no justice in firing people who have been working for years and have built up pension rights and all the rest. They acknowledge they can do

this.

Secondly, they say they can run it without cost to the U.S. Government. The fact they will need 3 or 4 months to study it out, after all it is a $12 million to $2 million operation. This is reasonable.

I think in our planning we anticipated that this committee's checking into this is but a beginning and certainly somebody will do it and do it right and it would take them some time. This satisfies the two big criterias.

Mr. HENLOCK. You mentioned pension rights. Of course, if a concessionaire takes over, such rights will not be preserved. Their existing pension benefits would go out the window because they would no longer be Government employees.

Mr. ANDREWS. This is why we want to discuss this with these companies but it would seem to me that there might be an arrangement worked out wherein these people could be retained as Government employees and the vendor could compensate the Government in some way for the employees' benefits, salary, or whatever else. This is one of the things we will have to check into pretty closely.

Mr. YATES. Go ahead, Mr. Roof.

Mr. ROOF. They say in the various food service areas they would keep the people. They do not define that terminology.

Mr. YATES. I assume that will be clarified and you will be asking them for definitions.

Mr. Roof. It does not necessarily mean everyone.

They are also saying it would require the coordination and collaboration of the various committees involved, such as the Speaker and others, which means, I assume, they would want to change the ground rules.

Of course, a lot could be done by our management if we change the ground rules.

Mr. YATES. What do you have in mind?

Mr. Roor. Increase in prices, better control of portions, closing of certain facilities earlier, et cetera.

Mr. YATES. Why have you not been able to do that?

Mr. Roor. These are some of the possibilities we previously mentioned to your committee. I think change is implied in all of these letters.

Mr. YATES. That is what we want to find out.

Mr. ANDREWS. The big thing we are finding out is that there are reputable firms who say they can take over, they can maintain the present employees, and they can eliminate or substantially reduce the deficit.

Mr. ROOF. They don't tell you the means by which they can do this. That is the key to the whole thing.

We think we possibly can do that, too, if you say "You gentlemen run the restaurants, period."

Mr. HENLOCK. I know some of these questions came up when the Canteen Food Service took over running the Senate Restaurants in 1947. For anyone to be a Government employee, obviously he must be an employee of the Government in every sense. Every pay increase, every benefit that the Government authorizes for its employees, the management would have to give the restaurant employees, if they

continue as Government employees, whether or not they wanted to give it to them, because they would be Government employees entitled to the same benefits as other Government employees.

I do not wish my remarks to be interpreted as an obstruction. We were, however, not able to work out a plan in the case of the Senate Restaurant whereby an employee could preserve his status as a Government employee and at the same time be under the control of a concessionaire because of many statutes which affect Federal employees, including, for instance, the Federal Tort Claims Act.

Mr. ANDREWS. There is no doubt it will be difficult to arrange this and probably, as you point out, there will be a conflict because there are Government employees and they would be subject to direction by a non-Government supervisor.

But certainly these people well realize what we are trying to do to help them, and because they realize this they should be more than cooperative with the new supervision that is put in if it means maintaining their job security and also their government pension rights.

I think a little understanding on both sides will possibly solve this. At least that is the goal we are aiming to.

Mr. HENLOCK. It would have to be done by statute. The statute would have to be worded in a way to make such an unusual arrangement possible. To me, working out such a statute appears, offhand, to be a very complex matter.

Mr. YATES. These are Government employees. Is there a civil service classification for employees of this type?

Mr. HENLOCK. No, sir. They are employees of the House of Representatives. The Architect of the Capitol has, for all these years, been ruled by the Comptroller General to be simply an agent of the House, in carrying on this functon for the House. Some of the personnel are white-collar employees and paid on the same basis as your

committee staffs.

The others are paid on the Wage Board system. Prior to adoption of the Wage Board system, a year or two ago, all of the restaurant employees were paid under the same system as other congressional employees.

Mr. ANDREWS. Off the record.
(Discussion held off the record.)

RESPONSE OF MARRIOTT CORP.

Mr. RooF. The next proposal is from Marriott. (Letter from Marriott Corp. follows:)

MARRIOTT CORP., Washington, D.C., June 4, 1968.

Mr. PHILIP ROOF,

Assistant to Architect of the Capitol,

Washington, D.C.

DEAR MR. ROOF: We very much appreciate the opportunity to submit this tentative proposal for the management, by the Mariott Corp., of the House Restaurant facilities. We also want to thank you for your time and that of your splendid associates.

We have studied your "Request for Proposal" and, as you know, have made a brief on-site analysis of the House Restaurant facilities. We are confident as a result of this analysis and of our ability to achieve maximum sales levels and

operational efficiency to be able to manage these facilities without an operating deficit. This proposal is based on the following basic assumptions:

(a) That we have complete control over all food and vending services provided in the House Restaurant facilities;

(b) That we have complete responsibility for and authority over the employees working in the House Restaurant facilities; and

(c) That we have jurisdiction to use supply sources of our own choice. We have found from our experience that an operation, the size and scope similar to the House of Representatives, will generate an annual sales volume of approximately $1,500,000 to $1,700,000 as a minimum. Needless to say, at this volume, a profit would be realized by the House.

We hope this preliminary information will meet with your approval, and we will be prepared to discuss the many aspects of our proposal with you at your convenience. This discussion would be considered "off the record" until a firm solicitation is received from your office.

Sincerely,

Mr. ROOF. Marriott says:

FRANK R. LYONS, Jr., Business Food Service Division.

We are confident as a result of this analysis and of our ability to achieve maximum sales levels and operational efficiency to be able to manage these facilities without an operating deficit.

This proposal is based on the following basic assumptions:

That we have complete control over all food and vending services provided in the House Restaurant facilities, that we have complete responsibility for and authority over the employees working in the House Restaurant facilities, and that we have jurisdiction to use supply sources of our own choice.

Then he says that he is basing this on an estimated level of sales volume of approximately one and a half million dollars up to $1.7 million.

He says "Needless to say, at this volume a profit would be realized by the House."

Mr. ANDREWS. I like that. That is the most refreshing statement I've heard in a long time.

Mr. YATES. You can see by the smile on Mr. Roof's face he doesn't believe it.

Mr. ANDREWS. They say they have to have complete control over food and vending. They have to have.

They say they need responsibility for and authority over the employees. They have to have this, too.

They didn't say they wanted to replace the present employees with other employees, and they didn't say they would cut down service in a meat-axe type of approach.

Mr. HENLOCK. You mention retention of employees. In the table we gave you, we have, for instance, head cooks rated under the Wage Board system. We use District Government and other Government agency Wage-board rates for restaurant employees. Our range for a head cook is from $2.62 to $3.00 an hour. The normal commercial restaurant around here which is unionized runs from $1.60 to $2.40 an hour. Even though someone tells you they might retain the personnel they do not tell you they will retain them at the present salary rate. There could be substantial salary reductions.

Mr. RooF. One firm did say that they would retain them at not less than the present salary wage but they didn't say for how long.

Mr. ANDREWS. You come to a basic point. Why should the taxpayers of the United States be required to pay a cook in the House of Representatives Restaurant more than they pay a cook in the Statler Hilton Hotel? Whose choice is this and why should this be done and how can we justify this?

We can sit back here happy and gay and play little games. It is OK if we will raise the rates and set it up so we pay for it. Then nobody has any complaints. However, I do not think you can justify socking the taxpayers and going gayly on our way. This is not justifiable.

Mr. HENLOCK. It is based on other comparable Government restaurant wages, is it not, Mr. Roof?

Mr. ROOF. Yes. How could the House justify paying our people less than the District government pays its people who work in food institutions here in Washington?

Mr. ANDREWS. But the taxpayers do not make up the deficit.

Mr. ROOF. The taxpayers pay District government employeesthere is always a Federal contribution to funds for operating the District government.

Mr. YATES. We should explore these last two propositions more. You have two other companies you will check, Szabo and another one?

Mr. ROOF. Mr. Yates, I think, though, if we go ahead and let everybody and anybody explore and explore it will just result in bedlam. You will never get an answer.

Mr. YATES. You have two responsible people who came in late. Mr. ROOF. Yes, sir.

Mr. YATES. We are not interested in management fee arrangements because of the unhappy experience the Senate has had in the past. I think you are likely to get the same deficits and an operating fee to boot.

Off the record.

(Discussion held off the record.)

QUESTIONS OF PERSONNEL NEEDS

Mr. YATES. Mr. Cowan, do you need any figures that you do not have with you?

Mr. CowAN. I don't have any figures with me, at all, Mr. Yates. I didn't expect this call.

Mr. YATES. Do you want us to wait while you get them? We want figures on the cost of operation of the restaurants. We are trying to find out if you are overstaffed in management; if you are overstaffed in the kitchen; if there are any reductions that should be made, not through forcible reductions by firings and so forth, but by way of not filling jobs when people leave. I understand there is a fairly high turnover of the help?

Mr. COWAN. There are reductions that can be made through attrition.

Mr. YATES. Why haven't you been making them?

Mr. COWAN. Because, I suppose, some of my unit managers seem to think they are understaffed and when we come up on a given day when a good many people are out it is very difficult to operate. In the actual operation there are many days when we think ourselves we are understaffed.

Mr. ANDREWS. What do you mean by days when a good many people are out?

Mr. COWAN. On a typical Monday there may be 31 or 32 people out Mr. ANDREWS. That just don't show up?

Mr. COWAN. That is right.

Mr. ANDREWS. If this is the reason why you have to overstaff, to take care of these people who choose to stay at home rather than coming to work, wouldn't you be better off deleting those people and keeping those that come to work with regularity?

Mr. COWAN. Yes, and we have done that on a small scale. They are usually the first ones to go off our payroll. They are usually in the lower ranks, the porters, pot washers, and so on.

Mr. YATES. Do you have difficulty getting people in the lower ranks? Mr. CowAN. Yes.

Mr. YATES. What do they get paid?

Mr. CowAN. $1.60 per hour. I called an employment agency the other day for porters and the man who answered said, "Mr. Cowan, they are not looking for that kind of job any more." It is pretty difficult to get people for these jobs.

Mr. YATES. How many porters do you have working in the House restaurants?

Mr. CowAN. About 20 or 25 at the moment overall in the organization.

Mr. YATES. Do you need all of these?

Mr. COWAN. Except in one unit where the business varies to such a degree-the catering services-on some days we may not need the porters, but 3 days a week we might. For instance, last Friday there were no banquets or anything scheduled. We had these men on the payroll. We were able to use some of them in other units where people didn't show up, but on quite a few days there is no need for a great staff in the banquet department, but when you need them, you

need them.

Mr. YATES. But shouldn't the cost of that go into the banquets? Mr. COWAN. Some of it does. That part of it that comes after 4 o'clock does.

Mr. YATES. The banquets are a special consideration. By "special consideration" I mean that is not your usual operation. You are talking about luncheons in the Speaker's dining room?

Mr. CowAN. And the facilities in the Rayburn Building.

Mr. YATES. But inasmuch as those are special considerations shouldn't you cover the full cost of those?

Mr. CowAN. In our prices we try to. If they happen after 4 o'clock in the afternoon ordinarily the full cost is charged to the party being served.

Mr. YATES. Why shouldn't the full cost be charged for a luncheon in the Speaker's dining room?

Mr. COWAN. The overtime cost is what we try to charge to the party in its entirety. But those that are on the Government payroll from 7:30 in the morning until 4 o'clock in the afternoon, I figure the man is here, he is working, and the Member of Congress should not be charged for his full services. That would eliminate him from the Government payroll and throw the entire cost on the Member of Congress.

BREAKFAST CHARGE

Mr. ANDREWS. You say in the morning they have to be here anyway and one of the things you said was there weren't many people for breakfast. The other day we had breakfast and it was the same that