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CURRENT STATUs of JURIsdiction Over BANK-CoMMINGLED FUNDs

Senator ALLOTT. Mr. Chairman, on that there is this one question which Mr. Cary referred to which we may want to discuss a little, and erhaps we can do this partially by letter: the status of this National }. Comptroller-SEC matter that we discussed last year. Mr. CARY. In the last hearing, yes, before you, I remember very specifically. I would be very glad to handle it in any way you wish us to, Senator. Senator ALLOTT. Suppose you let me have a letter as to the present status of this, and then when it comes up I can ask that you either come up—it just depends on what the House does whether we will have you up again or not, but I would like to leave it open that we could have them up for this one matter, Mr. Chairman. Mr. CARY. Right, and you wish us to send you a letter on the present status of that? Senator ALLOTT. Yes. Mr. CARY. We shall do so.

CoMMITTEE recess

Senator MAGNUsoN. The committee will recess. Tomorrow we will meet with the Selective Service System. Thank you very much, gentlemen. Mr. CARY. Thank you very much. (Whereupon, at 10:05 a.m., Wednesday, May 6, 1964, the committee recessed, to reconvene at 8:30 a.m., Thursday, May 7, 1964.)

INDEPENDENT OFFICES APPROPRIATIONS FOR 1965

THURSDAY, MAY 7, 1964

U.S. SENATE, SUBCOMMITTEE of THE CoMMITTEE on APPROPRIATIONs, Washington, D.C.

The subcommittee met, pursuant to recess at 8:30 a.m. in room S-128, U.S. Capitol Building, Hon. Warren G. Magnuson presiding. Present: Senators Magnuson and Allott.

SELECTIVE SERVICE SYSTEM

STATEMENT OF LT. GEN. LEWIS B. HERSHEY, DIRECTOR OF SELECTIVE SERVICE; ACCOMPANIED BY COL. WILLIAM S, ILIFF, JR., ASSISTANT TO THE DIRECTOR; COL, BERNARD T. FRANCK III, CHIEF LEGISLATIVE AND LIAISON OFFICER; EDMUND FUCHS, CHIEF, MILITARY SELECTION RESEARCH LABORATORY, ARMY PERSONNEL RESEARCH OFFICE

APPROPRIATION, FISCAL YEAR, 1964; ESTIMATES, FISCAL YEAR 1965

Senator MAGNUSON. The committee will come to order. This morning we have the Selective Service System. '#. year's appropriation was $37,840,000 and this year the budget estimate is $43,020,000, or plus $5,080,000. General Hershey, your general statement and summary justification will be placed in the record at this time. (The information referred to follows:)

SELECTIVE SERVICE SYSTEM
GENERAL STATEMENT (FISCAL YEAR 1965)

There is presented herewith justification for the request of $43,020,000 with which to operate the Selective Service System, the National Advisory Committee on the Selection of Physicians, Dentists, and Allied Specialists, and the National Selective Service Appeal Board during the fiscal year 1965,

The Selective Service System is organized to carry out the primary functions of registration, classification, selection, and presentation for induction in the Armed Forces of the men necessary for maintenance of those forces at the determined strength and by means of deferment, urges men into those occupations and activities necessary to the maintenance of the national health, safety, or interest. It also determines the availability of men for a selective callup from the Standby Reserve. The collateral functions of administration, planning, training, and records management are also performed by this agency,

The use by the Selective Service System of the services of over 48,000 uncompensated officials is unique in Government. These patriotic citizens give the strength to the Selective Service System.

It is inevitable that these unconipensated citizens will become less enthusiastic in their giving of service unless adequate clerical personnel is provided. The request for fiscal year 1965 includes the provision for such services in project 30.

The Selective Service System, which is decentralized, is organized on a pyramidal structure, the broad base of which is the local and appeal board element where the contact is maintained with over 2712 million registrants by the uncompensated members of the System and the local and appeal board clerks who staff the 4,046 local boards and the 94 appeal boards. The next largest group is composed of the 56 State headquarters; the relatively small group which comprises the national headquarters is the apex.

The strength of the Selective Service System lies in the fact that classification is the responsibility of those uncompensated civilians living in the communities with the registrants. They have no pecuniary interest in their position but perform their tasks as a patriotic service.

The size of the calls or the number of inductions in any given period directly affects only one cost factor; namely, selectee travel. This estimate for fiscal year 1965 is based on the induction of 100,000 registrants.

Executive Orders Nos. 10166 and 10185 created the National Advisory Committee on the Selection of Physicians, Dentists, and Allied Specialists. Pursuant to these orders, the Selective Service System is required to furnish funds for its operation and provision is included herein.

Executive Order No. 9988 created the National Selective Service Appeal Board. The Selective Service System is required to pay the members of the Board and "to furnish suitable office space and other necessary facilities and service.” This requires more personnel in national headquarters to the extent necessary to meet this requirement. This budget includes a request for funds to accomplish this purpose.

The principal factors in this request for an increase in 1965 over 1964 are: (1) The unprecedented increase in new registrations as estimated in the table below based on Bureau of Census figures related to experience. (2) Administrative increases in pay to local board clerks has been provided comparable to those given to classified employees by the pay act. For 1963, this was 1812 pay periods. For 1964, it is provided for the full-year plus the additional increase in pay to be effective January 1, 1964, and for 1965 on the basis of the last half of fiscal year 1964. (3) Within-grade pay raises for classified employees. Pay act increases are included for classified employees. No additional positions are provided for classified employees.

The following 10-year table shows the experience and projection of the number of new registrations in future years:

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1962 1963 1964 1965 1966 1967 1968. 1969 1970. 1971.

1944 1945 1946 1947 1948 1949 1950 1951 1952 1953

1, 402 1, 397 1. 414 1,955 1,811 1.813 1,857 1, 902 1, 768 1,850

11,512, 980 11,506, 857 2 1,525, 847 2 2, 109, 836 ? 1.954, 431 2 1,956,590 31,980, 305

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2,027,832 21.885, 395 2 1,972, 840

1 Actual.
2 Estimated.

Since the submission of the 1964 appropriation, several factors have increased our workload. (1) Department of Defense estimate of 129,000 was revised in August to 147,000; (2) on September 10 childless husbands other than volunteers were put in a delayed call status, and (3) in May of 1963 the standards for acceptance of certain registrants were raised.' No official approval of a supple mental has been given, however, if goals are to be met, it is expected that a supplemental appropriation for 1964 will be required.

A request is included for the replacement of motor vehicles. In fiscal year 1964, 22 vehicles will be replaced. For 1965, 13 are being requested for the amount of $23,100. These are: (1) five automobiles to replace those which have

passed both the age and mileage requirements; and (2) eight station wagons, all of which have met the age and mileage requirements.

Our fleet consists of 1 heavy sedan replaced in 1961 and scheduled to be replaced again in 1964, 44 other automobiles, 27 station wagons; and 12 trucks, 1 of which is 112 tons, the balance 1 ton or less. The heavy sedan is located in Washington, D.C., assigned to the Director of Selective Service. The balance of the equipment is in areas where there are no General Services motor pools available. They are principally used by the State directors and the officials of State headquarters for contact with local boards within their respective States. The station wagons are used also to deliver light equipment and supplies to local boards.

Consolidated summary of objective classification

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11 Personnel compensation:

Permanent positions:

Civilian

Military-
Positions other than permanent.
Other personnel compensation.

Total personnel compensation. 12 Personnel benefits:

Civil service retirement contributions
Group life insurance contributions
Federal insurance contributions act taxes
Health benefits contributions

Employee suggestion awards.
21 Travel and transportation of persons:

Administrative travel.
Travel of selectees

Rental of passenger vehicles 22 Transportation of things:

Freight, express, and drayage.
Rental of trucks

Parcel post (penalty indicia)
23 Rent, communications, and utilities:

Communication services -
Rents and utilities.

Penalty mail.
24 Printing and reproduction.
25 Other services
26 Supplies and materials
31 Equipment..

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Total obligations.

35, 439, 661

37, 705,000

43, 020,000

Relation of authorizations to expenditures- Administrative budget

[In thousands of dollars)

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SUPPLEMENTAL REQUEST Senator MAGNUSON. Then you have supplemental estimates of $3,098,000. Is this added to it?

General HERSHEY. No; the $3 million we add to the $38 million.

In other words, we are asking for $43 million. That is $5 million ahead of last year's, $2 million ahead of last year's regular plus supplemental which we have asked for and haven't gotten yet, and this

year then is $2 million more, and we are calling attention to the fact that it is $2 million less than it would have been had we inducted as many people next year as this year. So it would have been $45 million had our inductions been as great next year as this year. Senator MAGNUSON. What is the status of the $3.098 million! General HERSHEY. It is in the House. Senator MAGNUSON. It is not included in this? General HERSHEY. No, sir; not in this.

Senator MAGNUSON. It will be heard by the Senate committee, I understand, next week when they get the deficiency bill over there.

FISCAL YEAR 1965 BUDGET REQUEST

Senator Allott. I have got to get straightened out, Mr. Chairman. The budget is $43 million. How much are you asking for? Is that what you are asking for?

General HERSHEY. Yes, sir.

Senator Allotr. The $3.098 million in the deficency doesn't mean anything.

General HERSHEY. Except that it reduces the difference between the two. We are $5 million above last year's original request, but last year we expected an added $3 million which we are asking for now so we are only $2 million above last year's budget estimate.

Senator Allotr. I must be a little sleepy this morning.

General HERSHEY. No, sir; I have a little trouble with this one myself, but there is $2 million difference between last year's budget and supplemental and regular, and this year's.

FISCAL YEAR 1964 APPROPRIATION

Senator Magnuson. Last year we regularly appropriated $38 million.

General HERSHEY. Approximately $38 million. Senator MAGNUSON. $37,705,000 and now have an additional amount of $3 million being considered by the House.

General HERSHEY. We are asking for $3 million supplemental.
Senator MAGNUSON. For this year.
General HERSHEY. For this present year, yes, sir.
Senator MAGNUSON. So that makes you $41 million.

General HERSHEY. That is right, and so we are $2 million above that.

Senator MAGNUSON. And you are asking and the budget gave you for fiscal 1965 ?

General HERSHEY. $43 million.
Senator MAGNUSON. $43 million.
General HERSHEY. $43 million is all.

Senator Magnuson. So actually if you get the supplemental and the $43 million

General HERSHEY. No; $43 million is for 1965. If we get the supplemental we are asking for $2 million more than we had last year.

Senator MAGNUSON. For fiscal year 1965?
General HERSHEY. That is right.
Senator MAGNUson. Then the $3 million is for fiscal 1964.
General HERSHEY. For 1964.

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