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aside for school-donation program. Since then, they have been preparing shipping documents for us.

Mr. HOLIFIELD. Is there any danger in letting an outside agency do this work! Would it encourage them to take a great deal more material than they might take!

Captain DEGARMO. This system has been approved by higher authority.

Mr. RIEHLMAN. Please send forward a list of type of equipment turned over in the fourth quarter to educational institutions.

SHARPE GENERAL DEPOT EXHIBIT No. 5

Salvage branch, M80Report of acquisition value of property donated to schools

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1 Unprecedented gain arose from heavy incidence of metal items (rod, sheet, shapes, etc.) and fact that, as set forth in transcript, State of California lent valuable assistance in expediting and processing all neces. sary records.

NATURE OF PRINCIPAL ITEMS TRANSFERRED TO EDUCATIONAL INSTITUTIONS DURING

FIRST QUARTER FISCAL YEAR 1984 The major elements of these donations took the form of bulk sheet metal; rod and bar steel; small hardware items; plumbing tixtures, and CO-2 fire extinguisher cylinders.

SHARPE GENERAL DEPOT EXHIBIT NO. 6

SHARPE GENERAL DEPOT

US ARMY
SALVAGE BRANCH
OPERATING COST VS SALES

(SALES: SURPLUS AND 201 C)

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SOU: PERFORMANCE ANALY818 REPORT

REPORT O DISPOSITION OF PERSONAL MOPERTY, DA MO-40 Proceeds from sale of salvage and scrap

MANAGEMENT ENOUICERING

DIVISION

REMARKS

OPERATING COBT VERBUS SALER

Sales dispose of the major tonnage processed through the Salvage Branch.

Sales consumed 66 percent of tonnage disposal in the fourth quarter of fiscal year 1953 and of 84 percent in the first quarter of fiscal year 1954.

Operating cost of the Salvage Branch is almost entirely for labor and administration. During fiscal year 1953 the cost was fairly uniform.

Compared with the tonnage received during the year, personnal authorizations were insufficient to keep pace with the workload.

Greatly increased sales receipts were caused mostly by 300-percent increase in output of invitations to bid and sale of numerous items of large equipment and machinery. Previously small items of relatively low value constituted the bulk of material processed.

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Mr. Balwan. According to the chart you show on operating costs, does that mean that $5.13 is received for each dollar you have spent in costs?

Captain DE GARMO. Yes.

Incidentally, you will note our great increase in numbers of sales held. Since the first of the fiscal year 1954 we have issued a total of 32 invitations to bids. In fiscal year 1953 we issued only 32 invitations in the total fiscal year.

Mr. Balwan. How wide a group of potential buyers do you circulate?

Captain DE GARMO. That depends upon the commodity. We keep a bidders' list by commodity. We circulate according to commodity.

Mr. Balwan. How many do you have on your bidders' list?

Captain DE GARMO. Slightly over 3,000, broken down by conimodity.

Mr. HOLIFIELD. Do you do any advertising on the sales ?

Captain DE GARMO. Some free advertising in our local newspaper through our public-information officer. We published some pictures and noticed increased interest by buyers.

Mr. HOLIFIELD. If you have a vigorous merchandising program, you might increase receipts to Government. The fact that you are sending out more invitations seems to indicate you are getting results. It also indicates that you did not have a vigorous program in the past.

Mr. RIEHLMAN. Is there any kind of trade magazine that furnishes a continuous reprinting of information like this?

Captain De GarMO. We send invitations to certain trade journals. It is entirely up to them if they want to print this material.

On this sales program, in addition to 100-percent increased output of invitation to bids, we have sold a larger type of equipment. We have sold some used ESS equipment for which the return was very good, such as scrapers, and large amounts of junk or scrap for which

41957 0—54—_-50

we received a good price. The geographical location helps bring about this increased revenue.

Mr. RIEHLMAN. Have you given any thought to holding an auction sale!

Captain DE GARMO. This was discussed at the salvage seminar in Los Angeles, and it was anticipated they would use one installation for a test case. Sharpe General Depot might be the test depot.

Mr. RIEHLMAN. I know there is a great interets in that type of sale, and I am of the opinion that the type of equipment you have been talking about would be of interest to different industries.

Have you had any spot-bid sales !
Captain DE GARMO. The Sixth Army frowned on this idea.

Mr. RIEHLMAN. We have found that in many instances smallerbusiness people do not have the money to tie up on a sealed bid, and therefore on a spot-bid sale you would have more people bidding. This should be given consideration.

Mr. Balwan. Does the Air Force or Navy supply you with any information on their experience in merchandising surplus !

Captain DE GARMO. "No, sir. We follow property-disposal instructions from the Sixth Army. There is only one area in the Western States that has unified

property disposal. The Navy sells for Army, Navy, and Air Force in the Utah area. That might be a trial program. I can get no information as to the method they use, unless it is in our instructions.

We operate under instructions from Army 100 percent. We make recommendations to them to change methods of selling and, especially in spare parts, they are in the process of rewriting this regulation.

Mr. BALWAN. I would like to see the operating budget for this Salvage Branch, breaking down replacement funds.

Please provide also a breakdown on two assistants, experience, low long they have been understudies, and a complete detailed personal background history statement.

SHARPE GENERAL DEPOT EXHIBIT No. 7
SHARPE GENERAL DEPOT, UNITED STATES ARMY,

Lathrop, Calif., January 2, 1954.
Col. Paul L. DOERR,
Department of the Army, Office of the Chief of Legislative Liaison,

Washington, D. C. DEAR COLONEL DOERR: The information requested in your letter of December 29, 1953, will be found in the enclosures hereto which consist of

Tab A: Organizational chart, Sharpe General Depot
Tab B: Organizational chart, Miscellaneous Services Office
Tab C: Organizational chart, Salvage Branch
Tab D: Organizational statement, Salvage Branch
Tab E: Functional statement, Salvage Branch
Tab F: Manpower table, Salvage Branch
Tab G: Personal history statement, Military chief of Branch
Tab H: Personal history statement, civilian assistant chief of Branch.

This material covers your questions fully I believe and is arranged in such a manner as to define all aspects of the surplus-property-disposal function at Sharpe General Depot.

The local salvage activity operates with a complete and effective coordination afforded by appropriate officials of headquarters, Sixth Army. Such liaison has been most productive and, of recent date, took form as an authorization whereby this headquarters will, by direction of the AC of S, G 4, D/A, mount an auction sale looking to the public disposal of supplies having an estiinated acquisition value of between seven to eight millions of dollars. The auctioneering fraternity

has shown a lively interest in this project and there is every reason that the undertaking will prove wholly in the best governmental interest. My initial step is, of course, to establish the auctioneer-depot relationship and this phase will take place in latter January. I have assembled all the necessary information from Department of Defense sources so that no delays will ensue thereafter and our present planning should enable the sale to take place in latter March.

Under the tentative personnel funding program given me by Sixth Army for the last half of fiscal year 1954, I feel it will be possible to raise the Salvage Branch civilian manpower complement to not less than 42 spaces. That figure is my initial target but, as circumstances permit and warrant, I shall add all the strength it will prove economical and feasible to employ. The impact of an auction sale will be such I am sure as to deserve and justify every manner of command support.

While a first reading of the credentials of my salvage chief military might fail to disclose any background essentially related to the disposal of surplus I should like you to know that the present appointee, Capt. I. M. De Garmo, is unusually and outstandingly qualified for such a duty. Much of the progress that has been made and which has won the commendation of congressional and Department of Defense visitors is a result of his zeal and painstaking interest. Such qualities are also of high value in this work in promoting firm and cordial public relationships among the firms and individuals who become the bidders for surplus property assets. Under this young officer's immediate leadership I am confident we will be able to make a first-rate job of the whole undertaking.

Should you have a continuing interest in our venture here I shall be glad to keep you informed covering each of the successive steps we undertake. Sincerely yours,

James B. CLEARWATER,
Colonel, Quartermaster Corps, Commanding.

DEPOT ORGANIZATION
The depot comprises :
Statt elements, such as the Comptroller and special staff.

Service elements, such as the Adjutant's Office, the Civilian Personnel Office, the Provost Marshal's Office, and the Miscellaneous Services Office.

Major service and housekeeping elements, such as the Transportation Division and the Depot Facilities Division.

Line or mission elements, such as the Stock Control, Storage, or Depot Mainte nance Divisions of the Engineer, Quartermaster, and Transportation Supply Sections.

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