The following schedule summarizes Army redistribution and transfers to other federal agencies, primarily AID, from PDO activities in France during the FRELOC period: ARMY REDISTRIBUTION OF PDO RECEIPTS IN FRANCE

Air Force data on redistribution of excess is available only in total for all bases in Europe including France. Transfers to AID, however, are identified by the country of origin. This information for the FRELOC period is summarized as follows:

Mr. MONAGAN. I would just like to conclude by asking you if you would explain just what this Army policy is that you speak about that led to the retention of excessive stocks? In other words, they have their current and war requirements, and then they have an additional reserve. Apparently this is a sort of supplemental reserve, is that it? Mr. STOLAROW. In essence, the way we look at it is that it is excess material. It is over and above any authorized stockage objectives within the theater. It is material that exceeds their current operating stock levels; that is, stock levels they maintain for day-to-day operations, plus their war reserve requirements. And as I indicated in the statement, periodically, requirements do change. The need for a certain type of repair part would drop, say, because the end items have been transferred to another command or another theater. The stock on hand then exceeds the computed requirements. Under Army regulations, the overseas commander does have an option of retaining that in his inventory.

Mr. MONAGAN. Is there any limitation on that option?

Mr. STOLAROW. The Army regulations say that he can retain up to an 18-month supply.

I might say that we have recently been advised by the Department of Defense that some attempts are going to be made within the next

year to get reporting data back from the overseas commands to the Inventory Control Point so that they will have more information. Mr. MONAGAN. Do you have any more questions?

Thank you very much.

We will recess until May 22 at 10:30 a.m. in this room.

(Whereupon, at 12 p.m., the committee was adjourned, to reconvene at 10:30 a.m., May 22, 1967.)

CONTROL AND USE OF EXCESS PROPERTY AND RELATED FOREIGN ASSISTANCE PROBLEMS FOLLOWING U.S. MILITARY EXCLUSION FROM FRANCE1966-67

MONDAY, MAY 22, 1967

HOUSE OF REPRESENTATIVES,

SPECIAL SUBCOMMITTEE ON DONABLE PROPERTY OF THE COMMITTEE ON GOVERNMENT OPERATIONS, Washington, D.C. The special subcommittee met, pursuant to adjournment, at 10:30 a.m., in room 2203, Rayburn House Office Building, Hon. John S. Monagan (chairman of the subcommittee) presiding.

Present: Representatives John S. Monagan and Margaret M. Heck

ler.

Professional staff members present: Miles Q. Romney, counsel; Peter S. Barash, legal assistant; and William Copenhaver, minority

staff.

Mr. MONAGAN. The hearing will come to order. As I understand now, Mr. Zaretzky, who is the Director of Supply Management Policy, Office of the Assistant Secretary of Defense for Installations and Logistics, will offer the testimony and then the other gentlemen who are here will be available for questioning. Is that right?

Mr. ZARETZKY. Yes, sir.

Mr. MONAGAN. You have a statement, Mr. Zaretzky. You may proceed.

STATEMENT OF HYMAN S. ZARETZKY, DIRECTOR, SUPPLY MANAGEMENT POLICY, OFFICE OF THE ASSISTANT SECRETARY OF DEFENSE (INSTALLATIONS AND LOGISTICS), ACCOMPANIED BY JOSEPH M. HEISER, BRIGADIER GENERAL, U.S. ARMY, ASSISTANT DEPUTY CHIEF OF STAFF FOR LOGISTICS (MATERIEL READINESS), DEPARTMENT OF THE ARMY; CHARLES C. CASE, BRIGADIER GENERAL, U.S. ARMY, CHIEF, SUPPLY AND MAINTENANCE AGENCY, U.S. ARMY EUROPEAN COMMAND; JOHN J. KIELY, JR., COLONEL, U.S. ARMY, COMMUNICATIONS ZONE, U.S. ARMY, EUROPE; FREDERICK S. WYLE, DEPUTY ASD (PLANNING AND NORTH ATLANTIC AFFAIRS) (ISA); JOHN M. MULLEN, OASD (ISA); GLENN E. BLITGEN, OASD (ISA); LESTER T. DAVID, COLONEL, U.S. AIR FORCE, OASD (I. & L.); AND WILLIAM W. CAVE, OFFICE OF THE CHIEF OF SUPPORT SERVICES, DEPARTMENT OF THE ARMY

Mr. ZARETZKY. May I introduce my colleagues? On my right is Gen. Joseph M. Heiser, who is here in Washington, as Assistant Dep

37

uty Chief of Staff for Logistics in the Department of the Army; General Case is the Chief of the Supply and Maintenance Agency in Europe; and Colonel Kiely is from what we call COMZ, or the Communications Zone in Europe.

Mr. MONAGAN. May I ask in each case you explain just a bit more what their functions or responsibilities are? Maybe each of them can briefly put that in the record.

General HEISER. Yes, sir. I appreciate the opportunity. I am Assistant Deputy Chief of Staff for Logistics, covering materiel readiness. Included in materiel readiness are the Directorates of Supply and of Maintenance. It is our responsibility to supervise policy and procedure at the Department of the Army level, covering functions involved in supply and maintenance, which includes responsibilities pertaining to property disposal.

Mr. MONAGAN. Thank you. General Case?

General CASE. I am the Chief of the Supply and Maintenance Agency of COMZ in Europe. I act in a dual capacity. I act as principal staff officer to the commanding general of the Communications Zone for the wholesale supply and maintenance functions in support of the Army in Europe; and I operate the Supply and Maintenance Agency, which is the operating agency through which all the depots and maintenance shops in Europe are controlled, which procures all the materiel needed in support of the Army in Europe and maintains it and which has the mission, in addition, of procuring subsistence offshore for the forces in Europe.

Mr. MONAGAN. Thank you.

Colonel KIELY. Until April 1, I was Chief of Installations and Services Division in COMŻ Headquarters. As such, I was responsible for their retail supply support, the support facilities for both the military and their dependents, and for such things as the construction program and property disposal activities as they occurred in France. Since April 1 I remained behind with the group that was continuing the closeout of the U.S. Army in France and I am now with that group as the Installations and Services Division Chief.

Mr. MONAGAN. Do you have concern with any new construction that may be required elsewhere as a result of the move from France? Colonel KIELY. Only in the beginning, sir. I do not have any now. It has moved with the headquarters, and there is a new organization formed there to take care of that.

Mr. MONAGAN. Would that be under General Heiser?

General HEISER. May I address this, sir? Actually, we did not come with a specific DA representative on construction.

Mr. MONAGAN. I do not know that we are particularly interested in it, but merely for informational purposes.

General HEISER. All right, sir. I can address the overall function of construction which is involved.

Mr. MONAGAN. Fine; thank you.

Mr. ZARETZKY. Mr. Chairman and members of the committee, thank you for the opportunity to review with you the disposition of Department of Defense supplies and equipment necessitated by the closing of U.S. facilities in France.

The committee chairman's letter to Secretary McNamara, dated May 11, 1967, requested that we respond to a number of questions. related to this move. In the course of this statement, I will address questions posed in that letter.

For all practical purposes, the relocation of materiel held in France has been completed. Of the 813,000 tons on hand on April 1, 1966, all but 6,000 tons have been consumed or removed. The materiel still in France is required for support of U.S. personnel and their dependents remaining in France until the end of the current school year.

Because we wished to ease personal hardships as much as possible, arrangements were made for 6,000 U.S. personnel, a large number of them either students, teachers, or administrators at dependent schools, to remain in France, with the approval of that Government, until the end of June. This total includes a small number of U.S. personnel required to remain in France for longer periods in order to complete property disposal actions and perform certain needed tasks in connection with SHAPE activities.

Disposition of materiel: Discounting the 6,000 tons of property just mentioned, FRELOC involved the relocation of approximately 807.000 tons. The preponderance, 722,297 tons, was held by the Army. The Air Force had 84,279 tons and Navy only 196 tons.

Mr. ZARETZKY. Yes. The Navy materiel, which consisted of housekeeping type items, was located near Marseilles and shipped to Gaeta, Italy, home of the 6th Fleet.

The combined tonnage of the Army and Air Force have been treated as follows: 388,294 tons were moved to Germany; 146,518 tons were moved to United Kingdom; 86,000 tons have been returned to the United States as excess to theater requirements; 9,753 tons were moved to Italy; and 6,528 tons were moved to Benelux.

These relocation actions account for 637,093 tons of the 807,000 tons in France on April 1, 1966. In addition to these bulk moves, approximately 100,000 tons of property were consumed through attrition during the FRELOC period. These 100,000 tons of property were applied to requisitions generated by the U.S. force elements in Germany as well as the forces still in France. I will speak further to this point

in a moment.

It can be determined from the foregoing, and I think this is a key point, that slightly less than 70,000 tons of property, or 8.5 percent, held in France became available for reutilization purposes or ultimate disposal action.

Attached to my statement for inclusion in the record are detailed tabulations showing the disposition of Army and Air Force materiel. Mr. MONAGAN. That may be made a part of the record at this point.