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because, among other things, of the need for "accomodation" of--and protection of--the Government's interests as first mortgagee of property which the borrower may have to use also for the interim financing.

REA also has many legal questions in connection with the "participation" agreements which regulate the rights of the various owners of the jointly held GT facilities, which agreements are subject to REA approval and are part of the security under the REA mortgage. Other similar agreements typically required for these projects and on which OGC advises REA as to legal matters include Construction Contracts and Operating Contracts, most of which have multiple parties with diverse interests, and in which REA as a guarantor, itself, as well as agent for the FFB lender, is directly concerned. OGC attorneys' advice is needed not only for the closing of the loan, but also in the construction phase and in such matters of the operation period as wholesale power, pooling and coordination contracts--which are subject to REA approval and constitute a significant part of the Government's security. Beyond the legal involvement to be expected in financing of any multi-million dollar project, OGC involvement is increased by statutory requirements applicable because REA is a federal agency, including the National Environmental Policy Act and other environmental statutes, Freedom of Information Act, and others.

Apart from REA, the borrowers themselves are also required to comply with many federal and state regulatory laws for which, of course, they have to employ their own counsel. While OGC cooperates with borrowers' counsel, and to the extent appropriate relies upon their opinions, their functions are distinct and they serve different interests. Where their interests, as in some NEPA litigation, are parallel, borrowers' counsel figures prominently in the joint effort, but OGC is very active in the representation of the Government's interests.

INVOLVEMENT IN REGULATION

Question: Your statement implies on page 9 that new regulations and revision of existing regulations under new laws translates directly into a higher workload for the General Counsel since they create "heavy demands for legal service." Does your office approve and/or comment on all new regulations issued by USDA agencies? Exactly what is the routine role of the General Counsel in the revision or writing of new rules and regulations?

Answer: Our attorneys review all new regulations, and proposed and final amendments of regulations, to assure that they come within the Secretary's statutory authorities; that they are consistent with any applicable cases and other precedents; and that they conform to the requirements of the Administrative Procedure Act, and the Federal Register Act and the rules and regulations under that Act. Appropriate changes are made to resolve any legal problems involved or the administrative agency is advised of the legal problems and our attorneys are available to counsel the administrative officials in resolving such problems. Most regulations and amendments are initially drafted by the administrative agency involved and forwarded to OGC for such review, revision, comment, or advice. Many proposed

new regulations and amendments require extensive legal research, consideration of a variety of issues, and the preparation of legal opinions for the advice and guidance of the administrative officials.

QUESTIONS SUBMITTED BY SENATOR BELLMON

Question:

BACKLOG

...

Your statement notes a request for 6 additional manyears "to meet immediate pressing demands and reduce the backlog of cases." Please discuss the nature and magnitude of this backlog, compare it with the previous two fiscal years, and what impact it is having on the Department's programs.

Answer: The nature and magnitude of this backlog is reflected in the tabulation I have submitted for the record listing the backlog under various program areas. That tabulation compares the backlog of cases pending at the end of fiscal year 1977 with that pending at the end of the previous 5 years, for which we have data. Such backlogs might have a direct impact upon the timeliness of the implementation of a departmental program, upon the effectiveness of a program or upon compliance with requirements by persons subject to the program.

WORK MEASUREMENT

Question: Does your agency have a work measurement system? If so, please provide data on overall workload demand for FY 1977, 1978, and estimates for FY 1979, and examples of measured increases in efficiency.

Answer: No, my office does not have a formal work measurement system. We have just recently instituted a monthly work status report in the Washington office, whereby each attorney turns in to me through his or her chain-of-command of supervisors a list of work performed during the month.

Since assuming the position of General Counsel I have initiated some measures, as set out in the General Comments section of my statement, which I believe will be beneficial in our attempts to provide more efficient and expeditious handling of the legal demands required of

us.

Question:

WORKING WITH JUSTICE

Please discuss the relationship between your office and the Department of Justice in court litigation.

Answer: Under our procedures, in connection with court litigation for enforcement of provisions of a statute or regulation administered by the Department, or for prosecution of persons who have violated them, the agency of the Department administering the program involved, or the Office of the Inspector General, investigates the case or compiles the evidence and submits a report to our Office. Our attorneys review the evidence to determine whether there is substantial evidence that a violation has occurred, and if so the na

ture and scope of the violation, under the particular statutory and regulation provisions involved. In the event such a violation is apparent, we transmit the report to the appropriate United States Attorney or the Washington Office of the Department of Justice with a letter describing the apparent violation and any significant legal or factual questions involved, and usually an appropriate pleading, that is a civil complaint or a criminal information or indictment, is also sent with the letter of transmittal. If warranted, a brief on legal or factual matters is also transmitted. Our attorneys assist in connection with any questions which may arise regarding the statute, regulations, or any other matter where our expertise will be helpful. In some cases, the United States Attorney or the Department of Justice requests our attorneys to argue the case. In other cases, our attorneys are requested to be present at the trial to otherwise assist as may be required.

In connection with suits against officials of the Department, our attorneys analyze the pleadings and briefs and prepare a litigation report for submission to the Washington Office of the Department of Justice or the appropriate United States Attorney. In the litigation report, the legal and factual issues are discussed and a suggested answer to each allegation in the case is set forth. Also included are a brief on legal or factual issues as warranted and a list of suggested witnesses. Copies of documents relevant to the defense of the case are submitted along with the litigation report. Our attorneys continue to furnish such advice or assistance as may be required during the course of the litigation.

Question: It is my understanding that you wish to provide for a greater role of USDA attorneys in actual courtroom proceedings. What advantage does this have for the Department?

Answer: Most of the statutes and implementing programs administered by the Department are complex and unique to the agricultural and related fields. Effective advocacy, therefore, requires extensive knowledge and expertise with respect to every statutory provision involved, as well as the legislative histories, the extensive implementing rules and regulations, the judicial and administrative precedents and the structure and operations of the industries involved. A United States Attorney or an Assistant United States Attorney rarely has an opportunity to acquire this type of knowledge and expertise prior to the litigation. Therefore, the knowledge and expertise of our attorneys in these complex and unique fields are valuable in litigation involving our Department and can be expected to contribute substantially to the success of litigation.

Question: Does this budget allow for such a policy direction?

Answer: In view of their knowledge of the factual and legal issues involved in each case submitted to the Department of Justice, preparation for more active participation in the cases by our attorneys should be minimal. And there may be savings in time with more active participation by our attorneys in many of the cases. Some additional expenses, such as travel, would be incurred, of course, in connection with more active participation; however, I believe more participation than is presently occurring can be supported within our budget request. I have discussed this matter with Barbara

Babcock and Jim Moorman of the Department of Justice and we have

agreed that OGC attorneys will participate more actively in litigation but a decision on the extent of participation will be made on a case by case basis, and of course, budgetary considerations must be a factor in those decisions.

Question: What was your initial agency request to the Department (in positions, dollars, and activities), and what was the Department's submittal to OMB?

Answer: Our budget request to the Department was for $10,334,000 to support 394 staff-years and it was submitted to OMB for $10,351,000 to support 394 staff-years.

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STATEMENT OF HOWARD W. HJORT, DIRECTOR OF ECONOM-
ICS, POLICY ANALYSIS, AND BUDGET

ACCOMPANIED BY:

KENNETH R. FARRELL, ACTING ADMINISTRATOR, ECONOM-
ICS, STATISTICS, AND COOPERATIVES SERVICE

BRUCE M. GRAHAM, ACTING ASSISTANT DEPUTY ADMINIS-
TRATOR FOR STATISTICS

LYLE P. SCHERTZ, ACTING DEPUTY ADMINISTRATOR FOR
ECONOMICS

RANDALL E. TORGERSON, ACTING DEPUTY ADMINISTRA-
TOR FOR COOPERATIVES

WILLIAM E. McELHANON, ACTING DEPUTY ADMINISTRATOR
FOR MANAGEMENT

L. DAVID YOUNG, ACTING BUDGET BRANCH CHIEF,
BUDGET AND FINANCE DIVISION

ROBERT SHERMAN, CHIEF, BUDGET DIVISION, OFFICE OF
BUDGET, PLANNING, AND EVALUATION

BIOGRAPHICAL SKETCHES

BRUCE M. GRAHAM

Mr. Graham is Assistant Deputy Administrator for Statistics in Economics, Statistics, and Cooperatives Service. He has served since 1971 as Chairman of the Crop Reporting Board, which prepares and issues the Department's official estimates on crops, livestock, agricultural prices and labor.

A native Virginian, he has degrees from Bridgewater College and Virginia Tech. and is a Navy veteran of World War II. Before being named Chairman of the Crop Reporting Board, he directed the Agency's data collection program for about 14 years. Before that, he served for 9 years as an agricultural statistician in the Statistical Reporting Service, now Economics, Statistics, and Cooperatives Service, field offices in the States of Washington and Virginia.

LYLE P. SCHERTZ

Lyle Schertz is Acting Deputy Administrator for Economics in the Economics, Statistics, and Cooperatives Service, USDA. He was born in El Paso, Ill., and received his B.S. and M.S. degrees in agricultural economics from the University of Illinois, 1953. He served in the Air Force as a 1st Lieutenant, 1953-55. He was an economist with the Pillsbury Co., Minneapolis, Minn. 1955-59. He attended the University of Minnesota, 1960-62, and received his Ph. D in agricultural economics for his research on U.S. farm policy. Beginning in 1962, he worked on the Kennedy round trade negotiations as a member of the Foreign Agricultural Service, USDA. In 1965, he was named Chief, International Monetary and Trade Research Branch of the Economic Research Service. In 1967, he became Deputy Administrator of the International Agricultural Development Service, USDA. When IADS was merged with ERS, Dr. Schertz was named as Deputy Administrator for Resource and Development Economics, ERS. He held that position until ESCS was established in December, 1977.

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