Mr. ROWBOTTOM. Are these employees under civil service? If they were not, you could not make deductions for the retirement fund.

Mr. McCARL. Yes, these are all subject to the provisions of the retirement law.

Mr. SCHAFER. Then their salary has been raised under the Welch bill, so that the real salary would be higher than $7,500.

Mr. McCARL. I am not positive whether such action has been taken or not.

The CHAIRMAN. Let me make this inquiry, General: I find in what is now sections 167 and 168 of Title XXIV of the United States Code, these provisions:

Adjustment of compensation of officers and employees. The Secretary of the Interior is authorized, as of July 19, 1919, to adjust the compensation of officers and employees at St. Elizabeths Hospital.

That is the act of July 19, 1919. Then, under section 168, of the same title:

Readjustment of salaries; credit to the accounts of disbursing agents. The general accounting office is authorized to credit the account of the special disbursing agent of St. Elizabeths Hospital with such amount as he may pay in carrying out the provisions of the preceding section relating to the readjustment of salaries at the hospital, and the schedule of salaries and allowances for maintenance, where the latter is not provided by the hospital, approved by the Secretary of the Interior August 1 and November 25, 1919, respectively, or as may be modified by him, notwithstanding the provisions of section 55, Title V, or section 165 of this title.

Now there is a question in my mind as to whether the employees of this hospital come under the provisions of the reclassification act of March 4, 1923. If they do come within the reclassification act, then, as I understand it, the Reclassification Board would be authorized to determine the cash value of quarters, subsistence, and so forth, furnished to each, and a corresponding deduction would be made by the General Accounting Office in fixing their respective salaries.

Mr. McCARL. As I pointed out, I have not determined the value of those at all.

The CHAIRMAN. I understand they have not been determined. Mr. MCCARL. Yes; and I can not act on the accounts until somebody determines that.

The CHAIRMAN. Is it your idea that the Personnel Classification Board has authority in the case of St. Elizabeths Hospital employees to determine the value of quarters, subsistence, and so forth?

Mr. McCARL. Either the Personnel Classification Board or the administrative head. The law does not fail for want of some one to execute it and you, the Congress, prescribed, in 1923 and 1926, that where employees or officials are supplied (and that is an elastic expression, as I will point out later) with quarters, subsistence, or allowance, their value is to be determined. And, in this instance, I can not get any one to determine the value.

The CHAIRMAN. If I understand correctly the position of Doctor White, from the correspondence which I have read, he takes the position that St. Elizabeths Hospital does not come within the provisions of the personnel classification act of March 4, 1923, creating that board; and that the attempt made by the board to fix the value of these extras is not authorized by law.

Mr. COLTON. Mr. Chairman, will you permit the further question does he also contend that the administrative head of that institution may not act in making these adjustments?

The CHAIRMAN. No; I do not think he so contends.

Mr. COLTON. As I understand, Mr. McCarl's attitude is this, that one or the other ought to act and he can not act until they have so acted. Is that your position?

Mr. MCCARL. Yes. No one has valued these allowances, whatever they may be. The only thing that has been suggested here is that the Personnel Classification Board considered them and decided that they would not value them, not because of any reason stated in the law as justification, but because the jobs are hazardous. That does not satisfy for the purposes of the accounts.

Mr. DALLINGER. You cited an act of 1926; did you not?

Mr. McCARL. Yes, 1926.

Mr. DALLINGER. That supersedes the act of 1923 ?

Mr. McCARL. Oh, yes. I do not think there is any question about that, Congressman; at least, I would not feel that I was doing my duty without enforcing the enactments of 1923 and 1926 as I am trying to do.

Mr. LANHAM. An exemption because of the hazardous service would have to be predicated by law; that is your contention?

Mr. MCCARL. Yes. I have appended to this statement all the correspondence that has passed between my office and the Secretary of the Interior, which begins with the letter I have read in part, to give you a picture of what has happened. In the Secretary's reply of September 22, 1928, he attached a statement that was prepared by an employee of the institution (I think an assistant to the superintendent), in which he fully sets out why allowances should be supplied to these particular officers and employees because of the need for their being constantly on the reservation and that the States in general supply the very things that are supplied here.

Mr. LANHAM. Is it suggested for what reason there should be no deduction?

Mr. McCARL. It is rather an argument why they should be supplied.

Mr. SCHAFER. Does your office have any information as to what allowances are supplied in all other governmental hospitals, particularly those of a similar nature, such as the hospital at Camp Custer, Mich., and North Chicago? Both of those hospitals care for mental diseases, and I think you will not find four servants allowed and subsistence allowed in those excessive amounts; neither will you find such allowances, subsistence, or servants in the Navy hospitals or Army hospitals.

Mr. McCARL. If it were my duty to determine the value of allowances furnished in kind, of course I would go into those things; but, as yet, in the matter before us we are just up to the question of why they have not been determined administratively.

Mr. SCHAFER. This is a thing that comes to my mind: At the last session of Congress, as chairman of a subcommittee of the Committee on Claims, we considered a bill and reported it out for the relief of Mr. Williams, disbursing officer of the Bureau of the Census. Through a very technical construction of the law your department

had held there had been payment of over $4,000 and the United States district attorney had been directed and had been pressed to bring court action to collect that money. Now, if there have been expenditures in violation of law-would not they be in violation of law if there was no law to provide for them?

Mr. McCARL. Surely.

Mr. SCHAFER. Then, should not some department officer be directed to bring action to collect them, the same as in the Williams case?

Mr. McCARL. Yes, sir, surely; and in the last analysis it will be done.

(The correspondence submitted by Mr. McCarl in connection with his statement follows. The first fragment is the completion of his letter of August 15, 1928, to the Secretary of the Interior, from the point where he was interrupted during his statement by Mr. Lanham.)

This office has been reluctant to take formal action in the matter pending some action by the Personnel Classification Board, but it now seems that sufficient time has expired to enable the board to act under the statute and to determine the value of the allowances furnished in kind in order that the salary rates of all positions may be adjusted in their proper grades. In the absence of action by the board it becomes the responsibility of the administrative office and of this office to determine the value of the allowances furnished in kind of all employees affected in order that proper retirement deductions may be made. Therefore, the administrative office should proceed at once to determine the value to the employee of the allowances furnished in kind in the case of all employees under St. Elizabeths Hospital. The schedule of values for the same or similar class or character of allowances furnished in kind should be as uniform as practicable. The administrative report should be forwarded to this office and to the Personnel Classification Board before October 1, 1928. Effective not later than that date the total salary rate, including both the amount of cash paid and the determined value of allowances furnished in kind, will be considered the "basic salary, pay, or compensation" for the positions on the basis of which retirement deductions will be computed, and for the purpose of determining whether the cash salary paid is in excess of that authorized by law.

Respectfully,

J. R. MCCARL,

Comptroller General of the United States. (The Secretary of the Interior replied under date of September 22, 1928, as follows:)

The COMPTROLLER GENERAL.

DEPARTMENT OF THE INTERIOR,

OFFICE OF THE SECRETARY, Washington, September 22, 1928.

DEAR MR. COMPTROLLER GENERAL: I am transmitting herewith copy of report from the assistant to the superintendent of St. Elizabeths Hospital, dated September 14, 1928, with reference to your letter of August 15, 1928, regarding the valuation of quarters, subsistence, and other allowances furnished certain officers and employees of the hospital residing on the grounds of that institution. Acting under authority of the act of July 19, 1919 (41 Stat. 163, 205), the Secretary of the Interior adjusted the compensation of employees of the hospital. The salary of the superintendent was thereby increased to $7,000, with full maintenance. That action was held by the comptroller to be without authority of law, as the salary had been theretofore fixed by statute. (See 26 Comp. Dec. 493.) To remove that objection Congress incorporated in the act of March 6, 1920 (41 Stat. 503, 513), the following:

"Hereafter the accounting officers of the Treasury are authorized to credit the accounts of the special disbursing agent of St. Elizabeths Hospital with such amounts as he has or may hereafter pay in carrying out the provision of the sundry civil act of July 19, 1919, relating to the readjustment of salaries at the hospital, and the schedule of salaries and allowances for maintenance, where the latter is not provided by the hospital, approved by the Secretary

of the Interior August 1 and November 25, 1919, respectively, or as may be modified hereafter by him, notwithstanding the act of April 6, 1914, or section 4839, Revised Statutes, United States, as amended."

The schedules of cash pay and allowances in kind were fully explained at the hearings before Congress at that time, and it was well understood that the superintendent was receiving compensation at the rate of $7,000 per annum, with board, lodging, laundry, and medical attention for self and family. Annual appropriations for support of the institution have been made with that understanding.

The positions at the hospital were classified under the provisions of the classification act of 1923 (42 Stat. 1489), and the result of that classification was brought to the attention of Congress in your report of December 6, 1926, after investigation of the hospital. (See House Document No. 605.) Among other things it was reported: "Since July 1, 1924, the hospital in addition to paying the salaries fixed as above has been furnishing quarters, subsistence, and other allowances, as specified in statement attached."

It will thus be seen that Congress has continued to make appropriations based on the estimates for cash salaries, with knowledge that quarters and other allowances were furnished employees in addition to the cash pay.

The valuation of such allowances was considered by this department and the Personnel Classification Board, and it was concluded that the arrangements for quarters and so forth for employees needed at all times at the institution were for the benefit of the institution rather than the individual, and should be classed as equipment needed for official purposes. Congress has apparently adopted the same view and has recognized the existing status since the adjustment of salaries under the classification act. As that action has been sanctioned by Congress by making yearly appropriations on Budget estimates in harmony therewith, it is believed that the present arrangement should not be disturbed at least for the present fiscal year.

It is accordingly requested that any proposed change in this matter be held in abeyance until Congress shall have had further opportunity to consider the subject in connection with the 1930 estimates.

Very truly yours,

The SECRETARY OF THE INTERIOR,

E. C. FINNEY, First Assistant Secretary.

DEPARTMENT OF THE INTERIOR,

ST. ELIZABETHS HOSPITAL, Washington, D. C., September 14, 1928.

Washington, D. C.

SIR: In reply to yours of August 17, 1928, transmitting a letter from the Comptroller General of the United States dated August 15, 1928, pertaining to the salary rates for positions of employees working and residing at St. Elizabeths Hospital, which had been fixed under the classification act of 1923 on the basis of cash paid only, without including the value of quarters, subsistence, and other allowances furnished in kind.

We have made a very careful examination of this letter and we note first that the comptroller requests you to determine the value to the employees of the allowances furnished in kind in cases of all employees under St. Elizabeths Hospital and cites the fact that the Personnel Classification Board has been requested to fix the value of the allowances in kind but has refused or failed to act giving as reason that the hazardous nature of the employment and the necessity of being subject to call 24 hours of the day justifies the granting of allowances in kind without deduction from salary; and we note further that in this letter there is no question of deduction from salary, but merely question of determining the value of allowances furnished in kind in order that the total salary rate and basic salary, pay, or compensation may be determined upon the supposition that the value of the allowances furnished in kind is as much a part of the total salary rate and the basic compensation as cash payment-and assume, therefore, that the fundamental purpose of the letter is to determine the value of the quarters and maintenance furnished to the employees and what adjustments should be made in their salaries in consequence.

The comptroller in his statement cites the several classification acts in reference to the fact that the Personnel Classification Board shall make necessary adjustments in compensation for positions carrying maintenance, and for

positions requiring only part-time service, together with comptroller's decisions on the act of March 4, 1923; also provision in the annual appropriation acts for the Treasury and Post Office Departments, directing the head of an executive department or independent establishment to furnish civilians employed in the Field Service with quarters, heat and light, etc., provided a reasonable value of such allowances shall be determined and considered as part of the compensation in fixing the salary rate of such civilian. The comptroller states that as the Personnel Classification Board has acted with respect to other positions in the District of Columbia that there would appear no sound reason for not taking similar action with respect to positions under St. Elizabeths Hospital; adding, furthermore, that it would appear that the total salary rate of the superintendent and possibly other officers or employees will exceed the maximum salary rate of $9,000 authorized by the classification act as amended by the act of May 28, 1928, when the determined value of all allowances furnished in kind is properly added to the cash paid, as required in this statute.

It would seem that the comptroller's letter is predicated on the value, or reasonable value, of what is furnished in kind to the superintendent and employees of St. Elizabeths Hospital who are compelled to live on the reservation, and are responsible for 24-hours service, and receive their quarters or maintenance from the hospital. He gives one example, as he says, for mainte

nance.

In examination of this list, showing a total of estimated value of allowances of $11,059, this sum includes items that should not be included, and others the approximate value of which, as placed, may be questioned. As to the superintendent's allowances, for example, it would be necessary, in order to determine what the value is, to analyze the statement submitted. The smallest item included is telephone service, $48. Fortieth Statutes, 19, approved April 17, 1917, as contained in the United States Code 680, section 175, provides "Rental for a system of telephones connecting the superintendent's, physicians', and employees' quarters at the hospital with other locations on the hospital grounds, may be paid from the appropriations for the support of the hospital." Here is a direct act of Congress authorizing phones in the superintendent's quarters to be paid from the appropriations for the support of the hospital, which apparently has never been repealed and is still in force, yet according to the comptroller's letter this should be paid out of the superintendent's salary. would hardly seem that the comptroller intended that his letter of August 15 should supersede a direct act of Congress.

It

If we add the allowances as stated by the comptroller, you will see that the total should be $10,059 instead of $11,059.

The statement says the superintendent has an apartment completely furnished, containing 19 rooms, for which a rental should be paid of $2,400 per annum. The building in which the superintendent's apartment is located was authorized to be built in 1857. The first part of it was finished in 1860, and this apartment was furnished and fitted up completely and was occupied by the superintendent of the Government Hospital for the Insane and his family. An addition to this building was completed in 1875. In the center of the whole building were the quarters of the superintendent of the hospital and his family. These quarters were built in such a way that they connect on both sides with patients' quarters, there being a total of something more than 900 patients living in the same building in which the superintendent resides. As stated, these quarters have been used by successive superintendents and their families ever since the building was constructed. These quarters are built in such a manner that if the superintendent could not use all of them the cost of dividing this section and using it for other purposes would probably be as great as would be the cost of erection of a separate house for the superintendent's use. If the quarters remained idle it would require a caretaker to keep them in proper preservation. Included in these quarters is what the comptroller designates as one board meeting room, attached to which is a wash room or bathroom. For upward of 60 years this board meeting room has been set aside for the use of the Board of Visitors, composed of nine citizens of the District of Columbia, appointed by the President, to preside over the hospital. This board is an honorary one and without compensation. They meet at the hospital at least once a month and must have some place in which to hold their deliberations. While at the hospital it may be necessary for them to have their meals, and these are furnished from the kitchen which provides for the superintendent. This is still the custom, as it has been for the last 68 years.