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along in their work, and suddenly find that there is no purpose in their work.

It boils down to this: Secretary Romney came to the homebuilders convention in January and made the announcement there, that, on January 5, it was over with as to the programs he was talking about. But he said the Government is going to keep its contracts. To us it appears it is not a question of honoring the contracts, it is also a question of whether the Government is going to keep its promise, because the departments which administer these programs have officials in communities throughout the land in contact with builders urging them to do certain things because of the long leadtime involved. To get ready to provide this housing—the active preparation-is a commitment on the part of the builders, and it is the responsibility of the Government to keep its promise, in addition to keeping its contracts in this area, sir.

Senator Ervin. An impoundment and freezing of funds has a very disruptive effect on housing programs for the reasons you stated; is that not true?

Mr. CENKER. Extremely so. I would like to take the liberty, since our chairman is from Florida, and I know Senator Chiles would be interested in this.

I have a letter which the State Director of the Farmers Home Administration mailed to one of the builders on July 10, 1972, announcing that they had just completed a most successful year in the rural housing program in Florida and recited a list of loans and went on to say that plans have been made to more than double the production this year and estimated numbers of loans to accomplish this have been given to each county supervisor. We need and solicit your active support and cooperation in expansion of our rural housing program, and I would submit that on the letterhead of the U.S. Department of Agriculture over the signature of the State director, as far as I am concerned, that constitutes promise by that Governor who enters into a contract for land and commits himself to buving materials and sets in motion the long and costly process of producing these things, and then to announce on January 5 that that is over, this constitutes a disservice to the Nation and particularly to the businessmen involved.

Senator CHILES. And actually one of our problems has been, has it not, that there wasn't any money available for loans in rural housing: that is exactly why Congress was trying to set up these funds because conventional funds would go out of corporate limits, so your sarings and loan, your banks and other private funds will not loan in these areas?

Mr. CENKER. That is quite right.

Senator CILES. Or if they do loan they loan to someone who has an awful lot of money or property, but not to someone who is trying to build a single family dwelling, or someone of lower income or modest means.

Mr. CENKER. A great deal, if not majority, of substandard housing of America has been in rural areas. The Congress, I believe, made this program possible to solve that very problem.


I live and work in Atlanta, Ga., and I don't do any work in the rural areas, but I was president of the State association in Georgia and got acquainted with the fellows around the State, and I can tell you they have found the program to be the kind of thing to help solve that housing problem in the rural areas. Now, they will be laid by and damaged and the program won't come back. Senator Chiles. Do you have any further questions? Senator Ervin. No questions.

Senator Chiles. We want to thank you very much for coming and staying with us to this late hour.

Senator Ervin. We are sorry we detained you so late. Senator CHILES. We will now recess our hearings to reconvene on Tuesday, February the 6th at 10 a.m.

(Whereupon, at 5 p.m., the joint hearing was recessed until Tuesday, February 6, 1973, at 10 a.m.)







Washington, 'd.c. The subcommittee met, pursuant to recess, at 9:30 a.m., in room 3302, Dirksen Senate Office Building, Senator Lawton Chiles presiding.

Present: Senators Chiles, Ervin, Muskie, 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; Prof. Arthur S. Miller and Prof. Philip B. Kurland, staff consultants; and George Patten, legislative assistant to Senator Chiles, chairman of the Ad Hoc Subcommittee on Impoundment of Funds.

Senator CHILEs. We will reconvene our hearings, and we are delighted to have as our first witness the Honorable Robert C. Byrd, the distinguished Senator from West Virginia, who has long been concerned about not only impoundment, but congressional powers. STATEMENT OF HON. ROBERT C. BYRD, A U.S. SENATOR FROM THE

STATE OF WEST VIRGINIA Senator BYRD. Mr. Chairman, I am pleased to appear today to join in support of S. 373, introduced by Chairman Ervin and cosponsored by almost one-half of the Senate, myself included. I wholeheartedly subscribe to the vital principle which this legislation seeks to restore and preserve; namely, the constitutional power and authority of the Congress to determine in what amounts, and the purposes for which, the Nation's revenues will be spent.

We have today been brought face to face with what recent newspaper editorials and network commentators have called the "constitutional collision of our generation” and “the constitutional crisis of the century.” It is a crisis that has crystalized quite abruptly as a result of certain impoundments of budget authority by President Nixon during the past few months, but it is a process that has been going on for years under various Presidents representing both political parties.

The distinguishing feature of the recent impoundments is in the fact that while some impoundments are legal and appropriate for example, the withholding of current funds to protect against future deficiencies in programs-many of the recent impoundments have not



been sanctioned by the Congress and, in the judgment of the cosponsors of this legislation, such impoundments constitute an instrument resorted to solely for the implementation of fiscal and economic policy.

This is where the grave constitutional question arises, and it comes at a time when the whole issue of separation of powers is being raised in many areas simultaneously—-executive privilege, war powers, and so on. In all of these, the problem is one, perhaps not entirely of our own making but, nontheless, one to which Congress itself has substantially contributed by acts of commission as well as omission.

Regarding the constitutional issue involving impoundments of budget authority as an instrument in the exercise of fiscal and economic policy, several U.S. Senators, the majority leader and I included, have joined with you, Chairman Ervin, in filling an amicus curiae brief in the case of State Highway Commission of Missouri, V. John A. Volpe, Secretary of Transportation and Caspar W. Weinberger, Director of the Office of Management and Budget. The case is on appeal to the eighth circuit from the U.S. District Court for the Western District of Missouri.

The district court ruled last June that the Secretary of Transportation does not have the power to impound Federal highway funds indiscriminately. But the case does not go to the question of the constitutional power of the President to impound legislatively appropriated funds, since the case turns on statutory construction of the FederalAid Highway Act, which includes a section prohibiting impoundment except under strict limitations. Therefore, S. 373 goes to the broader question of impoundment_limiting the power of the Executive to impound except where that impoundment is sanctioned by the Congress.

As I have indicated, the problem with which we are here dealing is one that is largely of Congress' own making. Candid reflection compels the admission that, for too long now, the Congress has been unwilling to wield its power of the purse in accordance always with the highest sense of responsibility. I hesitate to suggest that it is too much to expect of the Federal Legislature-considering the countless cross currents of spending pressures to which it is constantly subjected, and keeping in mind its Constitution of 535 Members with differing views and differing constituencies—that it at all times act in a fiscally responsible manner. But one cannot deny the patently evident fact that a high degree of fiscal responsibility, political independence, and statesmanship has not been the constant standard by which the Congress has measured its collective judgment regarding the authorization and funding of programs.

In many instances Congress has acquiesced in the creation and funding of costly and unsound programs urged upon it by Presidents of both parties. It has all too often yielded, also, to the political pressures of blocs and groups with vested interests in continued and increased funding for various and sundry programs. It cannot be gainsaid that organized special interest groups, with political clout, have on too many occasions influenced the creation and perpetuation of costly pet programs, the financial burden of which is borne by the general public.

Any effort to cut back or eliminate programs once started, notwithstanding their exorbitant cost and inefficiency-has invariably been met with organized resistance and cries of anguish from one pressure group or another.

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