attempt to lower the price. The State Department is now aware of its responsibility to the American consumer and the investigation was terminated.

(b) Benefits. It is not possible to estimate monetary benefits.

19. District of Columbia Health Department Venereal Disease Program.

(a) Summary.-As a result of a broadcaster's allegations of misuse of funds and personnel in venereal disease control, an investigation was begun in the fall of 1970 into operations of the Health Depart

ment program.

(b) Benefits. It is not possible to ascertain monetary benefits now, since the investigation is still underway.

20. Disposal of Diseased Meat Animals.

(a) Summary. As a consequence of the retail beef price study, reference to meat inspection standards led to an inquiry as to disposal of diseased animals. A joint review study has been undertaken by Agriculture Department and the Public Health Service at the request of the subcommittee. The study is not yet completed.

(b) Benefits. It is not possible to ascertain benefits now, since the investigation is still underway.

21. District of Columbia Police Department Recruiting Program. (a) Summary.-Investigation was begun into the intensive recruiting program designed to bring the Police Department of the District of Columbia up to its newly authorized strength of 5,100 men. Fiscal 1970 figures on recruiting showed extra costs incurred for out-of-town civilian recruits. The study also showed a larger percentage of resignations in fiscal 1970 by out-of-town civilian groups. While the recruiting program has been completed, a high attrition rate will require substantial recruiting which should not include a continuation of out-oftown recruiting. A hearing was held September 30, 1970. The transcript has been printed.

(b) Benefits. It is not possible to ascertain monetary benefits.

22. A Study To Determine the Cost and Efficiency of the "Outreach” Offices of State Bureaus of Employment Security Vis-a-vis "Heartland" Oflices of These State Agencies.

(a) Summary.-State bureaus of employment security are 100 percent federally funded, and their operations, therefore, are under constant review by the U.S. Department of Labor. At the request of the committee chairman, the subcommittee has been studying the programs being sponsored by the Department of Labor to determine whether there are areas in the State programs where cost savings and increased program effectiveness can be achieved. Although several metropolitan areas are currently being studied, Philadelphia has been concentrated on because (1) the Pennsylvania Bureau of Employment Security (PBES) has been one of the first State agencies to inaugurate the Labor Department's new cost accounting system; (2) the new accounting system permits the extraction of the kinds of detailed information the subcommittee's study seeks; (3) the proximity of Philadelphia allows convenient travel there for study or obtaining informa

tion as necessary.

A tentative observation based on information obtained from the Philadelphia offices of the PBES and the Department of Labor, indicates that the restructuring of the PBES metropolitan or "heartland" offices in that city to operate as manpower community service centers, which will include a "job bank," is proceeding with less dislocation than was predicted. As planned, the restructured offices will be full-functioning service centers, but each will serve a designated geographical area or community. Satellite stations such as "outreach offices" or "mini" service centers and mobile units will be established as needed under each service center.

(b) Benefits.-A more effective utilization of financial resources and staff is assured, and a greatly improved service to employers and persons seeking jobs is effectuated. An applicant may now visit the nearest local office or referral station, all of which will be covered by the "job bank." With the "job bank" system and the satellite stations, an applicant may check daily to see if there is an opening for the type of job he wants. In any event, an applicant is assured that his application will be reviewed every 5 days to see if the type of job he wants has become available. On the other side of the ledger, the job order receives immediate service; the employer's job order receives maximum exposure, and he receives only the number of applicants he requests. Persons with no skills can be provided job training for employment requiring certain skills.

23. Efficiency of Interstate Commerce Commission Operations Designed To Protect Consumers From Household Moving Abuses in Interstate Commerce.

(a) Summary-In the spring of 1969, the special consumer inquiry was in receipt of a large number of consumer complaints regarding abuses suffered at the hands of interstate household movers. An investigation was undertaken to determine whether the programs and procedures utilized by the Interstate Commerce Commission for the purpose of protecting household shippers were efficient and adequate to the problems posed by interstate household moves.

Approximately 40 million Americans move each year and a substantial number of those moves result in abuses which come within ICC jurisdiction. Abuses generally break down into the following three categories; first, underestimation by carriers of the weight of the household furnishings to be moved, the result being an underestimation of the cost of the move; second, late pickup and delivery of household furnishings by the carrier; and third, damage to furnishings and failure of carrier to give prompt and equitable attention to claims for loss and damage of property.

The Commission has ample legislative authority to deal with the first and second abuses; but lacks clearly defined authority to resolve the third category of abuse.

The investigation disclosed preliminarily that the Interstate Commerce Commission has failed properly to protect the consumer interest because of a number of deficiencies, including an absence of efficient procedures.