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Letters, statements, etc., submitted for the record-

Adriaenssens, Joseph L., president, J. & M. Adriaenssens N.V., Ant-
werp, Belgium:

Copy of certification of work performed.

Example of shipping document..
David, Col. Lester T., U.S. Air Force, OASD (I. & L.): Disposition

excess and foreign excess personal property at Army property dis-

posal activities in Europe, table-
Heiser, Brig. Gen. Joseph M., Assistant Deputy Chief of Staff for
Logistics (Materiel Readiness), Department of the Army:

Distribution of FRELOC theater excesses to MAP-
Storage and logistics-related construction in Europe Authorized

and funded through fiscal year 1966 and fiscal year 1967, table..
Nelson, Col. Robert K., commanding officer, U.S. Army General
Depot, Kaiserslautern, Germany:

Briefing tour of Germersheim Depot activity, with charts...

Briefing tour of Kaiserslautern General Depot, with charts.
Regan, Col. John, Assistant Deputy, Military Liquidation Section,
U.S. Embassy, Paris,
Cost analysis of related personal property sales to anticipated

Cost of custodial functions on noninterest bases.
Interest bases, table-
List of Installations turned over to MLS as of April 5, 1967.
Organizational chart— Military Liquidation Section, U.S. Em-

bassy, Paris, France..
Recapitulation through July 31, 1967, of Military Liquidation

Section sales, table..
Sales negotiations-related personal property, as of June 30, 1967,

Romney, Miles Q., counsel, Special Subcommittee on Donable Prop-

erty, House Committee on Government Operations: Letter from
Lawson B. Knott, Jr., Administrator, General Services Adminis-
tration, to Hon. John S. Monagan dated May 26, 1967, regarding

foreign excess property returned to the continental United States -
Scordas, Paul, Officer in Charge, European Office of Government

Property Resources Division, Office of Procurement, Agency for
International Development:

Chart 1.- Acquisitions.
Chart 2.-Inventory--
Chart 3.- Undelivered orders.
Chart 4.-Inventory frozen..
Chart 5.–Production..
Chart 6.-Shipments.
Chart 7.- Revolving fund.

Chart 8.-Financial status revolving fund..
Sidman, Abraham, Chief of Merchandising, Military Liquidation

Section, Foreign Excess Sales Office: FESO volume of sales in ton-
nage, fiscal year 1967.
Stolarow, Jerome H., Assistant Director, Defense Division, U.S.

General Accounting Office: Property Disposal Office action by

Army and Air Force in France during FRELOC.
Waters, Herbert J., Assistant Administrator for war on hunger,
Agency for International Development, Department of State:
Backlog of orders for excess property.
Section 608 material shipped to DOD.
Shipments of excess property to Vietnam, table..

Utilization of excess property, table---
Woll, Jack K., Director, Government Property Resources Division,
Office of Procurement, Agency for International Development:

AID contractor, Antwerp, Belgium, March 31, 1967, tables.

Average 4-week period, Antwerp production.-
Zaretzky, Hyman S., Director, Supply Management Policy, Office

of the Assistant Secretary of Defense: Material relocated (U.S.
Army and U.S. Air Force), March 31, 1967, table...












TUESDAY, MAY 16, 1967


Washington, D.C. The subcommittee met, pursuant to notice, at 10 a.m., in room 2203, Rayburn House Office Building, Hon. John S. Monagan presiding:

Present: Representatives John S. Monagan, Fernand J. St Germain, and Margaret M. Heckler.

Professional staff members present: Miles Q. Romney, counsel; Peter S. Barash, legal assistant; and William H. Copenhaver, minority staff. Mr. MONAGAN. I will call the hearing to order.

Since 1965, the Special Subcommittee on Donable Property has been engaged in an active examination of the use of excess property in the U.S. foreign aid program. “Excess property” is, of course, any property under the control of any Federal agency which is not required for its needs and the discharge of its responsibilities. As excess, it is available for use by other Federal agencies.

The principal authority for the use of excess property in the U.S. foreign aid program is the Foreign Assistance Act of 1961, as amended. In enacting the Foreign Assistance Act of 1965, Congress added new language which directly called upon AID to utilize excess personal property whenever practicable in lieu of the procurement of new items for U.S. assisted projects and programs.

During the 89th Congress, the subcommittee undertook an extensive review of the use of excess property by our AID program in Latin America. That review resulted in House Report No. 1466, 89th Congress, entitled, “The Use of Excess Property by the U.S. Foreign Aid Program in Latin America.” Significant improvements in the effectiveness of the program there have ensued.

The hearing today has been called to receive testimony on the opportunities and problems created by the generation of foreign excess property as a result of Operation FRELOC, the relocation of materiel necessitated by the pullback of NATO and the closing of U.S. military bases and related facilities in France. Our concern is focused on U.S.owned personal property, now largely removed from France, which is or can reasonably be expected to become excess to the needs of the Department of Defense and thereby become available for use by AID


or other Federal agencies. The magnitude of this move and the opportunities available thereby to AID are clearly illustrated by the fact that some 800,000 short tons of supplies and equipment have been transported out of France, and by the fact that since March 1966, personal property having an acquisition value of one quarter billion dollars has been offered to AID for its possible use. The subcommittee's concern with efficiency and economy of Government operations warrants careful scrutiny of agency programs, procedures, and practices with respect to the availability, screening methods, accounting, storage, rehabilitation, and program utilization of these vast amounts of property.

Pursuant to the mandate of Congress, AID has utilized since 1960, excess property with an acquisition cost of $367 million. This property includes such items as passenger vehicles, road equipment, building construction machinery, diesel locomotives, and engine lathes. Most of it was generated by the Department of Defense.

This subcommittee has seen much substantiating evidence, that without the ready and efficient availability of excess property, AID would either have had to request substantially more funds or the economic assistance efforts of the U.S. foreign aid program would have been far less effective. It is incumbent on this subcommittee, therefore, to make a careful review of agency operations associated with the excessing and eventual utilization of U.S.-owned property generated by the closedown of U.S. bases and related facilities in France.

While our initial focus is on the use of this excess property by AID or other Federal agencies having operations abroad, we also want to develop information on the extent and nature of Operation FRELOCgenerated personal property which has been shipped back to the United States. Eventually some of that returned property may be declared excess, and as such available for further Federal use within the United States. Moreover, if other Federal agencies should not have need for that property, it would, of course, become surplus property. The subcommittee's interest in the potential surplus status of that property lies in the fact that as surplus it would be subject to screening for disposal under the Federal donable property program authorized by section 203(j) of the Federal Property Act.

Our first witness this morning will be Mr. Herbert J. Waters of the Agency for International Development. Mr. Waters, has appeared before our subcommittee before. He recently became Assistant Administrator of Aid for the War on Hunger, but before that he was AID's Assistant Administrator for Material Resources. We are happy to bave you before us again, Mr. Waters.

Mr. WATERS. Thank you, Mr. Chairman.

Mr. ST GERMAIN. At the outset, I would like to apologize to Mr. Waters and the subsequent witnesses who will testify because of a conflict.

I wanted to be here at the beginning, however, to greet you, Mr. Waters, to tell you how much we appreciate your testimony. I will take it with me and will be reading it at the other subcommittee. Should the occasion arise where I am needed, I will be in the other area.

Mr. WATERS. With me is Mr. Jack Woll, Director of the Government Property Resources Division connected with this program.

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