Mr. CONWAY. Yes, sir. They are gotten up in separate booklets, 28 separate booklets when completed.

Mr. DIRKSEN. Has not that work been done by the War Department?

Mr. CONWAY. No, sir; it has not. It has been done by no one else. Mr. WIGGLESWORTH. When did you start that work?

Mr. CONWAY. Research has been going on for a good many years. Mr. WIGGLESWORTH. How much of it has been completed?

Mr. CONWAY. The summaries are all in galley; part of them are in page and part of them are ready for printing; in fact, the job is almost completed.

Mr. WOODRUM. Thank you, Mr. Conway.

FRIDAY, JANUARY 8, 1943.

THE TAX COURT OF THE UNITED STATES

STATEMENTS OF J. EDGAR MURDOCK, PRESIDING JUDGE, AND ROBERT C. TRACY, SECRETARY

SALARIES AND EXPENSES

Mr. WOODRUM. We will take up the items for The Tax Court of the United States. The first item, on page 338 of the bill, is as follows:

For necessary expenses of The Tax Court of the United States as authorized by chapter 5 of the Internal Revenue Code, and sections 504 and 510 of the Revenue Act of 1942, including personal services and contract stenographic reporting services, traveling expenses, carfare, stationery, purchase and exchange of lawbooks and books of reference, and periodicals, $555,940.

The name of

Judge Murdock, the presiding judge, is with us. your court has been changed to The Tax Court of the United States, Judge?

Judge MURDOCK. Yes.

Mr. WOODRUM. We changed that name by law; did we not?
Judge MURDOCK. That is right.

GENERAL STATEMENT

Mr. WOODRUM. Have you a general statement you wish to present to us?

Judge MURDOCK. I shall be glad to make a brief statement.

One of the first changes, of course, is the one you have already mentioned. Congress made us The Tax Court of the United States instead of the Board of Tax Appeals, and we have been proceeding under that name. There were no changes as a result of that in personnel or operations or finances, of any kind, except such minor ones as changing a name on a door, here and there.

Our estimates for the fiscal year 1944 show an increase of approximately $9,900 over the appropriation for the current fiscal year 1943. The amount is made up almost entirely of two items, rental of quaiters in New York City, $4,800, and printing and binding, $4,000.

We have hearings in New York City more frequently than at any other place. The court is holding hearings there more than half the weeks of the year. Formerly, our hearings were held in Federal courtrooms, including those of the United States Customs Court. For a period of a year or so we had satisfactory quarters in the old Federal Building in City Hall Square between the time it was abandoned by the circuit court and the time it was torn down. Satisfactory arrangements could no longer be made for space in the new Federal Courthouse on Foley Square. The explanation given us was that all of the courtrooms were needed because of a large increase in the work handled by the district judges. The use of United States Customs Court courtrooms was unsatisfactory for several reasons. Our calendars and the calendars of that court frequently conflicted. The courtrooms were not conveniently located, and no space other than the courtroom itself was available. Last spring we made a careful canvass of available space in New York City and finally rented space in the Grand Central Terminal Building. We fitted this up with surplus furniture of our own and have made almost constant use of the new quarters.

We had dismantled a couple of courtrooms in Washington that we did not need any more because, for the last 8 or 10 years, all of our hearings have been all over the United States, anyway. So we had these fittings here and we took some of those up to New York. By the way, we gave some of those fittings-casting bread upon the watersto the Processing Tax Board when it was created some years ago, and they fitted up a courtroom. Now they have come back to us, when Congress gave us that work to do. I will touch on that in a

minute.

We have, in addition to a medium-size courtroom a small room for our clerk, a small chamber for the judge, and a medium-size conference room for the use of counsel, witnesses, and others having business with the court. This new arrangement is far more satisfactory than any we have ever had in New York. We have similar accommodations only in Washington and Chicago. The new space in New York has met with the unqualified approval of all of those having business with the court. It is only to be regretted that we cannot have at least the use of similar space when we hold hearings in other important. centers where at present we usually obtain only a court room and the rest of the business has to be done in the halls or else in the courtroom during recess and after regular hours.

I may say, in that connection, that that is one of our difficulties. We hold hearings in 50 different cities in the United States, and in only 3 of them do we have any space that is our own. In the rest

of the places, we have to make arrangements to borrow somebody else's courtroom. In most instances we can find that a judge will be glad to let us have 1 courtroom, but there is no witness room, where we may hold witnesses if we want to exclude witnesses from a hearing, or if counsel want to talk to witnesses in the next case, or prepare for it, or perhaps for counsel to get together, counsel on both sides, and settle cases or stipulate facts. There is no place for them to go other than to stand out in a public hall. It does handicap us, but I have no answer to that, particularly, because I do not think that we go to any of the places often enough to justify having the

Government go to the expense of providing us with our own court

room.

For example, at the moment we could arrange to have a courtroom in San Francisco, which the judge there has been very agreeable about providing us. But we schedule hearings about 60 days ahead, in order to give the parties a chance to get together and to prepare for the trial or perhaps to settle the case. Now, a few days ago, we got word from the judge's clerk that he was sorry but that he would have to use the courtroom himself, so that we do not have any place to go. We have to go out and find some place.

This time we rented a courtroom from the county court. We will have to pay rent for that. That is our only alternative. But, as I say, unless the Government of the United States in putting up buildings-some of these Federal buildings-would put in an extra courtroom for occasional users such as ourselves, I do not know what the answer can be, because certainly we would not be justified in having a courtroom for our use, except in New York.

Mr. FITZPATRICK. I thought the Foley Square Building was large enough to accommodate more than the district courts there.

Judge MURDOCK. We were in there for about a year and a half, or maybe 2 years. We had courtroom 619, and it was entirely satisfactory. It apparently was never used by anybody except ourselves.

There is a funny story connected with that, that I should like to tell you. They did not want to give us any space in that building. At that time we were a board, the Board of Tax Appeals, and they would not let us in there. Judge Knox was the senior district judge, and he felt he could not let us go in there without letting other agencies in. He did not want to do it. So we could not get in. Arundell was chairman of the Board at that time. He went up to pay his respects to the circuit judges, and he ran into Judge Manton up there. He was a very forceful kind of a person, as you know. judge asked, "What are you doing up here?" he told him, to which he replied, "That is a hell-of-a-note," and he rank a bell and said, "Get these gentlemen a courtroom. We have extra courtrooms." So they gave us a courtroom there. Of course, that was embarrassing to us. Unfortunately they put Judge Manton in the penitentiary and we lost our courtroom.

The

Mr. FITZPATRICK. If an investigation were made up there, I think they could find some room for you.

Judge MURDOCK. I had this up with Mr. Shafroth, who was assistant to Mr. Chandler, who is supposed to take charge of the use of courtrooms, and the amount of work in the Federal courts, and so forth. He told me that they were using all of those courtrooms up there now; not that they were using all of them continually, but they were using all of them some of the time, and it would be very, very uncertain as to whether we could or could not use it. But we have to have a courtroom in New York. We are up there 26 weeks of the year, and we could not run if we did not have, or did not know ahead of time, where we were going to be up there. For that reason we

went out and rented a place. This is quite a modest set-up that we have. I agree that it is too bad we were not able to get in some already established place. We did not want to spend the money, but we finally came to the conclusion that we could not get along any other way.

Down at the customs court they were always agreeable, everybody has been very agreeable about giving us a courtroom, except at the Foley Square Building. But sometimes their calendars would conflict with ours at the last minute. We might go in there with 70 or 80 cases, and about 150 people awaiting a calendar call, and when the calendar call was over, and we began to try the various cases, there was no place for these people to retire, or to prepare for the next case, except to go out into the hall. It causes quite a bit of confusion, with so many people milling around.

PRINTING AND BINDING

Mr. WOODRUM. Your next item is:

For all printing and binding for the Tax Court of the United States, $36,000. Will you explain the purpose of the increase requested?

Judge MURDOCK. The purpose of that is that we have always gotten out two volumes a year, but now it looks as if we will have more than will go into two volumes. Up to now, two have come out each year. It looks now as though we will have to have an additional volume. It will not be all work of that year. Some of it will be carried over from the previous year. But we will need three volumes, and that is why we have estimated $4,000 for that printing.

Mr. HENDRICKS. Are you printing any new forms?

Judge MURDOCK. Only to replace the old ones, as the supply becomes exhausted. We took a rubber stamp and eliminated the name of the Board on our old forms and are using and will continue to use the old forms as long as possible.

OVERTIME PAY AND AUTOMATIC PROMOTIONS

Mr. WOODRUM. The act of 1942 transferred to you all the tax matters of the old Processing Tax Board of Review. Has that brought a lot of additional work on your court?

Judge MURDOCK. May I refer to page 3 of the justification? We do not contemplate any increase in personnel, but we would like to have the 139 full-time officials and employees that we have had up to now. The figure does not include estimates for automatic promotions under provisions of the Ramspeck Act or for overtime pay under the recent act. The court is on a 44-hour week, which includes 4 hours of overtime under this new act. That was true at the time that I wrote that, but since then, by Executive order, we have been put under the 48-hour act, which includes 8 hours of overtime. Forty-four of our employees on our present pay roll will receive automatic promotions under the Ramspeck Act during the fiscal year 1944. The net amount involved in these promotions will be approximately $2,550.

I would like to tell you in that connection that it will take $2,700 a month, or $32,400 a year, to take care of that overtime pay.

I am preparing answers now to a lot of questions asked by the Director of the Bureau of the Budget. In connection with that, I asked him if we could not go on this 10-percent basis instead of the overtime basis, because we really do not need those extra hours. That is, if they would give us the 10 percent, as they have the other courts, and the legislative establishment, a straight 10 percent increase

in pay, because they are not paid on an overtime basis. If that could be done for us, too, it would save us an awful lot of that $32,000. We do not really need the time, because we just have a certain amount of work that has to be done anyway.

Mr. WOODRUM. If you have to go on a 48-hour week you will not require as many people, will you?

Judge MURDOCK. We will. That is the point. We are all chopped up into a lot of little groups doing special jobs. In a situation like that, the extra time of one person does not save you anything. It does not save you any one employee. There is not enough saved to take up the work of one person on the pay roll except perhaps one place in the whole organization. We are divided up into groups from three to five.

AMOUNTS OF COLLECTIONS

Mr. FITZPATRICK. What does your report show as to the amounts collected from taxpayers, as compared with last year?

Judge MURDOCK. I do not have those figures before me.
Mr. FITZPATRICK. We used to get such a figure.

Judge MURDOCK. I can get those figures for you, but I do not have them with me.

(The following statement was later supplied by Judge Murdock:) Our court has nothing to do with collections and, therefore, I have no figures on that. However, I have figures for the fiscal year ended June 30, 1942, showing the amount of deficiencies originally dete mined by the Commissioner and the amount subsequently determined as a result of petitions having been filed with this court. 4,292 cases were closed during that period in which the total deficiencies as determined by the Commissioner amounted to $171,732,820.42, and the total amount redetermined under our orders was $41,818,203.54. 2,517 of these cases were closed by a stipulation of the parties whereby they agreed that the correct deficiencies were in the total amount of $24,152,145.35 instead of $137,460,973.72. 181 cases were dismissed with practically no change in the deficiencies as originally determined in the total amount of $1,350,618.22. The remaining cases were ones decided by opinion and in those the total deficiencies as originally determined by the Commissioner amounted to $29,386,963.75, whereas the amounts determined under the decisions of the court amounted to $15,021,250.88. The above figures are the latest available and I believe they give the information which Mr. Fitzpatrick desires.

NUMBER OF CASES PENDING AND DISPOSED OF'

Mr. WOODRUM. What about the number of cases that you handle? Has your work increased a great deal?

Judge MURDOCK. No. I am glad to advise the committee of a reduction in our list of pending cases. Last year, when I appeared at the hearing, I reported 5,536 pending cases as of October 31, 1941. The total as of this date has been reduced to 5,040. That is, at the beginning of the year, it was 5,019. That is as low as it has ever been since they began to pile up in the very beginning, when it went up to 22,000 altogether.

Mr. WOODRUM. What about the number of cases disposed of? Are you disposing of more cases?

Judge MURDOCK. We are disposing of some more, but the Commissioner adopted a policy whereby they do not have so many petitions filed, and it has reduced the number of cases coming in. As a matter of fact, since the beginning of this year, there have been 231 new cases docketed. I think during the entire period they averaged around 350