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""STAFF MEMORANDUM ('EXTENSION OF AUTHORITY OF THE ADMINISTRATOR OF THE VETERANS' ADMINIS

TRATION TO ENTER INTO 5-YEAR LEASES "The Administrator of the Veterans' Administration was originally granted authority on June 22, 1946, to enter into leases for periods of 5 years. At the same time, he was given an exemption from the Economy Act provisions requiring that rentals at the rate of over $2,000 per annum may not exceed 15 percent of the fair market value of the premises at date of the lease, and prohibiting improvements at Government expense where the cost would exceed 25 percent of the first year's rental. The basic justification for the original authorization was the extreme difficulty of locating rental space. This was of particular difficulty to the Veterans' Administration at that time because of the obvious necessity for establishing new offices and expanding existing offices to care for the tremendous work load arising from the accelerated demobilization of our armed forces.

“On June 14, 1947, the original 1-year authority was extended for an additional year. The basic justification at this time was the generally poor space situation in numerous VA offices and, in some cases, the need for the consolidation of various parts of individual offices under one roof to promote more efficient operation. On June 16, 1948, the authority was again extended for an additional 1-year period, the basic justification being that with the beginning of the downward adjustment of VA nonmedical personnel, it would be possible, in some cases, to obtain smaller or less expensive rental space at a considerable savings of funds.

"On March 25, 1949, the Administrator transmitted a draft of a proposed bill, together with a proposed report, which would place the existing temporary authority on a permanent basis. In response to our request, the Comptroller General furnished us, on April 27, 1949, with a report outlining his views on the VA proposal. Briefly, the Comptroller General called attention to the following points:

(a) The Public Buildings Administration, Federal Works Agency, has authority to enter into 5-year leases in order to procure space for the housing of any Federal agency outside the District of Columbia, except the Post Offce Department.

(6) The proposal would permanently exempt leases made by the Veterans' Administration from the limitations of section 322 of the Economy Act of June 30, 1932, as amended.

(c) The granting of permanent authority to any single agency, outside the Post Office Department and the Public Buildings Administration, is obviously objectionable, particularly where the leases are made without any provision for cancellation by the Government prior to the expiration of the term and where the requirements of the agency are constantly changing.

The Comptroller General concluded that the enactment of such legislation on a permanent basis would be undesirable. In addition to the views of the Comptroller General, the policy of the Government in connection with the control of space would seem to be pertinent.

With reference to the control of general-use office space, it has been the policy of the Government for some time to assign the primary responsibility in this field to a single agency in order to promote the most efficient use of Governmentcontrolled space. For this reason, the Public Buildings Administration has been granted authority to enter into 5-vear leases while such authority has been withheld from other agencies, except for the Veterans' Administration. The report of the Commission on Organization of the Executive Branch of the Government (Hoover Commission) under the subject of the Office of General Services (H. Doc. No. 73, 81st Cong.) recommended that among the responsibilities for the proposed Office of General Services would be the control of space allotments generally. It is understood that the Congress is presently considering legislation along the lines recommended by the Hoover Commission and that such pending legislation supports the Hoover Commission recommendations on space control. It appears clear, therefore, that any unlimited extension of the Veterans' Administration's 5-year lease authority would be contrary to Government space control policy, although the Government policy will not become fully recognized until after the passage of the legislation referred to above.

The Veterans' Administration bases the case for an extension of authority primarily upon the condition of the real-estate market, citing particularly the difficulty of determining fair market value of properties, and the high current day costs of alterations and improvements. They also point out that this creates a special difficulty in the case of out-patient clinics, where necessary alterations

and improvements are known to be much more expensive than for office space in general.

It is likely that the relatively tight office space situation will continue in many parts of the country. In addition, there is information indicating that, as nonmedical personnel of the Veterans' Administration declines in number, it may be possible to consolidate operations in such a way as to produce economies. Consequently, it appears that a temporary extension is in order and should be recommended. The length of time for which the extension should be granted is not certain; it is recommended that in no event should the extension exceed 2 years. This will enable future review of this matter when the long-range requirements of the Veterans' Administration can be more clearly established.

THE WHITE HOUSE,

July 2, 1949. To All Executive Agencies:

By virtue of the authority vested in me by section 205 (a) of the Act entitled "An act to simplify the procurement, utilization, and disposal of Government property, to reorganize certain agencies of the Government, and for other purposes," approved June 30, 1949 (the Federal Property and Administrative Services Act of 1949) it is hereby directed that:

1. In cooperation with other interested agencies, the Administrator of General Services shall institute studies and surveys to determine, the extent to which existing policies, procedures, and directives heretofore promulgated and remaining in force under section 501 of the act, should be modified or revoked in the interest of promoting greater economy and efficiency in accomplishing the purposes of this act. Careful attention shall be given to determining the degree of centralization in the General Services Administration to be attained in the performance of the functions involved. When these studies and surveys have been completed and after consulting with the interested agencies, the Administrator shall prescribe such regulations as may be necessary to implement the determinations resulting from such studies and surveys.

2. After consultation with the Bureau of the Budget and other executive agencies, and also with the General Accounting Office in respect of such matters As may be appropriate, including matters affecting its functions under sections 205 (b) and 206 (c) of the act, and at the earliest possible date, the Administrator of General Services shall establish such standards, prescribe such regulations, and prepare and issue such manuals and procedures as may be necessary to guide all executive agencies in ascertaining whether their operations in the field of property and records management are efficient and economical as well as consistent with established Government policies.

3. In accordance with directives to be issued by the Administrator of General Services, each executive agency shall promptly institute surveys to determine excess personal property and that portion of excess real property, including unimproved property, under their control which might be suitable for office, storage, and related facilities, and shall promptly report to the Administrator as soon as each survey is completed.

4. Each executive agency shall carefully plan and schedule its requirements for supplies, equipment, materials, and all other personal property in order that necessary stocks may be maintained at minimum levels and high-cost small-lot purchasing avoided.

5. Under section 201 (c) of the act, executive agencies are permitted to apply exchange allowances and proceeds of sale in payment of property acquired. The Administrator shall promptly prescribe regulations specifying, the extent to which executive agencies may exercise this authority, and pending the issuance of such regulations, no executive agency shall exercise this authority except to the extent permitted by, and in accordance with the provisions of, statutes in force prior to the taking effect of this act.

6. Section 502 (d) of the act provides that certain programs and functions now being carried on by various executive agencies shall not be impaired or affected by the provisions of the act. However, the attention of these agencies is called specifically to the purposes of this legislation and they shall, insofar as practicable, procure, utilize, and dispose of property in accordance with the provisions of the act and the regulations issued thereunder in order that the greatest over-all efficiency and economy may be effected. These same agencies shall also cooperate with the Administrator of General Services in the making of surveys of property and property management practices and in the establishment of inventory levels as provided in section 206 (a) (1) and (2) of the act.

HARRY S. TBUMAN.

RAMSEYER RULE

In accordance with clause 2a of rule XIII of the Rules of the House of Representatives, the changes made in existing law by the bill are shown as follows (existing law proposed to be omitted is in black brackets; new matter is in italics; existing law in which no changes are proposed is shown in roman):

S. 2010, AS REFERRED TO THE COMMITTEE Section 100 of the Servicemen's Readjustment Act of 1944, as amended:

SEC. 100. The Veterans' Administration is hereby declared to be an essential war agency and entitled to priority equal to the highest granted any department or agency of the Government in personnel, service, space, equipment, supplies, and material under any laws, executive orders, and regulations pertaining to priorities The Administrator is authorized, for the purpose of extending benefits to veterans and dependents, and to the extent he deems necessary, to procure the necessary space for administrative, linical, medical, and out-patient treatment purposes by lease, purchase, or construction of buildings, or by condemnation or declaration of taking, pursuant to existing statutes.

Uniil [June 30, 1949] June 30. 1951, the Administrator is authorised to enter into leases or renewals of leases of property for any of the purposes specified in this section for periods not exceeding five years. The provisions of the Aot of June 30, 1932 (47 Stat 412), as amended by section 15 of the Act of March 3, 1933 (47 Stat 1517 40 U. S. C. 278a), the provisions of section 3679 of the Revised Statutes, as amended by the Act of March 3, 1905 (33 Stat. 1257), and the Act of February 27. 1906 (34 Stat. 48; 31 U. S. Ć. 665); and the provisiors of section 3732 of the Revised Statutes (41 U.S. C. 11) shall not apply to any lease entered into by the Administrator under the authority of this section. Nothing in this section shall be construed to diminish, or in any way limit any right, power, or authority granted to the Administrator under any other law.

S. 2010, as REPORTED BY COMMITTEE

Section 100 of the Servicemen's Readjustment Act of 1944, as amended:

Sec. 100. The Veterans' Administration is hereby declared to be an essential war agency and entitled to priority equal to the highest granted any department or agency of the Government in personnel, service, space, equipment, supplies, and material under any laws, Executive orders, and regulations pertaining to priorities. The Administrator is authorized, for the purpose of extending benefits to veterans and dependents, and to the extent he deems necessary, to procure the necessary space for administrative, clinical, medical, and out-patient treatment purposes by lease, purchase, or construction of buildings, or by condemnation or declaration of taking, pursuant to existing statutes.

Until (June 30, 1949] June 30, 1950. the Administrator is authorized to enter into leases or renewals of seases of property for any of the purposes specified in this section for periods not exceeding five years The provisions of the Act of June 30, 1932 (47 Stat 412), as amended by section 15 of the Act of March 3, 1933 (47 Stat 1517 40 U S Č 278a), the provisions of section 3679 of the Revised Statutes, as amended by the Act of March 3, 1905 (33 Stat 1257), and the Act of February 27. 1906 (34 Stat 48:31 U. S. C 665); and the provisions of section 3732 of the Revised Statutes (41 U S C. 11) shall not apply to any lease entered into by the Administrator under the authority of this section Nothing in this section shall be construed to diminish, or in any way limit any right, power, or authority tranted to the Administrator under any other law.

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CONTINUING UNTIL THE CLOSE OF JUNE 30, 1950, THE SUSPENSION OF DUTIES AND IMPORT TAXES ON METAL SCRAP

JULY 7, 1949.—Committed to the Committee of the Whole House on the State of

the Union and ordered to be printed

Mr. EBERHARTER, from the Committee on Ways and Means,

submitted the following

REPORT

(To accompany H. R. 53271

The Committee on Ways and Means, to whom was referred the bill (H. R. 5327) to continue until the close of June 30, 1950, the suspension of duties and import taxes on metal scrap, and for other purposes, having considered the same, report favorably thereon with an amendment and recommend that the bill as amended do pass.

The amendment is as follows: On page 2, line 15, strike out the quotation mark and insert immediately after line 15 the following:

"Sec. 3. Sections 1 and 2 shall not permit the free entry of any article of which aluminum is the component material of chief value.”

GENERAL STATEMENT

The suspension of import duties on scrap iron, scrap steel, and nonferrous metal scrap provided by the act of March 13, 1942, as amended (Public Law 497, 77th Cong., 56 Stat. 171, and Public Laws 384 and 613, 80th Cong:), expired June 30, 1949.

Large quantities of metal scrap, much of which originated in the Cnited States in the form of military equipment, is still available in foreign countries. Domestic industrial consumers of scrap should be encouraged to utilize these important supplies of metal scrap in order to conserve limited reserves within this country and to develop stock piles against any future national emergency.

The favorable report of the Department of Commerce, which was cleared with the Bureau of the Budget, stated:

vast quantities of metal products were sent abroad during World War II. and the intensive search for scrap within the United States during the war reduced our scrap reservoir to a very low level. It is apparent that every ton of scrap metal imported reduces the drain on our natural resources.

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