Mr. MONAGAN. You are doing better than paying your expenses? Mr. WOLL. That is right. From the inception of the program we show a profit of $932,470.58. Mr. MONAGAN. But this is really only a rehabilitation fund, is it not? Mr. WOLL. Rehabilitation and storage. Mr. MONAGAN. Rehabilitation and storage but the idea of the capital aspect of, let us say, the $10,000 truck, that means somebody is getting that truck for a payment of only 15 percent, $1,500 out of $10,000, whereas if it were not for this program the Government of Turkey would have to pay back to AID all the development loan or whatever it is plus interest? Mr. WOLL. That is right, and if development grant funds are used, without a doubt, AID would have to come to Congress for more money. Mr. MONAGAN. Where it is an out-and-out grant? Mr. WOLL. Yes, sir. Mr. MONAGAN. We are saying that our own Government is saving money there, but from the other aspect it seems to me there could be cases where there is quite a windfall. Mr. WOLL. We don't like to call it savings or a windfall. We like to think of it as a way of stretching AID-appropriated dollars in achieving our objectives. Mr. MONAGAN. I understand that, but you see, the American taxpaver has paid for the item in the first place when it was put in the military program, so it isn't as if it is coming free of any obligation whatsoever. Mr. WOLL. Yes, sir. Mr. MONAGAN. So it might be advisable in some cases to have some recoupment rather than deduct from the loan the amount which you sav is done. Mr. SCORDAS. Mr. Chairman, the potential of this program looks exceptionally good. We feel as long as the military relocates and modernizes and reorganizes property will be available to AID. Mr. MONAGAN. You indicated there was some reduction in the volume being generated. Mr. SCORDAS. Yes, sir. I feel-this is my personal opinion-that we will have another peak in the fall and this coming winter, in the second and third quarters. The military had to move out of France and it is possible they did not declare excess all the items they had on hand that were excess. Mr. WOLL. Mr. Chairman, the committee knows that in the last 4 or 5 years the Department of Defense has excessed $4 to $6 billion annually. With the appropriations going up each year I would think the excessing of property would increase rather than decrease. Mr. MONAGAN. Of course, that works both ways. You probably have more beds and mattresses but you have less electronic equipment and things like that. Mr. WOLL. There really does not seem to be any end to the excess property situation. I know most everybody in it, in private industry, as well as in Government since World War II and there doesn't seem to be any end to it. Mr. MONAGAN. I think this is very useful in making some recoup ment. Mrs. HECKLER. May I ask a question, Mr. Chairman? Mr. MONAGAN. Certainly. Mrs. HECKLER. Is your procedure now to place reliance on the contract rehabilitation firms or do you have any inspection procedures after the work is completed? Mr. SCORDAS. Yes, we inspect the items. We have a combination of our inspectors and the contractor's inspectors. Mr. MONAGAN. We can go into that question when we are in Antwerp. I certainly think we should. Mr. WOLL. We are putting another American as an inspector at this plant. Mrs. HECKLER. It seems a little more control would be advisable. Mr. MONAGAN. Thank you very much, gentlemen. We appreciate your assistance. We will receive the photographs for the file. (Thereupon, at 4:45 p.m. on Saturday, May 27, 1967, the hearing was adjourned.) CONTROL AND USE OF EXCESS PROPERTY AND RELATED FOREIGN ASSISTANCE PROBLEMS FOLLOWING U.S. MILITARY EXCLUSION FROM FRANCE1966-67 MONDAY, MAY 29, 1967 HOUSE OF REPRESENTATIVES, SPECIAL SUBCOMMITTEE ON DONABLE PROPERTY, The subcommittee met at 9:45 a.m. in the Office of the Depot Commander, U.S. Army Depot, Germersheim, Germany, Hon. John S. Monagan (subcommittee chairman) presiding. Subcommittee members present: Hon. John S. Monagan and Hon. Margaret M. Heckler. Subcommittee staff members present: Miles Q. Romney, counsel; Peter S. Barash, legal assistant. Also present: Col. Robert K. Nelson, commanding officer, USAGDK; Mr. I. Levinson, special assistant, Supply and Maintenance Agency, Communications Zone; Col. William Pencak, I. & S. Communications Zone; Brig. Gen. Frank B. Clay, C/S, Communications Zone; Lt. Col. P. M. Princigalli, commanding officer, USADAG; Maj. James J. Lancaster, commanding officer, 7th Maintenance Battalion, NARG; Mr. Felix Piantanida, C/STD, USADAG; Mr. Robert M. Gilroy, audit manager, European Branch of International Division, General Accounting Office, Frankfurt, Germany; Mr. Jack K. Woll, Director, Government Property Resources Division, Office of Procurement, Agency for International Development, Washington, D.C.; and Col. John Pfeiffer, Headquarters, USAREUR, escort officer. BRIEFING BY COL. ROBERT K. NELSON Colonel NELSON. It is indeed a pleasure to welcome you to the Germersheim Depot activity. This depot activity is a subordinate element of the Kaiserslautern General Depot. It was established orginally in 1951 as an ordnance vehicle storage park for the purpose of handling World War II vehicles that became surplus in the European theater, and has served in that mission up until we moved from France. At the present time it is being converted into a general depot. CHART NO. 1- -MISSION The mission of the depot is shown on this chart here. We have a storage and issue mission of both reserve and peactime operating stocks. 107 82-554-67- -8 We provide direct and general support maintenance to designated elements of the USAREUR Augmentation Readiness Group. And we act as a transfer point under the cooperative logistics program. CHART NO. 2-TONS IN STORAGE This chart reflects the tons in storage at the depot with 30 June 1966 as the base point and brought up to date as of 26 May 1967. Mr. MONAGAN. What was the date the movement started? Colonel NELSON. Actually the movement from France started in April. You will see this in the next chart that I will show you. We have used in this one our year end tonnage. In Germersheim they received a relatively small amount the first 3 months. The bulk of our tonnage came in the period October, November, and December. As you can see, the big increase has come in ground forces equipment. This was the equipment that was formerly the Engineer Commodity Group's equipment. This consisted principally of bridging, though there is some tonnage of heavy construction equipment included. CHART NO. 3-STATUS OF STOCKS This next chart shows the status of our stocks. It is a significant one because it shows a change in our stock status in shifting from an ordnance vehicle storage park to a general depot configuration. A significant part in this shows the major increase in our serviceable tonnage. We have reduced the number of major items of equipment. These are such items as tractors that have been reduced after the serviceability of these items has been increased. Mr. MONAGAN. What is the legend "Unserviceable"? Colonel NELSON. These are items that are not ready for issue. They require overhaul or rebuilding or have exceeded their serviceable life. It is used equipment, sir, that would require repair before it could be reissued for combat serviceability. Mr. MONAGAN. The major portion for fiscal year 1966 is in that category. Colonel NELSON. Yes, sir. Sir, this was the principal issue and turn-in point for all the combat vehicles for the 7th Army, so as you modernized the 7th Army we received back from the 7th Army the old vehicles. So as we issue a good vehicle we get back an unserviceable one. Mr. MONAGAN. These figures are numbers of items, is that right? Colonel NELSON. Yes, sir. Mr. MONAGAN. But your percent of serviceable is almost the same as unserviceable. Colonel NELSON. The third item in the legend below is "Disposition instructions received." This indicates that we have received disposition instructions on 3,000 items. This may be directing us to ship the item back to CONUS or to a rebuild plant or to the property disposal activity. Mrs. HECKLER. Would the orders be from the NICP? Colonel NELSON. That is correct. All our instructions come from the commodity agency here in Europe. Mrs. HECKLER. How is it you have received disposition instructions on a very, very small percentage? Colonel NELSON. This is a continuing process. Equipment is coming in all the time and we prepare the necessary forms and the supply agency reviews the items. If they have authority in the field they will give us disposition instructions. If not, the forms are transferred back for decision by the commodity manager in CONUS. Mr. MONAGAN. But your normal position in peacetime would be to have a large amount on hand and a relatively small amount going out, wouldn't it? Colonel NELSON. In what respect, sir? Mr. MONAGAN. Mrs. Heckler asked why there was such a small amount that was allocated. Normally you are storing materiel for emergency use? Colonel NELSON. Yes, sir. Mr. MONAGAN. So it is not necessarily a bad thing to have a large amount on hand and a small amount going out. Mrs. HECKLER. This is unserviceable? Colonel NELSON. Yes. Mr. LEVINSON. These things are held in "as is" condition until they are screened and the determination made as to whether or not we should repair them for disposal. There must be established a definite need for this specific item before it is put in serviceable condition. Mr. MONAGAN. In this summary as of June 30, 1966, the majority of those items are those which were normally a part of this installation? Colonel NELSON. Yes, sir. Mr. MONAGAN. And as of May 26, 1967, was most of the increase due to the FRELOC movement? Colonel NELSON. No, sir. Mr. MONAGAN. Can you separate that? Colonel NELSON. We are talking about the total number of items? This chart is in tonnage. Mr. MONAGAN. In either category. Colonel NELSON. From France we received essentially serviceable. property. The majority of the disposition instructions had been issued to the French depots as pertains to this type of equipment, disposing of it before it was shipped. So our receipt has been primarily in the serviceable property. Mr. Levinson, do you know of any shipped in from the French depots for rebuild? Mr. LEVINSON. I have no doubt there was some. Mr. MONAGAN. In the serviceable category how can you divide it as between what came from FRELOC? Colonel NELSON. I think the next chart will clarify that. Mr. MONAGAN. Both in tonnage and number of items? Colonel NELSON. Yes, sir. I have a tonnage chart which will give you a pretty good feel on that, sir. Mrs. HECKLER. Is this typical of the operation that you keep on hand that much materiel that is not serviceable? Colonel NELSON. Well, our mission here is to hold this materiel until we receive shipping instructions from the commodity manager. As to what our level is, Mr. Levinson do you have that? |