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MILITARY CONSTRUCTION, 1954

HEARINGS

BEFORE THE

SUBCOMMITTEE OF THE
COMMITTEE ON APPROPRIATIONS
HOUSE OF REPRESENTATIVES
EIGHTY-THIRD CONGRESS

FIRST SESSION

SUBCOMMITTEE ON CIVIL FUNCTIONS AND MILITARY CONSTRUCTION

GLENN R. DAVIS, Wisconsin, Chairman
T. MILLET HAND, New Jersey

CLARENCE CANNON, Missouri
ELFORD A, CEDERBERG, Michigan LOUIS C. RABAUT, Michigan
JOHN TABER, New York

JOHN J. RILEY, South Carolina
FRANK SANDERS, Executive Secretary to Subcommittee

21.5. Congresa. House,

Printed for the use of the Committee on Appropriations.

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COMMITTEE ON APPROPRIATIONS

JOHN TABER, New York, Chairman
RICHARD B. WIGGLESWORTH, Massachusetts CLARENCE CANNON, Missouri

BEN F. JENSEN, Iowa GEORGE H. MAHON, Texas
H. CARL ANDERSEN, Minnesota HARRY R. SHEPPARD, California
WALT HORAN, Washington ALBERT THOMAS, Texas
GORDON CANFIELD, New Jersey MICHAEL J. KIRWAN, Ohio
IVOR D, FENTON, Pennsylvania W. F. NORRELL, Arkansas
JOHN PHILLIPS, California JAMIE L. WHITTEN, Mississippi
ERRETT P. SCRIVNER, Kansas GEORGE W. ANDREWS, Alabama
FREDERIC R. COUDERT, JR., New York JOHN J. ROONEY, New York
CLIFF CLEVENGER, Ohio J. WAUGHAN GARY, Virginia
EARL WILSON, Indiana JOHN E. FOGARTY, Rhode Island
NORRIS COTTON, New Hampshire ROBERT L. F. SIKES, Florida
GLENN R. DAVIS, Wisconsin ANTONIO M. FERNANDEZ, New Mexico
BENJAMIN F. JAMES, Pennsylvania PRINCE H. PRESTON, JR., Georgia
GERALD R. FORD, J.R., Michigan OTTO E. PASSMAN, Louisiana
FRED E. BUSBEY, Illinois LOUIS C. RABAUT, Michigan
EDWARD T. MILLER, Maryland SIDNEY R. YATES, Illinois
CHARLES W. WURSELL, Illinois FRED MARSHALL, Minnesota
T. MILLET HAND, New Jersey JOHN J. RILEY, South Carolina
HAROLD C. OSTERTAG, New York ALFRED D. SIEMINSKI, New Jersey

OAKLEY HUNTER, California
FRANK T. BOW, Ohio
HAMER H. BUDGE, Idaho
CHARLES R. JONAS, North Carolina
OTTO KRUEGER, North Dakota
ROMAN L. HRUSKA, Nebraska
SAM COON, Oregon :
MELVIN R. LAIRD, Wisconsin * .
ELFORD A. CEDERBERG, Michigan *

GEoRGE Y. HARVEY, Clerk
KENNETH SPRANKLE, Assistant Clerk

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(PROPERTIES AND INSTALLATIONS)
REAR ADM. JOSEPH F. JELLEY, DIRECTOR OF CONSTRUCTION

Mr. Davis. The subcommittee will begin hearings on military construction for all three branches of the services in accordance with the provisions of the Supplemental Appropriation Act for 1954, which provide that before funds are to be used for the 1954 authorization, the armed services are to come into agreement with the Appropriations Committees of the Senate and the House.

We are pleased to have with us Secretary Floete and Admiral Jelley who have been given a new responsibility in the Department of Defense.

We ask you, Secretary Floete, to just proceed in your own manner and to give us as you see fit your concept of how this program is being handled and the general plan of supervision that you have worked out in connection therewith.

GENERAL STATEMENT OF SECRETARY FLOETE

Mr. FLOETE. This particular department with the name of Properties and Installations—and I think the title very well describes the responsibility-includes in it all existing property owned by the Government in the Department of Defense as well as all new construction,

Obviously it divides itself into three natural divisions: Real Property Management; Real Property Maintenance, and Construction, and I have so divided the department.

REAL PROPERTY MANAGEMENT

In charge of Real Property Management is a man by the name of Ira Beynon, of Lincoln, Nebr., whom I have known for a long while and have been associated with to some extent. He is a lawyer by education. He has had a lot of business experience and I feel is very well qualified to handle that particular phase of the work.

We have gotten a good start. We have never had an inventory of all these properties of the Government in one uniform form. It exists among the services in various forms, and of course the basic requirement for any of our plans on real property management is to have such an inventory.

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That form is practically ready to go to the services and will be sent to them soon, but it will be some time before we get it working. We think we cannot only get the information in concise form all of the United States, but that it will be of great benefit to the services, because they have a complicated method, at least it so appears to us now. That inventory will be of great assistance to us in the matter of property utilization.

There is a tremendous number of units. There are some $17 billion worth of property, based on the original cost, and I suppose the replacement cost would be twice that or more, because some of these facilities are in at a very low price.

The Air Force has 706 separate installations, the Navy has 741 and the Army some 1,140. That means complete camps or airbases, forts, and so forth.

Within that number of units, of course, are hundreds of buildings so that the totals would run into large numbers.

The Government owns some 27 million acres of land and leases some 3 million acres. We hope, with a proper inventory, to be able to get much better utilization than we have had in the past of all of these acres and all of these buildings. We hope that within the field of industrial- and commercial-type activities, that perhaps we can get the Government out of some of these many businesses that it has been in and have the property for some other use which should also enable us to reduce the requirements for additional facilities or additional land.

We also believe that by a proper handling of this matter of utilization it will result in a very definite saving to the Government.

Within that particular division also falls family housing, which is a continuing problem. It is not as acute now as it was, of course. Since 1950 the Wherry Housing has performed a very good function. The number of applications for housing has been going downhill. There have been some applications under title IX and under title III there was some $8 million made available for temporary housing. We have requested the FHA for housing in the total amount available.

We also believe that better appraisal methods can be worked out with respect to the acquisition of property. We have run into some very good examples of improper appraisal and we hope to perhaps develop some criteria that can be used, but of course no criteria can substitute for good judgment.

We have contacted the people who handle the appraisals for the Army and the Air Force to see if we could, by study and persuasion, get some better method, and we have already had some success in that direction.

Within that division also falls the national industrial reserve and the departmental reserve. Most of the units within this division have been very active. There are several plants that have not been sold or leased with recapture clause. We are having a meeting the 1st of December with the national committee that was created by public law and we hope to get some definite suggestion from them at that time.

REAL PROPERTY MAINTENANCE Maintenance, which is another division, has to my knowledge, never been studied by the Department of Defense. The services, of course, have had their own procedures and their own methods. We are not

prepared to say that all of them are wrong. We do know that some of them are good and we know that some of them are not. And we will develop those that are good and do away with those that are bad.

The amount expended each year for maintenance is very large. We cannot give you at this time the accurate figures, because the departments do not keep their records on any uniform basis, but it is a pretty good guess that it is around a billion dollars a year. It is a continuing cbligation and actually is increasing all of the time. So if we can make any kind of a proportional reduction in that expense it will amount to a lot of money; even 10 percent would be a substantial sum.

For that particular division we do not have a man at the head of it as yet I think I will have one before the day is over. He is just arriving in town this morning. But I think by getting new uniform accounting methods and by adopting proper maintenance procedure on some uniform basis that much can be accomplished there.

REAL PROPERTY CONSTRUCTION · In construction, that divides itself also naturally into three divisions which we designate as the Planning Division, the Technical Division, and the Analysis Division.

Admiral Jelley is Director of the Construction Division. I think, with his sound background, his education and experience, he can make a very definite contribution and certainly he will be of great assistance to me.

I have been a contractor in the past, and although I have been out of the business for some time, I have kept in touch with it. I had contracts for about 9 years doing heavy construction work largely on the Mississippi and the Missouri Rivers for the Government. We were one of the large companies that carried on work throughout the depression, which was a tough time to be in construction, or, for that matter, anything else.

Admiral Jelley will bring definite new knowledge. In addition, we are exploring the idea of putting in some sort of plan-we have not got it formulated yet-under which we will use civilian consultants, particularly on the analysis end, someone who is actually a working contractor. There are objections to that—one may be that of getting a men who is not disinterested, but we believe that it would be advantageous to us if they could come to us with an opinion that is backed up by present civilian experience. We have been successful in getting three excellent men to head this up: Mr. Dowling of the Plans Division, Mr. Poorman of the Technical Division, and Mr. Sheridan of the Analysis Division. These are all very high grade men and each of them will have a small group of experienced men under him, not a big group, because we do not intend to have a big group. We want to have just a small compact unit, one that can do its work effectively.

Mr. Davis. Would you take just a little time to explain to us where the line would be drawn between these three groups.

Mr. FLOETE. Yes. Perhaps Admiral Jelley can best explain that.

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