HOUSE RESTAURANTS, FISCAL YEAR 1968, $332,000 "CONTINGENT EXPENSES OF THE HOUSE "Miscellaneous Items "For miscellaneous items * * * including the sum of $332,000 for payment to the Architect of the Capitol in accordance with section 208 of the Act approved October 9, 1940 (Public Law 812) ** For 1967, the amount allowed under the House Contingent Expenses appropriation for the operation of the House Restaurants was $332,000 in the regular annual appropriation act. A current study of the financial condition of restaurant funds as of the close of the 9th accounting period (March 11, 1967), indicates a lesser loss than previously estimated. The current estimate, based on actual figures through March 11, 1967 and estimates for the remainder of the fiscal year 1967, is $262,000. For 1968, a budget estimate of $332,000, the same as allowed for 1967, was submitted last fall. Based on a recent study, the loss for 1968 is estimated as follows: Estimated loss for FY 1967-- Mandatory wage-board pay increases- Annualization of special wage adjustments in D.C. wage rates effective August 28, 1966-‒‒‒ Less: Subtotal___. $262, 000 24,000 20,000 8, 500 314, 500 Annualization of menu price adjustments effective January 1, 1967--- −24, 500 Current Revised Estimate for FY 1968–– 290,000 The lowering of our estimates for the fiscal years 1967 and 1968 is due essentially to two factors: (1) there has been a substantial increase in the overall sales (from an actual total of $1,330,000 in FY 1966 to an estimated total of $1,485,000 in FY 1967-an increase of $155,000); and (2) the menu price increase of January 1967 has had a greater net effect than was anticipated. These factors, of course, overlap to some extent, but the result has been to decrease losses below those previously estimated. HOUSE RESTAURANTS, $332,000 The Architect of the Capitol is responsible, by law, for the management and operation of the House of Representatives Restaurants. The group of feeding units comprising the House Restaurant has been operated by the Architect of the Capitol since the following dates: 1. House restaurant in the Capitol.-October 1, 1940-Transferred by H. Res. 590. 76th Congress from the House Committee on Accounts to the Architect of the Capitol; operated under Public Law 812, 76th Congress. 2. Cafeteria on ground floor, South Capitol Street Side, Longworth House Office Building-New establishment, opened March 3, 1942. Operation discontinued Feb. 4, 1959. 3. Coffee shop in the basement of the Capitol.-New establishment, opened February 18, 1947; discontinued September 26, 1961. New establishment in improved location, opened January 6, 1962. 4. Members' private dining room in the Capitol.-New establishment, opened March 19, 1947. 5. Carry-out food service, Longworth House Office Building.-New service, opened January 7, 1953. Expanded facility in new location, opened February 4, 1959. 6. Carry-out food service, Cannon House Office Building.-New service, opened February 6, 1953. 7. Cafeteria in courtyard, Longworth House Office Building.-New establishment, opened February 5, 1959. New short-order line added August 1, 1962. 8. Private dining room in extended section of House connection of Capitol.— New establishment, opened January 6, 1962. 9. Carry-out food service, Rayburn House Office Building.-New establishment, opened February 1, 1965. 10. Cafeteria, Rayburn House Office Building.-New establishment, opened opened March 1, 1965. 11. Private dining room, Rayburn House Office Building.-New establishment, opened April 5, 1965. Under the statute controlling operation of the House Restaurants (54 Stat. 1056), a special deposit account is maintained for the House Restaurants in the Treasury. All funds, including daily receipts, are deposited in and disbursed from the account by checks drawn on the Treasury of the United States. The House Restaurants' accounts are audited by the General Accounting Office. The net loss for the fiscal year 1966 was $219,257, made up as follows: Miscellaneous operating loss-- Retirement Fund Contributions (Public Law 854, 84th Congress) $177, 782 28,807 5.742 2,512 4, 414 The net loss for the first eight and a half months of the fiscal year 1967 was $188,201, made up as follows: Miscellaneous operating loss- Retirement Fund Contributions (Public Law 854, 84th Congress) $157, 882 22.653 4,885 1.759 1.022 Total---- 188, 201 As of March 11, 1967, the unobligated cash balance in the restaurant account, exclusive of petty cash and change funds, was $156,275. Table showing comparison of receipts, expenditures, and losses for the period 1960-67 181⁄2 months. 2 Full year. REVISED DEFICIT ESTIMATES Mr. ANDREWS. Did you have any additional statements? Mr. ROOF. I would like to brief this. When we prepared the appropriation estimate last fall we asked for $332,000, which was the same as granted for 1967. We have recently made a study using actual figures through March 11, 1967, which is the close of the ninth accounting period, and based on that study and the estimated amounts for the rest of the year it appears we will lose only $262,000 this year instead of $332,000. If we use the $262,000 as the base for 1967 and then add on the known increase for 1968 it will come up to $290,000 instead of the $332,000 that we budgeted for 1968. The lowering of our estimates for fiscal years 1967 and 1968 is due primarily to two factors: One is the substantial increase in overall sales from an actual total of $1,330,000 in fiscal year 1966 to an estimated total of $1,485,000 in fiscal year 1967, an increase of $155,000; and secondly, the menu price increases which went into effect in January 1967 have had a greater lowering effect on the loss than was anticipated. These two factors, we realize, overlap to some extent but taken together they have caused a decrease of the estimated loss and therefore a decrease in the appropriation necessary to operate the restaurants. Mr. ANDREWS. In other words, you have increased your prices and also your total sales? Mr. ROOF. Yes. Mr. ANDREWS. But you expect a deficit of $290,000 for fiscal year 1968? Mr. Roof. That is correct. Mr. ANDREWS. Is that the amount you are requesting now in this budget? Mr. ROOF. Yes, sir. We think you could change the $332,000 request to $290,000. We feel that is a safe figure. REASON FOR LOSSES ON OPERATIONS Mr. ANDREWS. Mr. Cowan, would you care to comment on the fact that the record shows that each year there is a loss in the operation of these restaurants and cafeterias and carryout places on the House side of Capitol Hill? Mr. COWAN. On the current loss, Mr. Chairman, our labor cost went up by $166,000 in a test period we had ending March 11. The restaurants here have always operated at a deficit as far as I know, but we try to keep the loss as low as possible. Mr. ANDREWS. How much was your labor cost increased in 1967 over 1966? Mr. CowAN. $166,000, approximately, during this test period. Mr. ANDREWS. All that is due to resolutions passed by Congress increasing the salaries of employees of the restaurants? Mr. CowAN. To pay increases by the Congress, inauguration of the wage-board system in March a year ago and the implementation of that system, and complying with the spirit of the minimum wage law as agreed to by the Speaker and the Architect, all of these things added together have caused these labor cost increases. WORK FORCE Mr. ANDREWS. How many employees do you have under your jurisdiction? Mr. CowAN. 230, sir. Mr. ANDREWS. At present? Mr. CowAN. Yes. Mr. ANDREWS. Do you anticipate more or fewer in 1968? Mr. COWAN. I do not anticipate any great change. We have, since this leave system came into effect, had to add employees to fill the gap caused by absenteeism. The leave expense in the last year went up 90 percent after we got this leave system in and I have had to put on a few extra people to keep operating. Mr. ANDREWS. Do you have any problem getting waiters, cooks, and other employees? Mr. CowAN. We have not had any problems on waiters in particular. We have a good supply of those people. It has been mighty hard to get porters, people at the lower level, and hard to keep them after we get them. Mr. ANDREWS. Are these employees paid and retained during congressional recesses? Mr. CowAN. Not if they do not work. Mr. ANDREWS. In other words, if Congress were to adjourn the 1st of October you would not pay your staff or employees from then until Congress convenes in January? Mr. COWAN. The waiters, after their annual leave runs out, unless they are employed in some other capacity in the restaurants, are off the payroll until Congress comes back in January. Mr. ANDREWs. Do your employees-waiters, cooks, busboys, and so on-have all the fringe benefits civil service employees have? Mr. CowAN. They have every benefit that the civil service employees have. Mr. ANDREWS. That adds to your cost of operation? Mr. COWAN. Yes, materially. Mr. ANDREWSs. I believe you told us last year it cost some $12,000 a year to keep the cafeteria in the Rayburn Building open on Saturday? Mr. COWAN. Yes, sir. Mr. ANDREWS. Has that cost increased or decreased during the past year? Mr. CowAN. Except for the labor costs which have gone up a certain percentage it has not increased since last year. It is perhaps $14,000 now. MENU PRICE INCREASES Mr. ANDREWS. Last year you and I had a colloquy about the price of food and we spoke about hamburgers. Mr. CowAN. Yes, sir. Mr. ANDREWS. I took the position I thought 70 cents was too high for a hamburger, and we received national publicity. I never dreamed it would make such a news story but it did and I notice now you have gone up on every item on the menu except hamburgers. They are still 70 cents. Mr. CowAN. Yes, sir; because of your interest, I made a closer study of the cost of hamburgers to the restaurant at the time of the menu |