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pendents (including expenses during necessary stopovers while engaged in such travel), and transportation of personal effects, household goods, and automobiles when any part of such travel or transportation begins in one fiscal year pursuant to travel orders issued in that fiscal year, notwithstanding the fact that such travel or transportation may not be completed during the same fiscal year, and cost of transporting to and from a place of storage, and the cost of storing automobiles of employees when it is in the public interest or more economical to authorize storage.

(c) Funds available under this Act may be used to pay costs of training employees employed or assigned pursuant to section 7(c) (2) of this Act (through interchange or otherwise) at any State or local unit of government, public or private nonprofit institution, trade, labor, agricultural, or scientific association or organization, or commercial firm; and the provisions of Public Law 84–918 (7 U.S.C. 1881 et seq.) may be used to carry out the foregoing authority notwithstanding that interchange of personnel may not be involved or that the training may not take place at the institutions specified in that Act. Such training shall not be considered employment or holding of office under section 2 of the Act of July 31, 1894, as amended (5 U.S.C. 62) and any payments or contributions in connection therewith may, as deemed appropriate by the head of the agency of the United States Government authorizing such training, be made by private or public sources and be accepted by any trainee, or may be accepted by and credited to the current applicable appropriation of such agency: Provided, however, That any such payments to an employee in the nature of compensation shall be in lieu, or in reduction, of compensation received from the United States Government. (d) Funds available for the purposes of this Act shall be available for

(1) rent of buildings and space in buildings in the United States, and for repair, alteration, and improvement of such leased properties, without regard to the limitation contained in section 322 of Public Law 72–212, as amended (40 U.S.C. 278a) ;

(2) expenses of attendance at meetings concerned with the purposes of this Act, including (notwithstanding the provisions of section of Public Law 60–328 (31 U.S.C. 673)) expenses in connection with meetings of persons whose employment is authorized by section 13(a) of this Act;

(3) purchase, maintenance, operation, and hire of aircraft: Provided, That aircraft for administrative purposes may be purchased only as specifically provided for in an appropriation or other Act;

(4) purchase and hire of passenger motor vehicles : Provided, That, except as may otherwise be provided in an appropriation or other Act, passenger motor vehicles for administrative purposes abroad may be purchased for replacement only, and such vehicles may be exchanged or sold and replaced by an equal number of such vehicles, and the cost, including exchange allowance, of each such replacement shall not exceed $3,500 in the case of an automobile for the chief of any special mission or staff abroad established under section 7(e): Provided further. That passenger motor vehicles may be purchased for use in the United States only as may be specifically provided in an appropriation or other Act;

(5) entertainment (not to exceed $5,000 in any fiscal year except as may otherwise be provided in an appropriation or other Act);

(6) exchange of funds without regard to section 3561 of the Revised Statutes (31 U.S.C. 543) and loss by exchange;

(7) expenditures (not to exceed $5,000 in any fiscal year except as may otherwise be provided in an appropriation or other Act) of a confidential character other than entertainment: Provided, That a certificate of the amount of each such expenditure, the nature of which it is considered inadvisable to specify, shall be made by the Director of the Peace Corps or such person as he may designate, and every such certificate shall be deemed a sufficient voucher for the amount herein specified ;

(8) insurance of official motor vehicles or aircraft acquired for use abroad;

(9) rent or lease abroad for not to exceed ten years of offices, health facilities, buildings, grounds, and living quarters, and payments therefor in advance; maintenance, furnishings, necessary repairs, improvements, and alterations to properties owned or rented by the United States Government or made available for its use abroad; and costs of fuel, water, and utilities for such properties;

(10) expenses of preparing and transporting to their former homes, or, with respect to foreign participants engaged in activities under this Act, to their former homes or places of burial, and of care and disposition of, the remains of persons or members of the families of persons who may die while such persons are away from their homes participating in activities under this Act;

(11) use in accordance with authorities of the Foreign Service Act of 1946, as amended (22 U.S.C. 801 et seq.), not otherwise provided for; and

(12) ice and drinking water for use abroad.

APPOINTMENT OF PERSONS SERVING UNDER PRIOR LAW Sec. 16. (a) Under such terms and conditions as the President may prescribe volunteer personnel who on the effective date of this Act have been engaged by contract by, or pursuant to agreement with, the Peace Corps agency established within the Department of State pursuant to Executive Order Numbered 10924, dated March 1, 1961, may be enrolled as volunteers or volunteer leaders under this Act. Such enrollment may be made effective, for any or all purposes, as of a date prior to the effective date of this Act but not earlier than the date of final selection for service abroad of the person in question. All allowances and termi. nation payments similar to those authorized by this Act received by any such person or by members of his family or payable with respect to any period between the effective date and the actual date of such enrollment shall be deemed for all purposes to have been received or to be payable under the appropriate provision of this Act.

(b) Persons serving as members of the National Advisory Council and the Career Planning Board of the agency referred to in subsection (a) of this section shall be members of the National Advisory Council and the Career Planning Board, respectively, established under section 12 of this Act without appointment thereunder.

USE OF FOREIGN CURRENCIES Sec. 17. Whenever possible, expenditures incurred in carrying out functions under this Act shall be paid for in such currency of the country or area where the expense is incurred as may be available to the United States.

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APPLICABILITY OF MUTUAL DEFENSE ASSISTANCE CONTROL ACT

SEC. 18. The Mutual Defense Assistance Control Act of 1951 (22 U.S.C. 1611 et seq.) shall not apply with respect to functions carried out under this Act.

SEAL

SEC. 19. The President may adopt, alter, and use an official seal or emblem of the Peace Corps of such design as he shall determine, which shall be judicially noticed.

MORATORIUM ON STUDENT LOANS

SEC. 20. Section 205 of the National Defense Education Act of 1958 (Public Law 85-864) (20 U.S.C. 425) is amended in the following respects

(1) by deleting the word “or” immediately preceding section 205(b) (2) (A) (ii) and by adding immediately after that section the following: “or (iii) during which the borrower is in service as a volunteer under the Peace Corps Act: Provided, That this clause shall apply to any loan outstanding on the effective date of the Peace Corps Act only with the consent of the then obligee institution,"; and

(2) by amending section 205 (b) (3) to read as follows:

“(3) not to exceed in the aggregate 50 per centum of any such loan (plus interest) shall be canceled (A) for service as a full-time teacher in a public elementary or secondary school in a State, at the rate of 10 per centum of the amount of such loan plus interest thereon, which was unpaid on the first day of such service, for each complete academic year of such service; and (B) for service as a volunteer under the Peace Corps Act, at the rate of 10 per centum of the amount of such loan plus interest there on, which was unpaid on the first day of such service, for each completed eight months of such service;'

TAXATION OF ALLOWANCES

Sec. 21. The Internal Revenue Code of 1954, as amended, is amended in the following respects:

(1) Section 912 of such Code relating to exemption for certain allowances is amended by adding the following new paragraph (3):

(3) PEACE CORPS ALLOWANCES.-In the case of volunteers within the meaning of the Peace Corps Act and members of families of such volunteers, amounts received as allowances under section 5 or 6 of the Peace Corps Act (other than termination payments under section 5(c) of said

Act).” (2) Section 1303(b) of such Code relating to income from back pay is amended by adding the following new paragraph (4):

“(4) Termination payments authorized by the provisions of section 5(c) of the Peace Corps Act and received or accrued by an individual during the taxable year on account of any period of service as a volunteer under the Peace Corps Act occurring prior to the taxable year."

SOCIAL SECURITY COVERAGE

SEC. 22. During any period of service as a volunteer under this Act, an individual shall, notwithstanding the provisions of section 210 of the Social Security Act and section 3121 of the Internal Revenue Code of 1954, be deemed to be performing service constituting employment for purposes of title II of such Act and chapter 21 of such Code; and, subject to the provisions of section 209(a) of such Act and section 3121 (a) (1) of such Code, any such individual shall be deemed to have received wages for such service at the rate determined under section 5(c) with respect to termination payments.

AMENDMENT TO CIVIL SERVICE RETIREMENT ACT

SEC. 23. Subsection (j) of section 3 of the Civil Service Retirement Act, as amended (5 U.S.C. 2253), is amended to read as follows:

"MILITARY SERVICE AFTER DECEMBER 1956 AND PEACE CORPS VOLUNTEER SERVICE

“(j) Notwithstanding any other provision of this section or section 5(f) of the Peace Corps Act, any military service (other than military service covered by military leave with pay from a civilian position) performed by an individual after December 1956 and any period of service by an individual as a volunteer under the Peace Corps Act, shall be excluded in determining the aggregate period of service upon which an annuity payable under this chapter to such individual or to his widow or child is to be based, if such individual or widow or child is entitled (or would upon proper application be entitled) at the time of such determination, to monthly old-age or survivors benefits under section 202 of the Social Security Act, as amended (42 U.S.C. 402), based on such individual's wages and self-employment income. If in the case of the individual or widow such military service or service under the Peace Corps Act is not excluded under the preceding sentence, but upon attaining retirement age (as de fined in section 216(a) of the Social Security Act, as amended), he or she becomes entitled (or would upon proper application be entitled) to such benefits, the Commission shall redetermine the aggregate period of service upon which such annuity is based, effective as of the first day of the month in which he or she attains such age, so as to exclude such service. The Secretary of Health, Education, and Welfare shall, upon the request of the Commission, inform the Commission whether or not any such individual or widow or child is entitled at any specified time to such benefits."

REEMPLOYMENT AND VOTING RIGHTS

Sec. 24. (a) Any person in the employ of the United States Government, its territories or possessions, any political subdivision or agency thereof, or the District of Columbia, or in the employ of any private employer, shall upon request be granted a leave of absence from such employment for the purpose of undertaking any required training under section 8(a) of this Act. Upon termination of such training (or upon discharge from hospitalization incident to such training) such person shall be entitled to return to his position with such seniority, status, pay and vacation rights as he would be entitled to had he not been absent for such purpose, if, but only if, he shall report for work not more than ten days following termination of such training (or following discharge from such hospitalization). If such person is not qualified to perform the duties of his position by reason of disability incident to such training but is qualified to perform the duties of any other position in the employ of the employer or his successor in interest, he shall be restored by that employer or such successor to such other position the duties of which he is qualified to perform as will provide him like seniority, status, and pay or the nearest approximation thereof consistent with the circumstances of his case.

(b) Any volunteer who, prior to his first day of service under this Act, had been for more than six months in the employ of the United States Government, its territories or possessions, any political subdivision or agency thereof, or the District of Columbia, or in the employ of any private employer, and who has completed any period of satisfactory service abroad as a volunteer, shall, upon termination of such service, be entitled to return to his position or to a position of like seniority, status, and pay with the employer or his successor in interest, if, but only if, he shall make application for reemployment to such employer or successor within sixty days after termination of his service (or after discharge from hospitalization incident to such service continuing for not more than one year after such termination). If such person is not qualified to perform the duties of such position by reason of disability sustained during service under this Act but is qualified to perform the duties of any other position in the employ of such employer or successor, he shall be restored to such other position the duties of which he is qualified to perform as will accord him like seniority, status, and pay, or the nearest approximation thereof consistent with the circumstances of his case. Any person reemployed under this subsection shall be considered as having been on furlough or leave of absence and shall be restored to employment without loss of seniority, shall be entitled to participate in insurance or other benefits offered by the employer pursuant to any established rules and practices relating to employees on furlough or leave of absence, and shall not be discharged from the position to which restored without cause within one year after such restoration. This subsection shall not apply with respect to employment in any temporary position.

(C) In case any private employer shall fail or refuse to comply with the provisions of this section or shall deny any rights accorded hereunder, he may be specifically required to comply with the provisions hereof, to grant such rights, and in addition, to compensate the person injured thereby for any loss of wages or other benefits occasioned thereby, in an appropriate action or proceeding against the employer in any court of competent jurisdiction.

(d) The President may render such aid as he deems appropriate to assist former volunteers in the securing of their reemployment rights in private employment under this section, and shall make appropriate arrangements to effectuate such rights in Government employment.

(e) Any person in service as a volunteer under this Act shall be permitted to vote in person or by absentee ballot in any general, special or primary election occurring in the State of which he is a resident, whether he is within or without such State at the time of such election, if under the law of such State he is otherwise entitled so to vote in such election; but nothing in this subsection shall be construed to require granting to such person a leave of absence of more than one day to permit him so to vote.

DEFINITIONS

SEC. 25. (a) The term "abroad” means any area outside the continental United States, Alaska, and Hawaii.

(b) The term "function" includes any duty, obligation, right, power, authority, responsibility, privilege, discretion, activity, and program.

(c) The term "health care” includes all appropriate examinations, preventive, curative and restorative health and medical care, and supplementary services such as travel and escorts when necessary.

(d) For the purposes of this or any other Act, the period of any individual's service as a volunteer under this Act shall include

(i) except for the purposes of section 5(f) of this Act, any period of training under section 8(a) prior to enrollment as a volunteer under this Act; and

(ii) the period between enrollment as a volunteer and the termination of service as such volunteer by the President or by death or resignation.

(e) The term “United States Government agency” includes any department, board, wholly or partly owned corporation, or instrumentality, commission, or establishment of the United States Government.

CONSTRUCTION

Sec. 26. If any provision of this Act or the application of any provision to any circumstances or persons shall be held invalid, the validity of the remainder of this Act and the applicability of such provision to other circumstances or persons shall not be affected thereby.

EFFECTIVE DATE

Sec. 27. This Act shall take effect on the date of its enactment.

The CHAIRMAN. Our first witness is Mr. Robert Sargent Shriver, Jr., who has been serving as Director of the Peace Corps established on a temporary basis by the President.

Mr. Shriver, we are glad to have you here. I believe you are accompanied by Mr. Moyers and several other of your aides. You have a prepared statement !

Mr. SHRIVER. Yes, Mr. Chairman, I do.

The CHAIRMAN. You may proceed, please, sir. STATEMENT OF HON. ROBERT SARGENT SHRIVER, JR., DIRECTOR,

THE PEACE CORPS; ACCOMPANIED BY BILL D. MOYERS, ASSOCIATE DIRECTOR, PUBLIC AFFAIRS; WARREN W. WIGGINS, ASSOCIATE DIRECTOR, PROGRAMS AND OPERATIONS; WILLIAM JOSEPHSON, SPECIAL ASSISTANT TO MR. SHRIVER; JOHN CORCORAN, ASSOCIATE DIRECTOR, MANAGEMENT; ROGER S. KUHN, ASSOCIATE GENERAL COUNSEL; RICHARD BOGARDUS, DIRECTOR, BUDGET AND FINANCE DIVISION; AND WILLIAM P. KELLY, DIRECTOR OF CONTRACTS AND LOGISTICS

Mr. SHRIVER. Thank you, Mr. Chairman.

In addition to Mr. Moyers, I have with me Mr. Roger Kuhn, Mr. Warren W. Wiggins, in charge of our program, Program Department, and Mr. Bogardus from our Budget and Financial Section.

THE PEACE CORPS AS REPRESENTATIVE OF AMERICAN IDEALISM

Mr. Chairman and members of the committee, 1 month ago in India, Ashadevi, an extraordinary woman and former associate of the late Mahatma Gandi, traveled 3 days and nights on a train to come to New Delhi to talk with me about the Peace Corps.

Yours was the first revolutionshe said. Do you think young Americans possess the spiritual values they must have to bring the spirit of that revolution to our country? There is a great valuelessness spreading around the world and in India, tooshe said. Your Peace Corps volunteers must bring more than science and technology. They must touch the idealism of America and bring that to us, too. Can they do it?

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