you get the $600 and anything in addition to that would be on a loan basis, repayable in accordance with the terms of the Keith bill, what would you say to that?

Dr. LIMOUZE. This has been suggested, and it has parallels which certainly would be satisfactory. For example, the Justice Department's program in the Law Enforcement Act; part of it is an outright grant for which there is a commitment to return to law enforcement. The rest of it is a much larger loan. The combination can total as high as $2,700 a year-loan and grant-and this is forgiven on a service basis. Again there are precedents for this, and I certainly think this would accomplish the objective.

Mr. HATHAWAY. So if we gave a grant of $600 and a loan of $400Dr. LIMOUZE. Or 50-50, or whatever proportion. This could be done. Mr. HATHAWAY. What about the administration of this? Is it going to be quite burdensome to the individual schools?

Dr. LIMOUZE. I do not think so, although this has been prognosticated by everyone who has considered objecting to the bill. I do not think so, for the reason that at least in the best ordered NDEA loan program I am aware of, the one at Boston University, the collection problem was not significant.

I have talked to the people in the Justice Department and they anticipate minimum problems in collection and, while we are perhaps not quite so tightly organized in our student organization and in our industry as the law enforcement branches of the State and Federal Governments are, we do have a very close-knit group of graduates.

We train these young men as officers with a code of honor which we think is significant. They are, most of them, commissioned as Naval Reserve officers and have another enforcement of a code of honor which they must live by. I do not think that default from a group such as this is going to be a significant factor.

Mr. HATHAWAY. There are going to be areas of judgment, though, to determine whether a person could have gone to sea if he didn't. Wouldn't it be better if we limited the Keith bill to state as long as he stayed in the Naval Reserve he would be fulfilling that obligation? Dr. LIMOUZE. I would have to logically offer the same objection to that proposal as I did to a similar objection in the printed testimony. I don't think that the merchant marine needs to rely on somebody else, namely the Navy, to police its own industry.

Second, Congressman Keith and I have discussed the suggested changes in the bill which appear in my printed testimony. One of those is to the effect that in periods of slump, and there are bound to be these in our industry as there have been in the past, in periods of slump where there are just not enough jobs to go around, the graduate be expected to seek a job for at least 60 days after graduation and, if there are no jobs-and this would be determined through a cooperative effort of all of us concerned with maritime, the Coast Guard, unions, management, Maritime Administration, and the institutionsthen I proposed more or less arbitrarily that if in the opinion of the graduating institution and the Maritime Administration there is indeed no berth aboard a ship as an officer for this young man, he would' be absolved from any responsibility.

I don't think it is fair to hold over his head a collection for a situation over which he has no control. I would prefer that to having the Navy do it.

Mr. HATHAWAY. You mean if he can't find a job in 60 days and then takes a civilian job, he is going to be all right?

Dr. LIMOUZE. Yes.

Mr. HATHAWAY. And he can keep the civilian job for the rest of his life. If an opportunity to go to sea comes after he has taken a civilian job, he doesn't have to go to sea and would still be forgiven the loan? Dr. LIMOUZE. Right. This is the proposal.

Mr. HATHAWAY. You may have covered all of this in your printed testimony. This is the first time I have seen it.

Dr. LIMOUZE. We distributed it to the committee yesterday afternoon.

Mr. HATHAWAY. Some of the questions may have already been answered. I assume that you have no problem with respect to the use of the additional $175,000?

Dr. LIMOUZE. I have not felt encumbered by any extra funds we have received so far. I think we could handle this, yes.

Mr. HATHAWAY. At your Academy are all of the students living onboard the ship?

Dr. LIMOUZE. They are at present. I would like you to come back and visit us again about a year from now because we are in the midst of a tremendous building program and have had over $9 million committed to construction since you were there. We are still aboard the ship, and we will be until our student union and first two of six dormitories are completed, which we figure will be 1972, early 1972.

Mr. HATHAWAY. And they will be located right there where your classroom buildings are?

Dr. LIMOUZE. On the Point, yes.

Mr. HATHAWAY. That will accommodate all the students and none will have to live aboard ship?

Dr. LIMOUZE. As we expand, we will have dormitories. It is a module construction program.

Mr. HATHAWAY. That is with HUD money?

Dr. LIMOUZE. We have HUD assistance. It is a State bond authority which funds our dormitories, and I am happy to report we were the first State-supported institution in Massachusetts to apply for and receive HUD assistance. We have an assistance grant of $500,000 for the first two dormitories. This will make the payments for the students considerably lower; and this was my main objective, to keep the price down for them.

Mr. HATHAWAY. What is your tuition?

Dr. LIMOUZE. Our State tuition and out-of-State tuition is set by law at $100 a semester, $200 a year. We have gone to a quarter system, and for the first time I think the State will now have a $75 a quarter tuition. We do not have an out-of-State increase. We charge the same for in-State and out-of-State. It is $300 a year at our school and would be $200 at a conventional college.

Mr. HATHAWAY. Only $300?

Dr. LIMOUZE. For tuition.

Mr. HATHAWAY. For tuition. Of course, a student can avail himself of the guaranteed student loan program and so forth.

Dr. LIMOUZE. Yes. We have had one or two, not many, actually of those. We have a loan fund at the institution which is interest-free which has covered the needs at least up to now.

Mr. HATHAWAY. Who sponsors that, the alumni?

Dr. LIMOUZE. No, this is the result of accumulations during the war years from the ship's store, the ship's service, the uniform clothing purchase. There is a little overcharge on that to maintain it, and the surplus has gone into a fund which we have diverted at least partly to a student loan fund. We have not had many students apply. We have one or two every year who apply for banknote assistance. By and large we have been able to handle it, in other words.

Mr. HATHAWAY. Thank you very much, Doctor.

Dr. LIMOUZE. Thank you.

Mr. HATHAWAY. Thank you, Mr. Chairman.
Mr. DOWNING. Mr. Keith.

Mr. KEITH. Thank you, Mr. Chairman.

I don't quite know what to call you, Sandy. You have so many titles. You have done an excellent job in presenting the case for my bill and commented helpfully on Congressman Hathaway's bill.

You mentioned that you wouldn't have any problems getting rid of additional Federal funds. Under the Hathaway proposal is it not possible, in fact even probable that you wouldn't have much increase in your budget, in spite of this increase in Federal subsidy to the institution. The academy budget would still be determined by the States and they will furnish the funds? It will really just help the State rather than the institution?

Dr. LIMOUZE. That is correct. In Massachusetts, and I believe-I am sure in New York-and I believe Admiral Williams can testify that this is true in California, the direct subsidy to the State goes directly into the State treasury. This was in the original contract with these States in founding the maritime schools.

However, obviously my complexion is a little brighter and shinier when I go up on Beacon Hill if the Federal contribution to the budget of a maritime school is $250,000 rather than $75,000. I would. I am sure, be able to argue more effectively for some badly needed increased positions and things like this.

Mr. HATHAWAY. Will the gentlemen yield?

Mr. KEITH. I yield.

Mr. HATHAWAY. You don't mean that the Commonwealth of Massachusetts will reduce the amount?

Dr. LIMOUZE. I do not anticipate any reduction. I am afraid to say I anticipate an immediate increase of $175,000. I would like to believe this, but I can't. We would get consideration and I am sure very serious consideration as a result of this, but I don't think it has ever been a direct dollar-for-dollar ratio.

Mr. KEITH. What percentage of the total operating cost is the $75,000?

Dr. LIMOUZE. In this year's budget it is just about 10 percent. Our total operating budget this year from State funds is $733,000 or $734,000; so that $75,000 is now about 10.2 percent. When it was first instituted in 1960 it was 1612 percent, and it has gone down.

We have, as I pointed out in my written testimony, just had a 12percent across-the-board salary increase in Massachusetts which was

not in our orginal budget which will mean that by the end of this year $75,000 will be 9 percent, and as we grow, it is very easy to predict that a $75,000 payment will begin to reach a very small percentage, 1 or 2 or 3 percent of the total budget.

Mr. KEITH. So it is safe to say that the Federal Government is not carrying the same share of the load that it did earlier?

Dr. LIMOUZE. That is correct. This is true of all the schools I think as was made clear yesterday.

Mr. KEITH. And it is also true of the subsidy to the students?
Dr. LIMOUZE. Absolutely.

Mr. KEITH. You mentioned the cost for tuition. What does it cost
a boy to go to Massachusetts Maritime Academy per year now?
Dr. LIMOUZE. About $1,400 average for the 3-year program.
Mr. KEITH. Average per year?

Dr. LIMOUZE. Yes. You take away the $600, and you are talking about $2,400 for 3 years.

Mr. KEITH. And, as contrasted to most other educational institutions, isn't it true that the chance for this lad to earn a share of that during the summer vacation is practically nil?

Dr. LIMOUZE. It is impossible for our students and those at any of the other maritime schools to get any sort of summer employment. Occasionally a boy who is fortunate can pick up something on a weekend, but there is nothing that he can count on. A young man has to have his eye on the money needed to pay his way through the school when he comes to the institution is almost what it amounts to.

Mr. KEITH. So the incentive financially to pursue other careers is probably greater from a financial point of view?

Dr. LIMOUZE. I am not sure I follow the question, sir.

Mr. KEITH. Well, if he goes to a liberal arts college, he can work summers. His tuition is about the same at the other State schools. So he gets 212, maybe 3 months off a year, and he can earn $1,500 to $2,000 during that time.

Dr. LIMOUZE. I see the point. It is easier for a young man in Massachusetts, for example, to work his way through one of the other State colleges, of which we are one of the 11, than it is for him to do anything about working his way through the Massachusetts Maritime Academy, quite right.

Mr. KEITH. So that to some extent the young man who is ambitious to further his education is more likely to turn to perhaps a school of engineering or a school of liberal arts, and the Maritime Academy loses some of the bright, but poor, boys and gets the bright, but middle-income, boys?

Dr. LIMOUZE. I don't think you would ever get any statistics on this, but I believe that the logic of it is sound. We couldn't prove it. Our students do tend to come from first-generation college families. These are the first boys in the family who have gone to college. They tend to come from a middle or lower income group, and it would be easier in Massachusetts to work your way through one of the state schools than to come to the Academy, true.

I know of one freshman, for example, who is in the night session of one of the State colleges and has a full-time daytime job, and this is impossible in our situation.

Mr. KEITH. Thank you, Mr. Chairman.

Mr. DOWNING. Mr. Watkins.

Mr. WATKINS. Mr. Chairman, I have just maybe one or two questions I would like to ask here.

How many students do you have in Massachusetts Maritime Academy?

Dr. LIMOUZE. Our present enrollment is, give or take a few, 233 students. We started the year with 249 or 250.

Mr. WATKINS. Two-hundred and thirty-three students. May I ask how long has the Massachusetts Maritime Academy been giving training?

Dr. LIMOUZE. This is the oldest continuously operating maritime school in the country. It was founded in 1891 and has been in continuous operation since then.

Mr. WATKINS. I have been visiting another committee and have not been on my job, and I hope you will pardon me for possibly asking something which has already been brought up.

How do these students that would attend this school stand under the draft?

Dr. LIMOUZE. Our industry has never, since World War II, been declared a critical industry, which means that students are not draftexempt once they graduate. The present status of students is the same as the status of a student at any college; and upon graduation a student aboard ship may be drafted.

Mr. WATKINS. In other words, there is no exemption. You mean that they would have 4 years of college and after that they are not exempt?

Dr. LIMOUZE. The Naval Reserve program which they pursue does put them into a somewhat different light from the non-Reserve students.

Mr. WATKINS. Again asking you to excuse me for being late and not hearing your testimony, what contribution does the Federal Government make to your school now and to these students?

Dr. LIMOUZE. We now have a policy in effect since 1958 of a direct payment of $75,000 to the State which chooses to run a maritime school.

Mr. WATKINS. You say from the State?

Dr. LIMOUZE. To the State.

Mr. WATKINS. To the State from the Federal Government?

Dr. LIMOUZE. Right. This goes to the State if they accept out-ofState students, and all of us do. In addition to that, each student receives a subsidy payment of $50 a month or $600 a year. The wording is actually "not more than $600" but it has been $600 a year per student.

Mr. WATKINS. The only thing I can say is that I am sorry again that I was not here to hear your whole testimony, but I assure you that I shall certainly study your remarks, and I am in favor of support for the U.S. merchant marine in any way that I can support it because I think we have a lot of bills on that and, Mr. Chairman, you feel the same as I do about that.

Mr. DOWNING. I agree with Mr. Watkins.

Mr. WATKINS. That is all, Mr. Chairman.
Thank you very much.

Mr. DOWNING. Mr. Hanna.

Mr. HANNA. Mr. Chairman, I apologize for being late and apologize to the witness for not having heard his statement. However, I have