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IMPOUNDMENT OF APPROPRIATED FUNDS BY THE

PRESIDENT

THURSDAY, FEBRUARY 1, 1973

U.S. SENATE,
SUBCOMMITTEE ON SEPARATION OF POWERS,
COMMITTEE ON THE JUDICIARY, AND THE AD Hoc
SUBCOMMITTEE ON IMPOUNDMENT OF FUNDS,
COMMITTEE ON GOVERNMENT OPERATIONS,

Washington, D.C. The subcommittee met, pursuant to recess, at 10:15 a.m., in room 3302, Dirksen Senate Office Building, Senator Lawton Chiles presiding.

Present: Senators Chiles, Ervin, Metcalf, and Percy.

Also present: Robert B. Smith, Jr., chief counsel and staff director, Committee on Government Operations; Rufus L. Edmisten, chief counsel and staff director, and Prof. Arthur S. Miller, staff consultant, Subcommittee on Separation of Powers; and George Patten, legislative assistant to Senator Chiles, chairman. Ad Hoc Subcommittee on Impoundment of Funds.

Senator CHILEs. We will reconvene our hearings and this morning our first witness will be Mr. Robert Koch.

STATEMENT OF ROBERT M. KOCH, PRESIDENT, NATIONAL LIME

STONE INSTITUTE, INC., ACCOMPANIED BY MIKE STROTHER, VICE PRESIDENT, NATIONAL LIMESTONE INSTITUTE, INC.

Mr. Koch. Mr. Chairman and members of this committee, I feel highly honored to have been invited by you to appear and testify on S. 373 and the profound constitutional question to which it is addressed.

Let me state for the record that my name is Robert M. Koch, president of the National Limestone Institute which is an organization of more than 600 limestone producers scattered all across this great Nation of ours. Let me further state that we have recently formed a federation called the National Crushed Stone Institute with our sister organization, the National Crushed Stone Association. They have a membership of nearly 200; thus, I am testifying today as an SCSI representative in behalf of nearly 800 stone producers.

But, I cannot refrain from mentioning that I, as one of the more than 210 million concerned Americans, personally appreciate this opportunity to talk about my government. And while I am only a layman and therefore am somewhat lost in the myriad of conflicting legal views, I would like to bring to your attention how our industry is being affected by the continued usurpation of power by the White House and its Office of Management and Budget.

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Before I begin my statement, I want to compliment and thank Chairman Ervin and Chairman Chiles and members of both committees not only for holding these extremely important hearings but for the outstanding statements which you all made Tuesday morning. I hope they can be made available to every citizen of our Nation.

As the years go by-and I would remind you that I have been on the Washington scene longer than any of your colleagues in the Senate, with the single exception of my good friend, the senior Senator of Vermont, George Aiken, who only preceded me by 6 months—I am more and more amazed at the ingenuity of our Founding Fathers. How a group of men who could not possibly have foreseen our tremendously complex society could have laid down the blueprint to establish the most perfect form of government ever developed for people to govern themselves never ceases to amaze me.

And may I say to this committee, in my judgment, one of the principal reasons why we as a nation are facing as many problems as we are today is because long ago we began to stray from the path they so clearly charted. It is my hope that not only this committee but the entire Congress will take the necessary steps to get us back to the constitutional separation of powers.

The industry it is my privilege to represent has more to gain than almost any other by a return to the type of government envisioned by the signers of the Constitution. While this may be true professionally it is, of course, not true as far as they are individually concerned for all 210 million of the citizens in this great Nation of ours have a vital stake in how we go on governing ourselves.

I have been accused—and maybe I am guilty-of tying our present quarrel with the administration too close to certain individuals. But, gentlemen, I was very much interested to hear Senators Mathias and Gurney question Caspar Weinberger when he appeared before your Separation of Powers Subcommittee in 1971. I want to make it crystal clear that my quarrel is not with Mr. Weinberger, who is a very fine and able gentleman, but with the system which allows Mr. Weinberger and his anonymous associates to lay down rules and regulations which completely negate laws passed by the Congress.

We all know our Government has grown too complex for any one man, who happens to be in the White House, to make all the day-to-day decisions. But what many Americans have not yet caught up with is that this delegation of power has moved us very close to literal dictatorship. Now I realize those are very strong words, but I submit, how else can you describe the situation when the action taken by the 535 Members of Congress, who are the elected representatives of the people, is destroyed by the stroke of a pen by an anonymous official in the Office of Management and Budget? When a Cabinet officer cannot appeal this decision to the President, much less to the Congress, we have certainly strayed a long way from what the Founding Fathers intended.

Mr. Chairman, Congress has the constitutional authority to set legislative policy. Congress also has the authority to appropriate monies to fund the various programs established under their legislative authority. Congress alone, under the Constitution, has the “Power of the Purse". Today, unfortunately, these statements are in theory, not in fact. We at the National Limestone Institute recognized this prob

lem several years ago. We have gone on record over and over again voicing our opposition to the actions of the executive branch in the impoundment of funds. Just 2 weeks ago the board of directors of the institute passed a resolution which I would like to have inserted into the record at this point.

(The resolution referred to follows:)

RESOLUTION ON IMPOUNDMENT, NATIONAL LIMESTONE INSTITUTE Whereas the Constitution of these United States of America was written nearly two hundred years ago to guarantee certain rights theretofore denied, and a government was formed to insure the protection and continuation of these basic rights; and

Whereas the American constitutional form of government incorporated a division of authority and a balance of power equally divided among the Executive, Legislative, and Judicial branches of our government in such a manner that nó one branch could usurp the power of the other equal branches thereby placing itself in violation of the precepts contained within the Constitution; and

Whereas the Executive Branch has now put itself in violation of the Constitution of these United States of America by causing Congressional appropriated monies to be impounded rather than to be made available to the people and programs for which they were intended by the elected representatives of the people; and

Whereas the action of impoundment by the Executive Branch is not subject to Congressional approval, the balance of power within our government has now shifted to a dangerous position, and is causing a multitude of national programs to be either terminated or reduced to a leval of insignificance: Now, therefore, be it

Resolved by the Board of Directors of the National Limestone Institute, Inc., this 17th day of January 1973, that this Institute reaffirms its stance of strong opposition to the flagrant violation of Constitutional and Congressional intent by the Executive Branch of our Government in the impoundment of appropriated funds; and be it further

Resolved that this Institute works for the re-establishment of balanced powers within the framework of the Constitution, and supports the efforts of Congressional leaders to return to the sound and sensible manner of determining our National priorities.

Mr. Koch. What this resolution says in effect, Mr. Chairman, is that we want a Government operated under the precepts of the Constitution.

Now a few words about our industry and how it has contributed to the fantastic growth of the Nation. I belong to the generation which saw this Nation literally taken out of the mud. The first car my Dad bought had to be "winterized” by being placed on blocks because, for months in Massachusetts, there was no way to get a car either through the snow or the mud that followed. Today, there are just three traffic lights between my home in Fairfax and my summer place in rural Vermont, 500 miles away. And when I-95 is finished to the south, there will be only three lights between Fairfax and my winter home over 1,000 miles south, in Fort Lauderdale. How did this come about? You gentlemen know as well as 1–by a tremendous partnership program between the Federal Government and the States. Isn't this an excellent example of almost perfect Government functioning "of the people, by the people and for the people?" No paternalistic government is handing this to to us on a silver platter. Highway users are paying taxes into a trust fund established by the Congress. And by what stretch or distortion of any part of the Constitution can the impoundment of those funds, paid by the people, be justified?

It is my personal belief that few people in this Nation know that the more than $6 billion of money already collected via highway user taxes and impounded as far as highway use is concerned, have already been spent on other programs.

I wish there were time to go into all the economic gains this Nation and its people have derived from this great network of roads. Everyone knows that the Interstate System is the greatest public works program ever embarked on by man. But the glamour of this system has completely overshadowed the utterly fantastic progress we have made in my lifetime in the primary and secondary road systems. We have greatly neglected our primary and secondary systems in recent years by impounding the more than $6 billion of collected highway user taxes. We have not only put off the completion of the interstate at a tremendously increased cost, but also delayed getting on with the job of upgrading our primary and secondary systems.

Highways are the backbone of our Nation's transportation system. They serve as the connecting link between all other forms of transportation. Often, we, who are part of the highway industry, are accused of trying to pave over the Nation. This accusation is totally unfounded. We are simply attempting to provide an adequate and safe highway system that can be used by all Americans. The United States has some 3.7 million miles of roads and streets. Less than half of these roads and streets are paved. In the early 1900's, there were about 3 million miles of roads already in existence. in over 70 years we have increased our total road mileage by only about 23 percent. As you can see, we have a long, long way to go before we get the Nation covered. In fact, even if we continued building new roads at the present rate, it would take over 10,000 years to do the job.

I would also like to refer to the 1972 Transportation Needs Study requested of the Department of Transportation by Congress in 1970 and presented by Secretary John Volpe last year. The report indicates that the Nation's highway needs would require an expenditure of $29.6 billion a year to meet the current public demands and that we are currently obligating only $7.3 billion per year from the Federal Highway Trust Fund and matching State funds. This means that we are only 25 percent committed to our present highway needs and these needs figures do not allow for inflation. In contrast to such figures supplied by the administration's own Department of Transportation, we find that the administration is currently holding over $6 billion of impounded highway funds. And we all know that under the Federal Highway Act of 1956, as amended, the Department of Transportation, or any other arm of the executive branch, is specifically denied the discretion to impound funds provided for by that statute for any reason except to meet operating obligations.

The 1972 Transportation Needs Study further reports that 13.4 percent of the average project cost on Federal-aid highway programs relates to the aggregate business. If we consider the $6 billion of impounded funds not put to work yet, this amounts to over $800 million in lost aggregate sales. This figure does not include the additional matching non-Federal funds. If we consider the current $7.3 billion of Federal and matching funds for the annual Federal-aid highway program, the projected annual loss of aggregate sales is nearly $1 billion in addition to the impounded moneys.

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