Y4.G 74/9: Sp 3/pt. 1 HURRY-UP" SPENDING Printed for the use of the Committee on Governmental Affairs For sale by the Superintendent of Documents, U.S. Government Printing Office COMMITTEE ON GOVERNMENTAL AFFAIRS ABRAHAM RIBICOFF, Connecticut, Chairman HENRY M. JACKSON, Washington LAWTON CHILES, Florida JOHN GLENN, Ohio JIM SASSER, Tennessee CARL LEVIN, Michigan CHARLES H. PERCY, Illinois WILLIAM V. ROTH, JR., Delaware TED STEVENS, Alaska CHARLES MCC. MATHIAS, JR., Maryland WILLIAM S. COHEN, Maine DAVID DURENBERGER, Minnesota RICHARD A. WEGMAN, Chief Counsel and Staff Director STEPHEN S. KLITZMAN, Staff Director and Chief Counsel STEVENS S. MICHAELS, Professional Staff Member for the Minority Joe N. Pate, Chief, Contracts Branch, Law Enforcement Assistance Ad- ministration, Department of Justice--- William E. Mathis, Director, Procurement and Contracts Management Division, Environmental Protection Agency-. Joseph A. Sickon, Director, Office of Procurement and Automatic Data Processing Management, Department of Commerce; Dana L. Scott, Asso- ciate Administrator for Administration, National Highway Traffic Safety Administration, Department of Transportation; Thomas Mad- den, General Counsel, Law Enforcement Assistance Administration, De- partment of Justice; and Robert Goffus, Comptroller_-_. W. Bowman Cutter, Executive Associate Director, Budget, Office of Management and Budget, accompanied by William D. Russell, Logistics, Office of Federal Procurement Policy; and Dale McOmber, Assistant "U.S. Agencies Rush To Spend Before Cutoff," by Clyde H. Farns- "Last-Minute Furniture Purchase Cited as Waste by Govern- ment," by Howie Kurtz, from the Washington Star, September "Consulting Firm Paid $29,000 by U.S. for Work Never Done," by 25 186ST 05/93 53-00% 5 7 Additional material for the hearing record—Continued General Accounting Office reports on yearend spending. Memorandums to heads of executive departments and agencies from: The White House, President Lyndon B. Johnson, May 13, 1966_ Letter to Henry S. Dogin, Administrator, Law Enforcement Administration, from Senator Cohen, January 15, 1980___. 233 Letter with attachments to Senator Cohen from Stephen T. Boyle, Director, Office of Congressional Liaison, January 25, 1980_. 234 "HURRY-UP" SPENDING THURSDAY, NOVEMBER 29, 1979 U.S. SENATE, SUBCOMMITTEE ON OVERSIGHT OF GOVERNMENT MANAGEMENT, COMMITTEE ON GOVERNMENTAL AFFAIRS, Washington, D.C. The subcommittee met at 9:30 a.m. in room 1318 of the Dirksen Senate Office Building, Hon. Carl Levin (chairman of the subcommittee) presiding. Present: Senators Levin, Pryor, and Cohen. Staff present: Stephen H. Klitzman, chief counsel and staff director; Richard Tallman, staff investigator; Susan Collins, minority staff director; Peggy Weeks, minority staff; Steven Michaels, minority staff; Todd Bachelder and Richard Houghton, interns; Kathleen Chapman, chief clerk; Frances de Vergie, assistant chief clerk. OPENING STATEMENT OF SENATOR LEVIN Senator LEVIN. Good morning, ladies and gentlemen. Several months ago, Senator Cohen, the ranking minority member of this subcommittee, proposed oversight hearings into the problem of rushed or "hurryup" spending by Federal agencies at the end of the fiscal year. After over 3 months of investigation by the efficient and talented minority staff, the subcommittee has ascertained that such wasteful yearend spending practices do, in fact, occur, and may well be the norm rather than the exception. It is acknowledged by the Office of Management and Budget that during the last quarter of each fiscal year there is a huge surge in spending by Federal agencies. For instance, in fiscal year 1978, expenditures rose from the level of $44.8 billion in August to $86.8 billion in September, almost twice as much. While delays in congressional appropriations and seasonal contracting fluctuations may account for much of this surge, such an extreme increase in expenditures demands a much closer look by the Congress into fiscal spending practices. A recent example of "hurry-up" spending came to our attention only yesterday. Senator Proxmire awarded his November Golden Fleece Award to the Air Force for a $715,000 spending spree at Clark Air Force Base in the Philippines. Apparently putting to use the age-old "use it or lose it" philosophy, the Air Force purchased items during the last month of fiscal year 1979 such as dormitory furniture, |