General MEHAFFEY. It is an increase in transformer capacity, which is now so small that when we put in new streets and additional housing we find we do not have the capacity to take care of the street lights which we need.

It does not involve any strengthening of the street lighting in the presently occupied part of the Ancon-Balboa district but merely an increase in the transformer capacity and the number of circuits.

CASH RELIEF TO ANNUITANTS

Mr. ENGEL. The next item is increased cost of cash relief on account of additional annuitants eligible to such relief in accordance with the act of July 8, 1937, $82,000.

Estimated actual cost for 1948 was $298,500.

Estimate for the fiscal year 1949, $380,500.

On page 24 of the justifications you have a tabulation showing the estimated additions, estimated separations, net on roll, monthly cost, and cost for the year, which we will place in the record. (The tabulation referred to follows:)

The following tabulation shows the estimated additions and separations during the fiscal year 1948, based on the best available information and on past records, and results in an increase of $33,500 over the original estimates for that purpose which has been provided from available funds:

The original amount appropriated for this function for fiscal year 1948

was..

There is available a saving of $11,296 as a carry-over from this function from the prior year..

Amount to be financed from other funds..

$265, 000

11, 296 22, 204

Total estimated requirements as revised for fiscal year 1948__ 298, 500 The original estimate of $265,000 for 1948 as presented last year was based on estimated net additions of 156 to the roll during the year at an average payment of $24 per month. The revised estimate herewith is based on net additions of 325 at an average payment of $23 per month, which is $1 less than used last year and represents the current average payments.

The estimate for the fiscal year 1949 is based on the continuation of 1,283

annuitants estimated to be on the roll as of June 30, 1948, plus an estimated net increase of 288 throughout the year, as indicated below:

Estimated June 30, 1948..

1,283

Estimated net additions during year (based on 360 additions less 72 separations at an average of $23 per month)..

$337, 463

Total

Rounded off.

1,571

380, 519

380, 500

Mr. ENGEL. Is there any comment you wish to make on that item, General Mehaffey?

General MEHAFFEY. I would like to say, Mr. Chairman, that although the question will not come to this committee initially, we have under study the revision of the cash relief system which now applies to the native employees of the Panama Canal.

The authority for the present system was included in a law which was passed in 1937. It authorized, in case native employees become disabled or unable to work, the payment of cash relief on the basis of $1 a month for each year of service with the Panama Canal or Panama Railroad Company, with a maximum of $25 a month.

While $25 a month maximum seemed very little to live on when the act was passed, it was not nearly as bad as it is at the present time. There are many superannuated or disabled silver employees who have worked perhaps 35 or more years for the Panama Canal or Panama Railroad Company and are now being retired on a maximum of $25, and it is practically impossible for these old people to go into Panama, rent a room of some kind, and live on as little as $25 a month.

We are considering the possibility and the advantages and disadvantages of covering those employees in under the civil-service retirement system, as the native employees of the Army, Navy, and other Federal agencies in the Canal Zone are now covered.

That, however, is a matter that will have to be taken up with the proper legislative committee.

Mr. ENGEL. That will have to come before a legislative committee first.

General MEHAFFEY. Yes.

Mr. ENGEL. You will recall I was down there in 1946, and at that time I felt there was justification for your recommendation, and I also felt that the pay of the silver employees was low.

General MEHAFFEY. Yes.

Mr. ENGEL. And the housing conditions were very bad in some

cases.

General MEHAFFEY. Yes.

Mr. ENGEL. Accounted for partly by the fact that they are given a three-room apartment, for one family, and they have families of four or five members, and the father, uncle, grandfather, and grandmother move in with them, which becomes a family.

General MEHAFFEY. That is true to some extent. I believe I showed you an apartment which I selected at random in which 8

people were living, all actual members of the family, and I was told that in the next apartment, which we did not go into, there was living in 2 rooms a family of 12, consisting of the father, mother, and 10 children.

Mr. ENGEL. I saw one place where the condition was bad.

General MEHAFFEY. Yes.

Mr. ENGEL. There is no question about that, and I think it was typical of a great many in particular area.

General MEHAFFEY. Yes.

TUG SERVICE, GAILLARD CUT

Mr. ENGEL. The next item is on page 26, "Tug service to provide security for shipping in Gaillard Cut," $40,000.

That is broken down into two items as follows:

Six months while dredge is operating away from Gaillard Cut, onewatch basis, five days; two watches, sixth and seventh days, $30,000. Six months while dredge is operating in or near Gaillard Cut, one watch, sixth day; two watches, seventh day, $10,000, making the total of $40,000.

General MEHAFFEY. Yes.

LOCAL RAILROAD TRANSPORTATION FOR EMPLOYEES ON OFFICIAL

BUSINESS

Mr. ENGEL. The next item is for local railroad transportation for employees on official business, $109,000.

We will place in the record the break-down shown on page 27, which details the items in this estimate.

(The statement referred to follows:)

Maintenance and operation appropriation: 1. Governor's office...

2. Engineer of maintenance.

3. Comptroller and budget officer.

4. Assistant engineer of maintenance_
5. Locks Division...

6. Office Engineering Division.

7. Meteorology and hydrography.

8. Marine Division_

9. Dredging Division.

11. Care of public buildings and grounds.

15. Personnel administration___

16. General correspondence and records. 17. General counsel...

18. Paymaster and collector_

19. Accounting Department

Estimate,

1949

$5

250

10

20

450

4,000

250

86, 450 15,000

910

700

300

5

500

General MEHAFFEY. Heretofore we have always carried a lumpsum item in the appropriation for maintenance and operation for the transportation of employees on the isthmus, which covered the payment to the Panama Railroad Company for local transportation of employees of transit divisions on official business, covered by the appropriations for maintenance and operation, civil government, sanitation and postal operations.

It is obvious that we have not been showing the costs for maintenance and operation of the various departments properly, because we were not breaking it down and charging it againat the individual units. We feel that the units are going to be more careful about using this transportation if it is charged against their own allotments, and that the new procedure would give us better bookkeeping and be economical in the long run. It does not increase the total cost, but is a redistribution of the cost.

Mr. ENGEL. The $109,000 item is for the transportation of employees in the 19 departments of maintenance and operation, and there is an item of some $26,000 for the transportation of officers in the Sanitation Department and $15,000, civil government. General MEHAFFEY. Yes.

INCREASED PURCHASE OF EQUIPMENT

Mr. ENGEL. The next item is for the increased purchase of equipment, $46,399. Will you give us a break-down of that?

General MEHAFFEY. The largest part of that is equipment for the locks. We have a small machine shop at each of the locks where running repairs are made, and many of the machines that we have there are machines that were bought during the construction of the Canal and which have long outlived their usefulness and must be replaced in order to do the accurate type of work that is necessary. We have made every possible effort to get suitable equipment from surplus war materials but have not been able to find the proper equipment available. We will continue our efforts in that direction. but we feel it is going to be necessary to buy new equipment.

OVERHAULING FERRY BOATS

Mr. ENGEL. The next item is on page 30, "cost of overhauling one additional ferryboat," $15,000.

General MEHAFFEY. We have three ferryboats at the Balboa end. I think it would be just as well if I read the statement from the justification.

Mr. ENGEL. Very well.

General MEHAFFEY. In the fiscal year 1949 there will be an increase of $15,000 for an overhaul of the ferryboat President Porras. Estimates for 1948, as revised, include an amount of $13,000 for the scheduled overhaul of the ferryboat President Roosevelt. In fiscal year 1949 it is planned to overhaul the ferryboat President Amador-sister ship of the President Roosevelt-for $13,000 and also to overhaul the larger ferryboat President Porras for $15,000.

A ferryboat must be overhauled after 12 months of service. It is planned to operate the President Porras, the larger boat, continuously while the President Roosevelt and the President Amador, the smaller boats, will alternate in service. Accordingly, in the future it will be necessary to overhaul the President Porras and one of the small boats every year.

In other words, the service required of those ferries has gone up so much and we have had to increase the number of trips so greatly that we find it necessary now to use all three of the boats alternately and to overhaul two of them every year.

Mr. MAHON. Are these boats named alternately after the Presidents. of Panama and the President of the United States, or what is the background of naming the boats?

General MEHAFFEY. We started out with two small boats which we built ourselves. One was named the President Roosevelt, for Theodore Roosevelt, and since the ferry service was put in there in order to unite the two halves of Panama, which was cut directly in two by the Canal, it was felt that it would be a friendly gesture to name the second one President Amador, who was the first President of Panama. During the war the service provided by the two rather small boats was inadequate, and we bought another large boat in the United States and brought it down, and again we felt that it would be a good idea to name it for one of the prominent Presidents of Panama.

Mr. MAHON. I think that is very important and was very nice to name it for one of the Presidents. Who was President Porras? General MEHAFFEY. President Porras was President for three terms.

TABULATING EQUIPMENT

Mr. ENGEL. Rental of additional tabulating equipment, $1,250. This item covers the replacement of a numeric printing machine with an alphabetic printing machine at increased rental rate. General MEHAFFEY. Yes.

WITHIN-GRADE SALARY ADVANCEMENTS

Mr. ENGEL. Within-grade salary advancements, $59,071.

We will place in the record the table shown on page 31, which shows the promotions. Those are within-grade salary advancements.