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SURPLUS PROPERTY ACT OF 1944
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HEARINGS

BEFORE THB
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COMMITTEE ON EXPENDITURES IN THE

EXECUTIVE DEPARTMENTS
HOUSE OF REPRESENTATIVES
SEVENTY-EIGHTH CONGRESS
SECOND SESSION

ON
H. R. 5125

A BILL TO PROVIDE FOR THE DISPOSAL OF SURPLUS

GOVERNMENT PROPERTY AND PLANTS

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COMMITTEE ON EXPENDITURES IN THE EXECUTIVE

DEPARTMENTS

CARTER MANASCO, Alabama, Chairman JOHN J. COCHRAN, Missouri

CHARLES L. GIFFORD, Massachusetts WILL M. WHITTINGTON, Mississippi CLARE E. HOFFMAN, Michigan EDWARD J. HART, New Jersey

D. LANE POWERS, New Jersey JOSEPH J. MANSFIELD, Texas

GEORGE H. BENDER, Ohio WILLIAM L. DAWSON, Illinois

WILSON D. GILLETTE, Pennsylvania DONALD L. O'TOOLE, New York

RALPH E. CHURCH, Illinois JOHN S. GIBSON, Georgia

NORRIS POULSON, California JENNINGS RANDOLPH, West Virginia

ROBERT HALE, Maine ALFRED J. ELLIOTT, California

SAMUEL K. MCCONNELL, JR., Pennsylvania ED GOSSETT, Texas GEORGE A. ANDREWS, Alabama

SURPLUS PROPERTY ACT OF 1944

MONDAY, AUGUST 7, 1944

HOUSE OF REPRESENTATIVES,

COMMITTEE ON EXPENDITURES
IN THE EXECUTIVE DEPARTMENTS,

Washington, D. C.
EXECUTIVE SESSION
The committee met at 10 a. m., Hon. Carter Manasco (chairman)
presiding.

The CHAIRMAN. The committee will please come to order.

We have met this morning to consider H. R. 5125, a bill to provide for the disposal of surplus Government property and plants, and for other purposes. (The bill referred to is as follows:)

(H. R. 5125, 78th Cong., 2d sess.] A BILL To provide for the disposal of surplus Government property and plants, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

OBJECTIVES SECTION 1. The Congress hereby declares that the objectives of this Act are to facilitate and regulate the orderly disposal of surplus property so as

(a) to assure the most effective use of such property for the purposes of war and national defense;

(b) to facilitate the transition of enterprises from wartime to peacetime production and of individuals from wartime to peacetime employment;

(c) to promote production, employment of labor, and utilization of the productive capacity, and the natural and agricultural resources of the country;

(d) to avoid dislocations of the domestic economy and of international economic relations;

(e) to discourage monopolistic practices, preserve and strengthen the competitive position of small business;

(f) to foster the wide distribution of surplus commodities to consumers at fair prices;

(g) to effect broad and equitable distribution of surplus property; and

(h) to realize the highest obtainable return for the Government consistent with the maintenance and encouragement of a healthy competitive economy.

DEFINITIONS

Sec. 2. As used in this Act

(a) The term “Government agency” means any executive department, board, bureau, independent commission, or other agency in the executive branch of thé Federal Government, and any corporation wholly owned and controlled by the United States.

(b) The term "owning agency' means a Government agency having control of property at or before the time when it is determined to be surplus to the needs and responsibilities of that agency.

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(c) The term “disposal agency" means any Government agency designated under this Act to handle disposition of one or more classes of surplus property..

(d) The term "property” means any interest in property, real or personal, owned by the United States or any Government agency, including, but not limited to, plants, facilities, equipment, machinery, accessories, parts, assemblies, products, commodities, materials, and supplies of all kinds, whether new or used, and wherever located.

(e) The term "surplus property” means any property which has been determined to be surplus to the needs and responsibilities of the owning agency in accordance with section 7 of this Act.

(f) The term “contractor inventory” means (1) any property related to a terminated contract of any type with a Government agency or to a subcontract thereunder (except any machinery or equipment subject to a separate contract or contract article specifically governing its use or disposition); and (2) any property acquired under a cost-plus-a-fixed-fee contract and in excess of the amounts needed to complete performance thereunder; and (3) any property which the Government is obligated to take over under any type of contract as a result of any change in the specifications or plans thereunder.

(g) The term "care and handling” includes repairing, converting, rehabilitating, operating, maintaining, preserving, protecting, insuring, storing, packing, handling, and transporting.

(h) The term "option" means any contractual right to retain or acquire any property at a price and upon terms prescribed or determined by the contract.

(i) The term “person" means any individual, corporation, partnership, firm, association, trust, estate, or other entity. • (j) The term "Administrator” means the Surplus Property Administrator.

SURPLUS PROPERTY ADMINISTRATOR Sec. 3. (a) There is hereby established the Surplus Property Administration which shall be headed by a Surplus Property Administrator. The Administrator shall be appointed by the President by and with the consent of the Senate, shall receive compensation at the rate of $12,000 per year, and shall serve for a term of two years.

(b) The Administrator may, within the limits of funds which may be made available, employ and fix the compensation of necessary personnel without regard to the provisions of the civil-service laws and the Classification Act of 1923 and make expenditures for supplies, facilities, and services necessary for the performance of his functions under this Act. The Administrator shall perform the duties imposed upon him through the personnel and facilities of the established Government agencies so far as consistent with his duty to insure uniform and efficient administration of the provisions of this Act.

(c) The Administrator shall have general supervision and direction over (1) the care and handling and disposition of surplus property and (2) the transfer of surplus property between Government agencies.

SURPLUS PROPERTY BOARD

Sec. 4. There is hereby created a Surplus Property Advisory Board with which the Administrator shall advise and consult. The Board shall be composed of the Administrator, who shall act as its Chairman, and of the Secretary of State, the Secretary of the Treasury, the Secretary of War, the Secretary of the Navy, the Attorney General, the Secretary of Commerce, the Secretary of the Interior, the Chairman of the Board of Directors of Smaller War Plants Corporation, the Chairman of the United States Maritime Commission, the Chairman of the War Production Board, the Director of the Bureau of the Budget, the Administrator of the War Food Administration, the Administrator of the Federal Works Agency, the Chairman of the Civil Aeronautics Board, and the Administrator of the Foreign Economic Administration, or any alternate or representative designated by any of them.

SURVEILLANCE BY CONGRESS Sec. 5. (a) To assist the Congress in appraising the administration of this Act and in developing such amendments or related legislation as may be necessary to accomplish the objectives of the Act, the appropriate committees of the Senate and the House of Representatives shall study the reports and information submitted to the Congress under this Act and shall otherwise maintain continuous surveillance of the operations of the Government agencies under the Act.

(b) Within three months after the enactment of this Act, and thereafter in January, April, July, and October of each year, the Administrator shall submit to the Senate and House of Representatives a quarterly progress report on the exercise of his authority and discretion under this Act, the status of surplus property disposition, and such other pertinent information on the administration of the Act as will enable the Congress to evaluate its administration and the need for amendments and related legislation.

(c) The Administrator shall submit to the Senate and House of Representatives copies of the regulations prescribed by him from time to time under this Act within thirty days after the effective date of such regulations.

PLANNING

SEC. 6. (a) The Administrator shall formulate as rapidly as possible detailed plans

(1) for the care and handling, and disposition of surplus property in accordance with this Act;

(2) for converting to civilian production by private industry as rapidly as war needs and conditions permit any Government-owned plants which are not needed for national defense and are capable of use for civilian production; and.

(3) for facilitating the most economical use and disposition of Governmentowned plants which are not needed for national defense but are not capable

of use for civilian production. (b) The Administrator shall make such studies as he deems necessary for the formulation of such plans or shall cause such studies to be made by other Government agencies.

DECLARATION OF SURPLUS PROPERTY Sec. 7. (a) Each owning agency shall have the duty and responsibility continuously to survey the property in its control and to determine which of such property is surplus to its needs and responsibilities. For the duration of hostilities in the present war, such determination shall be the exclusive province of the owning agencies, but thereafter the Administrator shall have power to require such a determination upon a finding by him that any property is surplus to the needs and responsibilities of an owning agency.

(b) Each owning agency shall promptly report to the appropriate disposal agency all surplus property in its control which the owning agency does not dispose of under section 8.

DISPOSITION BY OWNING AGENCY SEC. 8. (a) Any owning agency may dispose of any property for the purpose of war production or authorize any contractor with such agency or subcontractor thereunder to retain or dispose of any contractor inventories for the purpose of war production, subject only to the regulations of the Administrator with respect to price policies.

(b) Subject to subsection (c) of this section, any owning agency may dispose of

(1) any property which is damaged or worn beyond economical repair; (2) any waste, salvage, scrap, or other similar items;

(3) any products of industrial, research, agricultural, or livestock operations, or of any public works construction or maintenance project, carried on by such agency;

(4) any contractor inventory in its control; and

(5) any other class or type of surplus property designated by the Administrator. (c) Whenever he deems such action necessary to effectuate the objectives and policies of this Act, the Administrator, by regulations, shall restrict the authority of any owning agency to dispose of any class of surplus property under subsection (b) of this section.

DISPOSAL AGENCIES SEC. 9. (a) The Administrator, by regulations, shall designate one or more Government agencies to act as disposal agencies under this Act and shall prescribe the class or classes of surplus property to be handled by each such agency: Provided, however, That the United States Maritime Commission shall be the sole

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