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Mr. KILDAY. The item is approved.

Mr. KELLEHER. Line 18, Fort Shafter, T. H., 481 units none approved.

Mr. Bray. Mr. Chairman, at the last meeting Delegate Burns raised the question that that was not intended to build those at Fort Shafter. There is to be a hearing and a full investigation as to the use at the place where they propose to build it.

Mr. KELLEHER. I believe, Mr. Bray, an amendment was suggested by the Chairman. It would read:

Fort Shafter, Hawaii, 481 units : Provided, however, That no family housing units shall be constructed on Fort DeRussy.

Mr. BURNS. Right.
Mr. Bray. And they will be constructed on Fort Shafter!
Is there any objection to that!
Mr.KELLEHER. No, sir; there was no objection to that.
Mr. BURNS. Mr. Chairman.
Mr. KILDAY. Mr. Burns.

Mr. BURNS. There may be a necessity to move some to the strip area or adjacent to a subinstallation of Fort Shafter, but not Fort De Russy.

Mr. KILDAY. With the amendment Mr. Kelleher read, the item is approved. Now the next one.

Colonel SYMBOL. Mr. Chairman, I would like to clarify one other part of the record. Yesterday we also discussed 64 units of appropriated fund housing at Fort Shafter.

Mr. KELLEHER. That is included.
Colonel SYMBOL. And all of those 64 will be built at Shafter.
Mr. KELLEHER. And they were approved, Mr. Chairman.
Mr.KILDAY. This completes the Army section; does it?
Mr. KELLEHER. It does, sir.
Mr. KILDAY. Just one second ; Mr. Kitchin has a question.

Mr. KITCHIN. Just one further question. The colonel has justified these items on the basis of so many substandard houses and so much that we are paying excess rent in many instances, in your testimony. Have you found in your survey where there is being paid by these people who live in substandard housing a rental lower than their allowance, where they pocket the money and are satisfied with living where they are and saving that much money?

Colonel SYMBOL. Sir, in some instances; yes. I am not so sure they are satisfied. But there are conditions existing as you describe them.

Mr. KITCHIN. Can you give me an idea as to a percentage figure as to that type of personnel, that is satisfied to the extent that he is making money where he is living and does not want to move?

Colonel SYMBOL. May I furnish that for the record, because I do not have it?

Mr. KITCHIN. I would like—Mr. Harvey who made a survey recently could probably answer that.

Mr. Harvey, can you answer that on the basis of any one of the units that you have recently surveyed ?

Mr. HARVEY. Yes, we found on a number of occasions, not only in the Fort Bragg area, but in the other areas in the country that many personnel are living in substandard housing very much against their wishes; very, very few do so by choice.

Mr. KITCHIN. Well, can you give me a percentage, an approximate percentage of those who would rather remain there and pocket the money than to move into what you call standard housing? Mr. HARVEY. You understand it would have to be a guess, but I would say certainly less than 5 percent. Mr. KITCHIN. Less than 5 percent? Mr. HARVEY. Yes, sir. Mr. RIVERs. Would the gentleman yield there? Mr. KILDAY. Mr. Rivers. Mr. RivKRs. You do not regard a trailer as being substandard, do you, as such, per se? Colonel SYMBoL. If it is a privately owned trailer that a man bought by choice and wants to live in, we let him live in it. Mr. Rivers. You find a lot of these enlisted men who prefer—a lot of them like to live in trailers. Now do you regard that as substandard? Colonel SYMBOL. If the man has bought the trailer and wants to live in— Mr. Rivers. We are not talking about “bought them.” I know plenty of places where they rent them and like them. Colonel SYMBOL. Sir, I have inspected many, many trailers, Government-owned and privately owned, that we consider inadequate, sir. Mr. Rivers. Do you find many cases where they prefer to live in them and keep the difference? Colonel SYMBol. I have found very, very few in my experience. Mr. KILDAY. Of course you will have a certain percentage who like to live in slums and save money. That is why we put these restrictions on them. Colonel SYMBOL. Yes. Mr. KILDAY. Because we do not want our military people living in slums. Thank you, Colonel. Colonel SYMBOL. Thank you, Mr. Chairman. Mr. KILDAY. We will now proceed. Mr. SMART. Title II. Mr. KELLEHER. Title II, Mr. Chairman. Mr. KILDAY. Title II of the bill. Mr. KELLEHER. Page 16. Mr. KILDAY. Page 16. Who is the first witness for the Navy' Mr. KELLEHER. Assistant Secretary of the Navy (Material), Fred A. Bantz, Mr. Chairman. Mr. KILDAY. Come around, Mr. Secretary. Have a seat, sir. Mr. BANTz. Thank you, sir. Mr. KILDAY. Go ahead with your statement. The committee will be in order, please. You gentlemen come up and have seats with the secretary. Mr. BANTz. Mr. Chairman and members of the committee, I am Fred Bantz, Assistant Secretary of the Navy for Material. I have a short, brief statement here that pertains to one subject only, and if you do not mind, I will read it. - * * * * Mr. KILDAY. You go ahead with your statement. The committee will be in order. We are going to let the Secretary complete his statement without questions, may I ask, until he has completed.

Mr. BANTz. I am happy to be here to open the Department of the Navy's presentation of its request for military construction authorization for fiscal year 1959. The Department is requesting $276,062,000 in new authorization in fiscal year 1959 and is requesting amendments in the amount of $15,825,000 to previous authorizations. Further, we are seeking authorization for the construction of 8,806 units of family housing. Vice Adm. R. E. Wilson, Rear Adm. J. W. Ailes, and other Navy representatives are here to discusss the program in detail with you. I shall concentrate my remarks on one problem in facilities management, namely the utilization and replacement of structures which, for one reason or another, are not well adapted for modern operation. This year, as in the past several years, the program is designed primarily to provide those facilities required to meet urgent operational requirements. For example, substantial amounts of authorization are requested in the fiscal year 1959 program for facilities at the Naval Auxiliary Air Station, Mayport, Fla.; Naval Auxiliary Air Station, Meridian, Miss.; Naval Seaplane Facility, Harvey Point, N. C.; Naval Air Station, Lemoore, Calif.; Naval Air Missile Test Center, Point Mugu, Calif.; and the Naval Radio Station, Washington County, Maine; in order to satisfy important military requirements. Inevitably, projects needed to replace inefficient, high maintenance, and operating cost facilities receive secondary consideration. However, as we look to the future, the problems posed by the continued operation of obsolescent and obsolete structures will be intensified. The acquisition cost of all of the facilities of the Navy and Marine Corps is $7,921,381,000 and the estimated replacement cost is $17,772,583,000. Of the total investment of $7,921,381,000, $5,459,504,000, or 68 percent, was acquired before 1946. Significant is the fact that $1,865,785,000 or 24 percent of the $7,921,381,000 investment is carried in semipermanent or temporary structures. Thus, a substantial portion of our physical plant is either of considerable age or was constructed for a relatively short useful life. These factors, taken together, impose severe handicaps on our operations. First, many structures now in use are ill-suited to their present purpose. To adapt these facilities to meet new technological demands ls an expensive proposition. Second, because so many of our structures were designed for a short life span, they are now nearing the point of complete deterioration. The steadily rising costs incurred to operate and maintain these temporary structures are pinching our relatively static maintenance and operating budget. To his pressure must be added the cost to maintain and operate the new facilities which either have recently been placed in operation or will be completed within the next few years. The situation becomes critical, of course, as some of our temporary structures reach the point where they simply cannot be continued in operation. The serious problems posed by the larger number of inefficient and uneconomical structures carried in our inventory can be solved in one or a combination of several ways. First, we are examining carefully our existing facilities to make Sure that we are not keeping in operating activities which can be dropped without loss in military and operating efficiency or can be consolidated with other activities which are adequately housed. As you know, over the last year we have closed or reduced in scale of operation a number of activities in an effort to reduce our maintenance and operating costs. We will continue to examine closely our Shore Establishment in an effort to make sure that the most efficient and economical utilization is made of it. In this connection, a secretarial directive has been issued instructing bureaus and offices of the Department, as well as commanding officers in the field, to review their activities closely to determine whether unused structures can be demolished or disposed of. Through these efforts, we may be able to bring the Shore Establishment to a point where our operating and maintenance budgets are not spread as thingly as they are now. Second, we are making sure we get full value for our maintenance dollar. The Bureau of Yards and Docks has developed and is installing its controlled maintenance program. Under this program, stress is laid on periodic inspection of structures, preventive maintenance, and systematic scheduling of work. Through this program we should be able to stretch our limited maintenance dollars further by getting the most out of them. A new directive places this program in operation throughout the entire Shore Establishment. Lastly, we can seek authorization through the military construction program for a greater number of replacement projects. In order to do so, we need to know, of course, what structures are most urgently in need of replacement. In the new inventory of military real property now being taken, information will be developed which should be helpful in giving us a line on where the most critical needs lie in this area. Action has been taken to insure that the inventory receives the personal attention of all commanding officers of shore activities. However, we must recognize that projects for replacement run up against the stiff competition inherent in the demands for facilities to meet urgent operational requirements. There is little likelihood that this competition will abate. If anything, it will be intensified, since the new weapons coming into general use over the next 10 to 15 years will, in and of themselves, impose a severe strain on our ability to provide the facilities to support those weapons. Thus, our major emphasis must continue to be placed on searching and continuous reviews of the Shore Establishment in order to make the best use of what we have and to derive the greatest value from our maintenance funds. Thank you, sir. Mr. KILDAY. Thank you, Secretary Bantz. Are there any questions of the Secretary 7 Mr. KITCHIN. Mr. Chairman. Mr. KILDAY. Mr. Kitchin. Mr. KITCHIN. I do not know whether this is an appropriate time to ask a question of the Secretary, but he has brought out the problem he has in maintenance throughout the total establishment. I would like to inject at this point in the record that while attending the Board of Visitors of the Naval Academy it was pointed out to us that the maintenance cost of the facility over there in 1957 was more than the total budget for the Academy in 1951 and they now have fewer maintenance employees than they had in 1951.

Is anything being done about that, Mr. Secretary, to try to equalize that on the basis of the program!

Mr. Bantz. You mean as regards the particular activity or all the shore establishments?

Mr. KITCHIN. No, I am interested in this particular activity, but in turn as concerns all the shore establishments.

Mr. BANTZ. Well, the two things that would have most influence on that is the maintenance operation program that is being installed by Yards and Docks, which I am sure we all feel certain will cut down substantially on costs of maintenance.

Admiral Peltier is here and he will be glad to explain that to you a little later. The other one is this inventory of real property, because there is no question about it, we have a number of buildings.

I do not suppose there are many activities within the Shore Establishment where we do not have one or more buildings that could be disposed of.

Mr. KITCHIN. And in addition to that, Mr. Secretary, I will ask you if it is not a fact that under the policies presently in existence, where the Labor Department comes up with an increase of 16 or 19 percent in labor cost, judging from the cost standards that are available in the various communities surrounding these naval establishments, you have to increase the cost of maintenance on the basis of increased wages for those employees, is that not right?

Mr. BANTZ. That is right.

Mr. KITCHIN. Is there any way that you could anticipate and at least have a little flexibility whereby these naval establishments or other military establishments would not have to reduce maintenance personnel in the event one of those cost figures came up during the fiscal year after the money has been appropriated for cost of maintenance.

Mr. Bantz. I do not know as I understood the first part of that question, Mr. Kitchin.

Mr. KITCHIN. I say, is there any flexibility that could be used whereby these naval establishments—and I have in mind particularly the Naval Academy-could have sufficient funds to meet those cost increases.

Mr. Bantz. Of course, the only way we can do it is within the particular appropriation. We have flexibility within the appropriation, of course.

Mr. KITCHIN. But is that flexibility in existence at the present time? Mr. BANTZ. Oh, I thing so, yes, sir.

Mr. KITCHIN. We were informed by Admiral Smedberg, and I hope, I am correct in this, that in the appropriation for the Naval Academy for the cost of maintenance, that he has had to on numerous occasions lay off employees or not replace employees due to the fact that their appropriation for maintenance would not warrant the maintaining of a certain number of maintenance employees that he felt was actually adequate to maintain the naval establishment there at Annapolis.

Mr. Bantz. I think, Mr. Kitchin, that would apply in many of our activities. I am not familiar with the particular activity, but I think what you should have said would apply to many activities, that we have had to lay off maintenance people simply because of the lack of maintenance dollars.

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