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BACKLOG OF PROJECTS

Mr. BATT. These allocations were of course made by the President on the recommendation of the Secretary of Commerce.

Now, within the past 5 months the entire $400 million has been allocated by the President except for a $3.7 million contingency reserve. Virtually all of the allocation has been committed to over 3,000 individual projects.

Now, with this $400 million gone there are some 6,200 additional projects submitted to the end of February that we cannot fund with the $400 million. These would require $1.2 billion in public works funds. The applications have been coming in at the rate of about $300 million a month, so the demand for these kinds of needed public works is very real.

Mr. THOMAS. The authorization remaining is $500 million and you have $1.2 billion in requests.

Mr. BATT. That is correct.

Do you have

Mr. THOMAS. You have how many applications? Do

3,000?

Mr. BATT. We have already funded over 3,000 individual projects. Mr. THOMAS. You mean allocated?

Mr. BATT. Allocated funds out of the $400 million.

Mr. THOMAS. Now stay with your $500,000. What is the number? Mr. BATT. 6,200 additional projects.

Mr. THOMAS. What is the source of that 6,200?

Mr. BATT. The large majority are from the local communities and the largest number of their requests are for sewer and water. Mr. THOMAS. Dr. Woolner again?

Mr. BATT. Yes, sir.

Mr. THOMAS. Dollarwise how much is the doctor wanting this time? Mr. BATT. I will let Dr. Woolner speak to that.

Mr. WOOLNER. Pending applications are around $700 million, Mr. Chairman.

Mr. THOMAS. The overall remaining authorization is $500 million? Mr. WOOLNER. Yes, sir.

Mr. THOMAS. So you have $700 million of the $1.2 billion.

Mr. WOOLNER. Yes, sir.

Mr. THOMAS. Go ahead, Mr. Batt.

Mr. BATT. We should note unemployment in February is running at 4.9 million, the highest in 17 months, and half of it or 2.5 million is in the eligible areas.

The need for additional public works

AREAS ELIGIBLE FOR ACCELERATED PUBLIC WORKS

Mr. THOMAS. You had better explain what your eligible areas are now. You have overlooked that.

Mr. BATT. The Congress provided, sir, that there would be two groups of eligible areas. First, the redevelopment areas that are eligible under the Area Redevelopment Act and, second, the labor surplus areas that have had over 6 percent unemployment for 9 out of the last 12 months.

Mr. THOMAS. Now, when was your Area Redevelopment Act first passed?

Mr. BATT. It was signed by the President May 1, 1961.
Mr. THOMAS. Two years have elapsed since the passage?

Mr. BATT. Yes, sir.

Mr. THOMAS. What does the second part of your yardstick add over and above the first one? Namely, those areas that have not qualified under the Area Redevelopment Act in 1961.

Mr. BATT. The Accelerated Public Works Act added over 100 labor market areas. These were primarily large labor market areas like Philadelphia, Buffalo, Toledo, Youngstown, San Diego, a total of slightly over a hundred labor market areas which just had not recovered from the last recession.

Mr. THOMAS. They were also included in your Area Redevelopment Act too, weren't they?

Mr. BATT. No, sir. Let me attempt to make this distinction again. Under the Area Redevelopment Act the Congress only directed us to include those areas which were what the Department calls "substantial and persistent unemployment areas." The area that had had heavy unemployment or rural poverty and underemployment for long, long periods of time. These requirements were: over 6 percent unemployment and 100 percent above the national average for 1 out of the last 2 years or 75 percent

Mr. THOMAS. That is your test right there?

Mr. BATT. That is our test-long-duration unemployment.

In Congressman Bow's State of Ohio, for example, the substantial and persistent areas are the old coal country in the southern areaabout 21 counties.

Mr. THOMAS. How did the 6-percent unemployment figure enter into your formula?

Mr. BATT. To be an Area Redevelopment Act area you have to have 6 percent unemployment and also be 100 percent above the national average for 1 of the last 2 years or 75 percent above the national average for the last 3 years or 50 percent above the average for 3 of the last

4 years.

This was designed by the Congress to get just those areas which are in bad shape almost irrespective of what happens to the Nation's economy as a whole. This was designed to get-in terms again of Ohio, the southern part of Ohio, the areas that have been in bad shape since the coal industry became so depressed.

Mr. THOMAS. In terms of numbers of unemployed, what does your last formula add to your first one?

Mr. BATT. It almost doubles it. We have about 1.2 million unemployed in the long-term, chronic areas designated under the ARA Act. They are by and large the smaller areas, the rural areas and small towns. The only large cities in the ARA areas are Providence, Pittsburgh, and Detroit. When we brought in the labor surplus areas, as Congress directed us to do in the APW Act, we got into areas, Congressman, like Toledo and Youngstown in the northern part of Ohio which are more responsive to movements in the business cycle. For example, Toledo, which became eligible last fall, has only recently been removed from the list of eligible areas.

We brought in Buffalo. We brought in larger cities. They were vastly fewer in number but much, much bigger in size and exactly equal in unemployment. We had before one-sixth of the population, a sixth of the labor force

Mr. THOMAS. Does your figure of 6 percent unemployment of the total population hold in both yardsticks?

Mr. BATT. Yes, sir. Under the ARA yardstick it is a long-term prerequisite and under the APW yardstick they have to have over 6 percent unemployment for 9 out of the last 12. It is just not as demanding a yardstick.

Mr. THOMAS. It is just more of the same, isn't it?

Mr. BATT. Except that these labor surplus areas hopefully will come out of this classification fairly quickly when business conditions improve.

Mr. THOMAS. Go ahead.

IMPLEMENTATION OF THE APW ACT

Mr. BATT. I would like to comment on what we have done administratively to implement the act. Secondly, some information on the distribution of the $400 million. And thirdly, our plans for the $500 million.

Now, first of all, on September 17 the President by Executive order delegated the authority to the Secretary of Commerce to issue rules and regulations as provided for in the act. The Secretary of Commerce in turn gave the Area Redevelopment Administrator responsibility for helping him in administering the act.

On September 24 the ARA issued instructions to the participating agencies, including forms for submission of projects and lists of eligible areas. On the 26th and the 27th of September ARA held a 2-day conference attended by 850 State and local officials to give everyone an opportunity to understand the program and know what the rules were that Congress had laid down.

Next, we devised a fair-share formula. By law, of course, Congress provided that one-third of the funds would have to be reserved for the rural areas. This we did, and the money was divided onethird for the rural areas an two-thirds for the 5(a) areas and the labor surplus areas under our act. The rural areas are the areas designated under section 5 (b) of the ARA Act. Each block of money was divided by the number of unemployed in each area, where unemployed data was available. In the rural areas, where no unemployment figures were available the money was divided by population. This gave us a fair-share ceiling for each area and I emphasize the word "ceiling." Incidentally, the ceilings for Pennsylvania and Michigan had to be reduced because under this kind of a formula they would have gone above the ceiling of 10 percent set by law for any one State. So much of the unemployment of the United States is in States with this type of unemployment, Pennsylvania and Michigan, for example.

ALLOCATION OF CURRENT APPROPRIATIONS

Now, how was the $400 million distributed? Within days after the President made the first allocation men were at work in national parks and forests and on flood control and soil conservation projects.

The first allocation of $165 million was made on October 24. A second allocation of $198 million was made on December 27 and a third allocation of $5.5 million on February 8.

The last allocation of $26 million was made on February 19. This gives us a total of $394 million that has been allocated for projects, leaving a balance for contingencies of $3.7 million. An amount of $2.3 million was allocated for administration.

The contingency reserve is terribly essential, because when the communties go out to advertise for these contracts for the work that is to be done, the bids may come in higher than they estimated originally. We are submitting herewith lists of projects cleared by ARA as of March 15 totaling $343 million. These lists are broken down and summarized by States, areas, and agencies. Additional projects totaling some $51 million have been programed but not yet publicly announced. This is the list here [indicating].

Mr. THOMAS. Do you have more than one copy of this?

Mr. BATT. We have given the staff data through February 18. This supplements it to March 14.

We have also provided summary tabulations, which show, as of March 8, the distribution for 2,500 projects and $285 million by State participating agencies, types of areas, and types of programs.

We have further provided summary tabulations showing the number of projects actually started as of February 28. These are the ones that have actually started, Mr. Chairman. And in the one that you have in your hand, we have data showing how many projects are scheduled to start each month.

Mr. THOMAS. All right, let's get into some detail. This money is all appropriated to the President. Right off the bat in a week's time he allocated $168 million of the $400 million including $15 million to Agriculture, $40 million to HEW, about $80 million to Mr. Woolner for community facilities.

As of January 1 how much of the $400 million had he allocated to the various agencies?

Mr. BATT. As of January 1 he allocated 363

Mr. THOMAS. I believe you stated it a while ago. Forget January 1. As of now I believe you say all of it has been allocated except about $3.5 million.

Mr. BATT. That is correct.

Mr. THOMAS. The act has built into it a 10-percent maximum limitation on allocations to any particular State.

Mr. BATT. That is correct, sir.

Mr. THOMAS. We will use a figure of $400 million for all practical purposes and that is the way it divides itself down.

Break down your $400 million. That is your appropriation to date. Who are the agencies who got it and how much?

You have "Community facilities" in Housing and Home Finance Agency, HEW, getting about two-thirds to three-fourths of it.

Mr. BATT. Those allocations begin at page APW-13 and run through

Mr. THOMAS. Can you summarize it for us? You have 3,756 projects. You have some local grants under direct construction and your estimated man-months of employment. These are nice figures and we will find when we go into them in a minute they are not going to mean much to you or us either, I am afraid.

Go ahead.

Mr. BATT. Would you like me to summarize it by departments? Mr. THOMAS. Yes.

Mr. BATT. Department of Agriculture, $33.5 million.

Mr. THOMAS. How many projects, now?

Mr. BATT. 1,725.

Mr. THOMAS. 1,725 projects for Agriculture at how much?

Mr. BATT. $33,593,000.

Mr. THOMAS. Go ahead.

Mr. BATT. Department of Commerce, 77 projects that cost $16,115,000.

Mr. THOMAS. Give us the nature of the projects as you go along?

Mr. BATT. For Agriculture the largest program, is in the Forest Service. They have projects for improvements in reforestation, timber stand improvements and trails and recreation facilities in the national forests.

Mr. THOMAS. That is Interior and not Agriculture?

Mr. BATT. That is Agriculture.

Mr. THOMAS. How much did you give them now, $17 million? Mr. BATT. No, sir, $33,593,000 to Agriculture. Of that amount $31.6 million went to the Forest Service.

Mr. THOMAS. They got a total of $39.5 million and you have given them $33 million more.

Mr. BATT. Soil Conservation, $1,994,000.

Mr. THOMAS. Soil Conservation how much?

Mr. BATT. $1,994,000, for 97 projects.

Mr. THOMAS. What is the nature of the projects?
Mr. BATT. Watershed protection projects, sir.

Under Department of Commerce, sir, there are 74 projects for the Bureau of Public Roads, which are for improvements to public land and forest highways such as widening and resurfacing and new construction and bridge replacements on the Federal-owned land for $15,610,000. That was the largest item.

Mr. THOMAS. We had an item for liquidation of contract authority before us this morning.

Go ahead.

Mr. BATT. The Weather Bureau, construction of facilities, two projects and $105,000.

Mr.THOMAS. What is the nature of the Weather Bureau now? Mr. BATT. This was for housing facilities at Guam.

Mr. IMHOFF. That covers construction of four housing units for the Weather Bureau, at Guam, $100,000; and grading and paving and access road to the Weather Bureau office headquarters at Guam, $5,000. Mr. BATT. The Coast and Geodetic Survey, construction of facilities, one project at $400,000.

Mr. THOMAS. What is the nature of that?

Mr. IMHOFF. That covers construction of a magnetic seismological observatory at Puerto Rico in the amount of $400,000.

Mr. THOMAS. Is this reconstruction to take care of the storm damage on an existing structure or is this new construction?

Mr. IMHOFF. This is new construction in Puerto Rico. Weather Bureau buildings at Guam are replacement buildings, because of storm damage.

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