MOBILIZATION AND DEMOBILIZATION PROBLEMS THURSDAY, AUGUST 10, 1944 UNITED STATES SENATE, WAR CONTRACTS SUBCOMMITTEE OF THE COMMITTEE ON MILITARY AFFAIRS, The subcommittee met, pursuant to call, in room 357, Senate Office Building, at 10 a. m., Senator James E. Murray (chairman) presiding. Present: Senators Murray, Revercomb, and Johnson. Also present: Bertram M. Gross and Sigmund Timberg. Senator MURRAY. Gentlemen, the hearing will come to order. We have for consideration this morning a bill proposed by Senators Stewart and Taft. (The bill referred to is as follows:) CONFIDENTIAL SENATE SMALL BUSINESS COMMITTEE PRINT No. 3, AUGUST 9, 1944 A BILL To establish a Surplus War Property Administration; to provide for the proper disposal of surplus war property; and for other purposes Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Congress hereby declares that the objective of this Act is to govern the disposal of surplus war property so as— (a) To assure the most effective use of such property for war purposes; (b) To achieve the prompt and full utilization thereof; (c) To promote maximum production and employment of the manpower and the natural and agricultural resources of all sections of the country; (d) To effect broad and equitable distribution of surplus property; (e) To facilitate the transition of enterprises from wartime to peacetime production and of individuals from wartime to peacetime employment; (f) To strengthen and preserve the competitive position of small business concerns in an economy of free enterprise; (g) To aid honorably discharged servicemen to establish and maintain their own small business or agricultural enterprises; (h) To protect free markets and competitive prices from dislocations resulting from uncontrolled dumping of surplus property; (i) To discourage monopolistic practices and assure fair prices to the consumer; (j) To utilize normal channels of trade and commerce (without discriminating against the establishment of new enterprises) and assure the sale of such surpluses in such quantities and on such terms as will discourage disposals to speculators or for speculative purposes; (k) To establish and develop foreign markets and promote mutually advantageous economic relations between the United States and other countries through the programmed export of such surpluses; and (1) To obtain the highest return for the Government consistent with the foregoing objectives. SURPLUS PROPERTY ADMINISTRATOR SEC. 2. (a) There is hereby established in the Office of War Mobilization, and in the office of its successor, should it be abolished, the Surplus War Property Administration (hereinafter called the "Administration"), at the head of which shall be a Surplus Wer Property Administrator (hereinafter called the "Administrator"). The Administrator shall be appointed by the President, by and with the advice and consent of the Senate, and shall receive compensation at the rate of $12,000 per annum. The term of office of the Administrator shall be two years. SURPLUS PROPERTY BOARD (b) The Administrator shall regularly advise and consult with a Surplus War Property Board. Such Board shall be composed of one representative each of the State Department, Treasury Department, War Department, Navy Department, Justice Department, Reconstruction Finance Corporation, Smaller War Plants Corporation, United States Maritime Commission, Wer Production Board, Wer Food Administration, Federal Works Agency, Civil Aeronautics Board, and the Foreign Economic Administration, as designated by the respective department, board, or egency heads; and two representatives each of industry, labor, and agriculture, who shall be appointed by the Administrator and compensated in accordance with the provisions of section 8. (c) The Administrator may, without regard to the civil-service laws, rules, and regulations and the Classification Act of 1923, as amended, employ 2nd fix the compensation of such Deputy Administrators and other officers and employees, and may make such expenditures for supplies, facilities, and services, as may be necessary to carry out the provisions of this Act. ADMINISTRATOR'S DUTIES AND AUTHORITY SEC. 3. Subject to the general supervision of the Director of Wer Mobilization, and the provisions of this Act, and notwithstanding the provisions of any existing law, it shall be the function and duty of the Administrator (a) To supervise and direct the handling and disposition of surplus war property by the Government in accordance with objectives and policies of this Act; (b) To supervise and direct the transfer of any surplus war property in the possession of any Government agency to any other Government agency; (c) To assign surplus property for disposal by the fewest number of Federal agencies practicable and to centralize in one disposal agency responsibility for the disposal of all property of the same type or class: Provided, That the disposal of all types of surplus property abroad may be centralized in one disposal agency; (d) To prescribe regulations and issue directives necessary to provide, so far as practicable, for uniform and wide public notice concerning surplus property available for sale, and for uniform and adequate time intervals between notice and sale so that all interested purchasers shall have a fair opportunity to buy; (e) To prescribe regulations and issue directives necessary to carry out the provisions of this Act; and no Government agency shall transfer or dispose of surplus property in contravention of such regulations or directives; and (f) To formulate and issue as rapidly as possible detailed plans (1) for the care and handling and disposition of surplus property in accordance with this Act; (2) for converting to civilian production by private industry as rapidly as war needs and conditions permit, any Government-owned plants which are not needed for national defense and are capable of use for civilian production; (3) for facilitating the most economical use and disposition of Governmentowned plants which are not needed for national defense but are not capable of use for civilian production; (4) for disposition of surplus Government-owned transportation facilities and equipment in such manner as to promote an adequate and economical national transportation system, preserving the inherent advantages of each mode of transportation and providing service at reasonable and nondiscriminatory rates and charges; and (5) for removal of any existing discriminations affecting the disposal and use of Government-owned plants and property, in accordance with this Act. SEC. 4. (a) The Administrator may delegate any authority and discretion conferred upon him by this Act to any deputy Administrator, and may delegate such authority and discretion, upon such terms and conditions as he may prescribe, to the head of any Government agency to the extent necessary to the handling and solution of problems peculiar to that agency. (b) The head of any Government agency may delegate, and authorize successive redelegations of, any authority and discretion conferred upon him or his agency by or pursuant to this Act to any officer, agent, or employee of such agency or, with the approval of the Administrator, to any other Government agency. (c) Any two or more Government agencies may exercise jointly any authority and discretion conferred upon each of them individually by or pursuant to this Act. (d) In carrying out the purposes of this Act, the administration may utilize the services of any other Government agency. (e) Notwithstanding the provisions of any other Act, the Administrator is authorized to dispose of surplus property in accordance with the provisions of this Act. SEC. 5. The Administrator is authorized to prescribe such restrictions on the return to the United States of surplus war property which has been disposed of abroad or sold in this country for export as he determines to be necessary to prevent the return of such property from interfering with the objectives and policies of this Act. The imposition of these restrictions shall be enforced through the Treasury Department. SURVEILLANCE BY CONGRESS SEC. 6. (a) To assist the Congress in appraising the administration of this Act and in developing such amendments or related legislation as may be necessary to accomplish the objectives of the Act, the appropriate committees of the Senate and the House of Representatives shall study the reports and information submitted to the Congress under this Act and shall otherwise maintain continuous surveillance of the operations of the Government agencies under the Act. (b) Within three months after the enactment of this Act, and thereafter in January, April, July, and October of each year, the Administrator shall submit to the Senate and House of Representatives a quarterly progress report on the exercise of his authority and discretion under this Act, the status of surplus property disposition, and such other pertinent information on the administration of the Act as will enable the Congress to evaluate its administration and the need for amendments and related legislation. (c) The Administrator shall submit to the Senate and House of Representatives copies of the regulations prescribed by him from time to time under this Act within thirty days after the effective date of such regulations. BUREAU OF THE BUDGET SEC. 7. It shall be the duty of the Bureau of the Budget, subject to provisions of subsections (h) and (e) of section 3 (a) To coordinate the inventory records of surplus war property in the possession or control of Government agencies; (b) To prescribe suitable standards and procedures which, so far as practicable, shall be uniform, for the inventory and classification of surplus property and for the transfer thereof among Government agencies; and to devise and prescribe the forms and records for sale or other transfer to insure property and uniform accountability control; and (c) To receive and review and approve or deny applications of Government agencies (other than the War Department, Navy Department, and Maritime Commission) for surplus property for the purpose of acquiring such property in their behalf from surplus stocks as hereinafter provided in section 11. ADVISORY COMMITTEES SEC. 8. Each Government agency charged with responsibility for disposal of surplus war property shall organize advisory committees with which it shall consult regarding policies and procedures to govern disposal of the various classes of surplus property under this Act. Such committees shall be fairly representative of (a) The larger business units of the interested trade or industry, including its wholesale and retail distributors, if any; (b) The small business units, therein, including distributors; (c) The labor groups interested therein; and (d) Interested farm, consumer, and other groups, if any. When engaged in the business of the Administration, all members of such advisory committees shall be entitled to compensation at the rate of $15 per diem, and actual traveling expenses and subsistence expenses (not in excess of $10 per diem) while away from their homes. DECLARATION OF SURPLUS PROPERTY SEC. 9. Every Government agency shall have the duty and responsibility continuously to survey the property in its possession or control and to determine which of such property is surplus to its needs and responsibilities. For the duration of hostilities in the present war, such determination shall be the exclusive province of the owning agencies. Following cessation of hostilities, the Administrator shall have authority to require full information concerning any property in the control of any owning agency and may upon his own determination declare it or any part of its surplus to the needs and responsibilities of such agency. If in the opinion of the owning agency the retention of any property so declared by the Administrator to be surplus is essential to the national security such agency may appeal from such declaration to the President for a final determination. Each Government agency shall submit to the Administrator such information and reports with respect to surplus war property in such form and at such times as the Administrator shall direct. When requested by the Administrator, a Government agency shall execute such documents for the transfer of title or for any other purposes or take such steps as the Administrator shall determine to be necessary or proper to transfer or dispose of surplus war property or otherwise to carry out the provisions of the Act. AGENCY INVENTORIES SEC. 10. Every agency engaged in the disposition of surplus property shall maintain in each of its disposal offices full records of the inventories of surplus property of such office and of each of the disposal transactions negotiated by such office and shall make such records available for inspection by the public. TRANSFERS BETWEEN AGENCIES SEC. 11. (a) The Administrator shall to the maximum extent practicable, by regulation, directive, or otherwise, give priority in the disposition of surplus property to the following Government agencies which shall have the right to acquire surplus property in the order and manner, and for the purposes following: (1) The War Department, Navy Department, and Maritime Commission may acquire surplus property necessary for the prosecution of the war or for purposes of national defense and security, or may direct the disposition thereof to any person engaged in war production. (2) The Bureau of the Budget may direct the transfer of surplus property to any Government agency (other than the War Department, Navy Department, and Maritime Commission) which demonstrates a need therefor. Such transfer shall be made upon such terms and with such charge to the appropriation of the transferee for the value thereof as the Bureau of the Budget shall prescribe in accordance with existing law. (b) The Administrator shall resolve any conflict between Government agencies over priorities in the acquisition of surplus property in such manner as will, in his judgment, best effectuate the objectives of this Act. DISPOSAL TO LOCAL GOVERNMENTS SEC. 12. The Administrator may prescribe regulations to provide for the disposition of surplus property to States, and political subdivisions, thereof, and to tax-supported and nonprofit institutions, as follows: (a) Surplus property which has been acquired by the Federal Government for school, classroom, or other educational use may be transferred to the Office of Education in the Federal Security Administration for donation to tax-supported educational institutions, and, within the discretion of the Commissioner of Education, to other nonprofit educational institutions. (b) Surplus medical supplies and equipment may be transferred to the United States Public Health Service in the Federal Security Administration for donation to tax-supported medical institutions, and, within the discretion of the Surgeon General of the Public Health Service, to hospitals or other similar institutions not operated for profit. (c) Surplus property for which the estimated cost of handling, storage, and sale would exceed the estimated proceeds of commercial sale, may be donated to States, political subdivisions thereof, or tax-supported institutions. |