retary of Commerce to answer a communication which was signed by myself, Senator Smith, Senator Muskie, Congressman Hathaway, and Congressman Kyros, asking him to act as quickly as he could on our application. This letter was sent on November 27, 1968. I received my reply sometime this week dated December 12, and inclosed in my reply was an advance copy of the press release of December 13 which said that no further action would be taken.

I have with me, Mr. Chairman, two members of my staff, Mr. Walter Corey and Mr. Andrew Nixon, who have worked very closely and who are better versed than I am in specific dates regarding many of the problems that we have encountered.

Thank you very much for this opportunity to be with you, and if I or my staff can answer any questions, we will be glad to.

Senator MCINTYRE. I have some questions here, Governor. I think that some of them may be a little repetitive. I think we would like to get the answers as briefly as you can. We need these for the record. There may be some new material that these questions will call for expansion of your answers.

Were you assured in early September that your application to the Foreign Trade Zone Board met all the requirements of the law?

Governor CURTIS. Yes, we were. In fact, we first submitted our application-I believe it was on June 19, and it was not really formally accepted because we were advised that the Board would very cooperatively review our application and advise us of any technical areas which needed strengthening or correcting, so that when we did submit our application it would be a technically correct document. We thought this was very cooperative on the part of the members of the Foreign Trade Zone Board staff. So when we did submit it, it was after many consultations between members of my staff and the staff of the Foreign Trade Zone Board.

Senator MCINTYRE. Was the Board willing to hold immediate hearings or was there an attempt to delay these hearings?

Governor CURTIS. I believe there was some reluctance to get the hearings underway. If I might ask Mr. Corey to speak to that, inasmuch as he is better versed in that than I.

Mr. COREY. That is absolutely the case, Senator. We tried, and we asked on several occasions just prior to the Board's formal acceptance of our application on September 13, and just after the acceptance on the 13th, that they schedule those hearings at the earliest possible time; and there was a good deal of give and take, some debate, a good deal of dialog between us and the Board on just how soon they could schedule those hearings, and they took the long view and naturally we took the short view. We aren't entirely satisfied that these hearings were held just as soon as possible after their formal acceptance of our application.

Senator BROOKE. Mr. Chairman, can we have Mr. Corey identified for the record?

Senator MCINTYRE. Yes, I would like to say that I plan to call Walter Corey, who is the Federal-State coordinator of the State of Maine, and the man that I understand worked directly under the Governor in the processing and the working with the Department of Commerce on this application.

Governor, did you ask that testimony at the hearings be limited to questions relevant under the trade zone law, and what was the ruling of the hearing examiner?

Governor CURTIS. Well, sir, I did ask at the beginning of my testimony that the decision be limited strictly in accordance with law to the matters pertaining directly to the granting of the license. However, I am guilty of launching into quite a bit of prerebuttal on the oil import question because I knew at that time I was not going to be allowed to rebut any of the testimony, and looking around the hearing room it was quite evident to me that most of the gentlemen in there were going to testify on the oil policy questions and not on the merits of our application.

Senator MCINTYRE. This goes back to your original statement which said that the hearing examiner said "We will conform to law but we will allow wide latitude to the testimony to be received."

Governor CURTIS. He said he would receive any testimony, but only matters pertaining to the zoning.

Senator MCINTYRE. How much notice were you given on the special hearing held in Washington on October 15?

Governor CURTIS. We were told about it the night before the Portland hearing commenced.

Senator MCINTYRE. How many days would that be?

Governor CURTIS. Well, the Portland hearing was held on the 9th of October and the Washington hearing was held on the 15th.

Senator MCINTYRE. Did that actually violate due notice to you required under the Administrative Procedures Act or the Trade Zone Board regulations, do you know?

Governor CURTIS. I don't know what the regulations are.

Senator MCINTYRE. Mr. Corey, can you answer that? Is that violative?

Mr. COREY. I think it does violate the fair standards of notice contained in the Administrative Procedures Act. Yes, sir; I believe that is the case.

Governor CURTIS. Senator, I would just like to add it would seem to me when the original notice of hearings was published in the Federal Register if there were to have been supplemental hearings in Washington that that would have been the proper time to announce those hearings, that there would be two sets of hearings, one in Portland and one in Washington.

Senator MCINTYRE. Governor, I understand there is some difficulty with the transcripts of the hearings. Did you make an effort to get the transcripts reproduced on time according to the rules of the Board?

Governor CURTIS. Yes, we did, and I would like to let Mr. Corey speak to this because he can speak about the first transcript which contained some items concerning divorce proceedings, I believe. Mr. Corey, would you

Senator MCINTYRE. Will you speak up, Mr. Corey? I have got a cold and I can't hear out of my right ear to begin with, so I want to hear this.

Mr. COREY. Senator, we made every conceivable effort to get the transcript of those hearings at least as soon as possible after the conclusion of those hearings. We had been assured by the acting secretary

of the board in a statement that he made publicly and privately in Portland that in no event would the transcript of those hearings be available later than 5 days after the conclusion of those hearings in Portland. In fact that transcript was not made available in any state, let alone a coherent state, before 5 weeks after the conclusion of those hearings in Portland. And it may be of some interest to you to know that when the transcript was first made available it was in such a garbled version, so incomprehensible, that it contained at least one, and possibly two pages from a divorce proceeding.

Senator MCINTYRE. A what?

Mr. COREY. A divorce proceeding, a suit for divorce between husband and wife. And where that came from I just don't know.

Senator MCINTYRE. I am going to ask for more detail on that when you appear as a witness on your own behalf.

Governor, have you been given repeated assurances on the date for decision by the board?

Governor CURTIS. Yes, we have been given assurances orally and I think substantiated by several press releases issued in Maine newspapers that the absolute deadline of the decision would be December 31, or the end of the year. And I believe that my staff received certain assurances that it might be possible to have a final decision at an earlier time.

Senator MCINTYRE. Governor, is the statement made by Assistant Secretary McQuade on December 12 consistent with what you have been told by officials during the hearing process?

Governor CURTIS. That's right. We have every reason to believe that Secretary McQuade acted very responsibly and very fairly with us, that what he was telling us was basically correct, and that he, by view of his speech in St. Louis, possibly had no knowledge whatsoever the next morning or the next day a decision was going to be made not to continue with this application based upon policy questions, which is in direct contradiction of what he said.

Senator MCINTYRE. In direct contradiction is the statement that Secretary of Commerce Smith made on the day following the speech by Assistant Secretary McQuade in St. Louis, was it?

Governor CURTIS. That is correct.

Senator MCINTYRE. Were you assured by Mr. Engleberg--and I believe he was the chief of the hearing examiners, was he not?

Governor CURTIS. Yes, he was the hearing examiner.

Senator MCINTYRE. Are you aware, Governor, of the Board's record of a meeting-now referring to the Board, Secretary of Treasury, Army, and Commerce-are you aware of the Board's record of a meeting which the Secretary claims took place? Are minutes available as they are required to be under the Board rules? As an applicant, were you notified of such a meeting?

Governor CURTIS. Never notified of a meeting. In fact, the first notification I had that a decision would not be reached was by notice in the press the next morning. I was not formally notified of this decision until later this week when I received the letter from the Secretary of Commerce enclosing a copy of his press release.

We do not believe, although we have no evidence to the contrary, that there ever was a Board meeting held. We expect it was handled

on the telephone. In fact, we know of no evidence that a Board meeting has been held since 1949.

Senator MCINTYRE. For the record, then, I would like to quote from the U.S. Department of Commerce News, Washington, D.C., Office of the Secretary, for immediate release Friday, December 13, 1968, the first paragraph of that release which says:

Secretary of Commerce, C. R. Smith, as Chairman of the Foreign Trade Zones Board, announced today that the Board members have decided to defer final action on an application by the Maine Port Authority for a general purpose foreign trade zone in Portland, Maine, and a special purpose subzone in Machiasport, Maine, in order to give their counterparts in the new Administration an opportunity to examine the far-ranging policy implications of this application.

Incidentally, I might just digress for interest here, their counterparts in the new administration-I think perhaps, Governor, you realize that the Secretary of the Interior-designate is to be Governor Hickel of Alaska, and he had a news conference yesterday. Perhaps you might have read coming down on the plane some of the things he said.

Governor CURTIS. Yes, sir; I did.

Senator MCINTYRE. I think this is William Blair's article in the New York Times, and in his news conference the incoming Secretary of the Interior said in effect on this question of oil that Alaska opposed the creation of a foreign trade zone in Maine. I think you probably agree with me that if this Governor of Alaska is going to take over the duties of Secretary of the Interior of this great Nation that he better be thinking in terms of all the States rather than just Alaska. Don't you agree, Governor?

Governor CURTIS. Yes, I agree, and of course we have been very concerned since his nomination in that Alaska brought suit against the State of Maine while he was Governor-I guess not against the State of Maine, but a foreign trade zones injunctive proceeding to prohibit the Secretary of Commerce from making a decision. Governor Hickel further sent a telegram to Hearing Examiner Engleberg opposing the Machiasport project. And I am willing to believe that on the face of it that when the gentleman receives the high distinction. of becoming a Cabinet officer he drops provincial interest and undertakes the interests of the entire United States.

But I am concerned over the statement I read in the New York Times, a report of it in the New York Times this morning, which stated after his nomination that Alaska was opposed to the Machiasport project. I don't know whether that means the State of Alaska or whether that still means Secretary of Interior Hickel.

Senator MCINTYRE. In the article he says not Hickel, but Alaska opposed the creation of the project. Kind of a tough judge to go before, wouldn't you say?

Governor CURTIS. Yes. I recognize this is out of order, but as Governor of Maine I would hope that the Senate delegation from New England would clarify this issue sometime in the next few weeks.

Senator MCINTYRE. Would you care to comment, Governor, on what you believe to be the reasons for the Secretary's announcement of this indefinite delay?

Governor CURTIS. Well, it has been obvious for several weeks that the greatest threat we had to the success of this project was simply a

failure to act, to run out the clock, so to speak. January 20 was in effect a favorable decision to the oil-producing States and to the major oil companies of this country that opposed us. So I believe that certainly and I think I must conclude with all the unexplainable delays, changes of rules in midstream that resulted, that there must not have been any strong intention to, even from the beginning, give the State of Maine and New England a fair chance at having this project decided on its merits.

And I would like to say again that I think this project is a perfect example of what we have been trying to create in this country, a marriage between private enterprise, State and Federal Governments, for the purpose of stimulating the economy where it is needed. I think that all of us did a good job in this regard in putting these pieces together. I think it is very sad that we find that the lobby of this country, particularly in the area of the major oil interests, can still defeat something that is being done in the interests of the people of this Nation.

Senator MCINTYRE. I agree. What do you think, Governor, this committee should recommend to the President and the Secretary of Commerce in order to meet the needs of the consumers and the small businessmen of New England?

Governor CURTIS. Well, I think realistically we should do away with the oil import system as it is now constituted, that was implemented in 1959. And I think we should start with the base-if we must have controls, we should start with the base that first of all looks to the needs of the people, looks to the needs of regions of this country, rather than having policy that is based upon those companies that happening to be importing oil into this country back prior to 1959. I can't conceive of a governmental policy that is designed to protect private interest, particularly the wealthy oil industry, to the detriment of regions of this country. I think we should abolish the whole system and start all over again.

Senator MCINTYRE. Thank you, Senator Brooke.

Senator BROOKE. Governor Curtis, you stated that it was your opinion that the Board never met. What evidence do you have to support that?

Governor CURTIS. I have no evidence, Senator Brooke, other than hearsay and conversations, rumors; and I have said publicly that I would be very glad to apologize to the Foreign Trade Zones Board if they would produce the minutes of such a meeting.

Senator BROOKE. Do you know whether the Board of Alternates met any time?

Governor CURTIS. I don't believe they have, because certainly a report has not been completed, to the best of my knowledge.

Senator BROOKE. So it is your opinion then that the Secretary acted without benefit of any recommendation from the Board of Alternates at all?

Governor CURTIS. That is my opinion; yes, sir.

Senator BROOKE. Did you receive a letter from the Secretary stating his reasons for the delay?

Governor CURTIS. No, sir. The only letter I have received recently from the Secretary has been the letter that was dated December 12