The attorney general rendered the opinion that existing statutes are adequate for reassessment of real property in order to take into account the destruction or reduced value resulting from the tornadoes. However, adequate authority for reassessment of personal property does not exist in the statutes, but a representative of the State tax board indicated unofficially that it would be the policy of the State tax board not to review decisions made by local assessing authorities in regard to efforts made to apply equity to personal property assessments for property destroyed or damaged by the tornadoes. It should be pointed out that much of the property destroyed was covered by insurance or will be replaced by the Red Cross in direct grants, and thus the owner of the property destroyed may have the use of such property with a minimum of interruption.

The treasurer of State advised the committee that he had transferred $18 million of State funds to the banks in the disaster areas with the verbal understanding that the banks would "lend it or lose it," meaning that these State funds which are deposited at no interest should be used for low-interest loans to disaster victims. It was pointed out that the treasurer of State could not bind his successor in office to a program of such deposits beyond the expiration of his present term in February 1967. Therefore, the low-interest loans made by banks to disaster victims from such funds probably will necessarily be short-term loans. Efforts are being made by the superintendent of State police, the Director of Civil Defense, and Weather Bureau officials to work out an effective system of tornado warnings which will provide maximum protection against future weather problems. The details of such a system have not been developed. Conclusion

It appeared to the committee that in spite of the contributions of the American Red Cross and other nongovernmental organizations and the participation of Federal, State, and local governmental units, many disaster victims will be left with considerable financial loss which is not compensated by insurance. The committee considered the question of recommending a program of direct grants in the form of cash payments by State government in such cases. However, it was the consensus of the committee that such a program would be a departure from previously existing policy and should not be recommended. Many suggestions have been made regarding proposed amendments to existing statutes to make State and local governmental functions effective for which precedent does exist.

The committee recommends that no special session of the general assembly will be recommended by the legislative advisory commission to Governor Branigin resulting from the problems created by the April 11 tornadoes. However, the committee does recommend that studies be continued by the Disaster Study Relief Committee in order that constructive legislation may be recommended to the 1967 general assembly in order that State and local governments may be even better prepared to relieve as many problems as possible in the event of similar disasters in the future. Respectfully submitted.

JACK H. MANKIN, Chairman, Disaster Relief Study Committee.

Mr. MANKIN. I have a couple of other comments I would offer, if the Chair is interested.

I was frankly quite surprised to hear the gentlemen from the HFA tell about some of the facilities of their agencies which would have been available in this instance in Indiana. Certainly, to my knowledge, this was never brought to the attention of any of the agencies working in the field in Indiana.

Senator BAYH. I agree wholeheartedly that this certainly was not the story that we were told when we tried our best to get this type of relief for Russiaville.

As you know, now, we have extended it through the appropriation procedure, which takes some time, and whatever assistance is available will then take additional time.

Mr. MANKIN. It appears to me that there are fragmentary parts of other existing Federal statutes which perhaps would have applied here. How did anyone know about it? I do not know about it, and we have been studying the problem out there.

Senator BAYH. Let me say we did approach this specific agency to try to get assistance for Russiaville.

Mr. MANKIN. I see.

Senator BAYH. And this was not forthcoming. Community facilities does have water resources available, if they set up the proper corporations, but they do not have sewer facilities, and the testimony to which the gentleman is referring and the authority which he was relying on is in the housing bill now in the Congress, and we do not know whether it is going to pass or not. Certainly it is not on the books now. So I did not press him on that, because it just was not available. I think he was referring to his hopes that this bill passes, and that the other bill passes. I hope so, too. The provision in here would be duplicatory, but I say why take a chance?

Mr. MANKIN. This is to me a good argument in favor of this omnibus type of disaster relief bill, such as your S. 1861, where you have got these things spelled out.

Now, if it so happens that the President is given authority which otherwise already exists in some Federal agencies, the President can readily designate that agency, and I assume he would, probably, to handle that particular problem.

But to have these in a single bill, and a single statute would, I think, be of great importance, and that is why I am attracted by the omnibus approach of our S. 1861.

As to the warning systems, I hope that Superintendent O'Neal, of the Indiana State Police, will be here, because I think he has some more up-to-date information, but it is my understanding that one of the two major disaster warning systems which has been used by civil defense in the past can be made available now, because of the developments in intercontinental ballistic missiles, and a lot of other things I do not understand about. But this one type of warning system is now obsolete, and that one such system may now be released, and I think Mr. O'Neal will have more specific information on that.

The other comment I would like to make before turning the matter over to Senator McCormick is in regard to the proposal, as I understand it, which I did not know about until I got to Washington, of the Bureau of the Budget, if I am correct about that, for a sharing approach here, an insurance system which would include contributing factors in both State and Federal Governments.

I am a little bit wary of this system, frankly, Mr. Chairman, for the reason that as you well know, in Indiana, we do not have the authority to issue bonds and go into debt. Also, our legislature meets only once every 2 years. At that time, the legislature adopts a budget for the next 2 years, and in doing so, it generally is a pretty tight budget, which recognizes anticipated revenues, and uses up just about everything that it anticipates it is going to have coming in, so that I am afraid that Indiana might have a little difficulty establishing a very substantial contingency type of fund to match Federal funds.

Now if a tornado went through Indiana and Ohio, and Ohio had established such a contingency type fund, and if Ohio were prepared to match Federal funds, it would seem a shame for the people of Indiana, because their legislators had not been farsighted enough to establish the matching fund, that they would be denied this insurance coverage.

I do not think there is any guarantee that all States, even taking into account the fact that you suggest some equitable approach on the degree of participation, would participate. This is why I think, in my judgment, at least, anything that we are going to consider as sure fire in providing additional disaster relief, I think the essential cost and perhaps control, too, should be borne by the Federal Gov

ernment.

Senator BAYH. May I ask one question on this?

I am quite well aware of the fact that State legislators do not like to have funds just lying around for which there is no specific purpose. They do provide our government in Indiana with a contingency fund, but this would not be large enough to meet any sizable emergency. This idea, which the budget is still in the process of developing, of course, would be over and above the provisions that are in the bill which you testified in support of. I wonder, in the event there was a substantial emergency, such as we just had in Indiana, if the legislature could not meet in 1-day session as we did on another matter, dependent upon the severity of the circumstances, and provide the necessary funds.

Mr. MANKIN. Well, Mr. Chairman, we could do that, surely, if we had anticipated budget surpluses that would have the funds there. Lacking that, we would have the problem which you well know. There is a very difficult problem for State governments looking for new sources of tax revenues. So I would say that the 1-day session notion, to establish the funds, or to make the appropriation, would be all right if we had a sufficient surplus.

Senator BAYH. Our major problem, of course, and the thing that this would try to deal with, is those particular cases where you have to give an individual a loan on top of a loan. The fellow that has a little equity in his house, and a long-term obligation, and yet has his car and all his wordly goods swept away, still has the mortgage indebtedness. He is helped very little by another long-term loan, and this is what this specific program was designed for. I share your concern that we use great care to see that this be administered equitably by the States, and I still feel that the bulk of this burden has to be on the Federal Government, and that when we look at the costsharing basis, we should bear this in mind.

Thank you, sir.

Senator McCormick, you have a statement, I understand, also.

STATEMENT OF HON. KEITH MCCORMICK, STATE SENATOR FROM THE STATE OF INDIANA

Mr. McCORMICK. Yes, sir, Mr. Chairman. I might say at the very beginning it is considered a privilege to appear before your committee in order to bring out these various facts, so your committee can be apprised of the great problem that we have witnessed after the tornado passed through.

In order to become acquainted, I am Keith C. McCormick, residing in Lebanon, Ind. I am a member of the Indiana State Senate representing Boone, Hamilton, and Tipton Counties. I own an insurance and real estate agency and 50 percent of my volume is with Hoosier farmers in the agricultural areas. I have been in the farm mortgage loan business for 20 years, representing the Prudential Insurance Co. of America in the agricultural financing and refinancing fields.

Certainly I do not wish to belabor you with meaningless facts, figures, and information pertaining to our disastrous Palm Sunday tornado which struck and literally destroyed some of the finest agricultural areas in the State of Indiana. There will be other testimony from other officials and citizens of Indiana, submitting to you pertínent damage facts and figures from the tornado in areas other than agriculture.

But, as a member of the Governor's, Governor Branigin's special disaster committee, I would like to dwell more on the tremendous financial loss suffered by the farmers in the tornado path.

To do this, I will use Boone and Hamilton Counties as examples, because they are most typical of Indiana's fertile and productive agricultural areas.

I submit to you a few photographs, Mr. Chairman, which will be for your use and the committee's, to give you a partial picture of the aftermath which is estimated by the disaster agencies and authorities that the property toll. in Boone County alone is $3.2 million and that approximately 12,000 acres of farmland were made desolate by debris.