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We welcome our colleagues, and I wonder if we could ask Congressmen Randall, Bolling, Hull, Winn, and Marsh all to sit up here together.

We would be delighted to hear first from our colleague on the Committee on Government Operations, the Honorable William Randall. STATEMENT OF HON. WILLIAM J. RANDALL, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MISSOURI

Mr. RANDALL. Thank you, Mr. Chairman, and members of the Subcommittee on Executive and Legislative Reorganization of the House Committee on Government Operations.

I appreciate very much this opportunity to appear before you. Later I may ask your leave as a member of the full committee to sit with you during the remainder of your hearings.

My hope is that this subcommittee may make a very thorough study of the recommendations of the administration's recent proposal to reshuffle certain Government service systems. As you know, it has been proposed to change several service regions by making these boundaries, in the words of the announcement, and also the press release that followed it, coterminus. The administration's announcement also involves the change of the location of several regional headquarters.

As the chairman mentioned, back on March 27 when the President released his statement, he ordered the creation of eight new regions and regional centers. After I read that statement I followed through by reading the transcript of the press conference which was held on that same day at the White House. That conference was chaired by Dr. Moynihan, the Presidential Assistant on Urban Affairs, and Mr. Sam Hughes, Deputy Director of the Bureau of the Budget, who is here with us this morning. Questions were raised at the press conference and some answers given in response at that conference, which would cause any casual reader to wonder whether the restructuring was studied with consideration of greater efficiency and certainly questions were asked about the economics involved in the moves which were not fully or satisfactorily answered.

It seems, after reading the press release and the transcript of the press conference, there were some statements made at that time that were not in complete conformity with the announcement made by the President earlier. For example, Dr. Moynihan stated that the restructuring involved substantially the question of where to relocate the regional director.

This statement seemed to be in contrast with the words of the President several hours earlier where he said he intended to create what he referred to as "regional councils." And at that time the President very strongly hinted that these regional headquarters would be strengthened and even added to in future years.

Now, I have read very carefully both the Presidential statement and the statements of Dr. Moynihan and Mr. Hughes. Because of these differences between the statements of the White House and the Bureau of the Budget, I concluded that certainly an effort should be made to find out all the facts, and particularly in view of a comment by Dr. Moynihan on page 10 of that press conference in which he says:

Let's be very candid when we ask, what is the difference between Kansas City and Denver. The answer is that a good case can be made for either.

Now, after the willingness of Dr. Moynihan to say that a good case could be made for either Kansas City or Denver, I became more convinced than ever that this restructuring in these proposals needed a careful review. Because Dr. Moynihan said that a good case could be made to either, is strong reason why we should take a careful look at all of the costs and the expenses entailed by a move of regional headquarters.

As a member of this committee, the full Committee of the House Government Operations, I have always understood that the principal objective, or the prime job and jurisdiction of this committee, was to study all reorganization plans and to find out if the proposals submitted by the executive branch will in fact result in better operational performance of the agencies involved with greater economy, and whether or not the reorganization proposals will in fact lead to increased operational efficiency.

One of the most important functions of this committee over the years, as I have observed it during my membership for several years, has been its work to determine whether the benefits of executive reorganization as to any particular proposal in fact equal, exceed, or fall below the costs. In other words, what is the cost benefit ratio of any executive proposal for change.

It was with this foregoing thought that I wrote to our chairman, the Honorable William Dawson, asking that a study be made of this proposed realinement of these regional boundaries, and a reshuffling of the regional headquarters.

It is my understanding that these hearings have been called on the order of Chairman Dawson to hold hearings on this particular proposal and to assign the inquiry to this subcommittee. There will be ample time to study the restructuring, and there will be other witnesses. Just this brief comment, and then I want to yield to my colleagues. In the consideration of the creation of a new region VII with Denver at its center, it should be observed-and it should be quite clearly observed that Denver is only the geographic center. There is another term that is frequently used, and that is the demographic center of an area. And that means the center of people. And I think that is one of the real issues that should be studied by this committee.

There is an expression that we use in engineering and physics called the center of gravity. And that expression has application here. Kansas City is where the weight of the work is, that is where the problems are, that is where the programs must be administered. And that is where the expenditures have to be made, and the service is to be rendered. And if you study the map very carefully you will find that the center of gravity of this new proposed region will not be Denver, as proposed.

I think that by any criteria you can easily determine that the population center of the new region or if you please, the work center-is clearly centered at Kansas City and certainly within a 300mile radius of Kansas City.

Thank you very much, Mr. Chairman.

Mr. ROSENTHAL. Thank you, Congressman Randall.
Congressman Bolling.

STATEMENT OF HON. RICHARD BOLLING, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF MISSOURI

Mr. BOLLING. Thank you, Mr. Chairman.

It is a particular pleasure for me to appear before this particular subcommittee of the Committee on Government Operations, because it was on this subcommittee, and one other, that I cut my eye teeth as a legislator. I had the privilege of serving on this subcommittee in the period 1949 to 1952, in the early part of which the subcommittee handled, under the very able chairmanship of my friend from California, Mr. Holifield, almost the whole of the first Hoover commission recommendations. And perfectly frankly, I learned about the executive branch and the Congress from the experience that I had on this subcommittee.

I also for the first time became acquainted with the problem to which the President's decision on restructuring the regional offices was aimed. Very clearly there does need to be an attempt to conform a variety of agencies' regional offices, so that you can have sort of one stop service when a problem overlaps more than one agency.

So I have no quarrel with the fundamental approach, the idea that we should make regional boundaries conform to a greater extent.

I have no quarrel with the good intentions of everybody involved at the administrative level in trying to work out a rational approach. I recognize how difficult it is. It has been hanging around, I believe, for something in the range of 20 to 30 years. And I would hope that this year would see real progress made.

My difficulty is both provincial and objective in accepting the proposal announced by the President. It rests largely on the notion, as far as it affects my area of Kansas City, Mo., that Denver, Colo., is closer to the State capitals of the proposed new region. This, I believe, is the only argument that can be made in favor of that particular regionalization. And I say that with absolute sincerity.

This is one of those cases where one need not bring in any other factors. The objective facts are so overwhelming as to the people involved that I am not even going to argue it. I will submit to you what you already have in front of you and identify the product of a combined effort of the cities of Kansas City, Kans., and Kansas City, Mo., of the local governments at the county level, of business and labor, without regard to party, which very wisely present to you in this form, "A Case of Reason," the fundamental reasons why Kansas City should remain a regional center. It is very simple, and I am not going to argue the case that is made in this document.

Our side of the region, the eastern side of the proposed region, has, roughly speaking-and I am understating rather than overstating -two-thirds of the people, two-thirds of the problems that these agencies deal with, and two-thirds of the money that the Federal Government expends in that area to deal with the problems.

Now, I know from my own experience on this subcommittee that your study of this matter will be exhaustive.

I would also like to say to you equally frankly that there are two aspects of this; there are two ways in which this matter can be resolved. One might be said to be peaceful, and the other might be described as less peaceful. This may shock some of my colleagues, but in this case I hope for a peaceful solution. I am hopeful that the restudy that has been undertaken at the request specifically of Congressman Winn and Senator Pearson will result in a decision that forwards the greater efficiency desired by regional conformation, and yet recognizes the rightness of the argument made by this bipartisan group of businessmen and others in our community.

I am hopeful that this peaceful solution will be the case.

What I would like to say as mildly as I can is that if there is not a peaceful solution, there will be a solution. And I suspect-and I am not really an optimist as a vote counter-I suspect that our side of this case can win this fight if we have to make it a fight. I think we have the horses and the ability. I don't propose to go any further, but just say that I am very hopeful that a peaceful compromise can be worked out in the interests of everybody concerned.

Mr. Chairman, I thank you for your courtesy.

Mr. ROSENTHAL. Thank you very much, Congressman Bolling. Congressman Hull.

STATEMENT OF HON. W. R. HULL, JR., A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MISSOURI

Mr. HULL. Mr. Chairman and members of the subcommittee on Government Operations, I appreciate this opportunity to appear before the committee to discuss the proposed transfer of the regional offices of Health, Education, and Welfare, the Office of Economic Opportunity, and the Department of Labor from Kansas City, Mo., to Denver, Colo.

I speak against this transfer not merely because I happen to represent part of Kansas City in Congress and certainly not because I am hostile in any way to Denver, which we all recognize as one of the finest, most beautiful and most progressive cities in the Nation. I speak in the interest of commonsense, of fairness, and of economy in Government.

As the members of the committee are aware, the thrust of any plan for uniform regional boundaries and most utilitarian location of Federal regional offices must transcend mere geographic considerations. Population concentration, transportation and communication facilities, effectiveness of service and costs to Federal, State, and local governments are factors more important and more pertinent. By any reasonable yardstick, these factors weigh heavily in favor of Kansas City as the site for these regional offices.

In terms of population concentration, the eastern section of this particular region, the States of Iowa, Kansas, Missouri, Nebraska, North Dakota, and South Dakota, have 72.2 percent of the population while the western section, made up of the States of Colorado, Idaho, Montana, Utah, and Wyoming, contain only 27.8 percent.

Thus, any argument that Denver could better serve the national interest, on the basis of distribution of population, is ludicrous.

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With respect to transportation, Kansas City has much superior air, railroad, and bus service, more readily accessible to the State capitals serving the great majority of the people living in the region.

It also exceeds the limits of credibility to argue that Denver could possibly provide more effective service to the public, considering that of the 24 standard metropolitan statistical areas in the region, 15 are nearer Kansas City than Denver; and of the people living in these areas, more than 70 percent live closer to Kansas City.

And then there is the commanding consideration of cost. We all know the money tree is getting a bit thin and we should avoid actions which add new pressures on the Federal Treasury. Clearly, the transfer of these regional offices to Denver would increase the cost of operating these offices at the expense of efficient service.

Just a few years ago, the Federal Government invested some $32 million in the secure future of the Kansas City area when it constructed a new Federal building there. It is the rankest kind of false economy to baggage up hundreds of employees and move them from this Government-owned office space in Kansas City to rented space in Denver.

Additional money would be lost through increased travel time and travel expense and this would affect not only the Federal Government but State and local governments.

Finally, let us consider the human element. I have received a letter from the wife of an HEW employee in Kansas City who would be affected by this transfer. She points out that it cost the Federal Government $5,000 to transfer her family from Washington to Kansas City in 1967 and that the family personally lost about $1,000. This represented real estate commission, points lost, and other nonreimbursable expenses. When this family moved from Washington to Kansas City, it went from a 5-percent interest rate on its home to a 64-percent rate and this would jump to 8 percent or more if this employee were transferred to Denver.

I respectfully submit to this committee that all factors considered, the transfer of these regional offices from Kansas City to Denver would be injudicious, profligate, and adverse to the interests of the people the Federal Government is obligated to serve.

Thank you for giving me the opportunity to testify before you this morning.

Mr. ROSENTHAL. Thank you, Congressman Hull.
Congressman Winn.

STATEMENT OF HON. LARRY WINN, JR., A REPRESENTATIVE IN CONGRESS FROM THE STATE OF KANSAS

Mr. WINN. First of all, let me make it perfectly clear that my views to be expressed in this hearing, or my views reported in the public press, are not intended to criticize the fine efforts being made by the administration in the proposed restructuring of Government service systems. On the contrary, I think that the administration should be commended for its work in this area, and particularly the time spent by Mr. Sam Hughes and Mr. Dwight Ink of the Budget Bureau.

I think, too, that we must concur in the administration's basic logic behind its reorganizational efforts. The organization of the Federal

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