Negotiations are currently underway with the Navy to acquire title to a tract of 175 acres of undeveloped land near Ewa Beach, Oahu. The Navy has indicated in writing their willingness to transfer the land to this Department for the observatory site. Numerous surveys and tests have been conducted on the island, and the proposed site on coral formation is magnetically satisfactoryan advantage probably not to be found elsewhere in the predominantly volcanic lands of Hawaii. The size of the tract offers good protection from encroachment in an area that appears to assure freedom from the danger of future disturbances. A comparison of the existing and proposed structures follows: A summary of the costs of the proposed facilities, plus the necessary approaches and utilities, follows: Buildings, including drawings, specifications construction supervision, etc. Approaches and utilities__. Reservations and contingencies___ $286, 000 87,000 27,000 "The life of the Export Control program was extended until 1960 through legislation enacted on June 25, 1958. The amount requested, $3,060,000, is the same as the allowance for fiscal year 1958. This program carries out the purposes of the Export Control Act of 1949, as amended, through the application of strategic controls on exports and the short-supply control of critical commodities. The recommended amount will permit continued operation at approximately the fiscal year 1958 level." EXPORT CONTROL JUSTIFICATIONS This estimate requests an appropriation of $3,060,000 for fiscal year 1959 for funds required to maintain the export control program at the current level. In accordance with the Export Control Act of 1949, as amended, the program is carried forward to serve the double objectives clearly intended by the Congress, namely: (a) to withhold strategic commodities from the Soviet bloc and (b) to maintain close surveillance and, where necessary, impose quantitative limits— over exports of commodities which are scarce in the United States. No increase in staff is contemplated in this estimate. Anticipated workload and continued economic penetration in many underdeveloped countries by the Soviet bloc rule out the likelihood of any substantial relaxation of controls or reduction in staff during fiscal year 1959. Short supply controls Short supply controls have largely disappeared from the export control program but have persisted as a nettlesome problem on a very few important commodities, e. g., iron and steel scrap, rerolling rail, nickel, industrial diamonds and Salk vaccine. Lively interest in these commodities persists as evidenced by testimony and questioning during recent congressional hearings on extension of the Export Control Act of 1949. Strategic controls The activity of depriving the Soviet bloc countries of strategic commodities is currently the main burden of the export control program. There are changes in locale or emphasis from time to time but Soviet efforts to obtain strategic goods continue relentlessly and unabated. There are currently five situations worthy of special note. (a) Exports to Poland. During fiscal year 1958 export controls over shipments to Poland were significantly relaxed as a part of a shift of United States policy in our relations with that country. As a result of this policy shift, and the related $95 million loan, exports to Poland during the coming fiscal year are expected to run at a rate approximately 15 times the rate of a year ago, and export licensing problems will be radically increased and complicated. Export license applications, which for years have been rejected out of hand, may now be approved if there is satisfactory evidence that the commodities covered by the applications are for peaceful uses in Poland. The examination of an export license application, including a prelicensing check abroad, frequently represents the last clear chance to examine export transactions in this area. Although there is a "calculated risk” in releasing these shipments, there have been no reports of illegal transshipments. To date the extra time and attention required to handle Polish applications seems to be amply justified. (b) Increased Soviet buying. For most of the 10 years since United States security export controls were first imposed Soviet Russia and the European satellites have studiously ignored the United States as a direct source of supply. In the past months, however, there has been a marked increase in the interest in buying goods from the United States. Chemical plants, synthetic yarn processing equipment, tire plants, and other types of advanced machinery and materials, both strategic and nonstrategic, have recently been the subject of inquiry by the Soviet-bloc nations. As with all shifts in Soviet policy the reason for this change in practice is not evident. Obviously, the extreme wariness is indicated, and each of these proposals comes in for very careful review by the Department of Commerce and other interested agencies of Government. (c) Control of advanced technical data.—The Soviet-bloc countries, particularly the U. S. S. R., have intensified their efforts to obtain United States plant design and industrial production techniques respecting strategic as well as nonstrategic equipment. This interest is shown in inquiries and by direct application to BFC for licenses, but even more particularly by efforts to obtain the technical data via third countries. Recent evidence of Soviet scientific advances has made it more important than ever that the United tSates have increased access to Soviet scientific knowledge. Accordingly, the United States Government has been encouraging exchanges of unclassified scientific information with the U. S. S. R. This increased activity-on our part to obtain more information concerning Russian developments and on the Soviet's part effort to obtain data regarding advanced technology-has made particularly difficult the administration of export controls over shipments of technical data to the Soviet bloc. Notwithstanding these difficulties, considerable success has been achieved in limiting the exportation of unpublished advanced technical know-how respecting industrial processes for the production or utilization of strategic equipment. (d) Near East.-During fiscal year 1958 while Soviet diplomatic and economic activity in the Near East was at a very high pitch it was necessary for the United States to pay special attention to licensing of certain paramilitary items to destinations in this area. Although the situation is not quite as explosive as a year ago we have continued almost daily collaboration with the State Department in attempting to limit shipments of quasi-military items to the area at levels which would permit the normal growth of the civilian economy and, at the same time, prevent an increase in tension through excessive military purchases. (e) Compliance proceedings on behalf of the Department of Defense.—The disposal of surplus military material located overseas is the responsibility of the Defense Department. However, at the request of Defense, Commerce has agreed to process cases under the Export Control Act to punish violators who attempt to dispose of such surplus material behind the Iron Curtain. Application workload One of the continuing tasks in administration of export controls is dealing with the daily flow of export license applications. The number of such applications has been relatively constant for the past several months at 750 applications per day (based on application intake from July 1, 1957, through March 15, 1958). It is expected that application intake will continue through fiscal year 1959 at about the same level. It is planned that of the $14,000 requested, approximately $7,000 will be expended for foreign travel and $7,000 for domestic travel. This does not represent an increase over 1958. The foreign travel is required for the following purposes: 1. Working with friendly foreign governments in the establishment of controls similar to the United States over strategic goods to unfriendly areas, and assisting such governments in improving the effectiveness of their export control systems. 2. Informing United States missions abroad either at their posts or in regional conferences on policies and operations of the security control program. 3. Education of United States missions abroad in connection with the enforcement of the export control program and special investigative trips dealing in reported violations. The estimate of $7,000 for domestic travel covers the following objectives: 1. Visits to field offices to keep personnel current on export control developments. 2. Conferences with customs people at various points in the United States in connection with their role in export control. 3. Attendance at Advisory Committee meetings and industry groups. 4. Travel to points within the United States in connection with enforcement and compliance activities. Transportation of things: 1958 1959__. Increase (+) or decrease (—)-- $100 100 This estimate is for the shipment of supplies and materials from Washington to the New York office of the investigation staff. Communication services: 1958-- 1959___ Increase (+) or decrease (—). $58,000 58,000 This estimate is based on the following estimated expenditures: Switchboard and equipment rental and related costs, $14,600; long-distance telephone calls, $2,400; all communication services for the New York office of the investigation staff, $3,600; penalty mail and other postage, $17,400; and Western Union Telemeter, teletypewriter service through PBS facilities, and other telegrams and cables, $20,000. Printing and reproduction: 1958 1959_ Increase (+) or decrease (—)‒‒‒‒ $56, 500 56, 500 Of the total estimate for this item, approximately $25,000 will be required for printing Current Export Bulletins: $6,500 for the annual edition of the Comprehensive Export Schedule; $8,000 for quarterly editions of the Special Check List; $4,000 is for the printing of the Quarterly Reports to Congress; $6,000 will be required for forms needed in licensing activities; the balance, $7,000, provides for such miscellaneous reproduction work as monthly activity reports, informational bulletins, workload charts, progress reports, and letterheads, the requisitioning of congressional matter, bills, hearings, etc., and any other necessary mimeograph, multilith, duplimat, drafting, photography, and photocopy work, Other contractual services: 1958_ 1959_ Increase (+) or decrease (—) $10,000 10, 000 Photocopy work for the New York office is estimated at $2,000; insurance payments will total about $5,000; $1,000 provides for stenographic reporting service; and approximately $2,000 will be required for addressograph work and miscellaneous machine and other repairs. Services of other agencies: 1958__. 1959 Increase (+) or decrease (-). $6,000 6,000 The cost of services of the General Services Administration is estimated at $5,000 for office moves, electrical work, miscellaneous repairs, partitions, etc., and $1,000 provides for health services. Supplies and materials: 1958 1959_. Increase (+) or decrease (—). $9,500 9, 500 Dun & Bradstreet reports for the New York Office of the investigation staff will cost approximately $500. Other materials and office supplies are estimated at $9,000. Equipment: 1958_. 1959 Increase (+) or decrease (−). $3,000 3,000 This item represents the cost of replacing about 20 typewriters, 15 years or older for which the estimated repair cost exceeds 10 percent of the replacement cost, as permitted by regulations of the General Services Administration. |