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of several future fiscal years. On the other hand, fiscal year 1962 funds may not generally be obligated to cover future years' salaries costs of personnel performing services for organizations having personal service-type contracts with the Government. Recognizing special needs of certain technical assistance programs, Congress included in the original point 4 law a provision substantially identical to the proposed section 10(c) of the Peace Corps bill. This provision was reenacted in section 307 (a) of the Mutual Security Act of 1954. It permits commitment of funds for up to 3 years, subject, however, to Congress power over the program and to the Government's power to terminate any contract.

Peace Corps projects involve very largely the provision of personal servicesthe services of volunteers. In cases where the Peace Corps makes a contract with a university or voluntary agency for administration of a project, however, it is essential that the Peace Corps be able to give the administering agency a firm commitment covering at least a 2-year period or occasionally longer. This means that it must have authority to obligate the money necessary to fund the contract for this period, even though much of the money will not actually be expended until a subsequent fiscal year. Section 10(c) would provide this authority, again, however, subject to congressional power over the program and the Peace Corps power to terminate the contract.


OR PERSONNEL AUTHORITIES, SECTION 10(d) (1) Section 10(d) (1) authorizes the President, in carrying out functions under the bill, to exercise any authority relating to administrative or personnel functions available to ICA or its successor, the Agency for International Development. This is analogous to the authority given to USIA by section 2(d) of Reorganization Plan No. 8, 1953. Its purpose may be briefly stated as follows:

The Peace Corps will require much of the same operating authority as is available to ICA, and many of the administrative and personnel provisions of the Peace Corps bill are modeled after provisions of the Mutual Security Act. All of the provisions of that act which the Peace Corps can now foresee as being necessary for its operations are included in the Peace Corps bill. However, at this early stage it is not possible to predict with certainty that no other authorities will be useful as the Peace Corps' methods of operation develop.

Consequently, the Peace Corps desires the additional authority of section 10(d) (1), which might enable it, for example, to utilize the authority contained in Mutual Security Act section 530(b), relating to employment of dollar-a-year personnel under the Defense Production Act, or the authority of Mutual Security Act section 537(c) authorizing the construction or acquisition of living quarters, office space, and supporting facilities for employees. (This latter authority is not included in the bill itself because it is anticipated that sufficient housing, office space, and supporting facilities for the small Peace Corps staffs overseas will be available on a rental basis or on the basis of reimbursement to the embassy or USOM. This may not always be the case, however.)

In addition, section 10(d) (1) would enable the Peace Corps to use in the future any personnel or administrative authorities which may be added to foreign assistance authorizing legislation from time to time or included in foreign assistance appropriation acts.

ALLOCATION OF FUNDS TO OTHER AGENCIES-SECTION 10(e) The proposed legislation would appropriate all funds to the President. Section 10(e) provides the basic authority whereby the President may allocate these funds to the Peace Corps or, in the case of other agencies performing functions under the bill, to those agencies. (Such functions might include the administration of particular projects or, more often, provision of administrative support, medical services, etc.)

The second sentence of section 10(e) states that funds so allocated may be obligated and expended for Peace Corps purposes in accordance with Peace Corps bill authority, regardless of the agency which obligates or expends the funds. It also provides that, in the case of funds allocated to an agency other than the Peace Corps, the funds may be obligated and expended in accordance with authority governing the activities of that agency—but only for Peace Corps purposes. This means that Peace Corps funds which are allocated to another agency may be used by that agency in the manner in which it is accustomed to handling its own funds. Thus, for example, funds allocated to the Department of Health, Education, and Welfare could be used in accordance with particular authorities contained in the HEW appropriation act.


The National Advisory Council, a list of whose present members is attached. is composed of distinguished persons from various areas of the country repré senting in general broad segments of American life. Their advice, counsel, and support is most necessary to the successful conduct of the Peace Corps program.

The Council has met once since its formation-on May 22, 1961, in Washington, D.C. Future meetings are planned approximately twice each year, but individual members of the Council are frequently called upon for advice and counsel by mail and telephone.



Hon. William 0. Douglas, Associate Justice, Supreme Court of the United States


Hon. Lyndon B. Johnson, Vice President of the United States


Dr. Mary Bunting, president, Radcliffe College, Cambridge, Mass.
David E. Lilienthal, chairman, Development & Resources Corp.
Rev. James Robinson, director, Operation Crossroads Africa.
Thomas J. Watson, Jr., president, International Business Machines Corp.


Dr. Leona Baumgartner, commissioner of health, New York City.

Joseph Beirne, president, Communications Workers of America, vice president, AFL-CIO.

Harry Belafonte, New York City.
Rev. William Sloan Coffin, chaplain, Yale University.
LeRoy Collins, president, National Association of Broadcasters.

Rev. John J. Considine, M.M., director, Latin America bureau, National Catholic Welfare Conference.

Col. Henry Crown, chairman, Material Services Division, General Dynamics Corp.

Dr. Albert Dent, president, Dillard University, New Orleans, La.
Dr. John Fischer, dean of Teachers College, Columbia University.
J. Peter Grace, president W. R. Grace & Co.
Cornelius J. Haggerty, president, Building Trades Council, AFL-CIO.
Mrs. Oveta Culp Hobby, president, Houston Post Publishing Co.
E. Palmer Hoyt, publisher, Denver Post.
Mrs. Robert E. Kintner, New York City.
Murray D. Lincoln, chairman, CARE, Inc.

Frederick R. Mann, secretary of commerce, the city of Philadelphia, Phila. delphia, Pa.

Dr. Benjamin E. Mays, president, Morehouse College, Atlanta, Ga. Dr. James A. McCain, president, Kansas State College, Manhattan, Kans. Franklin Murphy, chancellor, University of California at Los Angeles. Mrs. E. Lee Ozbirn, international president, General Federation of Women's Clubs.

Rev. Clarence E. Pickett, executive secretary, American Friends Service Committee.

Roger Revelle, director, Scripps Institution of Oceanography.
John D. Rockefeller IV, Harvard University.
Mrs. Franklin D. Roosevelt, Hyde Park, N.Y.
Eugene V. Rostov, dean, Yale Law School.
George L. Sanches, chairman. Department of History, University of Texas.
James Scott, international vice president, U.S. National Student Association.

CAREER PLANNING BOARD-SECTION 12(b) The Peace Corps has initiated the establishment of a Career Planning Board whose function it will be to guide volunteers in furthering their careers following service in the Peace Corps. It will advise the Peace Corps staff and will initiate liaison arrangements and open channels of opportunities between the Peace Corps and various business, labor, government, education, and profes. sional outlets. The Board will also provide counsel to volunteers if they request it,

To date there has been one formal meeting of the Board, but the Peace Corps staff is in frequent touch with its members. It is anticipated that the Board may meet perhaps four or more times in the next fiscal year and with greater frequency as the number of returning volunteers increases.

We believe that it is important that the Board be created now and begin now the development of policies and procedures in furtherance of its purposes. It takes time to work out policies and open channels of communication. It is important to Peace Corps recruitment for prospective volunteers to know that the Peace Corps is actively concerned with their futures. And, in the immediate future the Peace Corps will be faced with the need to assist with the placement of applicants who have been selected for training but who, for various reasons, have not been sent abroad. Nonselection for service overseas may be due to insufficient physical stamina, oversupply of qualified volunteers for a particular project, lack of adaptability to the peculiar requirements of certain oversea assignments involving isolation and cultural strain, or other factors not related to professional competence or employability in the United States. However, especially in the early days of the Peace Corps, when nonselection factors are not generally understood by the public, trainees who are not sent abroad may meet with difficulties in employment, and it is important that the Peace Corps be ready to assist them where necessary.

We believe that those who are motivated to serve in the Peace Corps, survive the Peace Corps' rigorous selection and training processes, and serve the Nation abroad for 2 years, should be regarded as a valuable human resource and should be helped to enter careers where such motivation and experience can be most productive for our Nation, The job of the Career Planning Board is, therefore, a most important one.


SECTION 15(a) At the hearing before the Senate Foreign Relations Committee on June 22, a question was asked by Senator Lausche as to the meaning of and need for section 15(a) of the bill, which authorizes "expenditures outside the United States for the procurement of supplies and services and for other administrative and operating purposes (other than compensation of employees) without regard to such laws and regulations governing the obligation and expenditure of Government funds as may be necessary to accomplish the purposes of this act.”.

Section 15 (a) is drawn essentially verbatim from section 411(d) of the MS Act. Section 411(d) in turn has been in the foreign assistance legislation in substantially its present form since 1948, when it first appeared as section 114(d) of the Economic Cooperation Act. At present, section 109 (C) of Executive Order No. 10893 (Nov. 8, 1960) lays down the guidelines for the use of this special authority. By this order, use of the authority is limited to cases where

(1) it is deemed to further the more economical, efficient or expeditious carrying out of functions under the act:

(2) it is deemed to obviate or mitigate hardship to personnel or the families of personnel carrying out functions under the act; or

(3) it is required for the settlement of tort claims arising from the conduct of a Government employee acting within the scope of his employ

ment under the act. Some of the expenditures which ICA and its predecessor agencies have made under this authority in the past are now authorized by general law—such as medical services and evacuation for dependents of Foreign Service personnel. Other uses made of section 411 (d) in the past would not be necessary for the Peace Corps. For example, if section 10(b) of the proposed bill is enacted, there will be no need to resort to this special authority in connection with settlement of tort claims.

If the specific authority for advance payment of rent con


tained in section 15(d) (9) is enacted, the section 15(a) authority will not be necessary for this purpose, as it has been for ICA.

However, a number of situations will still arise in which effective and eco nomical operations abroad will require expenditures not specifically authorized for Government agencies or on behalf of Government personnel. Following is a series of examples based largely upon the experience of carrying out foreign aid activities over the past decade. These examples are intended to be illustrative rather than comprehensive. It should also be remarked that, in every case where the special authority is used, specific approval by the Director of the agency or some other high official is first obtained.

(1) Peace Corps employees will often be stationed at isolated posts, where the climate is severe and where primitive conditions make life oppressively monotonous over long periods. Under such circumstances, recruitment and morale problems can become acute. ICA has used its special authority to pay round-trip transportation for its personnel between such posts and nearby areas for rest and recuperation purposes.

(2) Although emergency medical evacuation expenses may be incurred by the Government on behalf of Foreign Service personnel, they may not normally be incurred by the Government for consultants or civil service employees temporarily stationed abroad. ICA has paid medical evacuation expenses for consultants and (prior to enactment of general authorizing legislation in 1958) for dependents under the special authority of section 411(d) of the Mutual Security Act.

(3) In many posts in the less developed countries, housing is in very short supply-especially housing which meets minimum American standards of health and sanitation. At such posts, decent rental housing is often not available, making it essential for the Government to build, buy, or substantially renovate quarters for Government personnel. The Mutual Security Act now has this authority, in section 53(c), but the Peace Corps bill does not. Thus, it will be necessary in some situations for the Peace Corps to use the special section 15(a) authority for this purpose.

(4) There are circumstances in which, because of the technicalities of the regulations governing travel of personnel and transportation of effects, an employee has a legitimate and pressing need to travel or to ship his household effects but there is no authority for the Government to reimburse him. This sometimes arises when, for reasons which cannot be ascertained, personal effects are misdirected, or where an employee transfers from one agency to another while temporarily in the United States. On occasion, personal effects are lost or destroyed through no fault of an employee, and under circumstances creating a moral obligation on the part of the Government. One case of this sort occurred when the jeep in which four ICA employees were riding was ambushed and robbed by bandits in the Middle East. In circumstances such as these, fairness to employees requires reimbursement, which is made possible by the sort of special authority contained in Mutual Security Act section 411(d) and proposed for inclusion in section 15(a) of the Peace Corps Act.

UNFORESEEN CONTINGENCY FUND—SECTION 15(d) (7) The executive branch proposed revised "contingency fund" language for section 15(d) (7) of the Peace Corps bill reads as follows:

(7) expenditures (not to exceed $5,000 in any fiscal year except as may be otherwise provided in an appropriation or other Act) not otherwise authorized by law to meet unforeseen emergencies or contingencies arising in the Peace Corps: Provided, That a certificate of the amount only of each such expenditure and that such expenditure was necessary to meet an unforeseen emergency or contingency, made by the Director of the Peace Corps or his designee, shall be deemed a sufficient voucher for the amount therein specified."

This authority is requested to enable the Peace Corps to make expenditures not otherwise authorized by law to pay equitable claims by employees, volunteers, host country nationals and contractors, and other expenditures necessary to meet unforeseen emergencies and contingencies arising in the course of Peace Corps operations. This authority is similar to the authority contained in sec. tion 537 (a) (8) of the Mutual Security Act, authority traditionally contained in State Department appropriation acts under the heading "Emergencies in the Diplomatic and Consular Service," and authority traditionally contained in Defense Department and other appropriation acts.

This type of authority is utilized only on a case-by-case basis and each nise is authorized by a high agency official. The following examples typify but do not by any means exhaust the type of expenditures which ICA has made under its similar authority :

(1) A foreign participant who had some personal property stolen from the ICA mailroom was reimbursed the value of the property stolen.

(2) A voluntary agency under an ICA contract which had in good faith spent somewhat more money than the contract authorized was reimbursed for the full amount of its expenditures.

(3) An employee who, for the benefit of the Government, had made unusual expenditures in excess of his per diem while in travel status, was reimbursed in full.

(4) An employee who, with his family, was en route to an Asian country, was stopped at the port of embarkation because unsettled conditions in that country had forced a change in the program there. He was reimbursed for his extraordinary hotel and other living expenses at the port of embarkation while he awaited reassignment.

USE OF FOREIGN CURRENCIES BY THE PEACE CORPS-SECTION 17 The Peace Corps is aware of the committee's interest in this subject and has given considerable thought to it. A number of legislative proposals were discussed within the executive branch. The provision finally proposed by the executive branch is section 17 of the Peace Corps bill (S. 2000) which provides that “[w]henever possible, expenditures incurred in carrying out functions under this act shall be paid for in such currency of the country or area where the expense is incurred as may be available to the United States.” Should the committee wish to consider some other provision, the Peace Corps would, of course, be glad to cooperate fully with the committee.

The questions on this subject posed by the committee and the Peace Corps' answers follow.

1. What are the Peace Corps' plans for using foreign currency! In accordance with proposed section 17, the Peace Corps' policy is that wherever possible expenditures payable in foreign currencies will be paid in such currencies as are available to the United States. In the case of U.S.-owned currencies, funds appropriated for the Peace Corps and required for expenditures payable in foreign currencies will be allotted to Peace Corps representatives abroad, U.S. disbursing officers, and other appropriate officials. These funds will then be used, in accordance with the Treasury's regulations, either to purchase needed amounts of foreign currency from the Treasury or other sources in accordance with normal procedures.

Also covered in the section 17 phrase "such foreign currencies as may be available to the United States” are foreign currencies not owned by the United States. While counterpart and other similar foreign currency funds are not owned by the United States, they would in general legally be available for use for the purposes of the Peace Corps. The Peace Corps intends to explore the possibility of utilizing such funds in its operations. It must be recognized, however, that counterpart and other funds generated under the foreign aid programs are often earmarked for particular assistance purposes or programs. In order to obtain such currencies for use by the Peace Corps the consent of ICA, its proposed successor agency, the Agency for International Development (AID), or other U.S. agencies concerned, as well as that of the foreign government, probably would have first to be obtained. It is not possible, therefore, to say to what extent such currencies might be available to the Peace Corps.

2. To what extent would foreign currencies be available without purchase from Treasury or appropriation for the purposes of the Peace Corps ? NonU.S.-owned foreign currencies (counterpart and similar funds) are generally available without the use of appropriated dollars. But, as indicated in the preceding paragraph, the extent to which such foreign currencies would in fact be available to the Peace Corps is uncertain.

Under the provisions of section 1415 of the Supplemental Appropriation Act, 1953, U.S.-owned foreign currencies would generally be available to the Peace Corps only through purchase from the Treasury with appropriated dollars or appropriation by the Congress. U.S.-owned foreign currencies generated under section 402 of the Mutual Security Act of 1954 and a few other similar provi. sions would legally be available for the purposes of the Peace Corps without appropriation or purchase from the Treasury with appropriated dollars. But like counterpart and other similar non-U.S.-owned foreign currencies available

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