negotiation, was submitted to the various affected Federal agencies for their comments and recommendations.

Practically all of the agencies have replied, and they were unanimous in recommending against enactment of this legislation for the following reasons:

(1) The bill would not provide the necessary priorities intended, and should it be amended to do so the agencies believe that priorities are not desirable.

(2) To permit executive agencies to set the price on surplus under their control would lead to a variation in prices for the same items of supply.

(3) It might lead to a chaotic condition, with State and local units competing among themselves for Federal surplus property.

(4) The agencies recommended that in lieu of S. 1799 the committee report S. 2668, a bill to amend section 203 (e) of the Property Act, to permit the Administrator of General Services to advertise and dispose of surplus property by negotiation.

Testimony submitted today, in connection with the subcommittee's consideration of H. R. 7855, indicates that the administrative agencies are agreed that it will be necessary to hold extended hearings on legislation which would provide permanent negotiating authority in connection with the disposal of surplus property, as proposed on S. 2668, and, as I have stated, the agencies in their comments on S. 1799 contend that the authority provided in the latter bill could better be incorporated in the administration measure, S. 2668.

In view of this situation, and the fact that the subcommittee indicated that it is desirable to withhold hearings on the permanent authority at this time, no testimony will be taken on S. 1799 at these hearings. As I have previously stated, however, the subcommittee proposes to consider a bill similar to S. 2668 early in the next Congress, at which time consideration will also be given to the proposals contained in S. 1799.

Copies of the bills, S. 2668 and S. 1799 will be inserted in the record at this point.

(The bills referred to are as follows:)

[S. 2668, 84th Cong., 1st sess.]

A BILL To amend the Federal Property and Administrative Services Act of 1949, as amended, regarding advertised and negotiated disposals of surplus property

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 203 (e) of the Federal Property and Administrative Services Act of 1949, as amended, is hereby further amended to read as follows:

"(e) (1) All disposals or contracts for disposal of surplus property (other than by abandonment, destruction, donation, or through contract realty brokers) made or authorized by the Administrator shall be made after publicly advertising for bids, under regulations prescribed by the Administrator, except as provided in paragraph (3) of this subsection.

"(2) Whenever public advertising for bids is required under paragraph (1) of this subsection

"(A) the advertisement for bids shall be made at such time previous to the disposal or contract, through such methods, and on such terms and conditions as shall permit that full and free competition which is consistent with the value and nature of the property involved;

"(B) all bids shall be publicly disclosed at the time and place stated in the advertisement;

"(C) award shall be made with reasonable promptness by notice to the responsible bidder whose bid, conforming to the invitation for bids, will be

most advantageous to the Government, price and other factors considered: Provided, That all bids may be rejected when it is in the public interest to do so.

"(3) Disposals and contracts for disposal may be negotiated, under regulations prescribed by the Administrator, without regard to paragraphs (1) and (2) of this subsection but subject to obtaining such competition as is feasible under the circumstances, if—

"(A) necessary in the public interest during the period of a national emergency declared by the President or the Congress, with respect to a particular lot or lots of property or, for a period not exceeding three months, with respect to a specifically described category or categories of property as determined by the Administrator;

"(B) the public health, safety, or national security will thereby be promoted;

"(C) public exigency will not admit of the delay incident to advertising; "(D) the property involved is of a nature and quantity which, if disposed of under paragraphs (1) and (2) of this subsection, would cause such an impact on an industry or industries as adversely to affect the national economy;

"(E) the estimated fair market value of the property involved does not exceed $1,000;

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(F) it is impracticable to secure competition;

"(G) bid prices after advertising therefor are not reasonable (either as to all or some part of the property) or have not been independently arrived at in open competition;

"(H) because of the character or condition of the property or unusual circumstances, the fair market value of the property and other satisfactory terms of disposal can be obtained by negotiation;

"(I) the disposal will be to States, Territories, possessions, political subdivisions thereof, or tax-supported agencies therein: Provided, That the fair market value of the property and other satisfactory terms of disposal are obtained by negotiation; or

"(J) otherwise authorized by this Act or other law.

"(4) Disposals and contracts for disposal of surplus real and related personal property through contract realty brokers employed by the Administrator shall be made in the manner followed in similar commercial transactions under such regulations as may be prescribed by the Administrator: Provided, That such regulations shall require that wide public notice of availability of the property for disposal be given by the brokers.

"(5) An explanatory statement of the circumstances shall be preserved in the file of each case where disposal occurs under paragraphs (3) or (4) of this subsection.

"(6) Section 3709, Revised Statutes, as amended (41 U. S. C. 5), shall not apply to disposals or contracts for disposal made under this subsection."

[S. 1799, 84th Cong., 1st sess.]

A BILL To amend section 203 (f) of the Federal Property and Administrative Services Act of 1949, as amended

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 203 (f) of the Federal Property and Administrative Services Act of 1949, as amended (40 U. S. C. 484 (f)), is amended to read as follows:

"(f) Subject to regulations of the Administrator, any executive agency may (1) authorize any contractor with such agency or subcontractor thereunder to retain or dispose of any contractor inventory, and (2) dispose of any surplus personal property to any State, Territory, or possession, or to any political subdivision thereof or any tax-supported agency therein, at a price fixed by such agency or determined by negotiation."

Senator KENNEDY. The subcommittee will now go into executive session.

(Whereupon, at 11:45 a. m., the subcommittee went into executive session.)