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Whereas it is the further consensus of the aforementioned national leadership that the next step in the shelter program has to be the creation of new shelter spaces where none now exist in order to extend the shelter program to provide shelter to every American; and

Whereas municipal communities, which have a major responsibility in this area, cannot properly plan for an effective immediate or long-term civil defense program without a continuity of Federal financial support: Now, therefore, be it

Resolved by the American Legion in national convention assembled in Miami Beach, Fla., September 10–12, 1963, That the American Legion call upon Congress as a whole to enact H.R. 8200 into law and then to appropriate the funds requested by the Department of Defense for the implementation of that law, with a minimum of delay.

Resolution No. 104, which we view as a mandate, reaffirms the commitment of the American Legion at every level to wholeheartedly support a sound system of civil defense. I urge your committee to give its favorable consideration to the modest budget requested by the Office of Civil Defense.

I thank you.

WETERANs' ADMINISTRATION

STATEMENT OF JOHN J. CORCORAN, DIRECTOR, NATIONAL REHABILITATION COMMISSION, THE AMERICAN LEGION

1965 BUDGET REQUEST

Mr. Chairman and members of the subcommittee, the American Legion appreciates the opportunity to express its views on that portion of H.R. 11296, the independent offices appropriations bill, which relates to costs for operating the Veterans' Administration during the 1965 fiscal year. Our organization feels there is cause for grave concern over the House Appropriations Committee's recommended $17,963,000 reduction in the budget estimates which were approved by the House of Representatives, May 21, 1964. In our opinion, a reduction of $524,000 in general operating expenses will impair the WA’s ability to efficiently service claimants in fiscal 1965. The general operating expenses appropriation supports staff services, the Department of Weterans' Benefits, and the Department of Data Management. WA budget estimates contemplated reductions in average employment in these activities except for data management and the compensation and pension service, where slight employment increases were contemplated. This reduction of $524,000 will undoubtedly cause further reductions in personnel, or prohibit employment increases in the two areas where workloads are rising. In either event, it appears that a reduction in quality and timeliness of service is likely to result from such a reduction. In the light of WA estimates that a 250-percent increase in disability pension claims, and a 112-percent increase in death claims, is expected between 1963 and 1965, the American Legion questions the wisdom of action that may well impair the agency's ability to effectively and efficiently process this anticipated rising workload. The recommended reduction of $685,000 for medical administration and miscellaneous operating expenses is based on a conclusion that 50 jobs in the area medical offices should be abolished. The WA's recently appointed Chief Medical Director, at the time of his appearance before the House committee, advised that he planned to survey these offices over the next 8 or 9 months for the purpose of evaluating their usefulness. We submit that congressional action forcing abolishment of these offices, through reduction in appropriations, should not be taken before the survey is completed and before the Chief Medical Director is in a position to present his views in the matter. Information has reached our office that the proposed reduction of $987,000 for medical and prosthetic research, if sustained, will cause abandonment of WA plans to study the desirability of establishing prosthetic centers in selected WA hospitals throughout the country. These centers would have provided amputee veterans with certain unique services, as knowledge important to the health and self-sufficiency of amputees was being accumulated. It is regrettable that reduced appropriations will eliminate this worthwhile project. H.R. 11296 would impose an expenditure limitation of $257 million in the WA's loan guarantee revolving fund in fiscal 1965.

Similar limitations imposed for the past 2 years have forced the WA to delay payment of legal claims to lenders. In view of the fact that payments from this fund are made pursuant to law, we fail to see where any useful purpose will be served by imposing an expenditure limitation. Delays in payment of claims to lenders lead to a reluctance on their part to participate in the WA's loan guarantee program. The American Legion is deeply concerned over the recommended reduction of $10,767,000 in the budget estimate for construction of hospital and domiciliary facilities. The House committee reported, “In recommending a reduction of 10 percent in the overall cost, the committee urges the Administrator to determine that good, substantial, and useful buildings without frills and unessential features are provided.” The construction costs estimated by the VA are based upon previous experience with contract awards and are consistent with their long-established policy to provide adequate construction at minimum cost. We know of no evidence which would support a conclusion that the budget estimate included nearly $11 million for “frills and unessential features.” A savings of such a sizable sum in construction costs will only be possible by abandoning plans to construct one of the facilities projected. Undoubtedly you are aware of the Chief Medical Director's revelation before the House committee that he has received reports from deans of medical schools affiliated with the Veterans' Administration's medical program, and others, expressing the opinion that the quality of the VA’s medical program, in recent years, has not kept pace with the quality of care provided by the best civilian institutions. The American Legion has received similar reports, which are most disturbing, indicating that a breach is developing between the deans committees and the VA medical program. The WA is finding it difficult to attract young physicians to participate in its medical program. As nearly as the American Legion can determine, a primary cause for existing dissatisfaction is the fact that insufficient funds are available to practice the latest developments in medicine and surgery. The medical staff does not have access to money necessary to employ the lessons gained from research. Also, the ratio of personnel to patients does not match that established in the best non-VA facilities. Needed expensive equipment cannot be purchased. The absorption of pay raises in the regular budget further limits available funds. The economy drive, calling for freezes in employment of personnel, is a frustrating element. As one student of the situation described it, the funds for the WA Department of Medicine and Surgery are 2 to 3 years behind the march of medical and surgical progress. The American Legion is disturbed over the situation and urges Congress to appropriate sufficient funds for effective and efficient operation of the VA’s medical program. Failure to provide funds in the appropriations for fiscal 1965 sufficient to allow the VA to construct needed modern medical facilities will not only prohibit them from meeting the demands for hospital beds but may very well widen the breach now developing between the deans committees and the WA's medical program. Thank you for receiving the views of the American Legion.

FEDERAL Power CoMMIssion

STATEMENT OF DENNIS LINDBERG, PRESIDENT, MIDwest ELECTRIC ConsumERs ASSOCIATION

SUPPORTING 1965 BUDGET REQUEST

My name is Dennis Lindberg. I am president of Midwest Electric Consumers Association. Midwest is the regional service organization of the rural electric and municipally owned electric systems in the eight States of Colorado, Iowa, Minnesota, Montana, Nebraska, North Dakota, South Dakota, and Wyoming. Our organization is composed of approximately 250 systems, which serve more than a half million consumers. Our organization was formed to obtain an adequate supply of low-cost electric power for these groups and generally to promote the interests of electric consumers in the region.

Midwest Electric Consumers Association is submitting this statement in support of the budget request for $13,335,000 for the Federal Power Commission for fiscal 1965. We believe that this amount is required to enable the Commission to protect the interests of the electric and gas consumers of this Nation adequately. We are especially interested in the requested appropriation of $2.520000 for regulation of the electric power industry. We feel strongly that this is the minimum amount which will make it possible for the Commission to employ a staff of sufficient size to enable it to carry out its responsibilities under the Federal Power Act.

Many of our members are municipalities and have a great need for the protection which they can enjoy against excessive wholesale electric power and energy rates if the Federal Power Act is administered vigorously in the interest of the consumer as intended by Congress. A statement has been submitted to your committee by Alex Radin, general manager, American Public Power Association, in support of the requested appropriation. That statement explains in some detail the benefits municipal electric systems and electric consumers generally will derive from the effective administration in the public interest of the Federal PoWer Act.

We shall not lengthen this statement by repeating those benefits, but Midwest Consumers Electric Association wishes to associate itself with the views expressed in Mr. Radin's statement. We are especially hopeful that as a result of the March 6, 1964, decision of the U.S. Supreme Court in the City of Colton case, a vast number of additional consumers of electricity will be benefited by the rate protection provided for in the Federal act.

In this connection, we are concerned over the introduction of H.R. 11081 because a new subsection “(h)” proposed to be added to section 201 of the Federal Power Act would have the effect of nullifying parts II and III of the Federal Power Act and reversing the unanimous Supreme Court decision in the Colton case. This bill would destroy a protection against overcharges and inequitable contract terms which is provided by the current Commission, and leave in exchange a regulatory “gap.” not covered by State commissions. Enactment of H.R. 11081 would kill or cripple meaningful regulatory control over many wholesale power transactions by private power companies, whose operations are increasingly interstate in character and national in impact.

We are not in a position to state that our membership approves of all of the action taken by the Commission in the past year. At our annual meeting. held in Denver, Colo., in December of last year, resolutions were passed deploring the proposal by the Commission staff that the Commission now, for the first time, attempt to exercise jurisdiction over rural electric cooperative borrowers. We believe that this would clearly violate the Federal Power Act and gravely impair the successful administration of the Rural Electrification Act of 1936 by the REA Administrator. A resolution also was passed condemning the ar. tion of the Commission staff in commencing proceedings which question the right of power companies to sell electricity to cooperatives at rates which will enable the cooperatives to carry out their mandate from Congress to electrify the rural parts of the Nation on an area-coverage basis at rates the rural consumers can afford to pay, if such wholesale rates are lower than rates to other wholesale customers. Our membership, also, has expressed its strong disapproval of the decision of the majority of the Commission to grant a license to a private power company to construct the High Mountain Sheep project on the Snake River in what seems to them to be a clear-cut violation of the “preference provision” of the Federal Power Act.

Although we are greatly concerned over the foregoing staff or Commission actions, we recognize that on the whole the present Commission has made vast strides forward in revitalizing its electric regulatory activities and we believe this is good news for electric consumers. We feel that the problems mentioned above can be corrected by strong guidelines for the staff being laid down by the Commission, and by the proper directives being given by the anpropriate congressional committees to the Commission. None of such problems would be solved by not making sufficient funds available.

We are convinced that this committee can make a genuine contribution to the welfare of the electric and gas consumers of the Nation by recommending the requested appropriation.

Senator MAGNUsoN. We are in recess until 9 a.m., Wednesday morning, with FAA.

(Whereupon, at 11 a.m.. the committee recessed, to reconvene Wednesday June 10, 1964, at 9 a.m.)

INDEPENDENT OFFICES APPROPRIATIONS FOR 1965

WEDNESDAY, JUNE 10, 1964

U.S. SENATE,
SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS,

Washington, D.C. The subcommittee met, pursuant to recess, at 9 a.m., in room S-128, U.S. Capitol, Hon. Warren G. Magnuson (chairman) presiding.

Present: Senators Magnuson, Monroney, Allott, and Saltonstall.

FEDERAL AVIATION AGENCY

STATEMENT OF NAJEEB E. HALABY, ADMINISTRATOR, FEDERAL

AVIATION AGENCY; ACCOMPANIED BY ALAN L. DEAN, ASSOCIATE ADMINISTRATOR FOR ADMINISTRATION, ROBERT J. SHANK, ASSOCIATE ADMINISTRATOR FOR DEVELOPMENT; DAVID D. THOMAS, ASSOCIATE ADMINISTRATOR FOR PROGRAMS; H. B. ALEXANDER, DIRECTOR OF BUDGET; JOSEPH D. BLATT, DIRECTOR, SYSTEMS RESEARCH AND DEVELOPMENT SERVICE; RICHARD B. LENG, DIRECTOR, INSTALLATION AND MATERIEL SERVICE; GEORGE S. MOORE, DIRECTOR, FLIGHT STANDARDS SERVICE; NATHANIEL H. GOODRICH, GENERAL COUNSEL; AND D. M. MUNSON, DEPUTY DIRECTOR OF BUDGET

1965 BUDGET REQUEST

Senator MAGNUSON. The Federal Aviation Agency is the only Agency other than the space agency that has not appeared before our subcommittee for their general presentation.

The space agency has not, for a very good reason: The authorization bill has not passed. It is on the Senate Calendar and will probably be taken up shortly.

I have asked Mr. Halaby and his staff to come in today and discuss in a general way the appropriations of the budget for the FAA for 1965.

(The justification statement referred to follows:)

GENERAL STATEMENT

Aeronautical services are provided by the Federal Aviation Agency under authority of several statutes, the more important of which are identified below:

1. The Federal Aviation Act of 1958 created the Federal Aviation Agency and provides for the regulation and promotion of civil aviation so as to foster its development and safety and to assure the safe and efficient use of the airspace by both civil and military aircraft.

2. Public Law 674, 76th Congress, authorizes the operation of the Washington National Airport, and Public Law 762, 81st Congress, authorizes the construction and operation of Dulles International Airport. 3. Public Law 377, 79th Congress, Public Law 211, 84th Congress, Public Law 86–72, and Public Law 87—255 provide for Federal aid in the develop. ment of public airports. 4. The International Aviation Facilities Act enacted to encourage the development of an international air transportation system adapted to the needs of the foreign commerce of the United States, of the postal service, and of the national defense, and for other purposes. The declaration of policy for the Administrator, which is section 103 of the Federal Aviation Act, summarizes effectively the objectives we wish to attain. “SEC. 103. In the exercise and performance of his powers and duties under this Act, the Administrator shall consider the following, among other things, as being in the public interest: “(a) The regulation of air commerce in such manner as to best promote its development and safety and fulfill the requirements of national defense; “(b) The promotion, encouragement, and development of civil aeronautics; “(c) The control of the use of the navigable air space of the United States and the regulation of both civil and military operations in such air space in the interest of the safety and efficiency of both; “(d) The consolidation of research and development with respect to air navigation facilities, as well as the installation and operation thereof; “(e) The development and operation of a common system of air traffic control and navigation for both military and civil aircraft.” In performing services essential to present-day aviation and its growth, the Agency operates and maintains a national network of air navigation aids and controls civil and military air traffic 24 hours a day; regulates the use of navigable space; certifies as to the competency of airmen and airworthiness of aircraft; procures and installs improved aids to air navigation; conducts research and development to improve and modernize aviation facilities and procedures; administers a Federal grant-in-aid program for a national system of airports; promotes and regulates the mental and physical fitness of airmen: conducts aviation medical research; constructs and operates airports in the National Capital area and certain other special locations; and carries on other related activities designed to promote air commerce and safe and efficient aviation. The enactment of the Federal Aviation Act and the creation of the Federal Aviation Agency have provided the framework and authority needed to deal effectively with the needs of aviation. The effectiveness of these measures are, however, dependent upon the continued provision of the resources required to keep pace with an ever more demanding job. Beginning in 1957, the level of appropriation for functions now carried on by the Federal Aviation Agency has been increased to provide facilities and services at a rate which has permitted substantial and encouraging progress in improving and augmenting present air navigation and traffic control systems and in rendering services essential for safety and efficiency in air operations. Further, the role of the Federal Government with respect to research and development has been recognized and implemented with appropriations support. This concerted effort must be continued and its success is also heavily dependent on the availability of adequate resources. Aviation is one of the major industries of the United States. The workload of the Federal Aviation Agency as generated by this industry is not controllable by the Agency but in large measure results from the requirements associated with air defense and with the growth of civil aviation. Increasing density of air traffic and the increasing use of high performance aircraft pose serions problems, and we must be continuously increasing our capabilities to handle the workload. All Agency workload indicators continue to reflect increases in 1965 over 1963. Some of the more significant of these are: an increase of 11 percent in aircraft operations at FAA towers; a 6 percent increase in IFR aircraft handled through air route traffic control centers. Another indicator of aviation activity is that of fuel consumed, as this is a reflection on the numbers of aircraft in the system as well as the size and complexity of the aircraft This indicator reflects a 15-percent growth in 1965 over 1963. It is also expected that the public will fly 53 billion passenger-miles in 1965, which is an increase of 15 percent over 1963.

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