Whereas: All products and/or materials used in plumbing installations do not perform uniformly under various conditions; and

Whereas Certain products and/or materials which are acceptable and troublefree in one area have proven a source of trouble and grief to the using public in other areas; and

Whereas: This trouble and grief to the using public is contrary to protection of the public and contrary to intent of a plumbing code; now, therefore, be it Resolved: The National Association of Plumbing-Heating-Cooling Contractors and its members individually do all within their power to prevent any government agency from issuing or requiring blanket approval of any product and/or material for all areas and plumbing codes; and

Be it further resolved: That government agencies shall be required to secure proof of acceptability for any product and/or material from the code governing body of any area prior to requirement of its inclusion in the area plumbing code.

The Convention also voted to oppose the Occupational Safety and Health Act in its present form. The contractors had no quarrel with the idea of improving safety standards for protection of their employees, but they resented the "police state" tactics and requirements of OSHA, especially when it is conceded by OSHA officials that it is impossible for a contractor to perform in compliance with the OSHA regulations.

The above resolution was presented to the 90th annual convention of PlumbingHeating-Cooling Contractors this past June 14 and adopted unanimously. Other witnesses have already raised the question of constitutionality. There is a serious problem of unlawful delegation of legislative power when the Congress of the United States attempts to make private codes and standards over into a form of public regulation. This problem arose in conjunction with the passage of the Occupational Safety and Health Act. A study furnished by the U.S. Department of Labor was incorporated into the House Hearings on Occupational Safety and Health Act, 91st Cong., 1st Sess., at pages 411-412. The leading cases in this area are Sunshine Coal v. Adkins, 310 U.S. 381 (1940); Carter v. Carter Coal Co., 298 U.S. 238 (1936); and R. H. Johnson & Co., v. SEC, 198 F. 2d 690 (1952). In any delegation of legislative power to a private party. the final authority over the subject matter must be vested in a governmental agency. This requirement is clearly missing from the language of S. 3373, for the Secretary of HUD would only approve standards agencies, not the standards themselves.

In conclusion, S. 3373 could not be more out of tune with the times. Previous witnesses have remarked that the bill is untimely since a Federal Trade Commission task force is currently investigating voluntary standardization activities. We suggest that it is untimely also for a different but related reason, namely the rising swell of consumer awareness of which the public uproar over the 235 and 236 scandals is but one manifestation. "Buyer beware" is on the way out in housing as well as other purchasing activities, and that's the way S. 3373 should go too-OUT!

Senator CRANSTON. That concludes today's hearings. We convene tomorrow once again at 10 o'clock in the morning in this room.

(Whereupon, at 11:20 a.m., the hearing was adjourned, to reconvene at 10 a.m., on Thursday, June 22, 1972.)

IMPROVED TECHNOLOGY AND REMOVAL OF PREVAILING WAGE REQUIREMENTS IN FEDERALLY ASSISTED HOUSING

THURSDAY, JUNE 22, 1971

U.S. SENATE,

COMMITTEE ON BANKING,

HOUSING AND URBAN AFFAIRS,

SUBCOMMITTEE ON HOUSING AND URBAN AFFAIRS,

Washington, D.C.

The subcommittee met, pursuant to adjournment, at 10:10 a.m., in room 5302, New Senate Office Building, Senator John G. Tower presiding.

Present: Senators Tower and Brock.

Senator TOWER. The committee will come to order to continue the hearings on S. 3373 and S. 3654.

Our first witness this morning is our distinguished colleague from the House of Representatives, the Right Honorable John D. Dingell. Congressman, would you take a seat right here.

Congressman, we have your full statement and that will be printed in the record as we have received it. You may deal with it in summary or you may read it in its entirety, as you see fit.

STATEMENT OF JOHN D. DINGELL, REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN

Mr. DINGELL. Mr. Chairman, I am keenly aware of the time demands of this committee and for that reason I shall summarize in the most brief form. I will be quite content to have my statement included in the record in full.

For the record, Mr. Chairman, my name is John D. Dingell. I am a Member of Congress from the 16th Congressional District of Michigan. I appear here principally to present my views with regards to S. 3373. I serve in the House of Representatives as the chairman of the Subcommittee on Regulatory Agencies of the House Small Business Committee and, for a number of years, I have been scrutinizing with great care the whole problem of involuntary industrial standards in the whole of our economy.

I have spent rather considerable time dealing with the question of voluntary industrial standards in the building industry, Mr. Chairman, and I must tell you that I found many things in that area that have troubled me greatly.

I have commented in my statement with regard to lumber standards. I have commented with regard to some of the things that I have seen done with regard to antitrust violations flowing from these standards.

I have pointed, Mr. Chairman, to the fact that the Federal Trade Commission is about to undergo a whole and an exhaustive investigation of the standards programs, something which I regard as of great importance as there are many antitrust and restrictive trade problems in that area.

I would point out, Mr. Chairman, that I think that something along the lines of S. 3373 is highly desirable. I want to commend the authors of that bill for seeking to meet a serious national problem.

I would point out, Mr. Chairman, that there is great peril in S. 3373 from the standpoint of the consumer, from the standpoint of the small businessman, and from the standpoint of good government generally, in that it does not, I think, with sufficient clarity, define restrictive practices and restraints at which the legislation is aimed.

I am very much troubled that the bill does not clearly enough define the need to have performance standards as opposed to identity standards.

I am sure you can recognize the advantage to the consumer and to industry as well as having good workable, strong, and effective performance standards so that you define what the thing is to be done and then you leave to the ingenuity of American industry the fabrication of the device which meets those standards.

The auto industry has always had trouble with standards-making attempts which seek to define with precision the exact engineering and engineering structure as opposed to laying out the kind of performance anticipated. There has been great trouble with regard to this, from the standpoint of air pollution, auto safety, and other legislation that we have had before the Congress. I am sure you can recognize a similar situation could and indeed at this time does exist with regard to the construction industry.

I would point out, Mr. Chairman, that another concern of mine is, of course, the fact that legislation of this kind might impose or might lead to elimination of standards which are clearly in the interest of the consumer and, of course, for that reason the legislation does require some rather careful attention insofar as drafting.

Last of all, Mr. Chairman, on reading the legislation over this morning, it became a matter of concern to me that you just might find that this legislation would most probably eliminate many assorted local and State statutes, or it could be used for the elimination of those statutes where they apply, for example, to State and local minimum wage standards and certain other fair labor practice standards on the State and local level. And I am sure this committee is not interested in engaging in that particular kind of practice.

With those comments, Mr. Chairman, I want to thank you and the committee for the privilege of appearing before you this morning and for the gracious courtesy you have extended me.

Senator TOWER. We are delighted to have you here, Congressman, to get your views.

As I understand it, you are in sympathy with the objectives of the bill?

Mr. DINGELL. Yes, sir.

Senator TOWER. But you question its actual implementation and the consequences of perhaps it being too loosely drawn; is that correct? Mr. DINGELL. Not only possibly too loosely drawn, but also too strictly drawn, Mr. Chairman.

I recognize the needs for perhaps some alteration in the way that hese voluntary standards are used in the building industry but by the .me token I want to be very careful that we don't throw the baby out with ne bath water when we attack the problems which we are addressing.

I do give this committee particular concern that I have with regard to the need for effective performance standards as opposed to standards which would direct themselves to particular design. This has been a major problem with regard to local building codes.

For example, they will specify particular devices as opposed to laying out-for example, we found in the water heating business, we found they would specify particular devices as opposed to specifying how the water heaters should function, for example, the pressure and temperature and things of this kind.

We found, for example, that these devices were used for actually freezing out small manufacturers who manufacture perfectly worthwhile and entirely effective and safe devices from the standpoint of

the consumers.

We found, of course, the voluntary standards ofttimes are made principally to benefit those who control the trade associations that promulgate these standards.

These are the cautions that I give you.

I would say, Mr. Chairman, I will be most pleased to have my staff work with your staff and the staff of the committee with regard to achieving perhaps some appreciation of the problems that we have run into with regard to voluntary standards and also any suggested amendments.

Senator TOWER. I think you have made a very constructive contribution with this testimony.

As you understand, our objective is to simply do what we can to apply modern technology to the residential construction industry to the extent we can bring more housing within the reach of low income families. This is our objective.

We are delighted to have any kind of constructive suggestions aimed toward that end.

I remember when Walter Reuther testified before us once. He said "The American people are getting Chevrolet housing at Cadillac prices."

Mr. DINGELL. I think we are getting Chevrolet housing or perhaps Volkswagen housing at Rolls Royce prices today. I think this is a commendable effort on your part and on the part of the committee. Senator TOWER. In the pending legislation that is before the House Banking Committee, which is the HUD Act of 1972, which we have already acted on over here, there is a proposed National Institute of Building Sciences. Would S. 3373 be made palatable to you if the National Institute of Building Sciences were designated as the testing agency?

Mr. DINGELL. I wouldn't have any particular problems with the legislation as drawn either way, Mr. Chairman. That is not a matter of great concern. I am always more comfortable where you have a Government agency which generally oversees things. Whether you want to have that particular body or whether you want to have the

Federal Bureau of Standards or the Department of Commerce or the Federal Trade Commission do this is not a matter of great concern.

I have a feeling that probably the best agency to do it would be either the Federal Trade Commission or the Bureau of Standards. But I would be willing to accept the wisdom of the committee with regard to that.

Senator TOWER. Thank you, Congressman, for appearing today. (The full statement and additional information submitted by Congressman Dingell follows:)

STATEMENT OF JOHN D. DINGELL, REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN

Mr. Chairman, distinguished members of the Subcommittee, I would like to thank you for this opportunity to appear before you to present my views concerning S. 3373. For a number of years the Subcommittee on Regulatory Agencies of the House Small Business Committee, which I have the honor to chair, has been active in the field of voluntary industrial standards and building codes. One of the areas within this field which has been a focus of attention is the application of standards to the housing industry. Through the years we have received testimony which has led me to the conclusion that at the present time voluntary standards do not adequately protect either the consumer or smaller competitors.

There is no guarantee of proper procedures being followed.

There is grossly inadequate opportunity for consumer participation.

Smaller firms who are not among the "in group" are frequently given short shriit and their views not seriousty considered.

Frankly, gentlemen, I find myself growing weary of standards programs that perpetuate the thought that standards are to enrich the producer not to protect the buyer. To the extent that this is allowed to happen, it is a clear case of non-feasance by a public official. Voluntary standards are, of course, most necessary in a technological society such as ours. If the nuts don't fit the bolts, if the tires don't fit the wheels, then producer and consumer alike are ill served. This is not to say, however, that producers, working through their own devices-standards promulgating committees and subcommittees, bearing only cosmetic consumer representatives, should be allowed to work their will upon the nation's consumers. No standard should be allowed to be promulgated by either a private or public agency which has not undergone the fair test of reasonable procedures, entered upon by a broadly constituted committee, representing fairly and squarely, producer and purchaser alike.

I am greatly encouraged by recent receipt of word from the very distinguished Chairman of the Federal Trade Commission that the FTC is about to undertake a massive investigation of standards programs. While this is heartening news, realistically, I must withhold judgment until I have observed the degree to which those controlling the standards programs are convinced-voluntarily or involuntarily-that the paths of righteousness are to their own advantage. These paths having remained too untrod in the past, you will pardon me if I retain a certain air of cynicism. Yet, I do not wish to mislead you while I fear the worst, I shall continue to hope for the best. And I must say that the quality of leadership present today at the FTC leads me to be far more optimistic than I would have been in the past.

Recent examples of the sort of misuse of standards that can occur include: the acceptance by FHA of the new standard for skinnier 2 x 4's and other structural lumber which resuits in less lumber-albeit for higher prices--going into homes; the holding back of approval for sizes other than three inch for thin wall PVC plastic pipe and fittings. This apparently was the result of a compromise reached within the industry. The end result has been that no model code acceptance has been sought for thin wall pipe and fittings, which demonstrates that private standards and model code standards follow marketing capability and become a technique for holding back innovations rather than promoting them.

Ideally, standards should be based on performance criteria. A wall should be described in terms of what it does-its insulative value, its strength, etc. rather than in terms of requiring that this or that specific material be used. If the performance standards are sufficiently rigorous then at one and the