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Mr. WIGGLESWORTH. Do you need them?
General FLEMING. Yes; we do.

Mr. WIGGLESWORTH. Cannot the Labor Department handle all that for you?

General FLEMING. No; I do not think they can. We have a great deal of construction work, and a great deal of dealings with the unions in labor relations, and we just have these two regular positions to cover that work, and they are busy continually.

MAINTENANCE OF RACIAL RELATIONS ACTIVITIES

Mr. WIGGLESWORTH. Do you still have a racial relations set-up, or have you eliminated that?

General FLEMING. No. I have a racial relations officer. Mr. WIGGLESWORTH. Has he anybody to help him? General FLEMING. He has one person to help him, a secretary. Mr. WIGGLESWORTH. Just two? General FLEMING. Yes; two regular positions, the racial relations officer and his secretary.

Mr. WIGGLESWORTH. I wish you would insert in the record the salaries of those two positions, and the positions.

General FLEMING. We will put that in.
(The information requested is as follows:)

Positions included in the estimate for racial relations

Racial relations officer, CAF-13-
Clerk-stenographer, CAF-4----

$5, 600 2, 040

EMPLOYMENT OF JACOB BAKER

Mr. WIGGLESWORTH. Have you a man named Jacob Baker on your rolls?

General FLEMING. No, sir; I have not.
Mr. WIGGLESWORTH. Did he used to be there?
General FLEMING. He used to be.
Mr. WIGGLESWORTH. When did he leave?
General FLEMING. Before the 1st of November.
Mr. WIGGLESWORTH. What were his duties and salary at that time?

General FLEMING. He was working on a per diem of $25 when engaged, and was working on the Public Works Reserve program.

Mr. WIGGLESWORTH. Why did he leave?
General FLEMING. Because we had no further need for his services..

Mr. DIRKSEN. Is he the same Jacob Baker who was originally
in the Department and then later went with the C. I. 0.?
General FLEMING. Yes; the same one.
Mr. DIRKSEN. The same Baker?
General FLEMING. The same one.
Mr. STARNES. Where is he now?
General FLEMING. In New York.
Mr. STARNES. Is he connected with the Government in any way?
General FLEMING. No; he is with some research institute ир

there.

EMPLOYMENT OF JAMES CRUTCHER, STATE ADMINISTRATOR FOR THE STATE

OF LOUISIANA

Mr. WIGGLESWORTH, Is James Crutcher still on the W. P. A. as State administrator down in the State of Louisiana?

General FLEMING. He is; yes, sir.

Mr. WIGGLESWORTH. You are aware of the fact or of the statement that he has been sued by the State of Louisiana on his bond for misappropriation of funds in respect to items that have been disallowed by the General Accounting Oflice? General FLEMING. I am aware of that; yes, sir.

Mr. DIRKSEN. General, did you see the report made by the General Accounting officer—their last report relative to irregularities in W. P. A. in Louisiana ?

General FLEMING. Yes: I saw it.

Mr. DIRKSEN. And the action of disallowance by the General Accounting Office ?

General FLEMING. I did not know there was a disallowance. That is in the report that was made to the Comptroller General, but I do not think we have received any disallowance from him.

Mr. DIRKSEN. Well, it was my impression, and I am reading now from page 46 of the General Accounting Office report, the Comptroller's report, where they say “86 debt charges have been raised in the amount of $7,174,960.42 against individuals, agencies, and others involved, and reported to the Department of Justice for appropriate action."

General FLEMING. Well, maybe to the Department of Justice, but I do not think I have received any statement of disallowance on that. That is the report made, as I recall, to the Comptroller General by two individuals in his department.

Mr. DIRKSEN. I assumed from this language that they had finally reduced the thing to an irreducible minimum, so to speak, and said, "Evidently here are matters, after our investigation, that cannot be explained; so, therefore, we must turn it over to the Department of Justice."

General FLEMING. I would like Mr. Johnstone to answer that.

Mr. JOHNSTONE. I am not prepared, Mr. Wigglesworth, to comment fully upon those figures, but perhaps I can throw a little light on it.

The Comptroller's Office, in a series of reports, took certain exceptions to expenditures of the Work Projects Administration in Louisiana. They were based largely upon

Mr. WIGGLESWORTH. Aggregating about $22,000,000, as I remember it?

Mr. JOHNSTONE. That is right-about $22,000,000. I might add, sir, that none of those exceptions that were taken questioned the integrity of Mr. Crutcher, or accused him of a misappropriation of funds. Generally speaking, the exceptions taken were based upon the idea that a governmental unit of the State of Louisiana that undertook a project did not have the charter powers to do so.

Mr. WIGGLES WORTH. We went into all of that very thoroughly in the W. P. A. investigation some years ago?

Mr. JOHNSTONE. That is right; I remember this committee went into it. Mr. Warren wrote us a series of letters, I might say, and those letters came to the Federal Works Agency prior to the time General Fleming took office, and I went down and discussed the whole field with Mr. Warren and his assistants and, after the presentation of facts within our possession, some $13,000,000 to $15,000,000 of those exceptions were lifted, because it was said they were in error. That left a residuum of some $7,000,000, I think, Mr. Dirksen?

Mr. DIRKSEN. Yes.

Mr. JOHNSTONE. Concerning that, the information was not in hand to fully explain them. Certain of them, I do not know whether the whole of them or not; I am not familiar with that, were referred to the Department of Justice. They entertained a different opinion from that of the Comptroller with respect to the collectibility of those funds. Just exactly what the status of the $7,000,000 is at the moment I do not know, but there is no question that money was actually spent upon W. P. A. projects. The question was whether the project was legally authorized. Those are the main

questions involved in that situation, Gate Mr. WIGGLESWORTH. Whether it was a legal project and whether

the money was legally or illegally spent ?

Mr. JOHNSTONE. Yes. There was a series of projects undertaken ak by the Levee Board of the State of Louisiana that is set up in their

constitution. Some of them involved the reclamation of certain lands pale upon coast waters of the State of Louisiana. The levee board then, the after the land was reclaimed by this project, undertook to sell the land bet to various private landholders. Some of the Comptroller's investi

gators, and the Comptroller himself, took exception to that upon the a theory it would put the State of Louisiana, or the levee board, into the

real-estate business and that they were not authorized to do that under in their constitution. An examination of the constitution and the statutes nom, and the decisions of the State of Louisiana demonstrated to Mr. WarGet ren's satisfaction that that was an authorized activity of the State of

Louisiana.

It was things of that kind, sir, that were involved, and there was kit involved also the whole question about the removal of streetcar rails, Bien as to whether that should be done in view of the existing arrangement

with the traction company that they should remove them and repair

the streets, and there was a considerable amount of controversy that pot involved the legal status of the project. But I think I am safe in tant saying it did not involve the personal integrity of any oflicer with concerned.

Then Mr. Crutcher was also called upon to account for and to explain il certain relief funds that had been granted to the State of Louisiana by

the Federal Emergency Relief Administration that involved the 1 Work Projects Administration. His immediate predecessor, I believe,

fell heir to something like a million and a half dollars of residuum of those funds and expended all but about $300,000 of them, to which no exception was taken. A couple of the investigators of the Comptroller questioned, I think, the expenditure of the balance of $300,000. Mr. Crutcher expended something like $250,000 and turned the balance of the $300,000 over to the State. And it was in the expenditure of the

$250,000 that certain investigators of the Comptroller's office took exbi çeption to certain items amounting, I think, to about $13,000. They

have stated to me Mr. Warren has stated to me, everybody with whom I have discussed it has stated to me—there was no question about the qersonal integrity of Mr. Crutcher. No one accuses him of having a dishonest dollar in his pocket. The question was whether or not the purposes for which these moneys were spent were actually relief purposes and, if so, whether they were the kinds of relief purposes authorized under the act and under the laws of Louisiana.

Then followed the controversy as to who the money belonged to; whether it belonged to the State or to the Federal Government and, if so, should it be expended according to the regulations.

Now that, in brief, sir, is, I think, the present status.

Mr. FITZPATRICK. Did the Department of Justice ever make a report on that?

Mr. JOHNSTONE. I might say, with respect to the $13,000, that the Comptroller has referred it to the Attorney General's Office for action, and the United States Attorney at New Orleans, with the concurrence of the Attorney General, ruled that there was no liability; whereupon the State undertook'to try the case again.

Mr. WOODRUM. Thank you, Mr. Johnstone.

OVER-ALL ADMINISTRATIVE EXPENSE OF F. W. A.

Mr. STARNES. I would like to ask a few questions. The general over-all administrative expenses of the Federal Works Agency this year, according to the request or estimate, are somewhat higher than in 1943.

Mr. HALL. $36,000.

Mr. STARN ES. What about the funds that are available for expenditure under the direction of the Federal Works Agency, as contrasted with 1943? Are they greater or less?

Mr. Hall. The total funds available will be about the same, although this depends on the extent to which the Congress approves appropriations for the Agency for 1944. The elimination of W. P. A. will make a reduction, but the Public Roads request is greater, the Public Buildings request is greater—and a contemplated request for War Public Works will offset that reduction.

Mr. STARNES. What are involved in Public Buildings? Mr. HALL. The Commissioner of Public Buildings is here Mr. WOODRUM. Yes; we will take that up in a little while, and have Mr. Reynolds discuss that.

DISPOSITION OF SURPLUS WORK PROJECTS ADMINISTRATION EQUIPMENT

Mr. STARNES. May I ask this: What is proposed to be done with the equipment which belongs to the Work Projects Administration, when it has been liquidated ?

General FLEMING. A great deal of the heavy equipment will be turned over to the Public Roads Administration for use in building the highway to Alaska, the Alcan Highway, and the highway in Central America from Mexico down to Panama. There is a shortage of equipment and that whole equipment will be turned over to them.

Then the War Public Works projects will take a small amount of the equipment which we feel they need.

The rest will be declared surplus and turned over to the Procurement Division of the Treasury to be disposed of as surplus property, but most of it is going to Federal agencies, and they will reimburse us for the value of the property as it exists today.

Mr. STARNEs. I think you are to be commended for turning it over and making it available immediately for those two highways, particularly, because of their great strategic value. I was down in the Caribbean and was impressed with the absolute necessity of pushing the Pan-American Highway just as fast as it is possible to do so.

General FLEMING. The Public Roads Administration is investigating the usefulness of all of that property owned by W. P. A., taking that part which they feel they can use.

Mr STARNES. You do have a lot of heavy equipment that is suitable for road-building purposes?

General FLEMING. Yes; we have.

Mr. STARNEs. Do you have a lot of automobiles and trucks generally that are available for relief to the Army and Navy for the war effort ?

General FLEMING. Yes; we have.

Mr. STARNES. It is proposed that all of this moving equipment, or motor equipment, will be made immediately available so that we won't have stocks of rubber in the form of tires lying around in warehouses and cached at motor depots, rotting on the wheels rather than moving over the roads?

General FLEMING. I can assure you that just as soon as it becomes surplus it will be moved.

Mr. Starnes. And put into use by other agencies?
General FLEMING. Yes, sir.

EMPLOYMENT OF LABOR RELATIONS PERSONNEL

Mr. STARNEs. I was wondering why it is necessary in your office to have the following positions in the employee-management office.” I biotice here under "Employee relations, you have an employee and labor relations officer at $5,600, which is a CAF 13-A position, a clerkstenographer at $1,800, and an assistant clerk-stenographer at $1,620, or a total of $9,020. What is the necessity of an employee and labor relations officer in your organization, when we have the Department of Labor, when we have the National Labor Relations Board, when we have the War Labor Board? All of them are agencies provided by the Government to handle labor relations. I just cannot for the life of me see the justification for it.

Mr. HALL. This particular position has to do with Federal employees within the Federal Works Agency; not our relationships to outside labor, or to contractors labor, or to the Labor Department. This position you have referred to has to do with employee relations within the Federal Works Agency, the coordination of and assisting in the establishment of employment policy, studying efficiency ratings, and all of that class of work, Ramspeck promotions, and so forth, of the employees of the Federal Works Agency.

Mr. WIGGLESWORTH. Why could not that have been done by your personnel officer? Do not you have a personnel division?

Mr. HALL. This is a division in the personnel office.

Mr. WIGGLESWORTH. In other words, instead of calling it a personnel division, you are calling it an employee-management office ?

Mr. Hall. That is right; that is our personnel office.

Mr. WIGGLESWORTH. Are they performing the same functions within the Federal Government that these so-called employee-management groups are performing on the outside in private business and industry, under the aegis of the Federal Government?

Mr. Hall. No, sir. This office of the director of employee management, in its functions, is comparable to the personnel office of the Treasury, the Department of Agriculture, the Department of Commerce or any other executive department of the Government. It carries on only those functions of the United States with regard to our handling of Federal Works employees--their appointment, and so forth, civil-service requirements in personnel administration.

Mr. WIGGLESWORI H. Who is that officer?

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