.03 Specific responsibilities as charged in .02, supfra, are as follows:

1. Bring to the attention of the disposal agencies and the Surplus Property Board (hereinafter termed the “Board”) information obtained by survey, or otherwise, on

(1) The needs and requirements of small business.

(2) Cases or situations which have resulted in or would effect dis crimination against small business.

2. Smaller War Plants Corporation is authorized and directed to

(1) Consult with small business to obtain full information concerning the needs of small business.

(2) Purchase any surplus property for resale to small business subject to regulations of the Board (and is impowered to receive other property in exchange as partial or full payment therefor), when, in Smaller War Plants Corporation judgment, such disposition is required to preserve and strengthen the competitive position of small business or will assist the Corporation in the discharge of the duties and responsibilities imposed upon it.

(3) Make or guarantee loans to small business enterprises in connection with the acquisition, conversion, and operation of plants and facilities which have been determined to be surplus property, and, in cooperation with the disposal agencies, to arrange for sales of surplus property to small business concerns on credit or time basis. Regulations covering this activity will be issued subsequently.

Section 3. Designated disposal agencies.

.01 The Board is directed by Public Law 457 to designate the disposal agencies. .02 So far the following disposal agencies have been designated:

1. United States Maritime Commission.

2. Department of Commerce.

3. Reconstruction Finance Corporation.
4. War Food Administration.
5. National Housing Agency.
6. Federal Works Agency.

7. Department of Agriculture.

8. Department of Interior.

.03 Surplus Property Board Regulation No. 1, issued April 2, 1945, attached hereto (exhibit A), describes in detail surplus property handled by these various disposal agencies.

Section 4. Surplus Property Division of the Office of Reconversion, Smaller Wa Plants Corporation.

.01 The Surplus Property Division will develop procedure, policies, and meth ods of operations (excepting financial operations) to which the Smaller Wa Plants Corporation will adhere, determined and based on Public Law 457, regula tions of the Board, and policies and procedures of the established disposa agencies.

.02 The Division is composed of four sections according to the types of prop erty with which they are concerned as indicated below:

1. Capital Goods Section:

(1) Production machinery and equipment.

(2) Ships, small watercraft, and marine propulsion machinery.

2. Consumers Goods Section:

(1) Consumers goods.

(2) Agricultural commodities and foods.

3. Raw Materials Section:

(1) All raw materials and semifabricated articles.

4. Industrial Plants Section:

(1) Industrial plants.

(2) Real estate or property.

(3) Housing.

(4) Community facilities.

Section 5. Surplus Property Board and Disposal Agency Regulations and Polici

.01 As regulations and policies are released by the above, they will be issu by Smaller War Plants Corporation in the form of an amendment to this ba procedure.

Section 6. Dissemination of information.

.01 It shall be the responsibility of the Regional Director, through his District Managers, Regional Information Officers, and Regional Staff; to make known to small business that SWPC is prepared to assist them in obtaining their requirements from surplus property, subject to the availability of the item and the condition of their sale by the disposal agencies.

.02 In effectuating .01 supra, the following are suggested avenues of approach: 1. The public press releases prepared by

(1) Director, Office of Information, Washington, D. C.

(2) The Regional Information Officer.

2. Public meetings-speeches delivered by all members of the field staff, after prior clearance with regional information officer as to content. 3. Miscellaneous:

(1) Mail-letters, reproduced material, pamphlets, etc.

(2) Telephone.

(3) Plant visits.

(4) Special surveys under direction of the Office of Reports.

Section 7. Method of operation—exercise of preference.

01 In the early development of the program, many of the desired surplus items will not be available, and this situation will continue until the termination of hostilities. This scarcity will be reduced as we approach victory. How ever, it is considered essential that we now prepare an organization to perform the important function of registering small business requirements, as provided by the Surplus Property Act. Against this backlog of established, small business requirements, surplus property may be moved very quickly. The establishment of this preferential method of handling Smaller War Plants Corporation applications has been generally concurred in by the Surplus Property Board a a letter from Mr. Gillette to Mr. Maverick under date of March 15, 1945, and will be followed by appropriate regulation.

02 Forms (temporarily numbered for this procedure until final clearance) SWPC O (exhibit B) or SWPC 00 (exhibit C), small business property request form, shall be provided all field offices of the Smaller War Plants Corporation. These simple request forms can be used by small business when they wish to make known their needs and requirements of surplus property to the Smaller War Plants Corporation. Every effort should be made to completely describe the item, especially machine tools. The applicant must record his proposed method of financing the acquisition of the property to afford the opportunity of coordination with the loan bureau, if required. These forms shall be filed with the istrict offices. Definite numbers will be assigned at a later date.

03 On receipt of Forms SWPC 0 or 00 properly prepared, or upon first-hand Knowledge and information, such as visit by small businessman, the district anager shall

1. Review Forms SWPC 0 or 00 to determine whether the needs are clearly set forth and understood.

2. If not, discuss with applicant and clarify.

3. Prepare either Form SWPC 0-A, capital and producers' goods (exhibit D), or Form 00-A, consumers' goods form (exhibit E), depending on article needed.

4. Only one item or article shall be registered on either Form 0-A or @-A, and the district manager shall prepare the form as follows:

(1) Insert the code number of the item or article as described in the Standard Commodity Classification Book.

(2) Date the form to coincide with date of application. This may be important to the surplus property liaison specialists in later determining priority of handling.

(3) Insert case number assigned to the specific application, as established by the district offices' own receipt register. This case number will be followed by the district code designation as established by the letter prefix code (exhibit F). Example: The third application to the Columbus, Ohio, district office would be entered 3-5-E. This may be essential to the surplus property liaison specialist of another region who may receive this application through reference.

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(4) Complete the balance of the form in accord with the latest revised classification standards for describing surplus property published by either the Surplus Property Board or the disposal agency. It should be clear that matching the applicant's statement of need with available surplus will depend upon accurate description in common terms.

5. Forms O-A and OO-A shall be made out in an original and four copies. 6. Completed form shall be distributed by district offices as follows:

(1) Original and two copies to the regional office.

(2) One copy to applicant.

(3) One copy for district office files, which is cross referenced to Form SWPC O or OO or letter or notes on visit setting forth pertinent date as it relates to the request.

7. Regional office shall distribute the original and two copies received from section 7, .036-1 supra as follows:

(1) Original to surplus property liaison specialist located in the disposal agency.

(2) One copy to Office of Reports, Washington, D. C.

(3) One copy retained by regional offices for its file, record, follow-up, and general control.

.04 Surplus property liaison specialist (Job description Exhibit G, attached). 1. On receipt of the original copy of SWPC Form O-A or 00-A, the surplus property liaison specialist will check the availability of the requested item in cooperation with the staff of the disposal agency. If the item is available and the disposal agency has arranged the terms of sale, the surplus property liaison specialist will advise the applicant on SWPC Form No. 000 (Certificate of Preference, Notice of Availability) (Exhibit H), setting forth pertinent information on price, unit of sale, time of sale, and any other information necessary to assist the applicant in the procurement of the item. Copies of this notice are to be sent to—

(1) The applicant.

(2) The district office, where the request originated.
(3) The appropriate section of the disposal agency.

(4) Office of Reports, Smaller War Plants Corporation, Washington, D. C.

(5) One retained by the surplus property liaison specialist. Provisions will be made at all times to allow sufficient time for inspection of the item consistent with the operations of the disposal agencies. Wherever a request on Form O-A or 00-A is received by the surplus property liaison specialist after the notices of sale have been mailed for this item, but before the time of sale, and where sufficient time is not allowed for the mailing of a notice, the surplus property liaison specialist will be responsible for advising the applicant through the proper district office.

2. If the items requested on Forms O-A or 00-A are not available at his own disposal agency, the surplus property liaison specialist will ascertain through the channels furnished to him by his disposal agency if the item is available in any other regional office of this agency. If the items are so located, the surplus property liaison specialist will request the assistance of his disposal agency office in the handling of the application.

3. An application registered on Forms O-A or 00-A will remain in effect in the files of the surplus property liaison specialist from date of receipt of application for 90 days, subject to renewal by the applicant. Forms O-A and 00-A will be filed by the surplus property liaison specialist under the code number, derived from the Standard Commodity Classification Book. 4. Upon completion of a sale or transaction, the surplus property liaison specialist will be responsible for securing the applicant's copy of SWPC Form 000, which should have accompanied the applicant's bid form, check, etc., to the disposal agency office, establishing the applicant's status. This form will be stamped by the disposal agency with a record of the consummation of the transaction. The surplus property liaison specialist will then mail this stamped copy of the form direct to the Office of Reports, Washington, for completion of their record.

(1) Should the applicant fail to furnish this copy of SWPC Form 000 the fifth copy which has been retained by the surplus property liaison specialist will be used.

(2) After use of this copy of the form by the Office of Reports, Washington, it will be mailed by them to the district office of origin to close out the file.

5. Reports:

The Smaller War Plants Corporation surplus property liaison officer in the disposal agency is responsible for furnishing the necessary reports and information required by the Smaller War Plants Corporation in meeting its responsibilities under paragraph (c), section 18, Public Law 457. Specific instructions covering this will be issued subsequently.

05 Inter-regional requests. Smaller War Plants Corporation liaison relations with Reconstruction Finance Corporation, Department of Commerce or other regional disposal agencies must be cleared through the assigned Smaller War Plants Corporation surplus property liaison specialist.

06. Procedure when acquisition of property involves financing: This procedure Low is being prepared for approval by the board of directors, Smaller War Plants Corporation, and will be published as soon as possible.

Section 8. Method of Operation-Exercise of Priority.

.01 The Smaller War Plants Corporation under Public Law 457 and the Surplus Property Board Regulation No. 2 has the right to exercise a priority in the purchase of surplus property for resale. In accord with the authority mentioned above, this priority may be exercised during the first 18-day period following declaration of the availability of the property by the appropriate disposal agency.

It is the intent of this Corporation that this right shall be exercised, instead of the preferential method, only when it will assist the Corporation in the discharge of its duties and responsibilities, or when it is required to preserve and strengthen the competitive position of small business. It will be exercised only against firm demand for the obvious reason that the Corporation does not expect to deal generally in surplus property in competition with other disposal agencies set up by the Surplus Property Board.

02 In the case of an individual applicant submitting a request for acquisition of property through this method, the request will be made on SWPC Form -A or 00-A identified by the words "priority purchase" clearly marked by the district manager and forwarded for the personal attention of the regional director. It shall be the responsibility of the regional director in cooperation ith the Surplus Property Division staff, Washington, to handle these applicaons in accord with policies established in the best interests of the Corporation. 13 In the case of items or classes of items deemed suitable for this type of quisition by the surplus property liaison specialist, he will submit his recmendations to the regional director who will be guided as indicated in secons, .02, supra.

4 In those cases involving acquisition of property through the exercise of ority purchase by the Corporation the procedure will be as follows: The gional director or any employee of this Corporation properly designated by tm in accord with resolution of the board of directors, Smaller War Plants Corporation, adopted April 20, 1945, shall—

1. Establish that a firm order has been made for the specific goods or property.

2. Obtain the prospective purchaser's certified check in the proper amount. 3. Obtain from the prospective purchaser a certificate stating that the goods or property are to be used by himself in the proper development of his own business activity.

4. Deliver these documents (purchaser's certified check and certificate) to the regional loan agent of this Corporation who shall-

(1) Issue purchase orders to the appropriate disposal agency in order to effect transfer of the property;

(2) Secure the purchaser's receipt for property delivered;

(3) Transmit purchaser's property receipt together with purchaser's certified check and certificate referred to in section S, .04-3, supra, to the Comptroller of the Corporation in Washington, D. C.

.05 The procedure involving acquisition of property by priority purchase through methods of financing other than cash purchases are under consideration and will be published upon adoption.

Section 9. Exceptions to sections 7 and 8.

.01 Any deviation from the methods of operation as described in sections 7 and 8 must have the prior approval of the Chief, Surplus Property Division. Section 10. Directions superseded.

.01 This procedure rescinds and supersedes field procedure No. 3 and supplement No. 1 thereof.

Mr. LAMB. The Surplus Property Board is now drafting regulations in conformity with the powers under the law in which they define the preferences of small business and the priorities which we have in the act, the Surplus Property Act, in which we determine the need of the small business interests throughout the country. At the disposal agency we will have a representative to relate it to the available supply of the material in surplus, and exercise the preference which the Board gives to small business, veterans, agricultural, and nonprofit institutions. After those needs are met, the balance is cleared in public sale. So, small business interests in the country will get a preference in the items that they need.

As said yesterday, there are many items in the consumers' goods field which may be something that could be used in a small hardware store, but that would not be packaged in a small enough unit to supply to individual stores. That problem is being studied now.

Mr. LUDLOW. Where would you say small business comes in in the list of priorities?

Mr. LAMB. Small business comes in as one of the preference categories: veterans, small businessmen, agriculture, and nonprofit institutions.

That would be the hospitals, colleges, and others. I am talking about the preferences, not priority. The government units get the same priority at the State, county, and local level as at the Federal level. We, of course, have a priority there where we purchase for the need of the small user and receive from him a certified check with which to pay for the material.

QUANTITIES OF AVAILABLE SURPLUS MATERIAL

Mr. LUDLOW. What information do you have as to the quantities available? Take machine tools, for instance; is there a large supply of surplus machine tools available?

Mr. LAMB. It is estimated that the supply of machine tools will run 400,000 to 500,000 individual items, of which there may be 100,000 special items which may not be applicable to peacetime economy, and the surplus will reach probably 150,000, and the remaining 350,000 or the balance will be for sale. We are making a survey of the needs of small business as it relates to the use of those tools by classes. Machine tools, though, you might say, are still frozen by the military service-not being sold for industrial use except by certification for work relating to war contracts.

Mr. TABER. Are you doing anything to break down the program of the Surplus Property Board to kind of hang on to everything until after it gets into production, so that the things that are in immediate demand by the public can be supplied?