greatly increased appropriations were granted; so that the supplies for the larger corps were procured and no further steps were taken at that time toward the purchase of these reserve stores. The war. ended soon after that, and we found ourselves with stores on hand which had been procured for 75,000 men, which were more than sufficient not only for the needs of the reduced corps, but to take care of the reserve stock as well. In consequence, therefore, no further expenditures were made from this special appropriation, and the balance remained at $13,361,306.63. Of this latter amount, under the provisions of the act of February 25, 1919 (second deficiency act, 1919), $7,000,000 was carried to the surplus fund and covered into the Treasury (40 Stat. 1173-1174); and under the provisions of the second deficiency act, fiscal year 1922, an additional amount of $5,000,000 was transferred to the Navy (42 Stat. 449, 450), which reduced the balance to $1,361,306.63, at which figure it has remained until this time.

Mr. FRENCH. What are you using it for now, or are you using it for any purpose?

General McCAWLEY. We have not used it lately at all.

Mr. FRENCH. Have we reached the point in the matter of the settlement of possible outstanding obligations against it, or in the adjustment of accounts, where we could turn back this amount, or most of it?

General MCCAWLEY. We have retained that appropriation with the thought that we might have to use it in some emergency. If some sudden emergency arose, and we had to buy additional supplies, when Congress might not be in session, this money would then be available for that purpose. However, we are not using it for current needs at all, and if you gentlemen want to turn it back into the Treasury, I do not know whether General Lejeune would have any serious objections or not.

General LEJEUNE. We have retained that small amount of the original appropriation. We have given money from it from time to time for other purposes, through the Appropriations Committee. When you appropriated for fuel for the Navy we gave up several million dollars of it in a deficiency. Our idea in not spending it was that if we bought anything with it the articles we bought might deteriorate. We have kept it so that in the event of an emergency we could use it. I will just put it into your hands. If you feel that we should return it to the Treasury, or that it ought to be returned to the Treasury, we are in accord with your views.

Mr. FRENCH. In raising the question I have in mind that we have been working at the adjustment of contracts, etc., following the war, and those moneys have been very generally turned back into the Treasury. At this moment I would not indicate, of course, what should be done, but I raise the question now with the thought that possibly it would be a desirable thing to do, and we will probably refer to it a little later in connection with the policy we are trying to follow, and to which I have referred.

General MCCAWLEY. If any action looking toward the return of this money to the Treasury is taken I think it might be advisable to use the words, "unexpended balance" instead of the definite sum that appears here, because there might be some outstanding obligations against it. Mr. Trail, however, informs me that all the obligations have been paid and that this is a clear balance.

Mr. TABER. How much does it amount to?

General MCCAWLEY. $1,361,306.63.

COST OF BUILDING CONSTRUCTED IN SAN FRANCISCO, CALIF.

General LEJEUNE. I might make a statement regarding a matter that Mr. Taber spoke about. Gentlemen, you will remember that last year you appropriated, or the conference agreed to a Senate item for a building in San Francisco, the amount being $500,000. We had some little controversy around the table as to the cost of the building, or as to what it would probably be, and Mr. Taber stated that the building could be built for $350,000, as planned. The Bureau of Yards and Docks, in view of the last contracts made out there, thought that it would take pretty close to $500,000. I agreed to give my word to the committee, and SO did Admiral Gregory, that we would not add to this building. We agreed to build it as planned and that if we found that the bids were less than the amount appropriated we would guarantee that that money would be turned back into the Treasury. I want to tell the committee that the actual cost of the building will be in the neighborhood of $340,000.

Mr. FRENCH. Somewhat less than was estimated.

General LEJEUNE. $160,00 less, which amount we want to turn back into the Treasury. We have had to resist a good many urgent requests to spend that money. They wanted to put another story on the building, they wanted an elevator, and all kinds of things. but we have turned them all down, because, I confess, I want a good name with the committee for carrying out my word

ADMINISTRATION IN CONNECTION ADJUSTED COMPENSATION ACT

Mr. FRENCH. At this point we will hear General Lane, touching any money that may be necessary for carrying out the work of the Marine Corps in connection with the adjusted compensation act for 1926. As I recall it, the Marine Corps, under the deficiency law. was authorized through the Veterans' Bureau to expend certain moneys which were appropriated for 1925 but you will probably need more moneys for 1926.

General LANE. Yes, sir.

Mr. FRENCH. Will you indicate what you have done, and to what extent you have drawn upon moneys heretofore allotted to you, and your plans for 1926?

General LANE. Yes, sir. The total number of eligible veterans estimated for the receipt of adjusted compensation is 78,362. It was some little time after the 1st of July before the Marine Corps was

able to start on this work due to the fact that we did not have the clerks or the blanks. In the meantime the number of applications accumulated. We finally did get started to work on it, and have been rapidly catching up. We expect to be caught up about the 31st of December, and after that we will be working on the current receipts.

Mr. FRENCH. How many employees did you add on account of that service?

General LANE. We have had a maximum of 43, and we now have 41 extra employees under the Veterans' Bureau appropriation. Mr. FRENCH. They will run throughout the fiscal year?

General LANE. No, sir; we are going to reduce that number about the end of this month. We estimate that 36,715 of those applications will be in by December 31.

Mr. FRENCH. How many do you expect altogether? General LANE. The maximum number is 78,362. The estimated number received to December 31 is a little less than half of that.

that the others will come in during

Mr. FRENCH. Do you ou expect the remainder of this fiscal year?

General LANE. Most of them will come in during that time. We think that the average number received will drop off after the end of the fiscal year. On December 31, 1924, we will have expended $21,410.78 in the administration of this matter, and we expect that by the end of the fiscal year we will have in 60,500 of the 78,362 maximum number of applications. Of course, we can only estimate, because nobody can tell how rapidly they will come in. In order to carry this work from the 1st of January to June 30, we will need about 25 clerks and the cost of those clerks during six months from January 1, will be about $15,870, making a total estimated clerical expense to June 30, 1925, of $37,280.78. After that, the number will necessarily drop off rapidly, and we estimate that for the fiscal year ending June 30, 1926, we shall need an average of about six extra clerks to handle this work, at an estimated cost for the fiscal year of $7,920.

Mr. FRENCH. Will that run you throughout the year? General LANE. It will be the average number for the year. After June 30, 1926, we think, or at least we hope, that the task will be sufficiently completed to enable us to carry the remainder with our regular force. Of course, we can not tell exactly.

Mr. FRENCH. Has the Budget Bureau passed upon this item? General LANE. No, sir; I do not believe it has come up. No bill has been presented for that purpose so far as I know.

Mr. FRENCH. We wanted to get the estimates from you at this time so that we may determine just what action we should take. General LANE. I am glad to have the data on record, because we will have this work to do.

Mr. FRENCH. On behalf of the committee, I want to thank you, General Lejeune, and the other officers who have been with you, for your presentation of these matters pertaining to the Marine Corps. WEDNESDAY, DECEMBER 3, 1924.

BUREAU OF MEDICINE AND SURGERY

STATEMENT OF REAR ADMIRAL E. R. STITT, SURGEON GENERAL, UNITED STATES NAVY, AND DR. W. S. GIBSON, CHIEF CLERK

GENERAL STATEMENT

Mr. FRENCH. At this point we will take up the Bureau of Medicine and Surgery, and we have with us Admiral Stitt, who will present the justification for that bureau for the 1926 estimates.

Admiral, you probably would like to make a general statement at first.

Admiral STITT. Yes, sir.

In the preparation of estimates for the operation of the Medical Department of the Navy it is necessary to strike an average of all factors that have a bearing on the cost of such operations. The fact that activities engaged in the care of the sick must be operated every day in the year, and that it is impossible to discontinue such activities when appropriations are exhausted, as would be the case with many projects, is kept in mind when estimates are prepared.

That it is not the policy of the Bureau of Medicine and Surgery to expend the total of appropriations when the sick rate is subnormal or where it is possible to utilize existing supplies, although they may not be fully suited to the purpose, is substantiated by the saving of over $900,000 turned in to the Treasury during the past three years.

The reasons for the increase in appropriations for the fiscal year 1925 and in the estimates for 1926 are, first, that the weather during the fiscal year 1924 was very mild, resulting in a very low daily average of sick. The peak load for 1924 as compared with 1923 was approximately 500 less. The estimates are based on an average year, and should conditions be abnormal to any great extent a deficiency would result if they were abnormally high and a saving if low. As conditions were abnormally low during 1923 and 1924, the saving shown above was made possible.

Second, the saving made during 1924 was influenced by two factors, one tending to decrease the saving and the other tending to an increase. The decreasing tendency is explained under the first reason--low patient rate. The increasing tendency was a wage increase amounting to approximately $270,000 for the same number of employees. This increase was not known or taken into consideration at the time the estimates for 1924 were prepared.

In order to meet this increase in wages and to determine the relative efficiency of out laundries as compared with contract work, all laundries with the exception of two were placed out of operation during the year 1924 and the employees discharged. As contract work proved unsatisfactory in many instances, laundries were again placed in operation on July 1 of this year. In addition to the reduction in laundry employees it was necessary, in order to provide for normal demands for medical supplies and operating force, to discharge maintenance employees, such as carpenters, painters, etc., to an extent

that left the hospitals with such a reduced complement of these employees that only the most urgent work could be performed. This reduction in maintenance employees was not made for the reason that their services were not necessary, but to avoid creating a deficiency. All employees except those immediately caring for the sick, such as firemen, cooks, mess attendants, janitors, etc., were reduced in number.

The average cost for the operation of all hospitals and other medical department activities during the year, based on the average complement, was $0.08136 per diem. That is, it costs approximately 8 cents per diem for each man in the Navy and Marine Corps, to maintain and operate hospitals, purchase medical supplies, and pay for the general maintenance of the medical department of the Navy. Considering the relatively high cost of hospital operation, this figure is low.

VETERANS' BUREAU PATIENTS

During the fiscal year 1924, the 20 hospitals expended a total of $4,392,634.58, and had a total of 1,353,215 sick days. The expenditures for provisions are returned to naval hospital fund from "Provisions, Navy," and for the care of Veterns' Bureau patients, from the Veterans' Bureau. The daily average of maintaining a patient in a hospital was $3.2418.

The Veterans' Bureau utilized naval hospitals to the extent of 331,738 sick days, for which they reimbursed naval appropriations $1,500,600.

Mr. HARDY. Is that the $3 a day rate?

Admiral STITT. Some hospitals are under $3 and some over $3. Of course, the Veterans' Bureau may utilize one hospital with a low rate very extensively and another hospital with a higher rate less extensively. So their rate varies from the rate that we have for naval patients, where all hospitals are considered. We have an agreement with the Veterans' Bureau under which they pay the expenses of the hospital proportionately according to the number of Veterans' Bureau patients and naval patients. If they have 50 per cent of the patients, they pay one-half of the cost of maintaining that hospital.

In this figure of $1,500,600 there is included reimbursement for 365 Hospital Corps men, amounting to $300,643, and transportation of medical officers and nurses, $4,005.73, which leaves a total of $1,195,951.27 for actual hospitalization of patients. The daily average for actual hospitalization for the Veterans' Bureau patients was $3.61.

NUMBER OF BEDS IN NAVAL HOSPITALS

Mr. FRENCH. Would you at this point insert a table showing the number of beds in all the naval hospitals, indicating the number reserved for naval personnel and the number reserved for Veterans' Bureau patients, and, as to the latter, the number not availed of? Admiral STITт. Yes, sir.