GENERAL ACCOUNTING OFFICE SALARIES AND EXPENSES STATEMENTS OF JOSEPH CAMPBELL, COMPTROLLER GENERAL OF THE UNITED STATES; ROBERT F. KELLER, GENERAL COUNSEL; JOHN F. FEENEY, ADMINISTRATIVE OFFICER; AND HERSCHEL J. SIMMONS, CHIEF, BUDGET AND FINANCE BRANCH TRAVEL LIMITATION Senator MAGNUSON. The House approved an increase of $375,000 in the travel limitation. We will put the estimate in the record, and you have a short statement. (The estimate follows:) SUPPLEMENTAL ESTIMATE (H. Doc. 333) "GENERAL ACCOUNTING OFFICE "In addition to the amount heretofore made available for travel expenses of employees, not to exceed $375,000 shall be available for such expenses from the appropriation to the General Accounting Office for the current fiscal year for 'Salaries and expenses"." The proposed provision is necessary to enable the General Accounting Office to use existing appropriations for the increased travel costs authorized pursuant to Public Law 87-139, approved August 14, 1961. Unless the current limitation is increased essential travel will have to be curtailed. Mr. CAMPBELL. We are asking for a $375,000 increase in our travel limitation. We are not asking for additional funds. We have sufficient funds on hand. Senator MAGNUSON. You will absorb them in your own budget? Mr. CAMPBELL. We will absorb them in our own budget. I would point out that the increases might have run to $638,000 but we are operating at below the maximum allowed by law, both as to mileage and per diem, so that we will be able to get by with a $375,000 increase in our limitation. Senator HOLLAND. You are not asking for a restoration? Mr. CAMPBELL. No, sir. Senator MAGNUSON. The House allowed this. It is within their own budget. They are having just a little more of this than anticipated in the regular budget, and that is due to the 1961 act and some of the expansions and things of that kind. Mr. CAMPBELL. Yes, sir. Senator HOLLAND. You are our agency, so we certainly will see you are supplied with whatever you need to give us the facts. it. Mr. CAMPBELL. I appreciate that, Senator. We are well aware of We try to be quite careful in our work. Senator MAGNUSON. Are there any questions of Mr. Campbell? If not, thank you very much. Senator HILL. I would say this, Mr. Chairman, that as our agent I think he does a good job. Senator MAGNUSON. I think so. Senator HOLLAND. He always has an answer and generally a very satisfactory answer to the questions we refer to him. I am glad we have such an agency, because we need light on many things that we do not have a machine here to find out. Senator MAGNUSON. Thank you very much, Mr. Campbell. GENERAL SERVICES ADMINISTRATION STATEMENTS OF BERNARD L. BOUTIN, ADMINISTRATOR; LAWSON B. KNOTT, JR., DEPUTY ADMINISTRATOR; ROBERT T. GRIFFIN, ASSISTANT ADMINISTRATOR FOR CONGRESSIONAL AND PUBLIC AFFAIRS; EDMOND J. ROUHANA, ACTING COMPTROLLER; WILLIAM A. BUTTS, ASSISTANT COMPTROLLER, BUDGET; WILLIAM A. SCHMIDT, DEPUTY COMMISSIONER, PUBLIC BUILDINGS; AND C. D. BEAN, COMMISSIONER, FEDERAL SUPPLY HOUSE ALLOWANCE Senator MAGNUSON. The Administrator, Mr. Boutin, is here, Mr. Knott, Bob Griffin, and the Acting Comptroller, and the Deputy Commissioner, Public Buildings, Mr. Schmidt, and Mr. Bean of the Federal Supply. They have four items in the bill totaling $15,638,000 of which the House allowed $9,600,000. They are not appealing, I understand, and you can correct me, $500,000 cut for additional court facilities or the $400,000 cut from your wage board increases in the public building service. That is maintenance, is it not? Mr. BOUTIN. That actually is wage board. Senator MAGNUSON. That is maintenance people? Mr. BOUTIN. Yes, sir; by and large it is. Blue-collar workers. RESTORATION REQUESTED Senator MAGNUSON. But restoration is requested for $5 million for the general supply fund and $138,000 for expenses of supply distribution. In addition they have a new supplemental request in Senate Document 83 for $2,703,000 to pay the judgment on the acquisition of the Rand McNally Building in Chicago. That is because of the building of the Federal building? Mr. BOUTIN. No, it is not, Senator. Senator MAGNUSON. We will get into that. I just wanted to clear that up. So the estimates and justifications will be placed in the record. (The information referred to follows:) SUPPLEMENTAL ESTIMATE (H. Doc. 333) "GENERAL SERVICES ADMINISTRATION "ADDITIONAL COURT FACILITIES "For an additional amount for 'Additional court facilities,' $2,500,000, to remain available until expended." This supplemental request is to provide additional funds for making limited alterations in existing buildings and providing furniture, furnishings, and rental and moving costs for some of the new judges appointed under the act of May 19, 1961 (76 Stat. 80). "OPERATING EXPENSES, PUBLIC BUILDINGS SERVICE "For an additional amount for 'Operating expenses, Public Buildings Service,' $2,650,000." This proposed supplemental appropriation is to cover the additional cost of pay increases granted wage board employees. This appropriation was apportioned pursuant to section 3679 of the Revised Statutes, as amended (31 U.S.C. 665), on a basis which indicated a necessity for a supplemental appropriation for wage board pay increases. This action was reported to the Congress by the Director of the Bureau of the Budget on January 29, 1962. "GENERAL SUPPLY FUND "To increase the general supply fund established by the Federal Property and Administrative Services Act of 1949, as amended (5 U.S.C. 630g), $10,000,000." Additional capital is needed for the General supply fund to provide adequate financing for increased sales, primarily to the Department of Defense. "EXPENSES, SUPPLY DISTRIBUTION "For an additional amount for 'Expenses, supply distribution,' $488,000." This supplemental is to provide additional personnel, automatic data processing equipment and supplies necessary to adapt General Services Administration supply procedures to the newly established Military Standard Requisitioning and Issue Procedure (MILSTRIP) that will become operational July 1, 1962, in the Department of Defense supply system. It is estimated that substantial savings will accrue to the Department of Defense through adoption of the new procedure, but it will be necessary for the General Services Administration to change its procedures in handling Department of Defense orders after the new system goes into effect. SUPPLEMENTAL ESTIMATE "GENERAL SERVICES ADMINISTRATION "ACQUISITION OF LAND AND BUILDING, CHICAGO, ILLINOIS "For an additional amount for 'Acquisition of land and building, Chicago, Illinois,' $2,703,000, to remain available until expended." This proposed supplemental appropriation is needed in order to provide payment for the judgment entered by the United States District Court for the Northern District of Illinois, Eastern Division, with respect to the property known as the Rand-McNally Building in Chicago, Ill. Judgment was rendered November 7, 1960, and was subsequently affirmed by the United States Court of Appeals for the Seventh Circuit on October 30, 1961. The amount requested is the net amount needed to pay this judgment, including interest thereon to June 30, 1962. Any interest saving effected by earlier payment would, of course, revert to the Treasury. GSA AMENDMENT NO. 1 GENERAL SUPPLY FUND PROPOSED AMENDMENT On page 8, line 13, of the bill as reported to the House, strike out “$5,000,000" and insert in lieu thereof "$10,000,000". LEGISLATIVE HISTORY Budget justification.-Pages 22-31. House hearings.-Pages 170-172. House Report No. 1548, page 5.-"The bill contains $5 million additional capital for the general supply fund to provide for increased sales, primarily to the Department of Defense. This is a reduction of $5 million in the budget estimate. The increase recommended in the bill will raise the appropriated capital in the fund to $126,750,000." JUSTIFICATION OF THE AMENDMENT The $5 million reduction reflected in the House bill, for which no explanation was included in the House report, would impair the financial condition of the general supply fund and provide inadequate capital to carry out the expanded sales programs. It would again create the situation of inadequate financing which this committee criticized in its Report No. 85, dated March 24, 1961. Cash must be maintained at the estimated level if GSA is to continue paying bills promptly, maintain good relations with industry, and take advantage of discounts offered. Inventory cannot be reduced below the level forecast, in the face of sharply rising customer demands, without impairing supply performance, and increasing both administrative costs and prices paid for merchandise. As of February 28 total GSF sales of $257.4 million are running well ahead of the rate contemplated in the budget estimate. Equipment, which is already largely on order, is required at the level forecast to continue orderly development of the motor pool program. Accounts receivable have been reduced to the minimum practical level in the estimate. It is therefore urged that the full amount of the proposed amendment be restored to provide sufficient capital in line with this committee's previous recommendations. GSA AMENDMENT NO. 2 EXPENSES, SUPPLY DISTRIBUTION PROPOSED AMENDMENT On page 8, line 16 of the bill as reported to the House, strike out "$350,000" and insert in lieu thereof "$488,000". House Report No. 1548, page 5.-"The committee recommends an appropriation of $350,000 for supply distribution expenses of the Federal Supply Service. This is a reduction of $138,000 in the budget estimate. This supplemental is to provide funds for automatic data processing equipment, supplies, and other expenses related to the program integrating the GSA supply system with that of the Department of Defense." JUSTIFICATION OF THE AMENDMENT Although the House Committee concurred in the need for adapting GSA supply procedures to accommodate the new military standard requisitioning and issue procedure (MILSTRIP) that will become operational July 1, 1962, in the Department of Defense supply system, it gave no explanation for reducing the estimate by $138,000. 82245-62 -8 This is a completely new concept in the Government's supply operations. The short lead time available to adapt procedures in GSA's 10 regional offices, including delivery of essential automatic data processing equipment and the training of personnel for its use, requires full provision for the added costs involved. Basically, the system represents an investment in improved supply practices. A brief explanation of the system and an estimate of the benefits expected to result from its use follows: On October 9, 1961, DOD prescribed the new military standard requisitioning and issue procedure (MILSTRIP) by issuing DOD Instruction No. 4140.17. This document established standard policies, procedures, and instructions effective July 1, 1962, for requisitioning and issuing material within and between military services and single managers to include GSA when providing logistical support to elements of DOD. Specifically, the MILSTRIP procedure establishes: A standard single line requisition format for all mechanized activities and a standard single line requisition for all manual use. A standard single line multipurpose format for all internal supply system transactions. A standard single line shipping documentation system. A uniform system of requesting and providing supply status data. Complete systems of preestablished standard supply codes for all coded elements for the several uses of the forms. A standard issue priority system. A standard frequency of requisitioning system. DOD estimates that when fully implemented the system will reduce its operating costs by $25 million annually. Reductions in inventories and space requirements are also expected as improvements are made in the stock turn. It will probably take several years to fully realize these monetary benefits. Since about 70 percent of GSA supply business is with the military and GSA has been designated as the primary source of supply for DOD common-use items, it was necessary for GSA to adopt this system. The system may ultimately be adapted to serve civilian agencies thereby providing for the first time a means to achieve uniform simplicity in requisitioning and related paper work on supply operations throughout the Government. The system cannot be installed in selected locations but must be ready for use in all GSA regional offices by July 1, 1962, because incoming orders from DOD will thereafter be on the new documentation basis. Accordingly, it is urged that the full budget estimate of $488,000 be restored. GENERAL SERVICES ADMINISTRATION SUPPLEMENTAL ESTIMATE OF APPROPRIATION, 1962 ACQUISITION OF LAND AND BUILDING, CHICAGO, ILL. APPROPRIATION LANGUAGE "For an additional amount for 'Acquisition of land and building, Chicago, Illinois,' $2,703,000, to remain available until expended." GENERAL STATEMENT "This proposed supplemental appropriation is needed in order to provide payment for the judgment entered by the U.S. District Court for the Northern District of Illinois, Eastern Division, with respect to the property known as the Rand-McNally Building in Chicago, Ill. "Judgment was rendered November 7, 1960, and was subsequently affirmed by the U.S. Court of Appeals for the Seventh Circuit on October 30, 1961. The amount requested is the net amount needed to pay this judgment including interest thereon to June 30, 1962. Any interest saving effected by earlier pay ment would, of course, revert to Treasury" (quoted from Senate document). JUSTIFICATION On June 22, 1951, GSA entered into a lease for the Rand-McNally Building primarily to provide space for the Bureau of Public Debt, Treasury Department. The lease provided for an annual rental of $500,000. |