MARITIME ADMINISTRATION AUTHORIZATION WEDNESDAY, MARCH 15, 1967 HOUSE OF REPRESENTATIVES, OF THE COMMITTEE ON MERCHANT MARINE AND FISHERIES, Washington, D.C. The committee met at 10:15 a.m., pursuant to call, in room 1334, Longworth House Office Building, Hon. Edward A. Garmatz (chairman of the committee) presiding. The CHAIRMAN. The meeting will please come to order. The purpose of this hearing is to consider legislation which would require annual authorization of certain appropriations for the Maritime Administration, the agency responsible for administering our American merchant marine policy. There are a number of bills pending before us. They are: H.R. 158 by myself; H.R. 804, by Mr. Lennon; H.R. 840, by Mr. Mailliard; H.R. 1028, by Mr. Pelly; H.R. 2024, by Mrs. Sullivan; H.R. 4222, by Mr. Downing; H. R. 4503, by Mr. Morton; H.R. 4746, by Mr. Keith; H.R. 4908, by Mr. Rarick; H.R. 5425, by Mr. Gilbert; and H.R. 5748, by Mr. St. Onge. (The bills and agency reports follow:) [II.R. 158, H.R. 804, H.R. 2024, H.R. 4222, H. R. 4908, H.R. 5425, and H.R. 5748, 90th Cong., first sess.] A BILL To amend section 209 of the Merchant Marine Act, 1936, so as to require future authorization of funds for certain programs of the Maritime Administration Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 209 of the Merchant Marine Act, 1936 (46 U.S.C. 1119), is amended to read as follows: "SEC. 209. (a) Except as provided in subsection (b) of this section, there are authorized to be appropriated such sums as may be necessary to carry out the provisions of this Act. "(b) Notwithstanding any other provision of this Act or any other law, beginning with the fiscal year 1968 and for each subsequent fiscal year, there are authorized to be appropriated or made available to or for the use of the Maritime Administration for "(1) construction and repair of vessels; "(2) payment of construction differential subsidy; "(3) payment of operating differential subsidy; "(4) maritime training (including Federal aid to State marine schools); "(5) maintenance and operation of vessels of the National Defense Reserve Fleet; "(6) the Vessel Operations Revolving Fund; and "(7) research and development activities; only such sums as the Congress may specifically authorize by law for each fiscal year." 1 [H.R. 840, H.R. 1028, H.R. 4503 and H.R. 4746, 90th Cong., first sess.] A BILL To amend section 209 of the Merchant Marine Act, 1936, so as to require future authorization of funds for certain programs of the Maritime Administration Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 209 of the Merchant Marine Act, 1936 (46 U.S.C. 1119), is amended to read as follows: "SEC. 209. (a) Except as provided in subsection (b) of this section, there are authorized to be appropriated such sums as may be necessary to carry out the provisions of this Act. "(b) Notwithstanding any other provision of this Act or any other law, beginning with the fiscal year 1969 and for each subsequent fiscal year, there are au thorized to be appropriated or made available to or for the use of the Maritime Administration for "(1) construction and repair of vessles; (2) payment of construction differential subsidy; (3) payment of operating differential subsidy; (4) maritime training (including Federal aid to State marine schools); (5) maintenance and operation of vessels of the national defense reserve fleet; (6) the vessel operations revolving fund; and '(7) research and development activities; only such sums as the Congress may specifically authorize by law for each fiscal year." Hon. EDWARD A. GARMATZ. EXECUTIVE OFFICE OF THE PRESIDENT, BUREAU OF THE BUDGET, Washington, D.C., March 15, 1967. Chairman, Committee on Merchant Marine and Fisheries, DEAR MR. CHAIRMAN: This is in reply to your request for the views of the Bureau of the Budget on H. R. 158 and H. R. 840, bills to require authorization of funds for certain programs of the Maritime Administration. H. R. 158 would require the enactment of authorizing legislation (presumably annually) for appropriations beginning with the fiscal year 1968 for the use of the Maritime Administration for (a) construction and repair of vessels, (b) payment of construction differential subsidies, (c) payment of operating differential subsidies, (d) providing maritime training, including Federal-aid to State marine schools, (e) maintaining and operating vessels of the National Defense Reserve Fleet, (f) operating the Vessel Operations Revolving Fund, and (g) research and development activities. H. R. 840 is similar in all details except that it would take effect with the fiscal year 1969. As we indicated last year in reporting on similar legislation, we believe that a requirement for an annual authorization for Federal maritime programs could interfere with the orderly planning and efficient administration of that program. While your Committee has an excellent record in advancing other authorizing legislation, the requirement of an annual authorization for the Maritime Adminis tration might delay enactment of its appropriations and this could lead to delay in appropriations for the Department of Commerce as a whole and for the other agencies involved in the same major appropriation bill. (The House Committee on Appropriations noted in House Report 1907, 89th Congress, dated August 29, 1966, that six major appropriation bills were seriously delayed or still pending largely because the Congress had not enacted authorizing legislation.) Also, it should be noted that the annual authorization procedure requires executive branch witnesses to justify and explain their programs in detail on at least four different occasions to four different congressional committees each year. This can involve a very heavy expenditure of time on the part of top agency officials. At the same time, legislative committees may find themselves becoming involved in the details of administration rather than taking a broader view of missions and objectives. We believe that a preferable course would be for the Congress to undertake a periodic review (say at five-year intervals) of the basic policies and aid formulae of the 1936 Act. The industry could continue operations under existing programs with some assurance of stability until new or revised programs had been devised, debated and adopted. It is true that a 1963 statute requires annual authorization of appropriations for the Coast Guard. However, that law deals with capital acquisitions and improvements related to the performance of public functions. The appropriations to the Maritime Administration, by contrast, are mainly for subsidies to the maritime industry and support ship operations as well as ship construction. Uncertainties occasioned by a requirement for an annual authorization could hamper industry planning and affect the way in which the subsidy programs currently operate. For example, your Committee may want to consider whether annual authorization of operating subsidy payments might adversely affect the 20-year contracts which now guarantee operating subsidies on the basis of a formula contained in the 1936 Act. These subsidies cannot be determined in advance or even estimated with complete accuracy. Without assurance that necessary Federal aid would be forthcoming, ship operators might be unwilling to enter into either construction or long-term operating contracts. In the light of the above considerations, the Bureau of the Budget cannot support the enactment of H. R. 158 and H. R. 840. Sincerely yours, WILFRED H. ROMMEL, Assistant Director for Legislative Reference. GENERAL COUNSEL OF THE DEPARTMENT OF COMMERCE, Hon. EDWARD A. GARMATZ, Washington, D.C., March 14, 1967. Chariman, Committee on Merchant Marine and Fisheries, Washington, D.C. DEAR MR. CHAIRMAN: This is in further reply to your request for the views of this Department concerning H.R. 158 and H.R. 840, which are similar bills "to amend section 209 of the Merchant Marine Act, 1936, so as to require future authorization of funds for certain programs of the Maritime Administration." H.R. 158 would amend section 209 of the Merchant Marine Act, 1936, to provide that beginning with the fiscal year 1968, there are authorized to be appropriated or made available to or for the use of the Maritime Administration for: 1. Construction and repair of vessels; 2. Payment of construction differential subsidy; 3. Payment of operating differential subsidy; 4. Maritime training (including Federal aid to State marine schools); 5. Maintenance and operation of the National Defense Reserve Fleet; 6. The Vessel Operations Revolving Fund; and 7. Research and development activities, only such sums as Congress may specifically authorize by law for each fiscal year. H.R. 840 is identical to H.R. 158 except that its provisions would apply beginning with the fiscal year 1969. The purpose of the bills is to require the Department to submit its proposed programs for the Maritime Administration for the activities listed in the bills to your Committee and the Senate Commerce Committee and obtain their approval of such programs and enactment of an authorization bill before appropriations could be made to fund these programs. The bills would have an impact upon procedures in the Department in that Department officials would have to appear before four Committees of Congress before appropriations could be obtained rather than before two Committees as at present We are, of course, always glad to appear before your Committee, as we did this year, and before the Senate Commerce Committee to explain the programs of the Maritime Administration and to furnish any information the Committees desire. The requirement for authorization bills has delayed enactment of some appropriation bills. House Report No. 1662, dated June 27, 1966, accompanying House Joint Resolution 1180, making continuing appropriations for the fiscal year 1967, states that the Committee on Appropriations original plan was to bring all the regular annual appropriation bills to the House by June 16 but that "the schedule has suffered considerable disruption largely from delays in reporting or otherwise processing several related annual authorization bills." House Report No. 1907, dated August 29, 1966, accompanying House Joint Resolution 1284, making further continuing appropriations for the fiscal year 1967, contains the same statement. In his testimony before the Joint Committee on the Organiza tion of the Congress on August 31, 1965, Charles L. Schultze, Director of the Bureau of the Budget, stated (p. 1779) that virtually one-third of the Budget is now dependent upon renewal of authorizing legislation each year before the Appropriations Committee can, under the Rules, report appropriation bills to the floor and that "This creates a real difficulty for the executive branch-in the late enactment of appropriations, in the indecisiveness and inability to make sound plans for the year being considered, in the requirements for executive branch witnesses to explain their program at least four different times to four different committees each year-and giving agency heads that much less time to think and manage in the immersion of the legislative committees as well as the Appropriations Committees in the details of administration to the detriment of taking the longer range, broader view of missions and objectives, and in prolonged congressional sessions which, in turn, hurry the executive branch beyond the economical point in reaching decisions on legislative proposals and the budget in the short time between sessions." We recognize that the authorization bills for the Coast Guard which come before your Committee have been expeditiously reported by your Committee and expeditiously enacted by the Congress and that they have not delayed the enactment of the Treasury Department appropriation bills. If after consideration of the foregoing, the Committee concludes that our voluntary appearance before the Committee, to explain our programs, will not adequately serve the Committee's purposes, the Department would have no objection to favorable consideration of the bills. We have been advised by the Bureau of the Budget that there would be no objection to the submission of our report to the Congress from the standpoint of the Administration's program. Sincerely, Hon. EDWARD A. GARMATZ, ROBERT E. GILES, General Counsel. DEPARTMENT OF THE NAVY, Washington, D.C., March 15, 1967. Chairman, Committee on Merchant Marine and Fisheries, MY DEAR MR. CHAIRMAN: Your request for comment on H. R. 158 and H. R. 840, bills "To amend section 209 of the Merchant Marine Act, 1936, so as to require future authorization of funds for certain programs of the Maritime Administration," has been assigned to this Department by the Secretary of Defense for the preparation of a report thercon expressing the views of the Department of Defense. The bills would require authorization to be enacted for funds appropriated for construction and repair of vessels, payment of construction diderential subsidy, payment of operating differential subsidy, maritime training (including Federal aid to State marine schools), maintenance and operation of vessels of the National Defense Reserve Fleet, the Vessel Operations Revolving Fund and research and development activities. It is believed that there is a possible defect in the subject legislation which might affect the ability of the Department of the Navy to place Economy Act orders with the Maritime Administration in the area of the maintenance and operation of vessels of the National Defense Reserve Fleet. The language could so be construed as to prevent the placement of Economy Act orders on the Maritime Administration as to any of the purposes listed in the legislation. Similarly the requirement for authorization for the Vessel Operations Revolving Fund, which is the fiscal instrument for the above program, could act as a bar to the utilization by the Department of the Navy of Maritime Administration services. We do not believe that the drafters of the legislation intended that result. In order to avoid such construction of the bill, it is suggested that the words, "or made available to or" be stricken from line 2 of page 2 of the subject bill. Accordingly, only the appropriations made for the use of the Maritime Administration would be subject to the limitations of the legislation. Subject to the foregoing, the Department of the Navy, on behalf of the Department of Defense, defers to the views of the Department of Commerce on this legislation. This report has been coordinated within the Department of Defense in accordance with procedures prescribed by the Secretary of Defense. The Bureau of the Budget advises that, from the standpoint of the Administration's program, there is no objection to the presentation of this report on H.R. 158 and H.R. 840 for the consideration of the Committee. For the Secretary of the Navy. Sincerely yours, R. WRZESINSKI, Captain U.S. Navy, Director, Legislative Division. COMPTROLLER GENERAL OF THE UNITED STATES, B-146473. Hon. EDWARD A. GARMATZ, Chairman, Committee on Merchant Marine and Fisheries, DEAR MR. CHAIRMAN: This is in reply to the request of Mr. John M. Drewry of your staff for our comments on H.R. 158 and H.R. 840, bills to amend section 209 of the Merchant Marine Act, 1936, so as to require future authorization of funds for certain programs of the Maritime Administration. The proposed legislation would strengthen the control of your Committee and that of the Senate Commerce Committee over Maritime policies by enabling and requiring the Committees to annually express their views and recommendations concerning the Maritime Administration's budget requests by approving authorizing legislation. While we appreciate the Committees can make a valuable contribution to Maritime policies by annually authorizing budget requests of the Administration, we believe that the proposals should be examined carefully in the light of the delay that necessarily results from a requirement that there be an annual authorization act as well as an annual appropriation act. A possible alternative for exercising the oversight functions of the legislative committees would be to require annual appearances of Maritime officials before the Committees at which time there could be a detailed discussion of the programs, activities, and budget of the Maritime Administration. Our views should not be considered as opposing favorable consideration of the bills. The need for the legislation is a matter primarily for determination by the Congress after consideration of its needs, and its relationship with the Executive. Sincerely yours, FRANK H. WEITZEL, Assistant Comptroller General of the United States. The CHAIRMAN. Last year we considered similar legislation based upon the growing feeling within this committee that our national maritime program could be aided by an annual review conducted by the responsible legislative committee. That legislation squarely faced the fact that annual appropriations should be supported by annual authorization. Hearings were held in late September on H.R. 15862 and identical and similar bills. A clean bill was introduced, and on October 10, 1966, H.R. 18176 was reported to the House. A rule was granted 2 days later, but due to the lateness of the session, there was not time for consideration on the floor of the House. That bill was unanimously reported by this committee. Upon the convening of this Congress on January 10, I again introduced an identical bill, H.R. 158, which is one of eleven now before In a statement issued on opening day, I noted that this subject was of "the highest priority for consideration early in this first session of the 90th Congress." us. At this point, I would like to say that all signs point to an interesting and important year for the future of the American merchant marine. When the Department of Transportation bill was before the Congress last fall, the Maritime Administration was kept out of it 77-118-67 -2 |