OFFICE OF THE SECRETARY OF THE SENATE

STATEMENT OF ROBERT A. BRENKWORTH, FINANCIAL CLERK, OFFICE OF THE SECRETARY OF THE SENATE

STATIONERY ALLOWANCE

Senator MONRONEY. We welcome you to the committee, Mr. Brenkworth.

Mr. BRENKWORTH. Thank you Mr. Chairman.

The question was raised regarding the background of the stationery allowance. Quite a bit of research was done.

Senator MONRONEY. This is as a result of the provision in the bill of last year the committee spent time looking up the background and history and reasons for the stationery allowance and the commutation in the bill which Senator Williams was seeking to eliminate.

LIMITATION BACKGROUND

Mr. BRENKWORTH. Yes, sir. It must be understood first that a great deal of the reasons for enactments in the past years are obscured by time. Legislative intent is impossible to determine in some of these

cases.

PROCUREMENT OF STATIONERY AND NEWSPAPERS BY SECRETARY OF SENATE THROUGH 1860

Going back to the beginning of the First Congress, the expenditure records and the appropriation records, which are our basis for the facts in trying to establish what was the situation and how this progressed to the current situation, would indicate that from the first Congress through 1860 the Secretary of the Senate procured stationery and newspapers directly and furnished them to Senators upon their request.

There were no allowances, there were no limitations imposed. There is no record to indicate either an allowance or limitation.

1860 RESOLUTION TO REIMBURSE SENATORS FOR NEWSPAPERS PURCHASED BY THEM

In 1860 there is a record of a resolution being enacted which permitted Senators to be reimbursed for newspapers that they purchased. This is a direct reimbursement to the Senators themselves as opposed to the Secretary paying for them to the newspaper company.

We could not find the resolution, itself, but we do find in the expenditure records references to this resolution and payments made based on this resolution.

1868 DEFICIENCY APPROPRIATION ACT

In 1868 there was a deficiency appropriation act which contained a deficiency appropriation for stationery for Members of the House, not the Senate, but the House.

In this appropriation act there was contained a provision which reads as follows:

Provided that from and after the third day of March 1868 no Senator or Representative shall receive any newspapers, except the Congressional Globe,

or stationery or commutation therefor, exceeding $125 for any one Session of Congress.

2 U.S.C. 41 ANNOTATION

Now, this proviso is a basis, appears to be the basis from the codifier's annotation, for 2 U.S.C. 41 which reads that "no member or delegate is entitled to any allowance for newspapers".

It is also the basis for the commutation that we have been making since.

Looking at this language it does not appear that this authorizes an allowance. It merely specifies a limitation. It would also appear that this is not a prohibition since it says that no allowance other than this $125 may be made it is a limitation, rather than a prohibition. As stated in 1868, and if we look at this alone it would not bear out, in my opinion and it is an opinion, that the prohibition can be attributed solely to this enactment.

CONTINUED APPROPRIATIONS FOR STATIONERY AND NEWSPAPERS

As time passes, we find that the appropriations themselves continue to provide funds for stationery and newspapers, bearing out that the limitation was to cover both items and on a continuing basis and that there was to be just one amount available to each Senator.

Senator MONRONEY. Was the stationery room paying the money for the newspapers which the Member subscribed to in commutation of the stationery allowance?

Mr. BRENKWORTH. The records indicate that the stationery was provided. We have vouchers showing the fixed amount, $125, for stationery furnished in kind, so much, for newspapers furnished, so much, balance in commutation to the Senator.

1913 DELETION OF THE WORDS "AND NEWSPAPERS"

In fiscal year 1913 where the appropriations previously had read "for stationery and newspapers," we find the words "and newspapers" deleted, making the appropriation available for stationery only.

It seems to me, and once again this is my opinion, that the 1868 proviso and the action in deleting the newspapers from the appropriation combined tends to the conclusion that an allowance for newspapers is prohibited.

The Rules Committee came to this conclusion when in 1951 Senator Hayden addressed a letter to all Senators saying newspapers were prohibited by this law and that the procedure of furnishing Senators newspapers by the Secretary of the Senate was to be discontinued.

Since 1913 we have had stationery, solely stationery, on a commutation basis and no allowance for newspapers.

Senator MONRONEY. Was this commutation understood that if the Member wanted to spend it for newspapers it was permissible after he received it?

Mr. BRENKWORTH. It is silent, Senator. There is no way of making that determination. At the present time, the appropriation is available for purchases from the stationery room and at the end of the fiscal year any amount that has not been utilized for stationery is available as a

commutation. The payment is made unless the Senator waives the entitlement, in which case it is withdrawn and deposited in the Treasury.

FORMER ACCUMULATION FOR RESERVE

Senator MONRONEY. Formerly this amount was allowed to accumulate if the Member desired to do so so that he would have it in the years that he used more stationery, his requirements were greater, he would have a reserve built up from previous years.

Is that correct?

CREATION OF REVOLVING FUND AND INTERNAL REVENUE RULING

Mr. BRENKWORTH. That is correct. The Rules Committee, when the revolving fund was created, changed this procedure, no longer permitting Senators to carry over from one fiscal year to another.

There is a method that can be used for this purpose, by withdrawing it and establishing a cash account for the purchase of stationery during the balance of the calendar year.

One of the reasons this was done was the Internal Revenue ruling that this was taxable income, constructively received.

Senator MONRONEY. Whether withdrawn or not?

Mr. BRENKWORTH. Whether withdrawn or not. So, continuing, it created a problem. I believe the House does allow them to continue. I believe the House also permits them to draw it at the beginning of the period for which it is available.

This is not true in the Senate.

1965 FUNDING

Senator MONRONEY. You say that some of it is returned to you? What is the total allowance and what has been disbursed for stationery and what amount has been subject to commutation?

Mr. BRENKWORTH. In fiscal year 1965 the total amount appropriated for stationery for Senators was $242,400; $172,151 of this was furnished in kind; $40 of this amount was not allowed since there were vacancies in terms; $7,951 was waived, various amounts waived by individual Senators.

The amount of $62,256 was commuted. This is the last fiscal year for which figures are available; 1966 is not yet completed.

Senator MONRONEY. Do you have an estimate on the use of the stationery allowance for the current year?

Mr. BRENKWORTH. No, sir; not presently.

STATIONERY COST AND USE INCREASES

Senator MONRONEY. The expense of the stationery is higher and probably the use of stationery is higher, so the stationery allowance will remain the same and the use will represent an increase.

Mr. BRENKWORTH. It should. Actually, the increase from 1964 to 1965, which is the only comparable figures we have, shows the amount to be about the same.

In 1964 it was $171,700. In 1965, $172,100.

Senator PROXMIRE. That is because 1964 was an election year and 1965 was not. Over the years there has been an increase in the use of stationery. I should think you would have an increase in election years and then maybe a stability the following year. Then an increase again.

Mr. BRENKWORTH. That is true.

Senator MONRONEY. I take it the use of stationery varies considerably. Some Members like personally printed stationery with their names alone showing on the stationery. Others accept the committee stationery type.

Mr. BRENKWORTH. Yes, Senator. Actually, of the total number of Senators involved in fiscal year 1965, and there were 112, more than 100, because we had Senators going out of office and others coming in, 30 of them fully expended, 13 had balances of less than $200, 11 had balances ranging from $200 to $500.

There were 22 with balances ranging from $500 to $1,000. And 36 with balances in excess of $1,000.

There were also 20 Senators who ran out of allowance and had to establish supplementary cash accounts in order to meet their stationery needs.

OPERATIONAL VARIANCES OF SENATORS

Senator MONRONEY. So the thing varies a great deal, of course, by the size of the State the Senators represent?

Mr. BRENKWORTH. And by the Senator, himself. I don't think you can establish a pattern for 100 Senators. Each of them will operate in his own way. You will find a great variance in operation and amounts of expenditures.

Senator MONRONEY. You say 30 fully expended their allowance and some 20 had to establish a cash account because they overexpended, is that correct?

Mr. BRENKWORTH. Not overexpended because they can't do that. Once they completely expend

Senator MONRONEY. In addition to the 30 you mentioned?

Mr. BRENKWORTH. This would be of the 30.

Senator MONRONEY. Some of them I imagine buy heavy at the end of the year to refill their inventory of stationery.

Mr. BRENKWORTH. I presume so. We usually have a higher volume of sale in June. We also have a high volume of sale in December.

FUNDS WAIVED BY SENATORS

Senator MONRONEY. Did you check back on those as to the Senator's use of the commutation through the years?

Mr. BRENKWORTH. Use of the commutation?

Senator MONRONEY. I mean how many claimed it?

Mr. BRENKWORTH. The past 6 years-6 fiscal years-from 1960 up through 1965, not by number of Senators but the amounts waived. In 1960, $1,277; 1961, $2,196; in 1962, $4,042; in 1963, $4,108; 1964, $6,305; 1965, $7,951.

In fiscal years 1964 and 1965 the allowance was $2,400 where previously it was $1,800 which would have some bearing on that. Senator MONRONEY. Senator Proxmire?

Senator PROXMIRE. No questions.

STATEMENT OF HON. JOHN J. WILLIAMS, U.S. SENATOR FROM THE STATE OF DELAWARE

INTERNAL REVENUE RULING THAT UNUSED ALLOWANCE IS TAXABLE

Senator MONRONEY. Senator Williams, you have been interested in this. Do you have any questions?

Senator WILLIAMS of Delaware. I raised this point, as you know, some time ago. It developed from notice that I received, frankly, from the Treasury Department. Mr. Brenkworth knows I had not used all the stationery allowance. Each year that I had not used it it stayed there.

COMPTROLLER GENERAL RULING THAT SENATORS NOT REQUIRED TO

WITHDRAW UNUSED ALLOWANCE

I never heard of such a thing as having to draw on an expense account that I didn't need. The Treasury Department ruled it was taxable to the individual since he could draw it. I took the position that the Government very properly should furnish the necessary stationery and expenses to run an office, but I should not have any left over to put in my pocket; that is not as a supplemental income. I objected to their decision and Mr. Brenkworth knows that the Comptroller General sustained my objection that you would not have to take it. So it was left.

Senator MONRONEY. You mean it was left on deposit?

NONSATISFACTION OF STATE TAX BY WITHDRAWAL AND REDEPOSIT

Senator WILLIAMS of Delaware. It reverted to the Treasury Department. I never used it. They took the position, first, that I would have to draw it and then if I wanted to avoid the taxes I could turn it over to the Treasury Department. I pointed out that if I did that and put it on my tax returns and then returned it to the Treasury that would take care of the Federal income tax but in the State of Delaware, the U.S. Treasury was not recognized as a charitable organization so I would still have to pay the State income tax on that.

SUGGESTED PROCEDURE REVERSAL

I thought the whole procedure was ridiculous because this was an expense account and we are not supposed to chisel on our expense account and have a profit left over. The procedure now is that each year I have been writing a letter, after getting the Treasury Department convinced that they could use the money, each year write a letter that I do not need the full stationery allowance. I must write the letter and get it in to Mr. Brenkworth by June 15. If you forget to write that letter on that date, then you have an accrued balance over there to your account that is taxable income. Any part of this allowance not needed ought to just automatically stay in the Treasury, unless we as Members of the Senate can certify it as being spent for the legitimate operations of our office. I think out statements should be affirmative. If I buy stationery at another place and want to be reimbursed I should have to sign affirmatively a voucher stating that it is being used for the expenses of stationery for my office. I don't see why we have to take affirmative action to keep us from taking something that we don't need.