been thoroughly reviewed with respect to the flow of gold problem, and costs are based on a minimum outflow of U.S. currency to foreign countries.

Classified projects would be authorized by section 202 in the total amount of $95,641,000.

1. Bureau of Ships facilities, $38,608,000: There is a total of 46 line items in this class, of which 9, amounting to $7.7 million, support the fleet ballistic missile, or POLARIS program; $18,955,000 provides for modernizing overhaul facilities at our shipyards such as $5.4 million to deepen drydock No. 2 at the Naval Shipyard, Norfolk, Va.

2. Fleet base facilities, $13,818,000: This includes 16 line items for improved fleet pier facilities, channel dredging, and personnel support facilities. The largest project is at Naval Station, Key West, Fla., in the amount of $5,621,000. The recent Cuban crisis emphasized the strategic importance of this station. Five line items, totaling $3,349,000 are for personnel facilities to improve the living conditions of assigned personnel.

3. Naval weapons facilities, $91,958,000: There are six groups of stations in this class each of which supports a particular segment of naval aviation or naval ordnance. These groups are for naval air training; field support of fleet operations; Marine Corps air stations; fleet readiness support; research, development, test, and evaluation; and oversea support of the fleet. Examples of projects in the program within these groups are airfield lighting at Naval Auxiliary Air Station, Whiting Field, Fla.—this lighting will enable naval cadets to train safely at night; runway extension at Naval Air Station, Key West, Fla.—this extension will allow modern high performance jet aircraft to operate with a greater margin of safety from this station; aircraft parking apron, Marine Corps Air Facility, New River, N.C.-this apron will allow safe movement of helicopters under normal operating conditions; marshaling yards, Naval Weapons Station, Yorktown, Va.-these yards will enable the station, which is the primary source of weapons for the majority of Atlantic Fleet units, to comply with explosive-safety criteria established by the Department of Defense; Composite Propellent Facility, China Lake, Calif.-this facility will be used to perform propulsion research and prototype propulsion development for current and future Navy weapons of intermediate size.

4. Supply facilities, $458,000: This facilities class includes two projects. One at the newly established Fleet Material Support Office, Mechanicsburg, Pa., for additional administration space and the other at the Naval Supply Center, San Diego, Calif., for a high explosive magazine to replace the present magazine that does not meet ordnance storage safety criteria.

5. Marine Corps facilities, $11,810,000: This class of facilities includes projects inside the United States and in Okinawa. They are required for the training and effective utilization of the Marine Corps in support of national objectives, including instant readiness for deployment to strategic oversea areas of local unrest.

6. Service school facilities, $22,701,000: This class is especially important to the Navy since it includes projects needed primarily for modernization of various Navy schools and training centers. In order to operate and maintain the highly complex ships and weapons of our modern Navy, it is essential that our young officers and enlisted men receive considerable training ashore before they can be considered competent, even under strict supervision, to assigned duty at sea. Science building at the Naval Academy, Annapolis, Md., and alteration for technical school at the Naval Training Center, Great Lakes, Ill., are examples of projects in the program needed to keep these personnel abreast of technological improvements.

7. Medical facilities, $336,000: One project is included in this facilities class. Enlisted men and WAVE barracks at the Naval Hospital, Long Beach, Calif. This is a new hospital and is without any type of billeting facilities for assigned enlisted personnel.

8. Communications facilities, $50,778,000: The Navy requires facilities in this class for effective and efficient command and control of our widespread forces. Rapid and accurate collection and dissemination of intelligence is an essential part of this function. The projects in this class will assist the Navy to carry out these tasks. As an example, a major project is for the relocation of Radio Receiver Facility from NRS (R) Cheltenham, Md., to the former Navy Radio Research Station, Sugar Grove, W. Va.

9. Research facilities, $7,280,000: Research is essential if we are to maintain an effective and efficient Navy. In this class are included two major projects at the Naval Research Laboratory located in the District of Columbia, Sector Focusing Cyclotron Building and Operations and Technical Services Building.

10. Yards and docks facilities, $4,620,000: Specific major projects include Salvage Fuel Boiler Plant, Public Works Center, Norfolk, Va., and reconstruction of wharf No. 6, Naval Construction Battalion Center, Port Hueneme, Calif.

All projects in this authorization program are also in our funding program. This concludes my summary, Mr. Chairman. Before we present the details of the Navy's 1964 program for authorization of military construction, the committee may wish to hear the report of the Chief, Bureau of Yards and Docks, on the general status of our military construction program. Rear Admiral Corradi is here to present his report. Thank you, sir.

STATEMENT BY THE CHIEF, BUREAU OF YARDS AND DOCKS, REAR ADM. PETER CORRADI, CEC, U.S. NAVY

Mr. Chairman and members of the committee, I am Rear Adm. Peter Corradi, Civil Engineer Corps, U.S. Navy, Chief, Bureau of Yards and Docks.

It is a pleasure to appear again before this committee to support the Navy's fiscal year 1964 military construction program. The Bureau of Yards and Docks and its 15 field engineering offices have participated in the development of this program by accomplishing preliminary engineering on the items included. This preliminary engineering has involved a study of the requirements presented by the bureaus and offices of the Navy to determne the most effective manner of providing the facilities needed to satisfy these requirements, and to develop estimates of the costs required to construct these facilities. This preliminary engineering will serve as a basis for the further development of final plans and specifications.

Cost estimates included in this program were developed in the field where local conditions are known in detail, and have been reviewed by the Bureau and further by the Office of the Secretary of Defense. They are the best estimates available from the application of the science and art of engineering cost estimating. I am prepared to comment upon any of these cost estimates in detail if you should so desire.

Subsequent to the enactment of an authorization law and appropriation the Bureau of Yards and Docks will execute this construction program by placing the individual line items under contract. Much attention has been given in the recent past to increasing the percentage of Government procurement achieved through the competitive process. I would like to highlight that, in the military construction program, virtually all procurement is accomplished on a competitive basis; it has been this Bureau's continuing policy to construct Navy facilities in this manner in peacetime. As an example, during fiscal year 1962, 95.1 percent of all military construction contracts were awarded on a lump-sum, competitive bid basis. This represented 97 percent of all military construction dollars obligated by contract. Through fiscal year 1963, 92 percent of all fiscal year 1963 contracts were awarded on a competitive basis representing 88 percent of all dollars obligated for contract purposes. We now have only one cost-plus-fixed-fee construction contract in force, that being in South Vietnam where the contractor is exposed to the hazards of armed conflict. A review of the Navy's performance in this area discloses substantially the same statistics during all peacetime periods. We continue to address ourselves to this problem, however I feel we have achieved the virtual irreducible minimum beyond which we could not intelligently manage our total program. We continue to include experience and antibrokerage clauses for our major projects. These have proved to be most effective in lessening the problem of unqualified or fringe contractors.

In compliance with the small business set-aside policy of the Secretary of Defense, during fiscal year 1962, 95.4 percent of all procurement actions were placed with small business, with 94.9 percent during fiscal year 1963. It is of

interest to note that prior to the small business set-aside policies, our experience approximated 95 percent of all construction contracts being awarded to small business. This is the result of the fact that the construction industry is constituted of a large number of small business concerns in addition to the many large ones.

If there are questions on these or other aspects of this Bureau's contribution to the military construction program I would be pleased to provide the answers. Thank you, Mr. Chairman.

STATEMENT BY MAJ. GEN. WILLIAM P. BATTELL, U.S. MARINE CORPS, QUARTERMASTER GENERAL OF THE MARINE CORPS

U.S. MARINE CORPS CONSTRUCTION PROGRAM, 1964

The Marine Corps construction authorization program for fiscal year 1964 is composed of 29 line items, at a total estimated cost of $11,810,000. Eight line items, at a total cost of $5,675,000, are to be located at five continental activities. Tweny-one line items, with an estimated cost of $6,135,000, are to be located at one oversea installation. This installation currently contains six camps. Minimum, adequately designed facilities are required to properly house, administer, and support the training program of the Marine Corps. Only the most urgent requirements necessary to accomplish this purpose have been included. Department of Defense guidelines have been adhered to in the preparation of the Marine Corps program for 1964.

Included in this program is a project for an urgently required religious education center at Marine Corps Supply Center, Albany, Ga. This facility will provide for the religious needs of the military personnel and dependents at this activity.

There are three line items for urgently required facilities at Marine Corps Base, Camp Lejeune, N.C. These facilities include training facilities, combat vehicle maintenance facilities, and water treatment and storage facilities.

The Assistant Secretary of Defense (Installations and Logistics) has directed the relocation of the Marine Corps Supply Activity, Philadelphia, Pa., from its present location to the Defense Clothing and Textile Supply Center, Philadelphia, as a tenant activity. This move is prompted by the need for increased efficiency and economy of operation. Accordingly, the necessary project has been included. Another most important project will relieve a critical situation at the Marine Corps Schools, Quantico, Va. A current and rapidly increasing requirement exists for the construction of facilities to accommodate the amphibious warfare research facility. This facility is presently operating in only a fraction of the required space, with no space available for expansion. Lack of adequate facilities is impeding the Marine Corps in research and development efforts and restricting the instructors and students in their amphibious warfare training courses. Included in the building design is a fallout shelter for 1,000 persons. One of the line items for the Marine Corps Base, Twentynine Palms, Calif., will provide vitally needed evaporative cooling systems in 13 buildings; the other will correct a serious operational problem which now exists in connection with the water supply system. Lack of these two items generates a serious morale problem and hazard to life and property.

The proposed third increment of construction at two Marine Corps camps overseas, and the construction of a new brig at another oversea camp are also in the Marine Corps program. These facilities are required to provide additional permanent, typhoon-resistant facilities for the 3d Marine Division. Existing temporary facilities are typhoon-ravaged quonset huts and butler buildings which hamper efficient performance of missions and are a hazard to the personnel billeted and working therein.

Our program is designed to provide a portion of the requirement for adequate, permanent-type facilities which are necessary to the accomplishment of the Marine Corps mission as a "force in readiness."

STATEMENT OF REAR ADM. G. W. PRESSEY, U.S. NAVY, DIRECTOR OF NAVAL SHORE ACTIVITIES DEVELOPMENT AND CONTROL DIVISION

Admiral PRESSEY. Mr. Chairman and members of the committee, it is a pleasure for me to have the opportunity to appear before you and to work with you on the military construction program of the Navy for fiscal year 1964.

We have submitted for the record statements from Secretary BeLieu, Vice Admiral Sylvester, Rear Admiral Corradi, and my own which cover various aspects of the program and I wish only a few minutes of your time to speak in summary of these statements and mention certain aspects of this program.

As you have mentioned, Mr Chairman, Secretary BeLieu is very disappointed that he cannot appear because of illness this morning, and I have submitted for the record his statement in support of the Department of Defense planning for the realinement of facilities currently supporting the U.S. Army Antilles Command, the U.S. Atlantic fleet and the U.S. Air Force Strategic Air Command in Puerto Rico.

The military construction program this year totals $259,234,000. It is routine in that, except for one communication facility, it includes only those types of facilities with which you are thoroughly familiar or which have been presented previously to this committee.

The program is designed to correct certain weaknesses of the Naval Shore Establishment which may be categorized as follows:

(a) Dredging of several major ports to provide safe depths for larger and deeper ships.

(b) Construction of waterfront supporting facilities including berthing space and utilities.

(c) Modernization and replacement of obsolete personnel support facilities, as well as the construction of new facilities to meet positive deficiencies.

(d) Construction of buildings to accommodate new and advanced training requirements and new weapons systems.

(e) The modernization of facilities at air stations to accommodate high performance jet aircraft.

(f) Minimal moderization of naval shipyards.

The construction of facilities for the manufacture, storage and test of current and future generations of missiles.

(h) The replacement of temporary and obsolete dispensaries and the improvement in outpatient care.

(i) The modernization of laboratory and test facilities to meet the requirements of a dynamic R.D.T. & E. program.

(j) Replacement of overage public works and utilities.

(k) The establishment of modern, fast, reliable communications for the Navy and DCA.

Although the impact of the system by which we develop our 5-year construction program has not yet been fully felt, it has been in operation long enough to make this year's military construction program the most critically reviewed and the most carefully prepared program that has ever been presented to you.

It is pertinent at this point to express several of Mr. BeLieu's views. He wishes to assure you that, in preparing this program, the Navy has been mindful of the committee's policies concerning:

(a) Projects that are not clearly essential to the military posture of the country;

(b) Maximum utilization of existing facilities; and (c) Excessive costs and overdesign.

I am sure you are aware that our current requirements are not fully met by this program and that some urgently needed facilities have necessarily been deferred in the interest of overall economy.

The program which has been approved for submission to you represents not only those facilities which we consider most essential, but also the best possible balance between material support and personnel support.

Your familiarity with the Naval Shore Establishment has disclosed to you the degree to which we are "makin do" with inadequate and temporary facilities. I am sure you have also noted the degree to which we have had to cut personnel support facilities in order to carry on our operations.

The backlog of deficiencies of personnel support facilities is now of very serious concern to us. If we expect to have willing and spirited men to man our ships, we must provide for them modern and acceptable living accommodations and basic recreation facilities. We cannot now afford to defer these facilities.

The impact of inadequate and crowded barracks and of deteriorated and obsolete mess halls upon operations is not as clear as the impact of a radio receiver building or a POLARIS trainer, but it is equally positive and becoming more important as our civil standard of living becomes higher.

Admiral Corradi is prepared to answer your questions on the engineering aspects of this program. You may be interested to note that 92 percent of all fiscal year 1963 contracts have been awarded on a competitive basis. In the matter of small business set-aside, 94.9 percent of all procurement actions in fiscal year 1963 were placed with small business.

Before you proceed to the examination of our military construction program I would like to mention three amendments to this bill. The Secretary of Defense and the Director of the Budget have authorized the Navy to request your consideration of amendments to the fiscal year 1964 military construction bill, S. 1101.

These proposed amendments would revise the amounts for three line items in title II of the bill, and increase the Navy program amount by a total of $633,000.

Details of the revisions have been furnished to Mr. Nease, a member of the committee's professional staff. Their need is based on results of recently completed studies which became available to us too late for presentation to the House of Representatives Committee on Armed Services in their hearings on the companion bill, H.R. 4825.

The adjustments are: First, an increase of $64,000 for an additional bombing target at the Naval Air Station, Corpus Christi, Tex. Senator SALTONSTALL. Where?

Admiral PRESSEY. Naval Air Station, Corpus Christi, Tex., sir.