Federal property and works off it in private industry or goes to school under the GI bill of rights or owns his home or rents and works on a Federal installation. In both of those cases, there is a tax loss to the community.

We realize in New Hampshire that this is not only pertinent to our community but applies to every situation in the United States where a Federal installation brings school children into the town. Now, to be specific, Portsmouth is a community of approximately 20,000 people. We have very little industry. It is fair to say that our neighboring communities are similarly situated in more or less degree.

We have a Navy yard, of which we are very proud. We have a situation in Portsmouth, wherein the number of school children is 3,410 average daily membership. Of these children at the present time, 1,582 are federally connected children, which is approximately 50 percent of our school children. Portsmouth is losing a taxable income because of the Federal connection of all of these children. Again, I say our situation more or less to a degree affects every community in our area. There must be hundreds of situations like that

in the United States. Now, we come to the principal reason for Portsmouth's representatives being here in Washington today. We are building at Portsmouth, N. H., located within our city limits, and in Newington, N. H., an Air Force base for bombers. It has been declared necessary for our defense by the Secretary of the Air Force, Harold E. Talbott, and high officials in the American defense. Contractors are working day and night with great big floodlights on this project. It is a very dramatic sight to see the job being done. As a result, the Air Force tells us in the fall of 1955, and this is pertinent to the length of your bill, there will begin to be stationed at this airbase 450 civilians and 6,800 officers and men.

This Air Force personnel and civilians will bring with them 1,300 elementary school children and 300 children of high-school age. This is confirmed by the statement of the Under Secretary of the Air Force, James H. Douglas, Jr., at the ground-breaking exercises for the Portsmouth Airbase held on July 3, less than 2 weeks ago, when he stated this personnel will start arriving in June 1955, and consists of 1,000 officers, 5,800 airmen and 450 civilian employees.

Of course, this Federal increase brings with it a collateral growth of civilian services of every description, and consequently additional children. We don't expect all of these children will occupy Portsmouth schools. A great many of them will be in our neighboring communities. However, all of the high-school children will enter Portsmouth high schools, and approximately 50 percent of the elementary school children will come to our schools. The rest will be distributed among our neighboring communities.

Our

We expect 950 additional children, or a 30 percent increase. community is already at a critical point with respect to school housing. It is absolutely essential for Portsmouth to build a new high school within the next 24 months, at an estimated cost of $3 million, not counting interest payments. Because of the impact of the Portsmouth Airbase, we are planning for a school building program of $3%1⁄2 million, approximately.

You gentlemen will quickly appreciate that this amount of capital expense amortized over 20 years means $175,000 a year to the Ports

mouth city budget, not counting the interest and not counting the additional current expenses that we will have to take care of as we put on more teachers, more coal and everything else.

This same situation affects all of our neighboring communities. That makes us vitally interested in bill 815. We don't want to overlook the fact our city is also interested in 874, which applies to current expenses. We do not want to lose a portion of our Federal assistance by the so-called 3 percent absorption clause. We would like to have this seriously considered by your committee, and another member of our group will speak concerning. We are a community in which the Federal impact is a serious one. Nobody appreciates this more fully than the communities who live with the problem.

Senator UPTON. Mr. Wilder, what is the number of employees at the navy yard, approximately?

Mr. WILDER. Six thousand.

Senator UPTON. And do they all reside in Portsmouth?
Mr. WILDER. Sixty percent.

Senator UPTON. Approximately 60 percent of the total number of employees reside in Portsmouth?

Mr. WILDER. Yes.

Senator UPTON. Well, you have responsibility of the other communities which would be affected by the airbase. To what extent do you expect the impact to be felt? That is, over what area within what radius?

Mr. WILDER. It will extend anywhere within 20 or 30 miles of Portsmouth, New Castle, Newington, Rye, Dover, Summersworth, all of us.

Senator UPTON. And you have told us about 60 percent of the employees of the navy yard reside in Portsmouth. To what extent are the other spread out over the area?

Mr. WILDER. It would be analogous.

Senator UPTON. Do you mean that they would spread over this radius of some 20 miles?

Mr. WILDER. The spread of the population of Portsmouth is a trading center, just as Dover, N. H., is.

Senator UPTON. Where do the employees reside?

Mr. WILDER. They are spread over the community, but principally in Portsmouth, but as we get away from Portsmouth, the load is lighter.

Senator UPTON. Are there those who reside in adjacent towns?
Mr. WILDER. They certainly do.

Senator UPTON. And how great a distance from Portsmouth?

Mr. WILDER. Well, I can't be accurate on that, Senator Upton, but I would say certainly within 20 to 30 miles.

Senator UPTON. That is all.

Senator COOPER. I will have to recess the committee until 11:45, while Senator Upton and I answer a quorum call. We will be back

at 11:45.

(The committee recessed from 11:35 to 11:45 a. m.) Senator UPTON. The hearing will be resumed.

Senator Cooper has been detained by pressing business and has asked me to conduct the hearing.

We will hear from Mr. Maurice Blais, from Dover, N. H.

STATEMENT OF MAURICE BLAIS, CHAIRMAN, BOARD OF EDUCATION, DOVER, N. H.

Mr. BLAIS. My remarks, Mr. Chairman, will of necessity be somewhat spontaneous. Just prior to coming into the hearing, the representatives of our area asked me to pinpoint the effect of the 3-percent absorption clause in Public Law 874. However, before going into that, I would like to try and impress the committee with the absolute need of the extension of Public Law 815, if the communities in our area, and Dover is very typical of the other communities, are to provide housing for the children thrust into our school system as a result of the operation of Federal establishments, such as the airbase in our area. Dover, like most of the other communities, has attempted to do its utmost to carry its share of the burden.

We completed last year a new elementary school, costing nearly a million dollars. This school was planned for approximately 800 pupils, with special rooms, such as science rooms and music rooms, for a well-rounded educational program. This year we find ourselves forced to use those special rooms to house children in regular classrooms. We have an estimated enrollment of 900 pupils in that school at the present. Now, we have no other source of income for buildings. Our only possible source is the Federal Government. By building that school, we are approaching what is our legal limit on debt for school construction. Under New Hampshire law we are entitled to 5 percent of our total valuation for school purposes. The cost of the school has brought our bonded indebtedness very close to that legal limit.

Therefore, if we are to absorb any large number or any great percentage of children into our school system, we have definitely got to have new school housing, and the cost of that new housing cannot come out of the real-estate taxpayer. The law will not permit us to bond enough money to build the necessary schools. So therefore I want to go on record as stating that extension of Public Law 815 is an absolute necessity if we are going to provide housing for schoolchildren put into our system as a result of the establishment of Federal establishments.

On Public Law 874, I have before me a chart which I will make a part of the record, showing the effect of the application of the 3-percent absorption clause.

(The chart is as follows:)

Public Law 874, as amended List of applicant school districts and estimated entitlements fiscal year 1954 and fiscal year 1955 (showing effects of 3-percent absorption on entitlement and total expenditures of districts)

Mr. BLAIS. Our cities last year and this year were receiving $29,602. With the 3-percent clause applying, we will receive next year only $18,162, or a loss of approximately 38 percent of our entitlement. The city of Somersworth will lose 47.7 percent. In many of the small communities, such as the town of Durham, which this past year is receiving $1,912 will lose their complete entitlement. In other words, they will lose 100 percent of the Federal money given them this year. There are several towns in that same category. Northwood is another one. Hampton Falls would lose 62.2 percent. East Kingston would lose 100 percent, which is $1,071. While this does not look like very much money, to these communities it has a great effect on their budget. We in the area feel that the 3-percent clause is unfair in that we are called upon to take a 3-percent absorption of our total enrollment. That is not only of our federally affected pupils, but of our total enrollment, and that is why we feel that the 3-percent clause should be eliminated from this bill as it definitely works a hardship on the communities in that area.

Senator COOPER. Well, due to what Federal activity is your increased enrollment?

Mr. BLAIS. The Portsmouth Navy Yard accounts for approximately 250 at the present time, Senator. Then the recent establishment of Simplex, which manufacturers underground cable and operates

on a high percentage of Government contracts; General Electric in Somersworth, Eastern Air in Dover-all of those firms are operating on Government contracts.

I might mention here as an example that over approximately a 12-year period prior to the postwar period, that is 12 years back from 1946, our school enrollment was practically static. It didn't vary any more than 1 or 2 percent up or down during that period; where as from 1946 on it has shown a very large increase due, we feel, to these establishments.

Senator UPTON. What is the limit of pupils for which you receive. Federal aid?

Mr. BLAIS. At the present time 250, Senator.

Senator UPTON. 250?

Mr. BLAIS. That is right.

Senator UPTON. And that increased enrollment results from what? Mr. BLAIS. We feel from the Federal activity.

Senator UPTON. From what Federal activity?

Mr. BLAIS. The navy yard and these other plants who are doing Federal work.

Senator UPTON. How far is Dover from this airbase which is under construction?

Mr. BLAIS. Five miles.

Senator UPTON. And what is the poplation of Dover?

Mr. BLAIS. Dover has a population of approximately 17,000 at the present time.

Senator UPTON. You referred to Somersworth; how far is that from the airbase?

Mr. BLAIS. Five miles from Dover, 10 miles from the airbase.
Senator UPTON. Rochester?

Mr. BLAIS. Fifteen miles from the base.

Senator UPTON. How far is Exeter from the base?

Mr. BLAIS. I would say about 12 miles.

Senator UPTON. And Hampton?

Mr. BLAIS. Twenty miles.

Senator UPTON. Mr. Gillmore appears to be next on my list.

STATEMENT OF ROY GILLMORE, SUPERINTENDENT OF SCHOOLS, SUPERVISORY UNION NO. 2, HAMPTON, N. H.

Mr. GILLMORE. I am Roy Gillmore, Superintendent of Schools of the Hampton Supervisory Union 21, New Hampshire. I am simply talking for 874.

We have reckoned that the amount of money that we will lose if this proposed 3-percent reduction goes into effect, we find that the total reduction will be $14,085. That will cut out completely at least two of the towns, Seabrook and Hampton Falls, and based on the old figure, we would receive $26,988. With the reduction of the $14,000, of course, we lose practically half of our money.

Two towns at least, Seabrook and North Hampton, have reached their debt limit practically. In New Hampshire the debt limit is 5 percent, as you know, but there is a provision that with the consent of the Governor and council it can be extended to 8 percent. Seabrook is now in the process of extending that to 7.6 percent. I believe the Governor and council committee is meeting with the school com