Mr. NOYES. Yes. The CHAIRMAN. There is some indefiniteness in final adjustments that should not have been? Mr. NOYES. Yes. The CHAIRMAN. I take it from what you have said that there should be some changes made, some of them I understand have been made? Mr. NOYES. Yes. The CHAIRMAN. We are very much obliged to you, Mr. Noyes, and on the part of the committee I thank you. I think you have been a very material witness. Mr. NOYES. I thank you, Mr. Chairman. The CHAIRMAN. The committee will stand adjourned until 10 o'clock in the morning. (Thereupon, at 6 o'clock p. m., the committee adjourned to meet again at 10 o'clock a. m., Wednesday, April 14, 1920.) COMMITTEE ON EDUCATION, The committee this day met, Hon. Simeon D. Fess (chairman) presiding. The CHAIRMAN. Mr. William A. Clark, will you take the witness stand? STATEMENT OF MR. WILLIAM A. CLARK, NEW YORK CITY. (The witness was duly sworn by the chairman.) The CHAIRMAN. Mr. Clark, you may give your full name and your present address to the official stenographer. Mr. CLARK. William A. Clark, 27 West Forty-fourth Street, New York City, Harvard Club. The CHAIRMAN. What is your present position, Mr. Clark? Mr. CLARK. May I make an opening statement, Mr. Chairman? There are a few things I would like to say most precisely, and if I could read a written statement which I have prepared, I should be very much obliged. The CHAIRMAN. We will permit that. It may be that we will ask you some questions while you are making the statement. Mr. CLARK. Perfectly all right, Mr. Chairman. The CHAIRMAN. You may proceed. Mr. CLARK. I returned from service in France in June of last year, where I had spent about 18 months in welfare work. In July I had an opportunity to become an officer of the Federal Board for Vocational Education, which I welcomed because it made possible a continuation of the service begun in France. I was appointed as executive manager of the New York office. Within three weeks Mr. Sidney E. Farwell was appointed as district vocational officer. Later my title was changed to assistant district vocational officer. Mr. Farwell resigned in January and I was appointed acting district vocational officer. Permit me to say that I did not seek this appointment. Two weeks had hardly elapsed before I heard rumors of a newspaper attack on the New York office by the "Post." On February 17 the first article appeared. The CHAIRMAN. Is that the New York Evening Post? Mr. CLARK. The New York Evening Post. Since then approximately 100 columns have been written. I was instructed by central office not to answer these attacks. The CHAIRMAN. By the Washington office? 4661-20-VOL 1- 48 751 Mr. CLARK. By the Washington office. On February 18, Mr. Littledale made a vicious attack on the New York office. The headline contained this phrase: "Only 3,199 men. in training here." On February 14 the weekly statistical report indicated 4,253 men had begun training. Therefore, Mr. Littledale's statement shows a discrepancy, you will notice, of over 1,000. I am not attaching a great deal of importance to this except to indicate his inaccuracy. Mr. Littledale knew better. This intentional inacracy is typical quite generally of his articles, and shows the injustice and bias of his attacks. The CHAIRMAN. Will you give us those dates again? What date was it that the statement was made as to 3,200 men in training? Mr. CLARK. On February 18. The CHAIRMAN. And what was the other date? Mr. CLARK. On February 14 the week statistical report indicated 4,253 men had begun training. The CHAIRMAN. Four days before the statement was made in the Post? Mr. CLARK. Yes, sir. On March 12 Mr. Littledale presented certain formal charges against the Federal Board for Vocational Education, which I understand were printed in the Congressional Record. There was one charge against me which I can not do less than regard as a very grave one. The CHAIRMAN. On what date was that printed in the Record? Mr. CLARK. I can not recall; I did not see it. The CHAIRMAN. Do you know whether it was in the House or Senate proceedings? Mr. CLARK. I do not know. That is purely hearsay and I will withdraw it, if you care to. The CHAIRMAN. No; but I do not recall that it was in the Record. Mr. CLARK. That was my understanding. The CHAIRMAN. And I was trying to identify it. Mr. CLARK. Yes. This statement was first made in the New York Evening Post of February 18. I shall, with your permission read it: MOVING TO NEW QUARTERS. Clark has now signed a lease for new quarters. The district office is moving from 469 Fifth Avenue. Beginning March 1, it will go to a new building in Forty-third Street. just west of Fifth Avenue. In its present quarters the board occupies some 13,500 feet and pays a rental of about $1.80 a foot. In its new quarters it is going to occupy 22,986 feet and is going to pay $3.50 a foot. The interesting point of this is that the board is going to pay $1 a foot more than other tenants in the building. Out of a total rental of $80,451 the board will pay $22,986 more than other tenants. And this money was appropriated primarily to reeducate these disabled men. The formal charge presented on March 12, as already indicated, read as follows: We charge that William A. Clark, acting district vocational officer at New York, has engaged new quarters for $3.50 a foot that were offered to him at $2.50 a foot. The first offer that came to Clark was $2.50 a foot. The landlord later refused to sign the Government lease. Clark then offered $3.50 a foot. For proof we ask you to call for the correspondence in the files of the Federal board, the Red Cross, the Public Health Service and the Bureau of War Risk Insurance and to call Mr. Lee, the owner of the building. The CHAIRMAN. That is the end of the quotation? Mr. CLARK. That is the end of the quotation, Doctor. Am I wrong in stating that there are only two possible conclusions which may be drawn from this charge; namely, that I either made a bad business bargain, or profited in some way by the transaction? I did not sign the lease, neither was I responsible for the lease, but I am perfectly willing to assume the entire responsibility and meet the issue squarely, because I was perhaps more active than any other person in bringing negotiations for the rental of quarters to house the War Risk Insurance, Public Health Service and Federal Board for Vocational Education, to a successful conclusion. To prove that I did not make a bad business bargain, and that Mr. Littledale's statements on this point are wholly erroneous, I submit the affidavit of Mr. James T. Lee, president of the national association building, who leased the space to the board. I hope you will permit me to read it, and that you will insert it in the record. The CHAIRMAN. There is no objection to your reading it. STATE OF NEW YORK, County of New York, ss: James T. Lee being duly sworn deposes and says that he is president of national association building corporation a corporation which owns the national association building, situate at 23-31 West Forty-third Street and 26-28 West Forty-third Street, in the Borough of Manhattan, city of New York. Deponent has supervised and controlled the renting of the building from the beginning up to the present time and is completely familiar with all matters relative to the rental, prices and negotiations for leases affecting space in said building. Deponent further says that he is advised that statements have been made and published in the New York Evening Post that the space on the second, third, and fourth floors rented to the Federal Board for Vocational Education, the Bureau of War Risk Insurance, American Red Cross and the Public Health Service, have been rented at a price which was $1 per square foot higner than any other space in the building and higher than the space could have been rented for by these Government departments and bureaus. Deponent further says that these statements are unqualifiedly false and that the facts in the matter are as follows: When the first rental schedule for the building was published the rates for the entire second, third, and fourth floors were quoted to be $2.50 per square foot but these rates were based on the ordinary form of lease running for a minimum period of 5 years and 2 months and in most cases leases for entire floors were expected to run for 10 years and 2 months. Under no circumstance was any lease taken for a period of less than 5 years and 2 months and none has been made in the building since except those closed after March 1, 1920, which run for 5 years and 1 month. When Pease & Elliman (Inc.), real estate brokers of this city, proposed to deponent that the Government departments above mentioned be taken as tenants for the second, third, and fourth floors deponent refused to consider them for two principal reasons, first that a Government department is an unsatisfactory tenant in that rent payments are invariably long delayed and second because the Government is unable to bind itself beyond the end of the current fiscal year. It was later proposed, however, that in view of the circumstances the Government would be willing to pay $3.50 per square foot provided a lease for four months, namely, from March 1, 1920, to June 30, 1920, would be accepted with an option to the Government departments to renew at the same rate for one year additional, and it was urged upon deponent that the public necessity and the efficiency of the work for disabled soldiers required that the above-named Government agencies have offices adjoining in the same building, and that nowhere else in New York City was sufficient suitable space available for the purpose. Just at this time the general schedule of the building was in course of revision and the new schedule which has since been strictly adhered to would have fixed $3.50 per square foot for this space for the ordinary commercial tenant. Under these conditions deponent made the leases but only after a thorough investigation had been made by a representative of the Treasury Department, a certain Capt. Frye, supervising chief engineer of the port of New York. Deponent further says that far from the rental paid by the Government being less than that paid by the rest of the tenants of the building it is a fact that the Government rental is the lowest paid by any tenant except for several small spaces fronting on the interior court and relatively undesirable and which rent for $3 per square foot, for the remainder of the space in the building is rented at from $4 to $6.50 per square foot to responsible commercial tenants on long-term leases. with rent payable in advance in every case. Deponent further says that the lease to the Government has, in addition to the . disadvantages above named, a further disadvantage in that it terminates on June 30 of some year which date is two months past the renting season, so that the owner of the building must be prepared for a large loss of rental from the date of expiration until a new tenant can be found which in a normal market might be 10 months later. JAMES T. LEE. Sworn to before me this 12th day of March, 1920. [SEAL.] MARY F. SULLIVAN, Notary Public, Kings County, No. 412. Certificate filed in New York County, No. 391. The CHAIRMAN. Mr. Clark, the statement there is that there was a difference in the rental rate due to, first, an undesirable tenant, in that the Government is not as desirable as a commercial business: secondly, the tenure was a shorter period than the usual commercial renter; and thirdly, the time of expiration was unfortunate in the year, being at the end of June. May I ask you whether in your judgment there is ground for his stating that the Government is a poor tenant? Mr. CLARK. My experience is very limited. I do not think that I can give you an answer which would in any way be helpful. The CHAIRMAN. You do not know by definite knowledge what has been the experience of other people in renting to the Government? Mr. CLARK. I only know, Mr. Chairman, that Mr. Lee stated that he had had three experiences already-I think he said three-and had to have an agent come to Washington to collect the rent, and consequently he was not in a mood to rent to the Government. It was only after the matter had been brought to his attention that this was for the disabled soldiers, and his interest was enlisted, that he even wanted to consider having the three departments as tenants. The CHAIRMAN. The business in New York would not modify its principle of operation because of the character of work the Government wanted to do; that is, simply because it was work for the rehabilitation of sildiers, the patriotic element would not enter into the business transaction. Mr. CLARK. I think it was given some consideration by Mr. Lee. I think it had some influence in his finally consenting to the arrangement that was made. The CHAIRMAN. Would you, upon the observation you have been able to make, assert that a short time lease made by the Government would be sufficiently undesirable for a higher rate to be demanded; would you state that upon your own judgment? Mr. CLARK. In this case it was an absolute fact, and quite generally I should say that was so because at the present time the rentals are very high in New York. There has been very little building for the last four or five years, and the man who has space to rent thinks possibly this is a peak price and wants to get it extended over a term |