Mr. ENGEL. That is just what I am saying that those items are not being included this year. General AKIN. Yes, sir, that is right. Mr. ENGEL. Last year you came here, and we discussed the matter very fully off the record and on the record, and I tried to get a system in here whereby we would know exactly what the communication system is going to cost us, and what we would have invested in it, just like any common business, and the Budget said you cannot do it. General AKIN. That is right. They said they would try to let us do it next year. Mr. ENGEL. Can you give us a list of those items which you have which they have excluded? General AKIN. I have that complete in my statement, Mr. Chairman, and I will cover it. I have it in the written statement. Mr. ENGEL. So that if the committee wants to put it in and have one system for the communication system you can do it, and I want the same thing in for any Air Corps facility which legitimately belongs there, and we want everything in here that way, so that we know what these communication costs are. General AIKEN. Yes, sir. I will have that complete in the statement, so that if you wish to do that you can shift it over that way. (The information requested is as follows:) Income: Operating forecast from the fiscal viewpoint fiscal year 1949 Estimated cash receipts to U. S. Treasury- $1, 175, 000 200, 000 1, 375, 000 Estimated cash value of free traffic handled for about 46 Federal agencies 3, 475, 000 Total 2 4, 850, 000 Expenses: A. Plant increase (capital expenditures) Signal construction projects (220-10) ACS....... Construction of buildings, quarters and utilities in Engi- Subtotal... B. Operating expenses: ACS budget fiscal year 1949 for maintenance of buildings, 159, 000 600, 000 1, 911, 500 2,670, 500 1, 645, 000 726,000 If Government agencies were required to pay for their traffic we believe there would be a 50 percent or more decrease in their traffic. See the following table: Operating forecast from the fiscal viewpoint fiscal year 1948-Continued Expenses-Continued. B. Operating expenses-Continued. Estimate for items furnished by Department of the Pay for military personnel from "Finance Service, Rental value of Government-owned buildings (PBA) Rental value of Government-owned land (estimated). Subtotal.... * See the following: Department of Air Forces-passengers, freight, mail. Engineers coal and utilities for buildings on Army stations. Quartermaster-gasoline, oil, furniture.. Signal-administration building, supplies and equipment.. Transportation Corps-passengers, freight. Public Buildings Administration-heat, water, light. Finance Service, Army permanent transfer military personnel. Ordnance, maintenance motor vehicles.... Total... $475, 375 2, 000, 000 114, 000 18, 000 4, 978, 375 $5,000 25,000 15,000 65,000 232, 379 54.246 5,000 55,750 18,000 475,375 Mr. ENGEL. The Army budget went to the Budget Office the way you intended it should be? General AKIN. Yes, sir. Mr. ENGEL. And the Budget then changed it. APPROPRIATION EXCLUDED BY BUREAU OF THE BUDGET General AKIN. Yes, sir, and specifically this was what they did, they took out of this budget $1,911,500 for construction of buildings that relate to the Alaskan system. Mr. ENGEL. The Alaska communication system? General AKIN. Yes, sir, and they put that in the Engineer Service of the Army, and then there was a net expenditure, an estimated expenditure by the Army of about $405,375 for items of the type which I have mentioned. We had that in the Alaskan system budget, and the Bureau of the Budget asked that that be left in the Army budget and that it be handled by the Army budget. Mr. ENGEL. In what branch of the service? General AKIN. It relates to the Signal Corps and other technical services. Mr. ENGEL. The Signal Corps of the Army? General AKIN. No, sir, as part of the Signal Corps and several others. Here is a list of $475,000 worth of items, and it indicates the appropriations under which they are covered. Seventy thousand dollars was carried in military budgets, and they did not cover that. The Bureau of the Budget stated we would have to absorb that amount in the Army budgets. However, they advised that $405,000 would be transferred to the Army budget. Does that clarify it, Mr. Chairman? Mr. ENGEL. If it does not we can come back to it. General AKIN. All right. Then there is a supplementary budget for $600,000 worth of signal equipment that we need for the rehabilitation of the system and to make the system complete and to meet the current requirements for the plant there, that they put into the supplementary budget and told us it would be submitted at the same time as the construction program of the Engineer Service of the Army which would cover the buildings for this signal equipment, and we have a list of those projects here if you would like to see them, Mr. Chairman. Mr. ENGEL. I have a list of all of the projects in Alaska. That is that $225,000,000 supplemental estimate that they sent down here last year, is it not? General AKIN. Yes, sir. Mr. ENGEL. I think they are rather optimistic. General AKIN. We can give you the whole thing if you want it, Mr. Chairman. LACK OF PROVISION FOR MEETING EMERGENCIES The $1,804,000 that we are asking for in this budget, plus the $405,000 that we spoke of just now to be provided by the various arms of the Army is only sufficient to operate the system and handle traffic. That left us without any money to meet emergencies. Specifically I mean that if we have any extended storm damage there we have not enough money to cover that. If we have a deep-sea cable break the cable barge that we have is only suitable to operate in the coastal service, close in to the shore for cable repairs. In such a case we would have to have a commercial vessel come there. The money for that vessel we would have to get in a supplementary estimate, and we estimate that it would take anywhere from 6 to 9 months to get the money and hire the ship to repair the cable. In the meantime about 60 percent of our traffic capacity which is handled over that cable would be out, and it would be a tremendous handicap to us. LACK OF PROVISION FOR ADDITIONAL REQUIREMENTS FOR ENGINEER SERVICE CONSTRUCTION PROGRAM The Engineer Service budget for fiscal year 1948, for the construction program in the area, amounts to approximately $43,000,000. That means that contractors will come into the area with their requirements for communication service, namely, for additional stations and additional circuits for the handling of messages in and out of the area, and we have no money to take care of the additional requirements in this estimate. Should the pulp industry come into the area we expect they will require some four new stations. I would like to go back to the budget system for a little while, if I may do so. Speaking of the items that have been taken out of this budget and put into the engineer budget and the others in the Army I want to mention that the officer in charge of the system there, in order to meet expected requirements, submitted a budget of some $9,000,000. The Department of the Army had reduced that to $4,872,000, so that was a reduction of $4,128,000 by the Department of the Army, and that was done by deferring to subsequent years many of the projects that we have. That was done in order to get within the current fiscal policy of the Bureau of the Budget. That, in general, gentlemen, brings us down to the actual comparative statement. Mr. ENGEL. Before you go into that I want to ask you a question or two, General. You mentioned a supplementary budget. General AKIN. Yes, sir. NEED FOR SUPPLEMENTAL FUNDS FOR EQUIPMENT AND BUILDINGS AUTHORIZED TO BE CONSTRUCTED Mr. ENGEL. Of course, until we see the engineer estimate we do not know what is in it, but, apparently, from your remarks on the budget statement why, $225,000,000 is going to come down as a supplemental budget to the Deficiency Subcommittee. Last year I saw a complete break-down of that $225,000,000, and they are supposed to spend every dime of it. Is the Department of the Army going to send this down as a deficiency again, is that the idea? Do you know, General Evans? General EVANS. Mr. Chairman, I think this supplemental that is referred to is for equipment which will go into the buildings which would be consturcted under the construction authorization. General AKIN. That is exactly right for the $600,000 Alaska Communication system supplemental for fiscal year 1949. However, there is $1,911,000 that was taken out of this budget and put into Engineer Service of the Army for buildings for the Alaska Communication system. Mr. ENGEL. That is for equipment? General AKIN. No, sir; for buildings to house equipment. Mr. ENGEL. For buildings? General AKIN. Yes, sir. Mr. ENGEL. Will that money be in the regular civil functions budget of the engineers, do you know? Colonel LAWTON. They are putting it in the civil section in the Engineer Service of the Army budget. Mr. ENGEL. Is that right? General AKIN. Yes, sir, $1,911,000. Mr. ENGEL. What I am particularly interested in is this: Last year, you remember the President sent down a $225,000,000 supplemental budget, after the civil-functions budget was passed, as I recall it. I saw at that time a complete break-down of the expenditure of the $225,000,000-$125,000,000, as I recall it was for overseas, and there was $100,000,000 for use here, or vice versa. I saw a breakdown of where it was going to be spent. Colonel MOORE. I think the chairman is referring to the authorization for construction which is contained in S. 1676, which passed the Senate on the 12th of this month. That is an authorization for construction both overseas and in the continental limits of the United States. Mr. ENGEL. That is the same thing. I have seen that list. Colonel MOORE. In the budget for the current fiscal year it was stated that a supplemental estimate would be submitted to cover the items provided for in that bill. Mr. ENGEL. The reason it has not been sent down here is because the authorization legislation has not yet been passed? Colonel MOORE. That is right. Mr. ENGEL. This item that we are speaking about for Alaska is not a part of this program, is it? General EVANS. No, sir. Colonel LAWTON. No, sir. The money that we are talking about here is for 1949. Now, let us go back to 1948. This authorization bill for the $225,000,000 for the Engineer Service, Army, is for the fiscal year 1948. In that $225,000,000 we have for the Alaska Communication System $2,336,264 for construction of buildings. We have not mentioned that figure before. That is for the fiscal year 1948. Now, let us go to the 1949 budget. We put construction in our budget for 1949 which is now in the engineers' 1949 construction program, and that is the $1,911,500 that the general was talking about a moment ago. Mr. ENGEL. If you are just authorizing it now, that money was not in the 1948 budget, as that has passed. Colonel LAWTON. No; it has not been appropriated. It is just enabling legislation for the Engineer Service of the Army. Mr. SCRIVNER. That is the one on which you are expecting to come in for a supplemental? Colonel LAWTON. No; the Engineer Service budget is 1948, and our supplemental of $600,000 for fiscal year 1949 will be presented concurrently with the Engineer Service construction budget for fiscal year 1949. Mr. ENGEL. This legislation here is merely an authorization for money to be expended in the future either in 1948 by a supplemental or 1949, $100,000,000 for the United States and $125,000,000 for overseas. That is not either 1949 or 1948. It can either be a supplemental appropriation in 1948 or 1949, or even 1950 for that matter. Colonel LAWTON. Yes, sir. Mr. ENGEL. And this item you are speaking of in Alaska does not come in under this bill? Colonel LAWTON. No, sir; not under this bill, because that is in the 1948 estimate of the engineers, and this is in 1949. Mr. ENGEL. Proceed. General AKIN. As I have previously stated, there is a supplemental estimate for $600,000 worth of equipment which is supposed to be submitted simultaneously with the engineer construction budget, of which latter $1,911,500 is for construction of buildings for the Alaska Communication System. FUNDS AVAILABLE, 1948, AND ESTIMATE, 1949 That, in general, gentlemen, gives you the general picture of the Alaska Communication System and the requirements thereof, and we get down now to a general comparison of the 1949 budget with 1948, which can be stated to you or, if you wish, we can go now to the details of the projects, whichever you are ready to do. Mr. ENGEL. What is that? General AKIN. I have a general statement here giving a comparison of the 1948 and 1949 budgets. Mr. ENGEL. We will have that here in each project, will we not? General AKIN. Yes, sir; you will get the same thing in each of the projects. NEED FOR ADDITIONAL PERSONNEL BECAUSE OF INCREASED TRAFFIC I would like to invite your attention to the high spots of the projects, the first of which is an increase of 26 civilian employees in the lowest grade, CAF-2. That increase results from several considerations, but mainly from the expected increase in traffic that we will have there. |