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Mr. DITTER. Can we anticipate, then, that this deficit that so much has been said about will ultimately be built up by this amount, whether the next year or the year thereafter?

Admiral Du BOSE. Yes, sir; we are asking in 1939 to conduct this investigation of the cause of fouling, and we are asking for $9,000 for that purpose. That is a small sum, and it may result in saving large sums of money in the future.

Mr. DITTER. Would there be any other items like the periscope item that you would change your mind about?

Admiral Du Bose. That is the only item that we will never again ask for, so long as I am Chief of the Bureau; also no item for ertraordinary construction of small boats. We will have boats built, but we will not set it forth as a special item, “Extraordinary construction"; it will be ordinary, routine small-boat construction. Otherwise those items will all sooner or later have funds requested for them.

Mr. SCRUGHAM. Admiral, on page 6, you provide for a new type of paravane gear. Did you find that the old type that the ships were equipped with was not a proper type?

"Admiral Du Bose. The reason we are asking for that item is not so much on account of the paravane itself, but improvements in the mines which are swept up by the paravanes. We are not asking to make improvements in the paravane itself but in the paravane gear.

Mr. SCRUGHAM. In item FF, construct new district craft, $610,000 I think you made some statement about that that I did not under stand.

Admiral Du BOSE. The Navy is continuing the 5-year program on district craft construction.

Mr. SCRUGHAM. What are district craft!

Admiral Du BOSE. They are small tugs, lighters, barges, garbage lighters, fuel barges, and things of that kind that are used around navy yards. We have gotten very little money for district craf in past years, and the items of district craft, tugs, barges, and so forth, are wearing out, and they are costing large sums for main tenance. Their upkeep costs are disproportionate to their present value, but it has been necessary to retain them because the fund have not been available for their replacement. This is a continus tion toward the orderly replacement of those items.

Mr. SCRUGHAM. Items V and Whave reference to chemical war fare protective equipment and a transfer of funds to War Depart ment for the procurement of chemical warfare protective equip ment, the total being $500,000. That is something that has not been done in the past, is it not?

Admiral Du Bose. It has been going on straight along from reg to year. The War Department has at Edgewood Arsenal thei Chemical Warfare School and factory. As a concrete example a that, gas masks are made there. They manufacture gas masks, ne only for themselves but also for the Navy, and we give annually i certain sum of money for which they give us gas masks and othe material of that nature.

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INCREASES REQUESTED FOR 1939

INCREASE IN SHIP REPAIR COSTS DUE TO GREATER NUMBER OF SHIP OVERHAULS

Item 1, increase in ship repair costs due to greater number of hip overhauls scheduled. The increases are $740,950 for repairs o the ships, and $45,800 for the equipment of the ships.

Objects 1291 and 1293, for which increases are asked here, proide funds for the repair of ships' hulls and of the equipage of hips. The Bureau allocates funds on the assumption that the unit ost of the overhaul and docking of each type of ship will be the ame in the two years in question. Therefore the total funds required depend on the number of overhauls and dockings which are cheduled for a particular year. However, the 1939 base for an »bject, by definition, is the amount allocated in 1938. Thus, the imounts requested above represent merely the difference between the 1938 allocation and the 1939 request.

The statistics are as follows:

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That is based entirely on the average number of overhauls of ships.

Mr. UMSTEAD. Admiral, in connection with your statement, there appears in the list of items withheld in the so-called administrative reserve fund $550,000 of the current appropriation under this item.

Admiral Du Bose. Yes, sir.
Mr. UMSTEAD. Do you expect any of that to be released ?

Admiral Du Bose. There is a letter in process of preparation in the Bureau of Construction and Repair at the present time requesting the return of some of this $1,600,000. At this time we are asking for the return of this $500,000. Some of it, at least, is necessary to take care of the increased cost of repair work brought about by the unexpected damage to the Omaha, for example. The reason for asking for that money is that there are also other items of work that have been brought to the attention of the Bureau that ought to be done, but which we cannot do unless we can get some or all of this $500,000 back.

Mr. UMSTEAD. In the request under this item which you are now making, are you asking for an increase of $740,950, plus the $550,000 which you expect to get released, or are you just asking for that increase?

Admiral Du Bose. No; they have no relation to each other, because the average unit cost of overhauling a battleship is based on past records and is so much a ship. It is so much for cruisers, so much for destroyers, and so much for battleships, and if we know the number of ships to be overhauled we can get the answer as to the amount of money needed for that purpose by multiplying the average unit cost by the number of ships.

Mr. UMSTEAD. Admiral, do you estimate the number of overhauls in the various categories of ships per year on the basis of your experience over a long number of years dealing with the same classes and categories?

Admiral Du Bose. The number of overhauls is given to us by the Chief of Naval Operations, by what is known as the operating-force plan.

Mr. UMSTEAD. It is determined on the basis of the experience of the Navy Department as to need for overhauls?

Admiral Du BOSE. The Chief of Naval Operations proposes to make so many vessels available for overhaul during the fiscal year 1939, and it is definitely determined that in the month of July certain ships will go into navy yards and certain ships will go in in August, and so forth, and so we know what number of ships it is proposed to send in, and the various classes of ships.

Mr. UMSTEAD. The necessity of overhauling a ship is determined by a number of different things, such as the age of the ship, condition of the ship, the uses to which it has been put, and various other things?

Admiral Du Bose. The amount of money to be spent on overhauling is determined by those things, but as a routine procedure the ships are made available for overhaul at certain specific periods of time.

Mr. UMSTEAD. Whether they need it or not?

Admiral Du BOSE. Well, they always need some overhauling, some work has to be done after they have been in service a few months. They always require bottom cleaning or something else, and the older ships may require many things. However, they are actually taken out of the fleet at certain predetermined times and taken to the navy yards, and we know the time, under the operating force plan, when they will be taken out of the fleet for overhauling.

Mr. UMSTEAD. Is that worked out so as to cause as little disputtion in the operating force plan of the Navy as possible?

Admiral Du BOSE. Yes, sir; based on a plan so as to interfere with the regular operation of the fleet as little as possible.

Mr. Thom. Do you have any standard time at which a battleship should be overhauled?

Admiral Du Bose. A battleship is supposed to go in once every 18 months for complete overhaul. A minor overhaul, consisting primarily of dry-docking for cleaning and painting, is given a battleship every 9 months.

Mr. Thom. Is that true of all the other types of ships!

Admiral Du BOSE. Yes; in general. For a few specific types of ships the overhaul intervals are somewhat longer and for a few other types, somewhat shorter.

Mr. Thom. Each type of ship has a period of time at which it should go into the dry dock for repairs?

Admiral Du BOSE. Yes; each type has a definite time; but, of course, if there is a casualty, it would have to go in sooner.

Mr. Thom. Of course, you fix those standards in accordance with the amount of money that you have to spend for it?

OVERHAULING OF THE "OMAHA”

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Admiral Du BOSE. Take a concrete example. The Omaha was on her way from the west coast around to the east coast, and she was to have regular scheduled work done, an overhauling, before going on a new assignment. She went aground and severely damaged the bottom. She went in not only for the regular overhaul work but for this additional work, and, as I stated to the chairman a little while ago, we have to get back some of this $500,000.

Mr. DITTER. By the way, what was the cost of the damage, Admiral ?

Admiral Du Bose. The estimated cost of damage for the Bureau of Construction and Repair was $190,000. That includes not only the damage work but the ordinary maintenance work. I think the damage was about $100,000.

Mr. DITTER. Who was in command of the Omaha? Would that be a matter within your knowledge ?

Admiral Du BOSE. It happens to be a matter within my knowledge. Captain McLeary was in command.

Mr. SCRUGHAM. Admiral, if I recall, it was the airplane carrier Yorktown that had abnormally noisy gears. Is that under your jurisdiction?

Admiral Du BOSE. That is under the Bureau of Engineering.

Mr. SCRUGHAM. I think there was a tender, the contract for which was held up by the New York Shipbuilding Co., and for which Diesel engines could have been provided, and if I recall correctly, steam installation has been specified. That is also under the Bureau of Engineering?

Admiral Du Bose. You are asking about something of recent occurence?

Mr. SCRUGHAM. Yes.

Admiral Du Bose. It has nothing to do with this particular appropriation.

Mr. DITTER. Is a casualty such as the Omaha made a matter of inquiry by any board in the Department?

Admiral Du BOSE. The commanding officer of the Omaha was court martialed as a result of the Navy Department's action. That was a matter that was noted in the public press, the fact that there was a court martial and sentence imposed on both the commanding officer and the navigator of the Omaha.

Mr. DITTER. Is not the matter of an inquiry of that kind a matter of public record ?

Admiral Du Bose. The details are not a matter of public record, sir, but the force commander, the commanding officer of the force to which that ship belongs, submits a report to the Navy Department, and then proper action is taken. If the facts in the case pem to indicate necessity for some action, there is a board of investigation, followed by a court martial.

Mr. DITTER. Does that mean that the commanding officer is relieved of his command?

Admiral Du BOSE. That is something that does not directly come under the Bureau of Construction and Repair. As a matter of fact, he was found guilty by the court martial and relieved of his command.

INCREASE IN UNIT-OVERHAUL COSTS OF SHIPS

Item 2 is increase in the unit-overhaul cost of ships, $25,000.

We need an increased allowance for repairing and overhauling ships because of the method that we follow in estimating the funds. This Bureau's method of estimating the funds requested for the overhauling of ships is to base the estimate for the new year on the actual unit cost of overhaul for the last fiscal year in which return costs are available. For example, in 1937 the detail table accompanying object 1291 shows that 10.7 battleship overhauls were undertaken at a total cost of $1,033,706, or a unit cost of $96,609.

Therefore, the allocation for 1938 and the request for 1939 hare been based on unit costs of $97,000. We know now that $97,000 is not sufficient for that purpose. It should be more than that. How much more we cannot tell you exactly, but in the following table show what has been requested by the various types of ships and what we were able to allow in 1938. These are not the absolute amounts, but the relative amounts.

This method of estimating overhaul costs is considered the best under usual circumstances. However, it is an inflexible method: the allocations are based on the amount of money which was available in the past rather than the actual current and prospective overhaul needs. The Bureau is faced regularly, therefore, with the necessity of eliminating highly desirable, and at times urgent items of repair because of lack of funds. This situation is best revealed by the following table, previously referred to, which contrasts the unit costs requested by the operating personnel with the unit costs which could be allocated:

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The weighted average shows that the requests for 1937 were percent higher than could be allocated and for 1938 are about 13 percent higher than appears possible to allocate.

It is recognized that requests for funds emanating from thar operating personnel will be greater than the absolute minimum re. quired for satisfactory upkeep, but the fact is undeniable that, particularly in the case of auxiliary ships, additional funds for routique repairs could be expended with great profit to the material condition of ships. Further, the Bureau is faced with the necessity of reducing the allocation of funds for ship repairs to a certain extent in order to effect the economy requested in the President's letter of June 1937. The work thus deferred will become urgently necessary in ti future. There is requested, in consequence, an increase of $21(** which represents less than 0.4 of 1 percent of the funds now all... cated for 1939 on the basis of 1937 costs, distributed over the vario in types of ships.

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