CALIFORNIA EMERGENCY RELIEF APPROPRIATION ACT, 1942 MONDAY, JUNE 16, 1941 UNITED STATES SENATE, SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS, Washington, D. C. The subcommittee met in the committee room, the Capitol, at 10:30 a. m., Hon. Alva B. Adams presiding. Present: Senators Adams, Hayden, Overton, Thomas of Oklahoma, and Holman. WORK PROJECTS ADMINISTRATION STATEMENTS OF HOWARD 0. HUNTER, COMMISSIONER; CORRINGTON GILL, ASSISTANT COMMISSIONER; FRANCIS H. DRYDEN, ASSISTANT COMMISSIONER; DALLAS DORT, ASSISTANT COMMISSIONER; AND MALCOLM B. CATLIN, DIRECTOR, DIVISION OF STATISTICS PRESIDENT'S MESSAGE OF MAY 20, 1941 Senator ADAMS. Gentlemen, we will proceed to consider House Joint Resolution 193, the pending relief measure, first placing in the record the President's message of May 20, 1941-House Document No. 214. (The message is as follows:) MESSAGE FROM THE PRESIDENT OF THE UNITED STATES TRANSMITTING A RECOMMENDATION FOR AN APPROPRIATION OF $886,000,000 FOR THE NEXT FISCAL YEAR, OF WHICH $11,000,000 WILL BE REQUIRED FOR ADMINISTRATIVE EXPENSES OF AGENCIES OTHER THAN THE WORK PROJECTS ADMINISTRATION; THE REMAINDER PROVIDING FOR AN APPROXIMATE MONTHLY AVERAGE OF 1,000,000 PERSONS TO BE EMPLOYED ON THE RELIEF PROGRAM To the Congress of the United States: In my Budget message to the Congress in January, I estimated that $995,000,000 would be required during the ensuing fiscal year for continuing the relief program by the Work Projects Administration of the Federal Work Agency. Since the transmission of that message, funds appropriated or recommended for national defense have been substantially increased and the lend-lease program has been set in motion. While the increase in defense expenditures will have an important bearing on employment, we cannot anticipate an increase in employment in the same proportion as the increase in expenditures for next year. Moreover, this increase will not necessarily result in a corresponding decrease in unemployment. The labor force will increase, partly due to natural growth and partly due to additional employment of workers such as students who during normal times would continue to pursue an education. Also, many youth and workers on submarginal farms will obtain jobs during the present emergency. An additional factor militating against as great a reduction in unemployment as might appear possible is that there are many of the presently unemployed who have little chance to be absorbed by the defense effort. Certain regions of the country are not affected by defense activities, and many types of workers are not in demand. After weighing all factors I recommend an appropriation of $886,000,000 for the next fiscal year, of which $11,000,000 will be required for administrative expenses of agencies other than the Work Projects Administration. The remainder will provide for an approximate monthly average of 1,000,000 persons to be employed on the relief program. It has been customary in recent years to provide in the relief appropriation an amount for allocation to Federal agencies for construction and other projects falling within the several categories set forth in the relief act. The agencies receiving such allocations frequently have projects of a similar nature included within State Work Projects Administration programs. It is my belief that most of these projects, and particularly those of the War, Navy, Agriculture, and Interior Departments, should be provided for in the State programs. I, therefore, recommend that provision be made for a limited amount, not to exceed $5,000,000, for Nation-wide Federal nonconstruction projects. I further recommend that $600,000 be set aside for allocation, with the approval of the Director of the Bureau of the Budget, to those Federal agencies engaged in the planning of projects, or the review of projects submitted through State Work Projects Administration programs. This sum will offset the 4-percent administrative allotment now made in connection with the allocations to Federal agencies for projects. During the current year the Work Projects Administration has been authorized to train workers for manual occupations in industries engaged in production for national defense. I recommend the broadening of this authority to accelerate the employment of Work Projects Administration workers in private industry. The Work Projects Administration is now required to remove from employment those persons who have been continuously employed for 18 months, and to make investigations at least once in 12 months to determine the continuing need of each project worker. I believe that the first requirement works a great hardship on many people. The second requirement is unnecessary and costly. I recommend the elimination of these requirements from the 1942 act. Under existing law aliens are denied the right to employment on relief projects. I believe that this works a hardship upon a class of persons whose private employment opportunities are becoming increasingly limited. I recommend the removal of this barrier to permit the employment of aliens who are otherwise eligible under the act. Administrative employees of the Work Projects Administration, and similar employees in other Federal agencies whose salaries are paid from relief funds, have been barred from the benefits of Executive Order No. 7916, dated June 24, 1938, and the act of November 26, 1940, extending the classified civil service of the United States. I recommend that this discrimination be eliminated. There are several sections in the current relief act with respect to political activities. While there is no particular objection to the reenactment of these provisions, most of them appear to be unnecessary because of the passage of the Hatch Act and amendments thereto. THE WHITE HOUSE, May 20, 1941. Senator ADAMS. All right, Mr. Hunter. FRANKLIN D. ROOSEVELT. Mr. HUNTER. May I read a prepared statement, Mr. Chairman? AVERAGE NUMBER TO BE EMPLOYED ON WORK PROJECTS ADMINISTRATION PROJECTS DURING FISCAL YEAR 1942 Mr. HUNTER. The President's message of May 20, 1941, requested the appropriation of $886,000,000, of which $875,000,000 was to provide employment for an average of 1,000,000 persons on the Work Projects Administration program during the fiscal year 1942. Employment of an average of 1,000,000 persons on W. P. A. projects would represent a 40-percent reduction from the average in fiscal year 1941. Employment during fiscal 1941 has been at the lowest average level since 1935. I will present a table and chart for the record showing the average number employed on W. P. A. projects each fiscal year since the program began as compared with the average contemplated under the appropriation recommended by the President. (The table and chart referred to were filed with the committee.) Average number of persons employed on Work Projects Administration projects, by fiscal year, January 1936 through June 1942 1 Includes employment on Work Projects Administration projects operated by other Federal agencies and financed by allocation of Work Projects Administration funds. 2 Estimated. Mr. HUNTER. I have prepared a statement for the committee, including a brief review of W. P. A. operations in fiscal year 1941, a discussion of the economic factors affecting private employment, and the need for the appropriation requested. Suggestions as to changes in the provisions of the act are included for the consideration of the committee. To save the time of the committee I have limited this statement to a summary of the more detailed information which is already published in the House hearings on this bill. FUNDS AVAILABLE AND WORK PROJECTS ADMINISTRATION OPERATIONS, FISCAL YEAR 1941 In the present fiscal year, $1,381,103,000 has been available to finance the W. P. A. program. This total includes the specific appropriation of $975,650,000 from the Emergency Relief Appropriation Act, fiscal year 1941; $375,000,000 from the supplemental appropriation provided in Public Law 9, Seventy-seventh Congress, approved March 1, 1941; and $30,453,000 in reappropriated balances carried over from the preceding fiscal year. Over the entire fiscal year employment on W. P. A. projects will average about 1,700,000. This is the lowest annual average employment ever provided by the W. P. A. The number employed on projects is being reduced from this year's winter peak of 1,890,000 in January and February to an all-time low average of about 1,300,000 in June. Telegraphic instructions have been issued to discharge 400,000 workers between the second week in June and the week of July 5, so that employment will be down to 1,000,000 early in July. WORK PROJECTS ADMINISTRATION EMPLOYMENT AT END OF JUNE 1941 Senator ADAMS. Mr. Hunter, if I may interrupt for a question at that point: The existing appropriation contemplated a reduction in W. P. A. employment to 1,300,000 during this month? Mr. HUNTER. June; yes, sir. Senator ADAMS. Has that been accomplished? Mr. HUNTER. It will average 1,300,000. It will be less than 1,300,000 at the end of June. Senator ADAMS. At the end of June it will be approximately what number? Mr. HUNTER. Approximately 1,150,000. Senator ADAMS. Then the amount you will have to drop from your rolls will be 150,000? Under the existing appropriation, there will be an expected employment of 1,150,000 at the end of June? Mr. HUNTER. That is correct; yes, sir. NUMBER TO BE EMPLOYED AT BEGINNING OF JULY 1941 Senator ADAMS. And the appropriation recommended by the President anticipates picking up the employment on the 1st of July at 1,000,000? Mr. HUNTER. That is right. Senator ADAMS. So that the actual drop from the end of June to the beginning of the new fiscal year will be 150,000? Mr. HUNTER. That is approximately correct; yes, sir. PERCENTAGE OF WORK PROJECTS ADMINISTRATION FUNDS EXPENDED ON WORK PROJECTS DURING 1941 In terms of expenditures, 96.4 percent of all the W. P. A. funds expended in the fiscal year has been used for work projects; this breaks down into 87.6 percent of the total for project wages and 8.8 percent for materials, supplies, equipment, and other nonlabor costs on work projects. Three and six-tenths percent of the total has been expended for administrative costs. I will insert a table showing the amount of W. P. A. funds expended for these purposes during the fiscal year 1941, to date. Amount of W. P. A. funds expended-By object of expendture-July 1940April 1941 1 Checks issued by the U. S. Treasury Department. Includes programs operated by the Work Projects Administration and Federal agency operations financed by allocation of Work Projects Administration TOTAL AMOUNT OF ADMINISTRATIVE COSTS Senator ADAMS. Again, Mr. Hunter, if you don't mind the interruptions, the administrative cost, as you give it here, is 3.6 percent. What does that represent, in terms of dollars? The reason I ask is, as you know, the House and Senate have not always agreed. We have wanted it on a percent basis and the House on a dollars basis. Mr. HUNTER. It represents, in dollars, at the end of April, $39,949,000, including transfers to Federal agencies. The total estimated for the fiscal year is a little over $44,000,000. CONTRIBUTIONS BY SPONSORS Sponsors of the projects operated directly by the W. P. A. have provided 30 percent of the total cost of their projects in this fiscal year to date. The average monthly expenditure from sponsors' funds has increased from $31,000,000 per month in fiscal year 1938 to $41,000,000 per month in fiscal years 1939 and 1940, and to $45,900,000 per month in the first 10 months of fiscal year 1941. DISTRIBUTION OF PROJECTS AMONG VARIOUS TYPES OF WORK Except for increases in certain types of defense work, notably airport construction, employment, and expenditures on projects operated by the W. P. A. have been distributed among the various types of work in about the same proportion as in earlier years. Slightly more than 71 percent of the W. P. A. funds expended on projects operated by the W. P. A. has been for construction work. About 27 percent has been expended on community-service programs, such as education, recreation, research, and sewing projects, and about 12 percent has been spent on projects for training W. P. A. workers in skilled occupations to help meet the need for skilled workers in defense plants and to help workers to get jobs in private industry. The amount of W. P. A. and sponsors' funds expended on each of the major types of projects operated by the W. P. A. and the number of workers employed on these projects as of the end of April 1941 are shown in the following tables which are submitted for the record. Number and percentage distribution of persons employed on Work Projects Administration projects by type of project, United States and Territories, April 30, 1941 |