In light of the above and at a time when this Nation faces the prospect of a continuing rise in crime and the continuing need for a greater number of Agents to counter acts of hostile intelligence services directed at the United States, it seems counter productive to decrease the compensation of those individuals directly responsible for the Government's mission. It is conclusive that the proposed reduction in AUO allowances would seriously impair the execution of our mission. Aside from a diminished number of overtime hours expended, we cannot expect the same degree of wholehearted participation at every level which has been the hallmark of the successes the FBI has achieved. Morale is an essential ingredient to effective personnel management and any action by the Government to reduce AUO pay where there is no diminished responsibility could only serve to have a deleterious effect on morale. The FBI's most valuable asset is its corps of highly motivated, dedicated, enthusiastic and competent Special Agents who can be counted upon to vigorously pursue both individually and collectively the wide range of vital matters for which we have responsibility. This organization is highly career oriented with supervisory positions being filled by Special Agents experienced in the broad phases of investigative endeavors so that supervisory positions in the FBI at all levels are fully supportive of our investigative responsibilities and participate equally in the AUO allowances. This uniqueness of having management so closely identified with our mission is one of the FBI's greatest strengths. Periodically, the FBI is faced with the task of solving a major crime of national importance. When this occurs, FBI Agents at all levels work around the clock in their collective efforts to solve the crime. Such special cases are very demanding on manpower and all Agents, regardless of their assignment, respond accordingly. Recent examples of such cases where FBI Agents concentrated their efforts are: The Patricia Campbell Hearst kidnaping and subsequent bank robbery case in which a total of 201,024 Agent man-hours were expended in the first four months of this investigation; in the bombing of the LaGuardia International Airport in New York, New York, in late December 1975, 28,958 Agent hours were expended through February 29, 1976; and in the case of James Riddle Hoffa, missing person-extortion, 30,974 Agent hours were expended between July 30, 1975 and February 29, 1976. These are just a few examples where all manpower available is applied to solve a single case. These examples depict the inconsistencies which would occur when Agents, some eligible and some ineligible for AUO, would work a special. Further, if AUO is not available as a means of reimbursement for a segment of our Agents, which has been proposed, regular overtime at $10.70 per hour for overtime worked would be the only available option in major cases for which here again there are no funds. Regular overtime pay is not a viable alternative to AUO pay for compensation for investigative overtime worked. The FBI has always closely administered the authorization for regular overtime pay and realizes the cost effectiveness of AUO when compared to regular overtime. Additionally, AUO is easier to budget than regular overtime in that it is estimated on a per annum basis, and it is a bargain for the price. If a reduction in AUO pay is mandated as proposed, our Career Development Program would be devastated. The Civil Service Commission, OMB, and the Department of Justice champion the development by agencies of sound career development programs, and the FBI feels its current program is most effective. The system of career development is geared to identify and select the most promising Special Agents serving as relief and field supervisors for supervisory assignment at FBI Headquarters. Service at Headquarters is regarded as vital in order to provide invaluable experience for application as they return to the field for more responsible supervisory positions such as Assistant Special Agent in Charge or Special Agent in Charge of one of our field offices. A system other than one that assures an equitably shared AUO would be divisive and eliminate any financial attraction for those with an advancement potential to strive for supervisory assignment. Significant is the dollar amount the FBI has been reduced for AUO allowances in fiscal year 1977. The 25 percent reduction in our fiscal year 1977 budget is approximately $8,156,000. As of January 31, 1976, there were 781 Special Agents assigned at FBI Headquarters, including those assigned at FBI Academy, Quantico, Virginia. Of this number, 179 are not receiving AUO or are receiving a reduced amount of AUO because of salary limitations. Servicewide, 116 Special Agents currently receive no AUO because of salary limitation and 175 additional Special Agents receive a reduced amount of AUO for this reason. There are 602 Headquarters Special Agents eligible for the full AUO compensation if they qualify by working the appropriate number of hours overtime. If every one of these 602 Special Agents were completely removed from AUO compensation, the total savings would be approximately $2,396,000, or $5,760,000 short of the designed cut of $8,156,000. To attempt to alter the current system of remuneration for overtime work would be totally disruptive to the FBI's Career Development Program and there would be little incentive for an FBI Agent at any level conducting field investigative work to accept promotion to a supervisory position in the field or at FBIHQ if that promotion would involve a corresponding loss in pay. For example, the rate for GS-14, step 1, which is the first supervisory grade, is $26,861 per annum. A Special Agent in GS-13, step 3, receives a base salary of $24,434, but when the AUO maximum, which the FBI has demonstrated as being justified, is added to this salary his income at step 3 is $28,140 per annum. The disparity here is obvious. Few Agents would accept a reduction in pay of $1,279 per annum to achieve administrative advancement. Some not acquainted with the specifics of the FBI Career Development program might view some positions as not qualified for AUO pay. However, it is believed that all Special Agent positions not restricted by salary limitations involve assignments which qualify incumbents for AUO pay. In this regard, it is important to note that pursuant to regulations, once an employee has satisfied the main requirement for eligibility for AUO pay (three hours of AUO per week) additional hours of irregular or occasional overtime duty performed must be paid under AUO pay provisions whether or not the additional duty meets the criteria for AUO pay. A mandated reduction in AUO allowances may appear on the face of it to be a ready means of effecting overall budget reduction. It is hoped, however, that it has been demonstrated that vital personnel management and attendant budget considerations for the FBI negate the effectiveness of any mandated reduction. DEPARTMENT OF COMMERCE STATEMENT OF JOSEPH E. KASPUTYS, ASSISTANT SECRETARY FOR ADMINISTRATION ACCOMPANIED BY: DAVID S. NATHAN, DIRECTOR, OFFICE OF BUDGET AND PROGRAM ANALYSIS JOHN W. EDEN, DEPUTY UNDER SECRETARY FOR FIELD PROGRAMS ROBERT HAGEN, DEPUTY DIRECTOR, BUREAU OF THE CENSUS ARTHUR T. DOWNEY, DEPUTY ASSISTANT SECRETARY FOR BUREAU OF EAST-WEST TRADE JOHN W. TOWNSEND, JR., ASSOCIATE ADMINISTRATOR, NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION BUDGET REQUEST Senator PASTORE. The next witness is Mr. Joseph E. Kasputys, Assistant Secretary of Commerce. For fiscal year 1977 the House considered budget estimates of $1,335,742,000, a reduction of $586 million below the previous year. The House, in its action, made a reduction of approximately $30 million in the various Commerce Department programs. In addition, the House added approximately $76 million to partially restore the Economic Development Administration programs to the previous year's level. The Department is asking the committee to delete all of the House recommendations for increases, primarily in the EDA programs. The Department is also asking that approximately $6 million of the $30 million in reductions be restored. Please proceed Mr. KASPUTYS. PREPARED STATEMENT Mr. KASPUTYS. Good afternoon, Mr. Chairman, If I may, my statement is somewhat lengthy. I would like to summarize it but I ask that the committee insert it in the record as if read. Senator PASTORE. Without objections. [The statement follows:] Mr. Chairman and members of the Committee, I appreciate the opportunity to appear before you in support of our request for appropriations to support activities of the Department of Commerce in 1977. Secretary Richardson regrets that he is unable to be present at this hearing today. He leaves tomorrow on a long planned trip to Korea and asks that I deliver his regards to you. It is my intention to concentrate, in my statement, on the areas where we believe that anticipated action by the House merits special reconsideration by this body. It may be useful, first, however, to describe the basic characteristics of the Department's budget request for 1977. That request reflected the President's determination to restrain the growth of Federal spending in order to achieve a balanced budget by 1979. The Commerce budget for 1977 does not contain any new programs. It does provide for increases in programs which will permit us to maintain essential services and allow program expansion in some high priority areas. Our budgeting requirements have been reduced through: --proposed reductions in lower priority programs; --savings achieved through increased productivity; and --use of prior year appropriations in some areas. The Appropriations request which we have proposed for 1977 was $1,739,463,000, a net reduction of $542,074,000 from the 1976 enacted appropriation level of $2,281,537,000. We firmly believe that the program control, which our estimates reflect, is essential if we are to have a stable and inflation-resistant economy in the future. The critical problem in Federal spending is seen in the Department's budgeted outlay estimates for 1977. While the request for appropriations is going down, our 1977 outlay estimate of $2,162,253,000 is $172,825,000 above the current year estimate. This increase in actual spending reflects large commitments made in prior years for programs that require several years for completion, so that there is a considerable lapse between the obligation and the expenditure of funds. We realize some of the reductions proposed in the budget are not popular. Nonetheless, they were made with the intention of preventing a new surge of inflation and enhancing the capacity of the private sector to create jobs. Appeal to House Action Although the report is not yet available, the House Appropriations Subcommittee on State, Justice, and Commerce, the Judiciary, and Related Agencies has met in open session to markup our request. As a result, we expect that the House will recommend a total 1977 appropriation of $1,787,202,000 including $388,000,000 to liquidate contract authority. This would be a net increase of $47,739,000 over our recommendation to the Congress in January. Changes they will propose include: --$78,062,000 in appropriations not requested by the --$30,323,000 in increases which were denied. |