substantial amount of variables in an individual's integrity and honesty throughout this country. That is the only reason we have laws and guidelines and criteria. But it is the question of how can you live within that framework of laws and guidelines?

Mr. BURGESS. Let me give you an example. This is the best one I know of right now. In 1965 the city of Baton Rouge and the parish of East Baton Rouge, the people of that parish and that city voted a $60 million capital improvements bond issue, an ad valorum bond issue to build streets, roads and drainage facilities within the city and the parish. We made estimates in our department for each one of those projects. I would venture to say we made them in 1964. We are just about finished with that entire program today.

We have done three things. We have built it within the time we said we were going to build it, and within the amount of money that we had available and within the estimates that we made in 1964. You will not be able to do this with one of these other programs. Your costs are going to double.

I would venture to say that the cost of this bridge-and I do not know what it is right now, and I am speaking off the cuff-I would venture to say the cost of this bridge is almost double what it was if it had been built in 1960 when it was supposed to have been built.

Mr. WRIGHT. Will the gentleman yield?

Mr. CLAUSEN. Yes, Mr. Chairman.

Mr. WRIGHT. We heard testimony last week to the effect that every time the total program is delayed by 2 years, because of inflation factors and other things, probably $5 billion is added to the total cost of completing the system. And from that we deduced that the delay built in inadvertently to the approval process may have added some $12 billion to the total cost of completing the system. Does that ball park figure sound somewhere nearly reasonable?

Mr. BURGESS. I have heard the figure before.

Mr. CLAUSEN. Mr. Chairman, I want to make certain, as I am sure you know, we have had an opportunity to discuss a number of these things at various meetings.

Mr. BURGESS. Yes, sir.

Mr. CLAUSEN. I am so strongly behind what we are attempting to do here in cutting down this time frame. I believe it is safe to say you and I, Mr. Wright, have probably been the most vocal in our desire to try to cut down the time period for the very reason you are expressing. But I do want to make sure that we do not get off base from the standpoint of the accountability question.

I am for the national program objectives subject to a decentralization of the decisionmaking process, where then we can confine our time at this level just to the oversight, the investigation to make sure that the funds themselves are being properly allocated and properly administered. And I think in this way we can accelerate a great deal of the construction programing and get the job done and save an awful lot of money and get more and safer highways built.

This is the reason I am so much behind what you are attempting to say. I think I have done nothing more than paraphrase what you have said, Mr. Miller.

Mr. BURGESS. Mr. Clausen, just cut down the time and you will save the money.

Mr. CLAUSEN. Yes, sir.

Mr. BURGESS. In the decisionmaking process, just cut the time down. Mr. CLAUSEN. I was just going to say, from the standpoint of time, is there anywhere in your testimony some specific recommendation as to how we can cut down on the time? Does this appear in your testimony? Mr. BURGESS. No, sir.

Mr. WRIGHT. If there are no further questions of Mr. Burgess, will you proceed, Mr. Miller.

Mr. MILLER. Thank you, sir. If I may, before presenting the next witness I think as a complementary statement to Mr. Burgess' reference to the 12-year bridge. I know this is old hat to you members on the committee. I might say that here in the Nation's Capitol, we have a bridge that has been underway, for 20 years, and it is not even now under construction. It is known as the Three Sisters Bridge.

Mr. Chairman and members of the committee, it is now my pleasure to present to this committee. Mr. Nello Teer, Jr. Mr. Teer is a man of very broad background, having attended the University of North Carolina. He is president of the Nello L. Teer Co., of Durham, N.C., which was founded by his father in 1909. I would say this company has been one of the leading highway contractors in the Nation. Mr. Teer has worked in 20 States and five foreign countries. So he brings to you a pretty broad background of actual experience in highway construction. Nello, will you proceed, please.

Mr. TEER. Members of the committee.

To put my remarks in perspective, let me begin by saying that the great majority of highway contracts are awarded by State and local highway departments. The Federal Government awards a comparatively small number of highway construction contracts. From the standpoint of the contractor, this means doing business with a State or local organization whose ability to make decisions is restricted by the necessity of consulting with a "silent partner" the Federal

Government.

As in the case of any contractual relationship, the highway contractor maintains a close working liaison with the engineers of the highway department. Most routine problems at the job site can be worked out in face-to-face informal discussions. However, when the highway department engineer must check with his "silent partner," difficulties and delays can naturally result.

We recognize the State highway department is caught in the middle. It must live up to two contracts. First, the "project agreement," which spells out the Federal Government's promise to reimburse the State government for a certain share of the project cost, under certain conditions.

The second agreement is the construction contract with the highway contractor, which commits the State to pay for authorized work properly performed. Modifications in the construction contract must be acceptable to the Federal Government. Otherwise, trouble arises when it comes time for final settlement.

What happens when the State has approved modifications resulting in extra costs and the modifications are not acceptable to the Federal Highway Administration? In many cases, final payments to contractors are delayed, while State and Federal engineers resolve the problem of Federal reimbursement. In many cases, contractors must pay interest on borrowed money while awaiting the final payment.

In order to avoid these difficulties, which are costly to the contractor and troublesome to the State, it is often desirable to obtain Federal concurrence in change orders before the modified work begins. The expense of the delay involved may offset the advantages of the proposed modification.

Absentee management is always difficult. The Federal Highway Administration is in the uncomfortable position of writing rules and regulations broad enough to apply to every conceivable situation throughout the country. Yet, these regulations must be specific enough to be interpreted to fit widely varying situations.

The range and complexity of Federal regulations have increased greatly in recent years. The contractor must comply with air and water quality regulations, Interstate Commerce Commission requirements for truck drivers, requirements for the employment and training of minority-group personnel, and both Federal and State industrial safety requirements.

All of these requirements involve substantial paperwork. The great majority of highway contractors are small businessmen and burdensome paperwork creates a special problem for them.

It is my observation that the great majority of highway contractors are sincerely committed to doing their part in providing employment for minority groups, in preserving the quality of the environment and in providing safe and healthful working conditions. They fully recognize the necessity for Government regulations. However, the difficulties of complying with regulations issued by both State and Federal agencies, and by several agencies at each level of government are enormous. The cost of building a Federal-aid highway project has been estimated to be as much as 30 percent higher than the same project would cost as a State project. It is very questionable that the Federal controls add that much value to the job.

Mr. Chairman, in conclusion, I strongly recognize the importance and desirability of Federal-aid highway work. I sincerely hope that some positive action can be taken, as the result of these hearings, to improve this relationship.

Highway delays with the utility companies, telephone poles, power poles, waterlines and so forth, fall into two categories.

We are told that these delays take place, first, by a lack of communication between the highway department and/or the utility company and the complacent attitude of the representatives of the utility company. We find when we get ready to start many of our construction projects, that the utility people arrive at the preconstruction conference with no idea what is going on, no prior notice, no plans for moving of these utilities that will delay the construction, even though the contract has been awarded for construction. We find that takes place almost on every single construction project.

The pollution controls that we are working under today seem to us to be an over-reaction to the problems involved. Surely we all agree that there are many areas where pollution controls are absolutely necessary and should be always enforced. But we find an over-reaction and an extra expenditure of funds in this particular area.

We also are greatly concerned as highway contractors in the DavisBacon wage determinations. It is an unwieldly act, unnecessary. It was inaugurated and placed into being during the depression years and it

is outmoded today. It is not needed today and it adds greatly to our costs and, in many instances, to the delays while we wait for the socalled wage determinations, and we find that the wage determinations are never very accurate and they do not represent truly the prevailing wage in that area. We are also concerned when these Davis-Bacon wages are suspended as they were recently and then reinstituted. It has caused a great deal of confusion. We would much prefer to see those regulations removed forever.

In many areas we are required to submit critical path method construction scheduling sequences for each and every contract. We think that this is unnecessary in many areas. Some people say it is a wonderful tool to be used but in many areas it is not necessary and it adds to the cost and to the delays of those types of constructions.

We find great difficulties in trying to settle our change orders that take place from time to time. During the construction contract when we are directed to make certain changes, we can agree with the State highway department as to the problems involved and the costs related thereto, but then they have to go and get Bureau of Public Roads concurrence, and we are not able to be there to defend our costs at that representation. It brings about a great deal of confusion.

We have even found in areas where we have worked that the BPR people took the position that the contractor's requests were always granted. The project engineer was opposed to approving the contractor's request for that specific reason.

We have specific instances where we are working in heavy mountainous areas of the State of West Virginia, for example. We have major slides in the mountainous areas there and we have been trying to get decisions as to what to do with these slides since October 1970. To date no decision has been made. The contract completion date is this fall, the scheduled completion date. We still don't have decisions as to what to do about the individual areas.

We found on computations of our base coarse materials and embankments that we are still working in many areas with antiquated procedures which take from 2 to 3 days to get compaction tests.

Where we are using multiple lifts on base coarse materials, this delays adding the next coarse. Today in some states we are using nuclear testing devices that are compact and easy to read; we are using materials that have been approved by the Corps of Engineers in many States, but still we find in many areas we are still using the horse and buggy methods of determining compaction.

On final payments, the contractors are still experiencing considerable difficulties in collecting for their work. We have projects in West Virginia that we completed and opened to traffic on November 24, 1970. The final quantities have not even been given to us for review as of yet, much less a final estimate. In North Carolina we have a project completed in May of 1970, and still no final quantities or final payment. There is a project in Virginia completed in 1970, and no final payment to date.

Those things are very annoying and expensive to the contractors and create considerable delay, and along with the violent fluctuations in our programs that we have experienced with the cutbacks, the contracting industry has found it most difficult to plan its work as to what capital improvements they should make, what manpower

training they should undertake. It has been quite a frustrating experience for the contractors and extremely expensive to deal with these on-and-off-again type of programs.

We need a stability to our programs in the construction industry. We certainly trust and hope that, in the wisdom of the Congress, some day we will be able to know, when a program is planned and authorized, the procedures and funding of that program so that we can make our commitments to purchase machinery and train manpower in that category.

Mr. Chairman, I thank you for the opportunity of appearing before your committee.

Mr. KLUCZYNSKI. (Presiding). Thank you, Mr. Teer, for your splendid statement. We are always happy to have you before the Committee on Public Works. Mr. Miller.

Mr. MILLER. Mr. Chairman, I attach particular significance to the testimony of our next witness, Mr. Hajzyk, in view of the provisions of section 17 of title 23 of the United States Code, which this committee initiated many years ago when the secondary road program was inaugurated.

At that time considertaion was given by the Congress to the fact that many of these small secondary projects would not require the formalities attendant to the primary system.

This committee initiated, in its wisdom, an amendment which we strongly supported with regard to the secondary road projects, providing that the Secretary of Transportation may accept certification from the State highway department that the secondary project has been built according to the proposal, and many of the detailed reviews of plans and specifications could thus be eliminated. This is present law. Perhaps consideration may be given to extending this law to the whole ABC program. I don't know. I submit it for your consideration, sir.

But Mr. Hajzyk is in a fine position to testify on the subject of these hearings. He is a graduate engineer from the great University of Purdue and a registered professional engineer. He was formerly director of planning and programming for the Maryland State Roads Commission, and now occupies the important position of director of public works for Harford County, Md. So he brings to you experience of both State and county levels.

Mr. KLUCZYNSKI. It is a pleasure to have Mr. Hajzyk. here. You may proceed in your own fashion.

Mr. HAJZYK. Thank you, Mr. Chairman. Mr. Chairman and members of the committee:

The Harford County Department of Public Works has come to the unhappy conclusion that obtaining Federal aid is hardly worth the trouble involved in most instances.

Having made that rather broad statement, I hasten to point out that there are exceptions to this rule. If we can select a job that is simple enough and yet big enough to support a considerable volume of paperwork, that project would be a good candidate for Federal aid. For example, a paving project of substantial length, with no rightof-way complications, can usually be approved and constructed as a Federal-aid project with no great problems.