NUMBER AND RANK OF INSURING OFFICES

Mr. SNYDER. With reference to the volume of your operations in the several States, what States, for instance, lead?

Mr. McDONALD. We have here a list showing the leading cities. San Francisco leads with 7,322 mortgages, in the amount of $33,677,400 for the first 6 months this year.

Mr. CANNON. Suppose you place that list in the record.

Mr. McDONALD. I will do so.

(Said list is as follows:)

Ranking of insuring offices by amount of mortgages selected for appraisal, January through June 1937

Ranking of insuring offices by amount of mortgages selected for appraisal, January through June 1937-Continued

STATEMENTS OF THAD H. BROWN, COMMISSIONER; THEODORE L. BARTLETT, LEGAL DEPARTMENT; WILLIAM N. KREBS, ENGINEERING DEPARTMENT; AND GEORGE E. STERLING, ASSISTANT CHIEF, FIELD DIVISION

PROMOTION OF SAFETY OF LIFE AND PROPERTY AT SEA, AND STUDY OF RADIO REQUIREMENTS OF SHIPS ON THE GREAT LAKES AND INLAND WATERWAYS

Mr. WOODRUM. We have before us a Budget estimate, in Document No. 279, amounting to $148,000 for the Federal Communications Commission. Will you tell us about this estimate?

Mr. BROWN. I will outline it briefly, Mr. Chairman.

I am appearing for the Federal Communications Commission because of the direction of Congress under S. 595, Public No. 97, Seventy-fifth Congress, with relation to safety of life at sea.

There are many directions in this bill with respect to safety of life at sea. The Commission submitted its request to the Director of the Budget in two sections, one of them having to do particularly with safety instructions and the other having to do with subsection (e) of section 15, with respect to a study which Congress has directed regarding communication conditions on the Great Lakes and inland waters. I will read that subsection for the record, as follows:

Such part or parts of the act entitled "An act to require apparatus and operators for radio communication on certain ocean steamers", approved June 24, 1910, as amended, as relate to the ocean and to steamers navigating thereon, are hereby repealed. In all other respects said act shall continue in full force and effect. The Commission is requested and directed to make a special study of the radio requirements necessary or desirable for safety purposes for ships navigating the Great Lakes and the inland waters of the United States, and to report its recommendations and the reasons therefor, to the Congress not later than December 31, 1939.

As I have indicated, the requests have been submitted in two sections: The safety requirements of the act might be termed the first section, under which an estimate of $123,000 is submitted; and the study of communications conditions on the Great Lakes and inland waters might be termed the second section, under which $25,000 is requested for the study I have referred to.

With respect to the latter section, I would like to invite the committee's attention to the report which was filed in the Senate covering Senate bill 595, in which this statement is made:

Therefore, it is proposed that the provisions of this bill shall not apply to the Great Lakes, but that the Ship Act be continued in effect thereon and that the Federal Communications Commission be directed to make a thorough study of the situation and report to the Congress on or before December 31, 1939. In this situation it is earnestly hoped and expected that the State Department will in the near future reach an agreement with the Canadian Government for th utilization of radio to its fullest extent as a safety factor for shipping on the Great Lakes so that the ships of both countries will be placed on a basis of equality in this respect and will receive assistance from the ships of each other as on the high seas.

That is from report 196, calendar 200, which was submitted by Senator White in the Senate.

The report to the House on the same bill is Report No. 286, and it reads, in part, as follows, on page 6:

Your committee joins in the hope and expectancy expressed by the Senate committee that the State Department will in the near future reach a regional agreement with the Canadian Government covering the use of radio on waters lying wholly within the territorial boundaries of the two countries, having as its object the utilization of radio to its fullest extent as a safety factor for shipping on the Great Lakes so that the ships of both countries will be placed on a basis of equality in this respect and will receive assistance from the ships of each other on the high seas.

A short time after this report was submitted, a letter was received from the State Department, which was addressed to the Commission, which included a memorandum from the Canadian Legation. I will read just one paragraph from that statement, as follows:

The Canadian authorities would welcome an arrangement whereby a formula for the regulation of radio would be established to apply to the ships of both the United States and Canada, plying on voyages between Canada and the United States on the Great Lakes. They would be glad to confer with representatives of the United States Department of Commerce, interested in this matter, in order to see whether some mutually agreeable formula can be arrived at for the consideration of the two Governments.

The Commission replied that it would take the matter under consideration at an early date.

SALARIES AND EXPENSES

Mr. WOODRUM. Tell us about the $123,000 for salaries and expenses, and what personnel will be covered by that. Tell us what personnel you already have, and why you cannot absorb this additional work. Mr. BROWN. Commander Webster was the technical adviser before the committees of the Senate and House with respect to this matter, and he is absent abroad now attending the Safety Convention in London. I am not as familiar with respect to this matter as some of the members of our staff, and I would respectfully ask Mr. Krebs to answer that.

Mr. WOODRUM. Tell us why you need this money, or why is this Budget estimate presented for additional personnel.

Mr. KREBS. Mr. Chairman, last year we were granted an additional $100,000 for the fiscal year. The International Convention for the Safety of Life at Sea was ratified by the United States, and became effective on November 7, 1936. For the fiscal year ending June 30, 1937, we were granted an additional fund of $60,000 in order to pro

vide for the enforcement of that convention, and we were granted $100,000 for the fiscal year 1938 in order to carry that work on. However, on May 20, 1937, this new law, Public, No. 97, was enacted, which greatly increased the responsibilities and duties of the Commission in connection with the safety convention. It also applied the convention standards to a number of coastwise vessels, approximately 775 in number, some of which were not affected by the safety convention.

It goes further in that it enacts the Safety Convention into a Federal statute, and extends the scope of the convention to coastwise vessels in this way: The Safety Convention applies only to vessels, or passenger vessels; and cargo vessels of over 1,600 tons engaged in international voyages only, but under Public, No. 97 the law applies to all passenger ships departing from the ports of the United States for a voyage on the open seas, and to all cargo vessels of over 1,600 tons departing from ports of the United States for voyages on the open seas, regardless of whether they go to foreign countries or not.

INSPECTION OF RADIO EQUIPMENT, AND NUMBER OF SHIPS TO BE INSPECTED

Mr. WOODRUM. You do not make an inspection of all those boats, do you?

Mr. KREBS. Yes, sir.

Mr. WOODRUM. Does not the Department of Commerce make those inspections?

Mr. KREBS. We make the inspections covering radio equipment. Mr. WOODRUM. The Department of Commerce inspectors have the right to pass on that, do they not?

Mr. KREBS. No, sir.

Mr. WOODRUM. The inspection of the Department of Commerce applies only to hulls and boilers?

Mr. KREBS. Yes, sir; to everything except radio. We have the inspection of radio.

Mr. WOODRUM. They have to make an inspection of the vessels, including hulls and boilers.

Mr. KREBS. Yes, sir.

Mr. BROWN. That is under an Executive order which makes the division of authority between the Department of Commerce and the Communications Commission.

Mr. KREBS. The act provides that an annual inspection in detail be made, and the fact that a ship is operating in accordance with the law must be certified to on the station license. In addition to that, the law requires that as many inspections during the year as can be made should also be undertaken. That involves a total of 1,675 domestic ships and 900 foreign ships, 'making a grand total of 2,575 ships to be inspected.

Mr. WOODRUM. Those are annual inspections?

Mr. KREBS. At least one detailed annual inspection, and the law requires as many other inspections as can be made.

Mr. WOODRUM. How long does it take to make an inspection, on the average?

Mr. KREBS. I would prefer to have Mr. Sterling, who is in charge of the field section, answer that.

Mr. WOODRUM. All right; how long does it take to make one of these inspections?

Mr. STERLING. We find that the detailed inspection we are required to make under this law usually takes about 2 days.

Mr. WOODRUM. For one man or two men?

Mr. STERLING. One man. It involves a very thorough inspection and test made of all the apparatus. There is a sort of preliminary inspection, and then there is an inspection of the replacements and repairs that are necessary, and of the additional equipment installed by the licensee. That means that an inspector has to go back and make another inspection to see that the ship complies with the law. Inspectors have to make as many as three inspections of a vessel before it is in compliance with the law.

Mr. WOODRUM. How many inspectors do you have?

Mr. STERLING. We have at the present time 45. That is not our total inspection force in the United States. The United States is divided into 21 administrative districts, and we have 13 seaport offices. We have at the seaport offices about 45 inspectors engaged primarily in this work.

Mr. WOODRUM. What is the total number of ships?

Mr. KREBS. The total number is 2,575.

Mr. WOODRUM. Will there be that total number to be inspected under this act?

Mr. KREBS. Yes, sir; there are 775 additional vessels, but they are included in the 2,575.

NECESSITY FOR INCREASED PERSONNEL

Mr. WOODRUM. All right, explain the necessity for this increased personnel.

Mr. KREBS. The work of the engineering department in regard to marine matters was increased by the enactment of the Safety Convention, or by the ratification of the Safety Convention, by reason of which a marine unit was organized consisting of myself in charge, with two engineers, one clerk, and three stenographers. This was done in accordance with the law, or for the enforcement of the safety Convention. We find that the work under Public, No. 97 is a great deal more than we can do with our present force, and it has been necessary for them to put in a considerable amount of overtime. Even with the overtime, we cannot handle it properly, and some of the stations are not having any attention at all. We have on hand, in accordance with the act, Public No. 97, 70 applications for exemption from the provisions of the act.

The act provides that the Commission may grant exemption to passenger ships which in the course of their voyage do not go more than 20 nautical miles from the nearest land, or more than 200 nautical miles between two consecutive ports; also, cargo ships, which in the course of their voyage do not go more than 150 nautical miles from the nearest land. There are certain other classes of exemptions provided for in the law where the Commission finds, after study of the conditions, that an exemption is warranted-that is, where the Commission finds that the route or the conditions of the voyage or the circumstances are such as to render a radio installation unreasonable or unnecessary. That, in my opinion, is quite a responsibility to carry, and it requires some study. We have no man to do that at the present time. We hope to be able to work it out at some time, but we badly need this additional personnel.