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However, some of these quarters may hit the middle of the summer and we might have to push it backward or forward a couple weeks.

Mr. RIEHLMAN. If it is possible, Mr. Chairman, I think the committee would like to know what is accomplished by these Advisory Committee meetings, and if in some way it is possible to inform us as to how effective they are and how well this Advisory Committee is really delving into this problem of solving a matter which is so vital-that of small business getting its reasonable share of this military procurement.

Mr. MCKELLAR. Congressman Riehlman, when we established this committee, we sincerely felt that it would come up with some mighty god and constructive recommendations and advice to us for helping small business. For that reason we wanted to have you people receive the benefit of knowing who these people are, so we sent invitations to you for our first meeting, and I would like to do this at our second quarterly meeting.

You understand now that the people have gone back to their respective plants and they are compiling information that we have asked for and they will be back in Washington in June to submit the information to us and I, at that time, would like to offer invitations to you and the members of the committee to review with us some of the recommendations made by this committee.

I take it as a completely nonpartisan, nonpolitical type of an advisory committee for the sole purpose of advising us in areas whree we can help small business, and I certainly think I am right in saying that that is of great interest to you, as it is to us.

Mr. RIEHLMAN. Well, I think so, and I think I speak for the chairman and for many of the members of the committee, and particularly our subcommittee, that if it is at all possible it would be desirable for our committee to attend this conference, if we are invited, and hear the recommendations that this committee is going to make to the Department with respect to what can be done and how best to implement this problem of assisting the small-business man in getting his correct share of the procurement.

Mr. MCKELLAR. We would feel honored to have you there, sir.
Mr. RIEHLMAN. Will there be minutes kept of the meetings?
Mr. MCKELLAR. Yes, sir. Under our directive we have to maintain
minutes of our meetings.

Mr. RIEHLMAN. Those would be available for the committee?
Mr. MCKELLAR. Yes, sir.

Mr. RIEHLMAN. And the recommendations will probably be included in the minutes, if we are not able to attend the meeting? Mr. MCKELLAR. They would be, sir.

Mr. RIEHLMAN. Thank you very much.

Mr. MULTER. Thank you very much, Mr. McKellar.

Mr. MCKELLAR. Thank you very much, Mr. Chairman.

Mr. MULTER. Next we would like to hear from Mr. Higgins, Assistant Secretary, Department of the Army.

Mr. JOHNSON. Secretary Higgins isn't here and I am here as his Deputy.

Mr. MULTER. Will you come forward, please?

You may ask to join you any of the others in your Department that may be of assistance to you.

Mr. JOHNSON. I would like to ask Colonel Prather and Mr. Askins

to accompany me.

Mr. MULTER. We are very pleased to have you with us. Will you identify yourself for the record?

Mr. JOHNSON. Yes, sir.

My name is Courtney Johnson and I am Deputy Assistant Secretary of the Army for Logistics. Mr. Higgins was unable to be here due to a long-standing previous appointment in Chicago today and he wishes me to express to you, Mr. Congressman, and to the committee his regrets that he could not be here today.

I have a prepared opening statement to read, if that is your pleasure. Mr. MULTER. If you will, please.

STATEMENT OF HON. COURTNEY JOHNSON, DEPUTY ASSISTANT SECRETARY OF THE ARMY (LOGISTICS); ACCOMPANIED BY COL. L. H. PRATHER, PROCUREMENT DIVISION, OFFICE OF THE DEPUTY CHIEF OF STAFF FOR LOGISTICS, REPRESENTING BRIG. GEN. A. L. CASSAVANT, CHIEF, PROCUREMENT DIVISION, DEPUTY CHIEF OF STAFF FOR LOGISTICS; JACK W. ASKINS, SMALL BUSINESS ADVISER TO THE ASSISTANT SECRETARY OF THE ARMY (LOGISTICS), AND TO THE DEPUTY CHIEF OF STAFF FOR LOGISTICS

Mr. JOHNSON. Mr. Chairman and members of the subcommittee, I appreciate the invitation to meet with you here today.

The Army small-business policy is fundamentally a plan affording qualified small business an equitable opportunity to compete for the supplies and services being procured by the Army.

The Army is aware of the importance the small-business community plays in our overall economy, as well as the necessity for small business in the logistics field. It is for this reason that the Army maintains approximately 360 small-business specialists at all echelons of the Army to work with and assist the qualified small-business firm to do business with the Army and maintain its place in our mobilization base.

In support of the Army small-business program, there has been during the past 2 years, a series of procurement conferences with our contracting officers and procurement personnel throughout the United States. Similar conferences will be held with industry, both large and small firms, in order that they might know first hand of Army policies and at the same time discuss their problems with the Assistant Secretary of the Army (Logistics) and a special panel of experts. The conferences have been conducted on an open forum basis and the Army small-business adviser has been a member of the panel. Small business has been one of the principal items discussed at each meeting.

To further advise industry and Army procurement personnel, including our small-business specialists, we have recently published and released two booklets; one, a listing of all Army small-business specialists at the Army principal purchasing offices, together with their addresses, and the other an alphabetical listing of Army prime contractors who have received contracts in excess of $1 million and who

have expressed their willingness to place a maximum of subcontracts with small business.

Ninety-eight Army prime contractors have submitted their first report for the period July 1, 1956, to December 31, 1956. Each of these prime contractors has indicated a person in his organization who will act as liaison for this subcontracting work.

All of the foregoing adds up to the fact that during July 1, 1956, to December 31, 1956, the Army placed 39 percent of its procurement dollars with small business on a prime-contract basis. This amounts to $778,645,000.

Mr. Jack Askins, Army small-business adviser and Colonel Prather, Procurement Division, Office of the Deputy Chief of Staff for Logistics, and other specialists have accompanied me for the purpose of assisting you ascertain to your satisfaction our inclusion of small business in all phases of our procurement program.

I would like to ask Colonel Prather to speak to you briefly and then have Mr. Askins present the Army small-business policy and program, if that is your pleasure. We are prepared to answer any questions, but would appreciate the opportunity for Mr. Askins to present the details of our program in full for questioning.

Mr. MULTER. Thank you.

Colonel Prather.

STATEMENT OF COL. L. H. PRATHER, PROCUREMENT DIVISION, OFFICE OF THE DEPUTY CHIEF OF STAFF FOR LOGISTICS, REPRESENTING BRIG. GEN. A. F. CASSAVANT, CHIEF, PROCUREMENT DIVISION, OFFICE OF THE DEPUTY CHIEF OF STAFF FOR LOGISTICS

Colonel PRATHER. Mr. Chairman, with your permission, I should like to read a very brief statement. I am Col. L. H. Prather of the Procurement Division, Office of the Deputy Chief of Staff for Logistics, Department of the Army, and am representing General Cassavant, who is unable to be here today.

As Chief of the Procurement Division of the Deputy Chief of Staff for Logistics, General Cassavant is responsible for implementation of the regulations and procedures by which Army procurement is effected. We are trying in every way we can to follow the desires of the Congress in carrying out our overall procurement program.

For any program to be effective it must be implemented wholeheartedly at the Field Purchasing Office level. Accordingly, we emphasize the small-business program at Army Area Procurement conferences as well as by field liaison visits to the purchasing offices to insure that the small-business specialists are actively participating on the contracting officer's team and conversely that the contracting officers properly apply the announced policies; and that they cooperate with the small-business specialists and the Small Business Administration officials at each pertinent level of procurement.

The success of this program I personally believe is reflected in Secretary Johnson's opening statement. As stated by the Secretary, we have our experts here today who will be glad to assist the committee to the best of their ability. With your permission, I will now ask Mr. Askins to proceed with the detailed presentation.

Mr. MULTER. Mr. Askins, we are pleased to have you with us.

STATEMENT OF JACK W. ASKINS, SMALL-BUSINESS ADVISER TO THE ASSISTANT SECRETARY OF THE ARMY (LOGISTICS), AND TO THE DEPUTY CHIEF OF STAFF FOR LOGISTICS

Mr. ASKINS. Mr. Chairman and members of the committee, I wish to present to each of you a leather-bound booklet, incorporating what I believe to be the various phases of the Army small-business policy and program and trouble areas which have come to your attention from time to time that you might be interested in knowing our precise policy.

In addition to these booklets, it is my intent to give you in narrative form, rather than a prepared statement, a background which I feel is most pertinent at this time in view of the fact that the Department of Army is fully cognizant of the intent and desires of the Congress and the wishes of many, many echelons of our Government.

With your permission, in the front of the book, behind the chart that reads: "Army small business policies, program and procedure,' you will find an index which refers to each of the tabs.

With your permission, I would ask you to turn to tab A, for we in the Department of Defense are cognizant of the fact that governmentwide interests in small business lie within every office from the Office of the President down through the General Accounting Office, who are your policing agency as far as procurement activities are concerned.

I need not enumerate them. However, we are fully cognizant of each echelon, agency, and committee interest.

I would like to submit this list for the record. (Document reads as follows:)

GOVERNMENTWIDE INTEREST IN SMALL BUSINESS

Office of the President

President's Cabinet Level Committee on Small Business
Council of Economic Advisers

Office of Defense Mobilization

Congress

Senate and House Appropriation Committees

Senate and House Armed Services Committees

Senate and House Banking and Currency Committees

Senate and House Government Operations Committees

Senate Select Committee on Small Business

House Select Committee To Conduct a Study and Investigation of the Problems of Small Business

Joint Committee on Defense Production

Small Business Administration

General Accounting Office

Mr. ASKINS. We in the Army, for a long time have felt that we must go back and seek from the laws, which you have given us, what you really intended to give us in the way of a message because we feel that there are occasions when it is a bit fuzzy when you say that a fair proportion shall go to small business.

I have taken the liberty of extracting from the existing laws which we are now working under; namely, Public Law 413, which is the Armed Services Procurement Act of 1947, those pertinent abstracts which I need not read for the record. However, I would like to present them for the record, rather than read them at this time.

(Extracts from existing public laws read as follows:)

JANUARY 1957.

EXTRACTS FROM EXISTING PUBLIC LAWS RELATING TO AND GOVERNING SMALL BUSINESS POLICY

Prepared by Army Small Business Advisor

PUBLIC LAW 413, 80TH CONGRESS, APPROVED FEBRUARY 19, 1948

ARMED SERVICES PROCUREMENT ACT OF 1947

Section 2 (b): "It is the declared policy of the Congress that a fair proportion of the total purchases and contracts for supplies and services for the Government shall be placed with small-business concerns."

Section 3: "Advertisement of bids shall be a sufficient time previous to the purchase or contract."

"Specifications shall permit full and free competition as is consistent with the procurement of types of supplies and services necessary to meet the requirements of the agency."

"Invitations for bids shall permit full and free competition as is * * *”

PUBLIC LAW 759, 80TH CONGRESS, APPROVED JUNE 24, 1948

SELECTIVE SERVICE ACT OF 1948

Section 18 (a) : Utilization of Industry:

"*** small business shall be granted a fair share of the orders placed * * *." “* * * a business enterprise shall be determined to be 'small business' if (1) its position in the trade or industry of which it is a part is not dominant, (2) the number of its employees does not exceed 500, and (3) it is independently owned and operated."

PUBLIC LAW 774, 81st CONGRESS, APPROVED SEPTEMBER 8, 1950

DEFENSE PRODUCTION ACT OF 1950

Section 2151: Encouragement of small business; allocation of supplies to business.

Section 2151 (a): "It is the sense of the Congress that small-business enterprises be encouraged to make the greatest possible contribution toward achieving the objectives of this act."

Section 2163a: Small Defense Plants Administration: Creation; independent agency.

Section 2163 (f): “Certification of small-business concern as conclusive proportionment of business, allocation of materials, and supplies ***.”

"*** The Congress has as its policy that a fair proportion of the total purchases and contracts for supplies and services for the Government shall be placed with small-business concerns ***.”

Section 2163 (1): "Fair charge for use of Government-owned property." "To the fullest extent the Administration deems practicable, it shall make a fair charge for the use of Government-owned property and make and let contracts on a basis that will result in a recovery of the direct costs incurred by the Administration."

PUBLIC LAW 163, 83D CONGRESS, APPROVED JULY 30, 1953

TITLE II, SMALL BUSINESS ACT OF 1953

Section 202: "*** security and well-being cannot be realized unless the actual and potential capacity of small business is encouraged and developed." Further stated: "It is the declared policy of the Congress that the Government should aid, counsel, assist, and protect insofar as it is possible the interests of small-business concerns in order to preserve free competitive enterprise, to insure

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