those projects to operational requirements. In other words, we have gone to the degree of determining in certain facilities projects, like the overhaul of aircraft engines, what will be the workload in 1956 and whether the facilities that we have at hand are sufficient, or whether additional facilities will be necessary to meet that workload. We have examined the number of aircraft that will be stationed at any given air station in 1956 to determine what facilities are necessary to support the number of aircraft which will actually be there. We have examined the requirements for the storage of ammunition based upon the production program for ammunition, as to whether that amount of ammunition will actually be delivered by the contractor

or not.

In every way possible within our abilities, we have tried to check each of these items against a specific and continuing need. It is our opinion that they support this existing and continuing need.

I have been associated personally with this program for about 18 months. Captain Lamb, who is the executive secretary of the Shore Station Development Board, has been associated with it for about the same length of time. He is thoroughly familiar with every project that is in this list, since he has visited most of these stations and has examined each of these projects personally on the stations concerned.

Mr. DAVIS. Does your capacity as senior member of the Shore Station Development Board exist coincidental with your position as Assistant Chief of Naval Operations?

Admiral BAKER. Yes, sir; I have two functions. I am Assistant Chief of Naval Operations and Chairman of the Ships Characteristic Board as one duty, and senior member of the Shore Station Development Board as my second job in the Navy Department.

DEVELOPMENT OF PROGRAM

I should like to speak for a moment, sir, on how we arrive at these programs, if it might be of interest to the committee.

At each station in the Navy we have a local shore station development board. This shore station development board examines the missions and the requirements of that station, and, if there is anything necessary to be constructed there to support the missions, it makes its recommendation to the commanding officer in a formal manner. This board is composed of line officers and at least one Civil Engineer Corps officer as a technical adviser.

The commanding officer then examines the report of the board. He either recommends it for approval, or approves it and sends it along recommending it be approved by higher authority; or he may send it back for revision. But the basis is that the things which are recommended must be necessary in the accomplishment of the mission of that station.

Those are then forwarded to the commandant of the naval district, who receives these reports from all the stations within his district. Then they are screened. The purpose of the screening, of course, is to determine whether there is any duplication, whether or not an existing facility over here will satisfy what this fellow is asking for, or something like that.

He may reject some projects, but he has to approve them before they can be forwarded. They are then forwarded to the Chief of

Naval Operations, and they come into my office in the Shore Station Development Board.

Within the Navy Department we have 13 sponsoring agencies. They are the technical bureaus, such as the Bureau of Ordnance, the Bureau of Ships, the Fleet Facilities Division in the office of the Chief of Naval Operations, the Bureau of Aeronautics, the Bureau of Supplies and Accounts, the Bureau of Personnel, the Commandant of the Marine Corps, the Director of Naval Communications, the Office of Naval Research, the Bureau of Medicine and Surgery, the Hydrographic Office, the Naval Observatory, and the Bureau of Yards and Docks. Each of those has a continuing interest in shore facilities for the execution of its particular function.

When these projects or programs or these requests for facilities come to the Navy Department, my office then sends them to the proper sponsor within the Navy Department for further examination and screening to determine whether such things are needed in view of the programs they have under way. For example, the Bureau of Ships will get all projects concerned with matters under the Bureau of Ships' jurisdiction, such as shipyards and the model basin and the boiler laboratory, whose functions are performed for the Bureau of Ships. Likewise all air facilities, both Navy and Marine Corps, are referred to the Bureau of Aeronautics, who are the sponsors for all aeronautical facilities.

They examine these things and screen them very carefully. We require them to provide us with their recommendations on these projects, and they must submit them in a priority list. The basis is that the most urgent project stands at the top, and they are arranged in order of descending urgency.

Each of these sponsors very thoroughly screens his own projects to determine whether within their own activities they do not have another station where they may perform a function which is being requested or may be considered necessary for some other place. They then submit to us these priority lists of projects with the complete justifications, which are found in these books. All of the approved projects are listed in this book.

We examine each project. We have been furnished by the Secretary of Defense and, of course, by the Congress, and by the Secretary of the Navy and by the Bureau of the Budget certain criteria on which we can judge whether we are within the limitations of the program as established.

We also have given to us the basic Naval Establishment plan which sets forth the objectives of the Navy Department and the force levels which will be in existence for the forthcoming year. They all have to be tied together. We then examine all projects and recommend a program to the Chief of Naval Operations. At this time he either approves it or, if he does not, he sends it back and we do it again. We finally arrive at a program that he will recommend to the Secretary for approval.

The Secretary of the Navy makes an independent examination of the program before it is submitted to the Secretary of Defense. When it goes to the Secretary of Defense it is examined again by his reviewers and reviewed very thoroughly before we are ever permitted to submit it to the Congress.

That, in general, is the method by which we arrive at this program. It gets quite a number of critical reviews before it ever gets out of the Navy Department, and many more before it gets to Congress, because it must go through the Secretary of Defense and then the Bureau of the Budget.

ESTIMATED REQUIREMENTS

Mr. DAVIS. Tie down for me again those figures you mentioned earlier of $3 billion and the $1.8 billion which subsequently became $1.3 billion.

Admiral BAKER. Yes, sir. I do not think I made that quite clear. If I may I would like to say this: In June of 1950, at the begnining of the Korean incident, we were directed by the National Security Council and the Joint Chiefs of Staff that by the end of fiscal 1954 the Navy should be expanded to a certain force level and all the shore station facilities should be provided necessary to support that force level. We asked for $400 million as a supplemental bill for public works for fiscal 1951. That is, we planned it that way.

We then examined all the requirements, and they were $3 billion. That, together with the fiscal 1951 appropriation, gave us a total of $3.4 billion in shore-station facilities which were considered necessary at that time to bring the Navy fully up to its peak shore establishment to support the Navy that was planned for the end of fiscal 1954.

Mr. DAVIS. That estimate was made sometime during calendar year 1951; is that right?

Admiral BAKER. Yes, sir.

Captain LAMB. Calendar year 1950, sir.

Admiral BAKER. Calendar year 1950, right after Korea. From June of 1950 on to December of 1950.

Mr. DAVIS. Yes.

Admiral BAKER. Those were simply requirements. They were funded this way: In fiscal 1952 the Congress authorized $932 million and appropriated $800 million. We had planned, however, to request $1.1 billion in 1952, $1.1 billion in 1953, and $0.8 billion, or $800 million, in 1954. We actually received $400 million in fiscal 1951, $800 million in fiscal 1952, and $363 million in fiscal 1953. That gave us a total of $1.563 billion as against a total requirement, as we visualized it, of $3.4 billion.

Mr. DAVIS. That is $363 million for 1953?

Admiral BAKER. Yes, sir; $363 million for 1953, 800 million for 1952, and $400 million for 1951. That gives us $1.563 billion as against the total requirement visualized of $3.4 billion. If we take the difference of those sums, that gives us approximately $1.8 billion.

We reexamined the program last year, when I became the senior member of that Board, on these remaining facilities which had not been authorized, and the sponsors at that time submitted requirements totaling $1.8 billion. We examined every one of those.

Mr. DAVIS. That was the review which took place in early calendar year 1953?

Admiral BAKER. Yes, sir. In the preparation of our 1954 program this was another start. We said: "Send in all your requirements. What do they amount to? We have gotten $1 billion worth. What is left? Are they really necessary?"

They came along with $1.8 billion. We reviewed that in our Board, and we reduced that to $1.3 billion, due to the criteria established.

REQUIREMENT CRITERIA

There are several criteria which would be of interest to this committee. As far as personnel is concerned, barracks, messhalls, and things of that sort, we can only provide permanent construction for the force level that existed June 30, 1950. That was considered to be the peacetime strength of the Navy. All permanent construction of that sort of facilities was limited to that. Anything in excess of that was to be temporary construction.

We could not combine building structures for improved efficiency. In other words, we could not take a number of activities that could be better operated in one building and build a new building for housing those activities. We had to leave them where they were. could not combine activities to promote efficiency.

We

For fire protection, that was limited to bringing the building to the same level of protection as the adjacent building. We could not add any additional facilities to make the whole area the same. We could not replace any building unless the cost of rehabilitation was considered to be excessive, and I think the criteria there was 20 percent or more per year for the cost of maintaining the building. By these criteria and also by our planning figures, and the figures are available, we arrived at this $1.3 billion as the requirement. Then we asked for the authorization to meet these requirements in our initial request to the Secretary of the Navy.

However, we do have some unexpended funds, and it was decided we should not now request appropriation for that amount of $1.3 billion. We submitted to the Secretary of Defense a program for $996 million.

Now, this $1.3 billion I have spoken about is, in effect, for plans for something we would like to do; some of it should be done now, some next year, some the year following. In other words, we have had to do first the urgent things that should be done now.

We have had an essential program which is something that must be done and then possibly next year and the year following those items will become urgent and will have to be done then.

Then, beyond that, we have the program that is desirable and that will fall due within 2 or 3 or 4 years. For instance, we will arrive at the point where all our aircraft will be jet, or we will have more different types of aircraft, or we will have aircraft which will probably be greater in size.

OBSOLETE AUTHORIZATIONS-RESCISSIONS

Mr. DAVIS. In the course of this review, Admiral Baker, where you have run across authorizations that you considered obsolete, for instance, what have you done about that?

Admiral BAKER. We recommended, and the 83d Congress rescinded, $84 million worth of previously authorized projects.

Mr. DAVIS. As of this date, do you consider all of the authorizations for Navy public works would be current, valid authorizations?

Admiral BAKER. I think there are a few that we will defer or possibly rescind. I do not know that we have that broken down.

Captain LAMB. I have a list amounting to $22 million, and then we have this program under which we will delay or rescind this amount at the time the Congress so decides.

39846-53- 3

Mr. DAVIS. Do you, as a part of your review about certain authorizations, do you periodically make recommendations to the Armed Services Committee for rescission?

Admiral BAKER. We have to do that at the first session of each new Congress.

Mr. DAVIS. You do each year?

Admiral BAKER. Yes; and as we have told you, we have rescinded $84 million. Some of these go back to the fiscal year 1948, and, as I say, they include some of the things we do not want; we had the authorization for them, for things that are no longer needed, and we wanted to give back a part of this $84 million to clear our books. Mr. HAND. That has been formally rescinded by the Congress?

Admiral BAKER. Formally recommended for rescission by the Secretary of the Navy to the Congress, and I think under the law it was rescinded.

Captain LAMB. Yes.

Admiral BAKER. That is required by law.

Captain LAMB. That is pursuant to Public Law 209, which specifies the authorizations which were rescinded. We send that up periodically, and there is a report on that, I am sure.

Mr. DAVIS. We are very much in accord with that.

Admiral BAKER. Yes.

Mr. DAVIS. I want to be sure that in the course of your review for the purpose of requesting funds, where you decide that a particular line item is no longer required and you do immediately request a rescission so that we do not have at that time the authorization on the book.

Admiral BAKER. We have now, I think, $22 million-here are $22 million of previously authorized projects that we will rescind when it is proper to do so, and this money is a part of the money we wish to apply to these appropriations that we are asking of you; that is in the $108 million.

Mr. DAVIS. Is there a Department of Defense directive that requires similar action to be taken in all branches of the armed services?

Captain LAMB. Last year there was. This year, we have heard nothing to that effect.

Mr. DAVIS. As of this time, what is your gap between what you might call effective authorization, and the appropriations which have been made to apply to those authorizations?

Captain LAMB. It is approximately $92 million of unfunded authorizations. I can furnish the exact figures for the record.

Mr. DAVIS. If you will, please, and may I ask you, Admiral Baker, to submit for the record information on these authorizations for which you plan to ask rescission.

Admiral BAKER. Yes; we can do that.

(The information requested appears on p. 34.)

EXPERIENCE OF ADMIRAL PERRY

Mr. DAVIS. May we refer now to you, Admiral Perry. Where did you assume the position of Chief of Bureau of Yards and Docks? Admiral PERRY. On 3 November.

Mr. DAVIS. What was your previous assignment?

Admiral PERRY. I was formerly Director of the Pacific and Alaska Division of Yards and Docks, with headquarters at San Francisco.