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FEBRUARY 27, 1945.-Committed to the Committee of the Whole House on the

state of the Union and ordered to be printed

Mr. Cannon of Missouri, from the Committee on Appropriations,

submitted the following

REPORT

[To accompany H. R. 2374]

The Committee on Appropriations submits the following report in explanation of the accompanying bill making appropriations to supply deficiencies in certain appropriations for the fiscal year ending June 30, 1945, and for prior fiscal years, to provide supplemental appropriations for the fiscal years ending June 30, 1945, and June 30, 1946, and for other purposes.

BUDGET ESTIMATES The Budget estimates upon which the bill is based were submitted in House Documents Nos. 25, 30, 39, 41, 44-53, 55, 60, 61, 63, 65-67, 72-75, and 77-89, of the present session, embracing requests for deficiency appropriations, supplemental appropriations, appropriations to pay judgments and authorized claims, and authority to enter into contracts which will require future appropriations.

Details as to the agencies involved and amounts, as well as committee recommendations with respect thereto, may be found in the table commencing on page 16 of this report.

Under the general categories indicated, the Budget proposesDeficiency appropriations (Navy)--

$80,000,000.00 Supplemental appropriations

2, 543, 694, 066. 98 Judgments and authorized claims

8, 481, 395. 58 Contractual authority (Navy)-

136, 800, 000.00

Total..

2, 768, 975, 462. 56

The accompanying bill proposesDeficiency appropriations (Navy). Supplemental appropriations. Judgments and authorized claims. Contractual authority (Navy)-

$80,000,000.00 2, 250, 406, 435. 94

8, 470, 689. 68 114, 300, 000.00

Total

2, 453, 177, 125. 62

Omitting contractual authority, the Committee has effected a net reduction of

293, 298, 336.94 and contractual authority has been reduced by --- 22, 500,000.00 Total reduction.

315, 798, 336.94 Of the total of the Budget estimates, apart from contractual authority, roundly $2,573,000,000, or 97 percent, is for or on account of national defense. The Navy's part is upward of $1,914,000,000.

There follows a listing of the major general objects embraced by the bill, which shows the amounts proposed in the Budget estimates and the amounts recommended by the committee:

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Of the amount proposed by the committee, $39,073,000 is in consequence of laws enacted subsequent to the passage of regular annual appropriation bills--mainly the Stabilization Act of 1944, the penalty mail law, the Public Health Service Act, and the act amending the Federal Crop Insurance Act.

Refusal to recommend an appropriation at this time for restoring the capital impairment of the Commodity Credit Corporation accounts for about 81 percent of the reductions effected by the committee as regards direct appropriations. One other sizable reduction applies to the Navy and ensues from the committee's proposal to substitute funds, reported to be surplus, to the extent of $39,073,000, for a like amount of new appropriation. The reduction applying to the National Housing Agency (war housing) results from a duplication and a changed demand, both pertaining to the Navy.

The committee met with instances which indicated either a lack of knowledge or an utter disregard of the so-called antideficiency law

(31 U. S. C. 665), in that agencies reported overobligations during the first half of the current fiscal year to an extent which places the Congress in the position either of granting additional funds or forcing the curtailment of operations which in some cases would be unwise and harmful. That sort of practice cannot be continued, particularly when the Congress is in continuous session. It must be stopped.

The Budget submissions which the committee considered lead the committee to repeat the observation in an earlier report as regards the wisdom of establishing cost limits in authorizing legislation, viz:

Cost limits in legislation are not always conducive to economical procedure. Once established, it seems to be the practice to program accordingly, justifiable in some cases, no doubt, but in others it has seemed that the controlling thought has been to obligate to the limit.

Another matter of questionable propriety continually confronting the committee is that of reclassification of positions of Federal employees. There seems to be a more liberal attitude toward reclassification than obtained in the not remote past, and, under an interpretation of the General Accounting Office, approval of the Civil Service Commission is tantamount to legislative approval, thus creating & legal obligation which must be discharged. The committee wishes to direct the attention of the Committee on Civil Service to the matter. Inquiry may disclose the advisability of passing legislation making the effectiveness of reclassification subject to the specific provision of funds therefor.

There follow explanations of or comments upon the principal features of the bill in the order in which the matters to which they pertain appear in the bill.

WAR MANPOWER COMMISSION

An additional appropriation of $5,567,400 for the current fiscal year is proposed under this head, which is in agreement with the Budget estimate. There has been appropriated heretofore $57,968,079.

The additional amount is made necessary (1) by the present drive for increased war production, and (2) the additional work load imposed by the Servicemen's Readjustment Act of 1944. The latter is responsible for $2,295,557 of the increase and is to cover personal services and the usual incidental expenses attendant upon administration. It is of paramount importance that there be available personnel and facilities adequate to assure service to returning veterans, as contemplated by the statute.

For coping with demands for labor necessary to the accomplishment of enlarged munitions programs, it has been necessary for the War Manpower Commission to maintain its personnel staff at a higher level than the original appropriation contemplated, and the entire additional amount of $3,271,843 is for personal services.

OFFICE OF PRICE ADMINISTRATION

The Budget has proposed an additional appropriation for the current fiscal year for this agency of $6,790,000. There has been appropriated heretofore $179,000,000. The committee recommends an additional amount of $6,235,000, the reduction of $555,000 applying to estimated penalty-mail costs.

The additional amount requested grows out of two laws enacted subsequent to the processing stage of the regular appropriation,

H. Repts., 79-1, vol. 1- 86

namely, the penalty mail law and the Stabilization Extension Act of 1944. The former occasions an additional expense (estimated) of $5,550,000, which incidentally will be redeposited in the Treasury, and the latter an additional expense of $4,380,820, of which $3,140,820 will be absorbed, making necessary an additional amount of $1,240,000.

As previously indicated, the committee has made a reduction of 10 percent in the penalty-mail item, which the agency may or may not be able to absorb. The additional amount for administering the added duties imposed by the Stabilization Act of 1944 is recommended as submitted. To illustrate the added work occasioned by such act, the following is quoted from the letter of the Administrator to the chairman of the Committee on Appropriations, dated January 31, 1945:

Section 2 (c) contains the requirement that the Administrator provide for individual rent adjustments for" peculiar circumstances" and "substantial hardship." Under the peculiar circumstances” provision, a cumulative total, of 11,110 petitions had been received up to December 31, 1944, of which 2,000 were pending review, the remaining having been processed prior to that date. Similarly, under the “substantial hardship” provision, a total of 5,570 petitions had been received up to December 31, of which 1,779 were pending review. The work load arising from most of these amendments has shown a steady increase since August and September. In December over 17,000 interviews took place in the area rent offices for both of these provisions. One thousand five hundred petitions were filed and docketed. In addition to the direct work of our rent personnel for these amendments, we have made extensive use of cost accountants employed by the Office of Price Administration to verify undue hardship petitions from a financial standpoint.

Section 205 (e) provides authority for the Administrator to institute legal action within thirty days of the date of the occurrence of the violation if the tenant or consumer fail to take action during the thirty-day period. This authority has been used extensively in our compliance work, constituting a tangible measure and basis of negotiating directly on small violations in the rent and retail price field. Authority to negotiate the settlement of the Administrator's claim has been delegated to rent offices and price panels in the local boards. Up to January 1, area rent offices had processed 78,460 cases, dismissing. 29,589 and settling 16,507 for $604,000. Six thousand two hundred and eighteen had been referred to the Enforcement Division for action.

The Bankhead amendment to the Stabilization Extension Act provides that in the case of cotton textile commodities, the highest applicable price standard of the act must be applied spearately to each commodity item. The only practicable method of insuring compliance with this requirement was to conduct a series of accounting surveys of a representative sample of textile mills. These surveys have been in process and are still being carried on for such items as combed yard, carded yarn, sheeting yarn fabrics, colored yarn fabrics, chambray, combed yarn fabrics, cotton hosiery, and other items.

Section 203 (c) requires the establishment of boards of review within the Office of Price Administration for the consideration of protests filed after September 1. The operation of this technique has not only required the establishment of boards of review in Washington and in the field but has also required that considerable assistance be given to the protestants in articulating their cases. Many of the protests are filed without legal assistance and a great deal of correspondence is required to clarify their requests for consideration and their concept of the nature of the proceeding. (Italics supplied.)

The committee feels that this activity is performing a most difficult and Herculean task in a very praiseworthy manner, and that the people of America should be eternally grateful to the host of volunteer workers who have contributed so largely to the accomplishment of its mission.

SOCIAL SECURITY BOARD

The Budget presented an estimate of an additional appropriation of $6,200,000 for grants to States for old-age assistance, aid to de. pendent children and aid to the blind, and of a further amount of

$450,000 for salaries, Bureau of Old Age and Survivors' Insurance. Both amounts have been represented as required to meet costs hayond those foreseeable when the original appropriations were being processed. The committee .proposes the grant of the first amount in full. It has halved the second amount, which is entirely for personal services. Only recently has claims work fallen in arrears. Half of the additional force contemplated by the supplemental estimate may or may not be able to avoid an unreasonable backlog. The committee feels that an effort should be made to find out.

FEDERAL WORKS AGENCY

COMMUNITY FACILITIES

Authority exists under title II of the Lanham Act of June 28, 1941 (Public Law 137, 77th Cong.), as amended, to appropriate $500,000,000 for a program of public-works construction and public services in communities experiencing an abnormal growth of population because of war-connected activities.

Under such authorization, appropriations heretofore made total $477,000,000. The committee considered an estimate of appropriation for an additional $23,000,000, which would exhaust the authority to appropriate.

Of the amount heretofore appropriated, there remained on January 16, 1945, a balance free of commitments (formal or otherwise) or obligations of $12,509,694. The additional amount of $23,000,000, if appropriated, in conjunction with the balance indicated ($12,509,694), or a total of $35,509,694, would be employed, according to representations to the committee, as follows: Construction projects: New projects...

$17, 180, 783 Reserve for contingencies.

4, 882, 276

$22, 053, 059 Service projects:

Maintenance and operation, of existing projects
Jan. 16, to June 30, 1945.

8, 703, 437
New projects..

3, 415, 927 Reserve for contingencies..

527, 271

12, 646, 635 Administrative expenses.

800, 000 Total...

35, 509, 694 Irrespective of the merits of new projects, construction or service, the committee was confronted by the fact that the additional appropriation requested, if employed as projected, would leave no margin for maintaining and operating service projects when funds within the existing authorized appropriation ceiling become exhausted. That ceiling may or may not be raised. The committee has no right to assume thåt it will be. It must proceed in accordance with the law as it is. Therefore, in order to be certain that the maintenance and operation of service projects would continue for several months beyond the end of the current fiscal year should there be no increase in the presently authorized appropriation ceiling, the committee is recommending an additional appropriation of $20,000,000, to which it has coupled a provision that $18,000,000 thereof shall be reserved for financing contributions subsequent to June 30, 1945, for the maintenance and operation of service projects. The effect of this course as to the remainder of the current fiscal year would be to add $2,000,000

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