DONABLE PERSONAL PROPERTY DISTRIBUTED BY STATE AGENCIES FOR SURPLUS PROPERTY TO PUBLIC HEALTH AND EDUCATIONAL INSTITUTIONS AND CIVIL DEFENSE ORGANIZATIONS AND REAL PROPERTY CONVEYED TO PUBLIC HEALTH AND EDUCATIONAL INSTITUTIONS (FEDERAL ACQUISITIONS COST) FISCAL YEAR 1968

1969 APPROPRIATION AND 1970 BUDGET REQUEST

Senator BIBLE. Next, we will hear the presentation of the surplus property utilization.

Mr. ELSON. I am wearing two hats, Mr. Chairman, in that I am Director of the Office of Surplus Property as well as the Acting Deputy Assistant Secretary for Administration.

Senator BIBLE. You may proceed with your statement.

Mr. ELSON. I am pleased to present the fiscal year 1970 budget for the surplus property utilization program. The $1,255,000 requested provides for an increase of $12,000 over 1969. This would cover for increasing costs of administrative services.

ACCOMPLISHMENTS-REAL PROPERTY

In 1968, the surplus real property program reached the highest level of activity since its inception in 1950. Conveyances were made of 161 properties, which had originally cost the Government $114 million. This acquisition cost was $19.9 million greater than the properties conveyed in fiscal year 1967.

This increase is primarily attributed to the many high-cost obsolete Department of Defense installations conveyed, as well as several other similar properties of other Federal agencies. For example, the former old post office buildings and annex at Austin, Tex., containing 105,126 square feet, was conveyed to the University of Texas as the downtown education center of the school.

These buildings will be used as a public exhibition center for the display of Texas cultural and literary pieces, office space for faculty research, staff, and visiting professors, and a central office for the Institute for Urban Studies of the University System. In addition, a portion of the building will be used for the accumulation of materials for the East Mall Graduate Library.

PERSONAL PROPERTY

In fiscal year 1968, the program allocated for donation to eligible donees, personal property which cost the Government $309.8 million. This was approximately 2 percent above the fiscal year 1967 level. This increase is attributed to release by the Department of Defense of high-cost inventories of property, including computers and aircraft.

Available personal property provides a valuable resource to educational and public health programs. For example, Northwestern Michigan College, Traverse City, Mich., advised this Department of its need for a Federal surplus vessel for use in its Great Lakes maritime training program.

This Department was able to locate and effect the donation of a 143-foot Navy surplus vessel, the USS Allegheny, an auxiliary ocean tug converted to an ocean research vessel. The vessel originally cost the Government $886,000. It was officially turned over to the college on January 20, 1969.

CASH COLLECTIONS

Through the real and personal property programs, moneys are derived from abrogations of restrictive conditions, leases of property for interim uses, sales, and other uses or disposals of property. In

fiscal year 1968, $999,000 was derived from these activities and deposited in the Treasury. We anticipate that approximately $1,085,000 will be secured in fiscal year 1969.

Since initiation of the program in 1950, over $16 million has been collected and deposited in the Treasury. This figure exceeds the total funds made available for program administration costs during the same period by more than $4 million.

WORKLOAD DATA

In addition to its continuing workload, the Office of Surplus Property Utilization is involved in the following activities:

The Office participates in the task forces organized by the Office of Economic Adjustment of the Department of Defense, to develop disposal plans for military installations being closed, which will minimize the economic impact on the local economy.

More frequently than not, our participation results in the development of health and educational programs which materially contribute toward relieving the local economic impact which would otherwise have resulted from the closing of these installations.

This Office is also part of a joint GSA-HEW-DOD study group which is exploring practical possibilities and opportunities for further utilization of U.S. personal property located outside the United States. This study was undertaken at the recommendation of the House Committee on Government Operations (H. Rept. 865, 90th Cong.).

This study group has developed a practical plan for the return of overseas property, which is now being tested at DOD bases in Germany. The volume of property which can be returned to the United States cannot be accurately predicted at this time. However, I am very optimistic about this large potential source of property for domestic health and education purposes.

Thank you, Mr. Chairman. If there are any questions, I will be happy to respond to them.

1969 APPROPRIATION AND 1970 BUDGET REQUEST

Senator BIBLE. The bill included $1,255,000, which was the amount of your request, $12,000 more than the amount appropriated for 1969. The full amount was allowed by the House?

Mr. ELSON. That is right.

Senator BIBLE. Obviously, you are not appealing the dollar amount. Mr. ELSON. No, sir.

SURPLUS PROPERTY DISPOSAL

Senator BIBLE. Where does your jurisdiction lie on surplus property disposal vis-a-vis the GSA?

Mr. ELSON. The General Services Administration has the overall responsibility. What happens in connection with surplus property is that when we have made the determination that there is a possible utilization of surplus property for health or educational purposes, we request the assignment of that property to us from GSA for the purpose of making that conveyance to the institution that has a program under our criteria.

Senator BIBLE. Why doesn't the GSA do that, itself?

Why do you have to have an overlaying agency?

Mr. ELSON. The reason for that, sir; is that it has been the feeling, and properly so, that the expertise in the determination as to whether or not there is a proper educational need or a proper health need is one which lies within the particular expertise of the Department of Health, Education, and Welfare.

Senator BIBLE. But why do they have to turn it over to you? Can't you tell General Services Administration that this particular facility should go to a State hospital or a county hospital in a certain State?

Mr. ELSON. The continuing compliance for that lies with the Department of Health, Education, and Welfare in order to see that over the period of time the property is properly utilized and continually being used for the purpose for which it was conveyed.

The compliance aspect is an important one.

COORDINATION WITH GENERAL SERVICES ADMINISTRATION

Senator BIBLE. Exactly how does that coordination with General Services work?

Mr. ELSON. A piece of property may be excess to the needs of a particular holding agency, at which time it is then reported to General Services Administration, who will then first circularize that property to determine whether or not there is a further Federal need for it. Önce having determined there is no further Federal need for it, they will notify the Department of Health, Education, and Welfare as to its availability. We will then make the determination as to whether or not that property can be properly used for health or education, and that there is a need for it.

When we do, and a program is prepared, and the criteria of the organization meets the criteria which have been set by the Department, the request is then made of GSA to assign that property to the Department of Health, Education, and Welfare for the purpose of making the conveyance.

PERSONNEL

Senator BIBLE. How many people do you have assigned to this function?

Mr. ELSON. In the entire program, nationwide

Senator BIBLE. Within HEW. Limit it to that.

Mr. ELSON. Within HEW, we are allotted 101. At the moment, we have 97 on board.

Senator BIBLE. And how many of those are in Washington?

Mr. ELSON. Eighteen.

Senator BIBLE. And the balance are where?

Mr. ELSON. In the field offices.

REGIONAL OFFICES

Senator BIBLE. How many regional offices does HEW have?

Mr. ELSON. We have nine at the present.

Senator BIBLE. Will there be some change?

Mr. ELSON. There will be a 10th regional office established in Seattle. Senator BIBLE. I have no further questions.

Thank you, Mr. Elson.