bus_1965

THE BUDGETOF THE

UNITED STATES GOVERNMENT

FOR THE FISCAL YEAR ENDING JUNE 30

1965

U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 1964

For Sale by the Superintendent of Documents, U.S. Government Printing OfficeWashington, D.C., 20402 - Price $1.50 (Paper Cover)

Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A NOTE ON THE FORMAT OF THE BUDGET

The Budget of the United States Government is presented in a compactvolume containing the Budget Message of the President and othersignificant data to place before the Congress the President's budgetaryrecommendations. This volume contains the facts and figures thatmost users of the budget would normally need or desire.

Additional information used by the Appropriations Committees ofthe Congress, and reference materials useful to those concerned withdetails, will be found in a further volume, entitled The Budget of theUnited States Government—Appendix. The Appendix contains thetext of appropriation language, schedules, and narrative statements onprogram and performance for the individual appropriations andfunds. It also contains those supplementary schedules required bylaw with respect to details of personnel compensation.

The budget for the District of Columbia is printed separately asusual.

Budget documents for the fiscal year 1965, available from theSuperintendent of Documents, U.S. Government Printing Office,Washington, D.C., 20402. (Paper covers* only.)

1. The Budget of the United States Government, 1965 ($1.50).2. The Budget of the United States Government, 1965—

Appendix ($6.25).3. The Budget of the United States Government, 1965—

The District of Columbia (40 cents).4. The Budget in Brief, 1965 (35 cents).


TABLE OF CONTENTSPage

PART 1. THE BUDGET MESSAGE OF THE PRESIDENT 5

PART 2. SUMMARY TABLES 39Table 1. Budget resume" 41Table 2. Receipts from and payments to the public 42Table 3. New obligational authority by type and function 43Table 4. New obligational authority by agency 44Table 5. Expenditures by agency 45

Table 6. Investment, operating, and other expenditures 46Table 7. Federal receipts and expenditures in the national income accounts 47Table 8. Relation of authorizations to expenditures 48Table 9. Obligations incurred, net 50Table 10. Balances of obligational authority 51Table 11. The public debt 52Table 12. Civilian employment in the executive branch 53

Part 3. RECEIPTS 55Analysis of receipts by source 56Table 13. Sources of receipts 62

PART 4. THE FEDERAL PROGRAM BY FUNCTION 69Analysis of Federal activities by function 70

National defense 71

International affairs and finance 81Space research and technology 87

Agriculture and agricultural resources 90Natural resources 96Commerce and transportation 100-Housing and community development 107Health, labor, and welfare 111Education 119Veterans benefits and services 123Interest 127General government 128

Table 14. New obligational authority and expenditures by function and agency 132

PART 5. THE FEDERAL PROGRAM BY AGENCY 145Explanation of means of financing agency activities 146Analysis of new obligational authority and expenditures by agency 150

Legislative branch 150The Judiciary 162

Executive Office of the President 165Funds appropriated to the President 168Department of Agriculture 173

Department of Commerce _ 189


THE BUDGET FOR FISCAL YEAR 1 9 6 5

PART 5. THE FEDERAL PROGRAM BY AGENCY—ContinuedAnalysis of new obligational authority and expenditures by agency—Continued Page

Department of Defense—Military 201Department of Defense—Civil 213Department of Health, Education, and Welfare 217Department of the Interior 236Department of Justice 253

Department of Labor 256Post Office Department 261Department of State 263Treasury Department 268Atomic Energy Commission 274Federal Aviation Agency 275General Services Administration 276Housing and Home Finance. Agency 282National Aeronautics and Space Administration 287Veterans Administration 288

Other independent agencies 290District of Columbia 307Special allowances 308Trust funds 309Memorandum—Annexed budgets 324

PART 6. SPECIAL ANALYSES 327

A. Three measures of Federal financial transactions 328B. Public enterprises, trust funds, and gross expenditures of the Government 337C. Civilian employment in the executive branch 347

D. Investment, operating and other expenditures 352E. Federal credit programs 371F. Federal activities in public works 383G. Federal health programs 397H. Federal research, development, and related programs 407I. Federal aid to State and local governments 427J. Principal Federal statistical programs 436

K. Foreign currency availabilities and uses 440L. International transactions of the Federal Government 446

PART 7. HISTORICAL TABLES 453Table 15. Administrative budget totals and public debt, 1789-1965 454Table 16. Consolidated cash totals and Federal sector of the national income accounts,

1940-65 455Table 17. Administrative budget and trust fund receipts, 1954-65 456Table 18. Administrative budget and trust expenditures by function, 1954-65 457

Table 19. Receipts from and payments to the public, 1954-65 462Table 20. Federal receipts and expenditures in the national income accounts, 1954-65 463

INDEX 465

GENERAL NOTESThe estimates in the budget cover requirements under existing legisla-

tion and under legislation which is proposed for enactment by the Congress.Unless otherwise indicated, all references to years in this volume are to

fiscal years ending June 30.Details in tables, charts, and text may not add to the totals because of

rounding.


PART 1

THE BUDGET MESSAGEOF THE

PRESIDENT


6 THE BUDGET FOR FISCAL YEAR 1965

of Federal Payments


BUDGET MESSAGE OF THE PRESIDENT

To the Congress of the United States:

This is the budget of the United States Government for 1965.The preparation of this budget was the first major task to confront

me as President, and it has been a heavy one. Many decisions of greatimportance have had to be made in a brief span of weeks. I have donemy best, and I am satisfied that the budget which I am sending tothe Congress will advance our Nation toward greater national secu-rity, a stronger economy, and realization of the American dreamof individual security and equal opportunity for all of our people.

In formulating my budget, I have been guided by two principles:

• I have been guided by the principle that spending by the FederalGovernment, in and of itself, is neither bad nor good. I t can bebad when it involves overstaffing of Government agencies, or need-less duplication of functions, or poor management, or public serv-ices which cost more than they are worth, or the intrusion of gov-ernment into areas where it does not belong. It can be good when itis put to work efficiently in the interests of our national strength,economic progress, and human compassion.

• I have been guided by the principle that an austere budget neednot be and should not be a standstill budget. When budgetaryrestraint leads the Government to turn its back on new needs andnew problems, economy becomes but another word for stagnation.But when vigorous pruning of old programs and procedures releasesthe funds to meet new challenges and opportunities, economy be-comes the companion of progress.

This is, I believe, a budget of economy and progress. On the onehand, it calls for a reduction from the preceding year in total admin-istrative budget expenditures—and it is only the second budget in 9years to do so. It calls for a substantial reduction in total civilianemployment in the executive branch—and it is the first budget to do sosince the practice of totaling the employment estimates in the budgetwas initiated in January 1956. It cuts the deficit in half, and carriesus a giant step toward the achievement of a balanced budget in a full-employment, full-prosperity economy.

7



On the other hand, this budget safeguards the peace by providingfor the further strengthening of the most formidable defense estab-lishment the world has ever known; it recommends continued militaryassistance to those nations menaced by Communist aggression, directand indirect; it includes economic assistance to those nations whichare willing to take the steps necessary to guard their freedom andindependence through economic self-help; it provides the funds neces-sary to advance our mastery of space toward the achievement of amanned lunar landing in this decade; it provides for the soundmanagement and development of our natural and agriculturalresources; and in its recommendations relating to education, hous-ing, manpower training, health, and employment opportunities foryouth, it provides more funds than ever before in our history for thefuller development of our Nation's most important resource—itspeople.

Moreover, this budget makes provision for the initiation of a newand major effort to break the vicious circle of chronic poverty, whichdenies to millions of our fellow citizens a just participation in thebenefits of life in our country. We owe to every young person inAmerica a fair start in life—and this means that we must attack thosedeficiencies in education, training, health, and job opportunities bywhich the fetters of poverty are passed on from parents to children.The attack on poverty must rely on local initiative and leadership;and the resources of the local, State, and Federal Governments must bemobilized to support these efforts. I will shortly send to the Congressa special message conveying my recommendations for the attack onpoverty.

The urgent and necessary program increases recommended in thisbudget will be financed out of the savings made possible by strict econ-omy measures and by an exhaustive screening of existing programs.As a result of the highly successful cost reduction program launchedin 1962 by the Secretary of Defense, the 1965 program of the Depart-ment of Defense will require over $2 billion less in appropriationsthan would otherwise be the case—a sum greater than the 1965cost of the new programs I am recommending to the Congress.Department of Defense expenditures will decline by more than $1billion from 1964 to 1965, and additional savings are expected to berealized in agriculture, atomic energy, postal services, veterans bene-fits, and in various lending programs through substitution of privatefor public credit.


THE BUDGET MESSAGE OF THE PRESIDENT

My proposals call for administrative budget expenditures in 1965of $97.9 billion—$900 million less than was requested in the 1964 budgetand $500 million less than I now estimate will be spent in 1964. This re-duction in expenditures will be achieved despite a steady growth inthe workload of nearly every civilian agency of Government—rangingall the way from the number of income tax returns to the number ofvisitors to our national parks. The reduction in expenditures will beachieved despite built-in and relatively uncontrollable expenditureincreases resulting from past commitments and legislative provisions,including higher costs for interest on the debt and for military andcivilian pay increases required by law.

Administrative budget receipts are expected to increase in 1965 to$93.0 billion, $4.6 billion over 1964. This increase, reflecting theexpectation of a strongly growing economy spurred by prompt enact-ment of the tax program, takes into account the estimated revenuelosses from the new tax rates.

The resulting administrative budget deficit of $4.9 billion for 1965is $5.1 billion below the deficit now estimated for the current yearand marks an important first step toward a balanced budget.



SUMMARY OF FEDERAL RECEIPTS AND PAYMENTS

[Fiscal years. In billions]

Description

FEDERAL RECEIPTS

Administrative budget receiptsTrust fund receipts. _ «Deduct: Intragovernmental transactions

Total cash receipts from the public

Add: Adjustment from cash to accrual basis ___ __Deduct: Receipts from loans, property sales, and other adjust-

ments _ _ - _ _ _ > _ . _

National income account receipts—Federal sector

FEDERAL PAYMENTS

Administrative budget expenditures ___Trust fund expenditures (including Government-sponsored enter-

prises) __ ____ _Deduct: Intragovernmental transactions and other adjustments.

Total cash payments to the public __

Add: Adjustment from cash to accrual basisDeduct: Disbursements for loans, land purchases, and other ad-

justments

National income account expenditures—Federal sector. __

EXCESS OF RECEIPTS (+) OR PAYMENTS ( - )

Administrative budgetReceipts from and payments to the publicNational income accounts—Federal sector

1963

$86.427.74.3

109.7

0.6

1.0

109.3

92.6

26.55.4

113.8

0.6

1.8

112.6

- 6 . 3- 4 . 0- 3 . 3

1964

$88.430.24.2

114.4

- 0 . 1

0.7

113.6

98.4

29.35.0

122.7

0.1

3.7

119.1

-10 .0- 8 . 3- 5 . 5

1965

$93.030.94.1

119.7

- 0 . 2

0.7

118.8

97.9

29.44.6

122.7

1.1

2.3

121.5

- 4 . 9- 2 . 9- 2 . 8

The traditional administrative budget does not include a numberof important Federal activities financed through trust funds, suchas social security and Federal aid to highways. These activities andthe special taxes which finance them have substantial economic effectsand serve significant public purposes. A comprehensive disclosureof Federal finances is provided by the consolidated cash statement ofFederal receipts from and payments to the public.

On the cash basis, total payments to the public are estimated at$122.7 billion for 1965. Total receipts from the public are estimatedat $119.7 billion, resulting in a $2.9 billion excess of payments overreceipts. The estimates of cash payments and receipts in 1965 reflect


THE BUDGET MESSAGE OF THE PRESIDENT 11

the normal, built-in growth of trust fund benefit payments, and theemployment and excise tkx revenues which finance them.

Another measure of Federal finances—one which emphasizes theimpact of the Government's fiscal activities on the economy—is basedon the national income accounts. Under this concept, Federal fiscaldata, including the trust funds, are generally estimated on an accrualrather than a cash basis, and eliminate transactions, such as loans,which do not directly result in production and income. These dataindicate an excess of payments over receipts of $2.8 billion in fiscalyear 1965.

THE ECONOMY AND TAX REDUCTION

The Federal budget is a detailed plan for managing the businessof Government, but it is more than that: In setting the relationshipbetween Government expenditures and taxation, the budget is also apowerful economic force which can help or hamper our efforts toachieve stable prosperity and steady growth.

The expenditure proposals in this budget are ample to satisfy ourmost pressing needs for governmental services, but the broad economicstimulus needed to carry our economy to new high ground in produc-tion, income, and employment will not come principally from Govern-ment outlays. I believe—as did President Kennedy—that the pri-mary impetus needed to move our economy ahead should come, inpresent circumstances, from an expansion of the private sector ratherthan the public sector. Therefore, the earliest possible enactment ofthe tax reduction bill now before the Congress is an integral and vitalpart of my budgetary proposals.

Our country is currently in its fourth postwar period of economicexpansion—a period which started in February 1961, and has nowlasted nearly 3 years.

Preliminary estimates indicate that the Nation's total output ofgoods and services—our gross national product—rose to $585 billionin calendar year 1963, an increase of 5.4% over 1962.

Over the same period, personal income rose 4.7%, industrial pro-duction 5.1%, and corporate profits 10.5%.

Price stability has been maintained for the sixth consecutive year.This is a record of strong expansion—and yet the expansion has

not been strong enough to absorb the margin of idle workers and idleplant capacity which continues to tarnish our economy's performance.Almost 3 years after the trough of the last recession, and despite thecreation of 2% million new jobs in our economy, the unemploymentrate now stands at 5y2%. Our factories continue to produce belowtheir optimum rate. As a nation we are producing at a rate at least$30 billion below our comfortable capacity. This is a ga/p for whichwe are paying a high price in idle resources, both human and physical.



This gap must be closed. I t must be closed—as President Kennedyurged a year ago—by loosening uthe checkrein of taxes on privatespending and productive incentives." It must be closed promptly,for the unemployed have already waited too long for jobs which canbe create^ simply by allowing our people to spend and invest a greaterpart of the money they earn.

The bill approved by the House of Representatives last Septembermeets the fundamental requirements for tax action in 1964. I proposeonly two changes in that bill:

• The bill provides for a reduction in the rate of withholding onwages and salaries from 18% to 15% for calendar 1964, startingon January 1, 1964. Since that date has already been passed, theinstitution of the 15% withholding rate at a later date in 1964would require substantial additional refunds to taxpayers nextyear. A corresponding part of the economic stimulus providedby the tax program would be delayed until then. Hence, I pro-pose that the withholding rate be reduced to 14% rather than 15%,effective as soon as possible after enactment. This will assure thatthe beneficial effects of the 1964 tax reductions are felt immediately,instead of being postponed, in part, for a year. It will simplifyprocedures for taxpayers and their employers by making unneces-sary another change in the withholding rate in 1965, as provided inthe House bill. Moreover, the change will also maintain approxi-mately the same division between the fiscal year 1964 and 1965revenue impact of tax reduction as would have resulted from theHouse bill. The revenue estimates in this budget assume approvalof this change.

• The House bill fails to close the loophole by which property trans-ferred at death now escapes capital gains taxation, but it never-theless would reduce the rate of taxation on capital gains. With-out the former provision, the latter provision is unwarranted, andit should be deleted from the bill.

With these two changes, I urge the enactment of the House billby the Senate.

With prompt enactment of the tax program, economic expansion in1964 should proceed briskly. Reflecting the effects of the first stage ofthe tax reduction, the gross national product in calendar year 1964should rise to about $623 billion, plus or minus $5 billion. This issubstantially higher than the GNP which could be expected in theabsence of prompt enactment of the tax legislation. In fact, sinceexpectations of a tax reduction have been incorporated into the for-ward planning of many business firms, the effect on the economy offailure to pass the legislation swiftly might be deeply disturbing.



As the tax reduction takes full effect, its stimulus to private con-sumption and investment will shrink the $30 billion gap betweenthe Nation's actual and potential output, and provide approximately2 million additional jobs for the unemployed and the new workersentering the labor force. As economic activity expands, and personaland business incomes increase, Federal revenues will also rise. Thehigher revenues, combined with continuing pressure for economy andefficiency in Federal expenditure programs, should hasten the achieve-ment of a balanced budget in an economy of full prosperity.

RECEIPTS FROM THE PUBLIC[Fiscal years. In billions]

Source

Administrative budget receipts:

Individual income taxes. _ _Corporation income taxes

Excise taxes

Other

Total administrative budget receipts

Trust fund receipts:Employment taxes

Deposits by States, unemployment insuranceExcise taxes __ _

Federal employee and agency payments for retirement

Interest on trust investments

Veterans life insurance premiumsOther___

Total trust fund receipts

Intragovernmental transactions (deduct)

Total receipts from the public

1963

$47.621.69.97.3

86.4

14.93.03.31.91.50.52.7

27.7

4.3

109.7

1964

$47.523.710.27.0

88.4

16.82.93.52.01.60.53.0

30.2

4.2

114.4

1965

$48.525.811.07.7

93.0

17.02.83.51.91.70.53.5

30.9

4.1

119.7

Income tax revisions.—The bill currently before the Senate willreduce income tax liabilities by $11.1 billion. Individual rate reduc-tions and structural changes account for about 80% of the total taxreduction. The remaining 20% reflects a reduction in corporate taxes,providing enhanced incentives for new investment.

Once the tax bill becomes fully effective in calendar year 1965,the entire schedule of individual income tax rates will fall from thepresent range of 20% to 91% to a range of 14% to 70%, and the cur-rent first $2,000 bracket of taxable income will be divided into foursuccessive brackets of $500 each.



Federal Receipts

1942 1945Etfimat*

All corporations will pay lower tax rates, with incorporated smallbusinesses receiving the largest proportionate tax rate reduction be-cause the tax rate on the first $25,000 of their taxable income is reducedfrom 30% to 22%. Large corporations (with estimated tax liabilitiesabove $100,000) will have to speed up their tax payments in order toreduce the lag between the time when taxable profits are earned andthe time when taxes are paid; however, this speedup plan is gradual,shifting the timing of corporation tax collections a bit each year forthe next 7 years.

The combination of the investment tax credit and the revision ofdepreciation guidelines achieved in 1962, plus the $2% billion tax ratereductions and structural changes proposed for corporations in thepending bill, will result in a total reduction of about $5 billion incorporate tax liabilities.

The bill also contains many changes in the income tax laws thatare designed to reduce the weight of taxes where the burden is mostunfair, and to correct special tax advantages which will no longer beequitable under the proposed structure.

Excise tax extension.—The Congress should extend several cur-rent excise tax rates which will otherwise decline or expire on July 1,1964. These excise taxes have been continued at the present ratesthrough annual extensions for the past several years. Without exten-sion, revenues would fall by $1.7 billion during fiscal year 1965.



User charges.—-Many Federal Government programs furnish spe-cific, identifiable benefits to the individuals and businesses usingthem. Equity to all taxpayers demands that those who enjoy thebenefits should bear a greater share of the costs. I am, therefore,renewing recommendations for the enactment of user charges for com-mercial and general aviation and for transportation on inlandwaterways.

Appropriate fees should also be assessed in other areas where theGovernment provides special services. New legislation is necessaryin several cases to carry out this policy—such as a revision of patentfees to reflect today's costs more adequately—and appropriate pro-posals are either before the Congress or will be forwarded this year.

NEW OBLIGATIONAL AUTHORITY

Obligations incurred by Federal agencies under authority pro-vided by the Congress are the forerunners of Federal expenditures.Expenditure control, therefore, depends substantially upon carefulcontrol of obligations.

In this budget, new obligational authority of $103.8 billion is pro-posed in the administrative budget for fiscal year 1965. This is $1.2billion above the amount now estimated for fiscal year 1964, but is $4.1billion less than was originally requested for the current year in the1964 budget. The amount recommended for 1965 includes $50.9 bil-lion for the Department of Defense (including military assistance),$120 million less than the amount for the current year.



Description 1963actual

$90.63.9

11.624.7

102.328.6

1964estimate

$90.00.4

12.631.3

102.631.7

1965

Total authorizations requiring current action by Congress:Administrative budget fundsTrust funds

Total authorizations not requiring current action by Congress:Administrative budget fundsTrust funds

Total new obligational authority:

Administrative budget fundsTrust funds

$91.44.2

12.427.6

103.831.8

Significant changes in new obligational authority from 1964 to1965 include increases of $1.5 billion for the Department of Health,Education, and Welfare, mainly as a result of new health and educa-tion proposals; $361 million for the Department of Labor because of



the recently amended manpower training program and the proposedyouth employment legislation; and $500 million for special appropria-tions requested for new community programs to attack poverty. Ma-jor decreases include $1.5 billion for the Housing and Home FinanceAgency, reflecting nonrecurring authority requested in 1964, and $1.3billion for the Department of Agriculture.

Of the total amount proposed, $40 billion will become availableunder permanent authorizations without further congressional action,including $27.6 billion becoming automatically available as revenuesflow into the trust funds. In the administrative budget, the principalpermanent appropriation is to pay the interest on the public debtwhich in 1965 is estimated at $11 billion, $0.4 billion more than in1964.

For the current fiscal year, the Congress is requested to enact $4.2billion of additional new obligational authority to provide neededfunds for housing and space programs and to finance legislation en-acted last year for which no appropriations were provided—such asincreased military compensation, broadened manpower developmentactivities, aid to higher education, vocational education activities, andmental retardation programs. Including supplemental authoriza-tions, a total of $102.6 billion in new obligational authority is esti-mated for fiscal year 1964 in the administrative budget.

GOVERNMENT PROGRAMS AND EXPENDITURES

The expenditures proposed in this budget are necessary to meetthe needs of our growing society, promote the basic strength of theNation, honor our worldwide commitments, and fulfill our financialobligations.

Between 1955 and 1965, our population will grow by almost 30million people, about 17%, with the largest increases in the very youngand the very old age groups. To keep pace, the Federal Governmenthas had to continue existing public services and provide the additionalservices needed for future growth. The expansion of the economy,even though falling short of its potential in recent years, has helpedprovide the resources for both increased public and private services.

We will continue to experience rapid population growth while weseek to improve the rate of economic growth, and over the long runthis will put upward pressure on Government expenditures for civilianpurposes. Nevertheless, wherever and whenever possible, we shouldtry to reduce costs, curtail less urgent activities, and find other savingsto permit essential new or growing services to be financed at the leastcost to the taxpayer. That has been the policy in this budget. Essen-tial services have been provided while administrative budget expendi-tures decline by over one-half billion dollars between the fiscal years1964 and 1965.


THE BUDGET MESSAGE OF THE PRESIDENT 1.7

THE 1964 AND 1965 BUDGETS COMPARED

(In billions)

National defenseSpace __Interest

Subtotal _

Health, labor, welfare, and education (includingattack on poverty)

Allother

Total

New obligationalauthority

1964budget

document

$+2.2+2.0+0.3

+4.6

+2.1-2.0

+4.7

1965budget

document

$-0.2+0.1+0.4

+0.3

+2.6'- 1 . 7

+1.2

Expenditures

1964budget

document

$+2.4+1.8+0.3

+4.6

+0.9-0.9

+4.5

1965budget

document

$-1.3+0.6+0.4

-0.3

+0.9-1.1

-0.5

The attack on poverty.—In this budget I have provided over $1 bil-lion of new obligational authority to begin an all-out attack on theproblem of poverty in the United States. In a nation as rich and pro-ductive as ours we cannot tolerate a situation in which millions ofAmericans do not have the education, health, and job opportunities fora decent and respected place as productive citizens. The vicious circleof poverty—in which one generation's poverty, ignorance, and diseasebreed the same problems for the next—must be broken. I propose tobreak that circle by raising the educational, skill, and health levelsof the younger generation, increasing their job opportunities and help-ing their families to provide a better home life. I propose a programwhich relies upon the traditional and time-tested American methods oforganized local community action to help individuals, families, andcommunities to help themselves.

Poverty stems from no one source, but reflects a multitude ofcauses. Correspondingly, a number of individual programs have beendeveloped over the years to attack these individual problems of jobopportunities, education, and training. Other specific programs dealwith the closely related areas of health, housing, welfare, and agri-cultural services. I propose to establish a means of bringing togetherthese separate programs—Federal, State, and local—in an effort toachieve a unified and intensified approach to this complex problem, inwhich each separate element reinforces the others.

Under this proposal, locally initiated, comprehensive communityaction programs would be developed, to focus the various availableresources on the roots of poverty in urban and rural areas. I shallshortly transmit to the Congress legislation initiating this attack and

700-000 0—64 2



PAYMENTS TO THE PUBLIC


Function

Administrative budget expenditures:National defenseInternational affairs and financeSpace research and technologyAgriculture and agricultural resources.Natural resources _Commerce and transportationHousing and community development _Health, labor, and welfareEducationVeterans benefits and servicesInterestGeneral governmentAllowances:

Attack on povertyCivilian pay comparabilityContingencies

Interfund transactions (deduct)

Total administrative budget expenditures.

Trust fund expenditures:Health, labor, and welfareCommerce and transportationNational defenseHousing and community development _Veterans benefits and servicesAll otherInterfund transactions (deduct)

Total trust fund expenditures

Intragovernmental transactions and other adjustments (deduct)

Total payments to the public

1963actual

$52.82.62.67.02.42.8

- 0 . 14.81.25.2

10.02.0

0.5

92.6

21.92.90.7

0.80.80.5

26.5

5.4

113.8

1964estimate

$55.32.44.46.12.53.2

- 0 . 25.51.35.4

10.72.2

0.20.7

98.4

22.73.40.91.60.60.60.5

29.3

5.0

122.7

1965estimate

$54.02.25.04.92.63.1

-0 .35.81.75.1

11.12.2

0.20.50.30.6

97.9

23.53.51.20000

29.4

4.6

122.7

* Less than one-half million dollars.

authorizing, in 1965, $500 million of new obligational authorityspecifically for this purpose. Additional funds for the local commu-nity action programs will be available from existing agency programs.Moreover, other legislative proposals, recommended elsewhere in thismessage, will contribute important new resources to the attack onpoverty. The Youth Employment Act, the National Service Corps,and the community work and training program, are examples of suchproposals. Of particular significance will be the education proposal



for project grants to meet special educational needs. All told, in 1965more than $1 billion of Federal resources under existing and proposedlegislation would be concentrated, through local community action pro-grams, in an intensive and coordinated attack on poverty.

Special emphasis is also being given to the economic needs of the165,000-square-mile Appalachian region of the United States, whichhas been largely bypassed in the growth of prosperity in recent years.This emphasis by the Government, combined with the resources andactivities of State, local, and private institutions and enterprises inthe region, will be directed toward the development of the natural re-sources of the region, and the promotion of better employment oppor-tunities for its people.

National defense.—To preserve freedom and protect our vitalnational interests in these recent years of uneasy peace, this Nationhas invested heavily in the improvement of its defenses. We havechosen not to concede our opponents supremacy in any type of poten-tial conflict, be it nuclear war, conventional warfare, or guerrilla con-flict. We have now increased the strength of our forces so that, facedwith any threat of aggression, we can make a response which is ap-propriate to the situation. With present forces and those nowplanned, we will continue to maintain this vital military capability.

During the past 3 years, we have achieved notable increases in mili-tary readiness, including:

• A 100% increase in the number of nuclear weapons available inthe strategic alert forces.• A 60% increase in the tactical nuclear forces deployed in WesternEurope.• A 45% increase in the number of combat-ready Army divisions.• A 35% increase in the number of tactical fighter squadrons.• A 75% increase in airlift capability to improve mobility.These rapid gains result from an increase in cash payments for mili-

tary purposes from $47.7 billion in 1961 to $56.0 billion in 1964.Along wTith the high level of preparedness we have now achieved,vigorous efforts to promote economies in the management of ourArmed Forces have been producing significant savings. We aretherefore able to propose a decrease of $800 million in cash outlays($1.3 billion in the administrative budget) for national defense infiscal year 1965 while maintaining our position of strength.

Nevertheless, national defense expenditures will remain high.These payments, estimated at $55.2 billion ($54.0 billion in the admin-istrative budget) in 1965, will provide for all essential military pur-poses, including substantial improvements in our present and plannedmilitary capabilities. For example, the 1965 budget provides for


2 0 THE BUDGET FOR FISCAL YEAR 1965

additional Minuteman missiles, further improvements in our air, land,and sea tactical forces, procurement of additional airlift aircraft, andcontinued research and development to ensure our ability to counternew threats.

To reinforce the total defense effort, the Congress should authorizefunds for fallout shelters in public buildings, schools, hospitals, andother nonprofit institutions.

Although we continue to seek a relaxation of tensions, we cannotrelax our guard. While the nuclear test ban treaty is a hopeful sign,neither that treaty nor other developments to date have, by themselves,reduced our defense requirements. We will continue undergroundnuclear testing, maintain our above ground test facilities in readycondition, maintain strong weapons laboratories, and continue thedevelopment of detection devices. However, because of the nuclearstrength we have achieved, it will be possible to cut production ofenriched uranium by 25% and to shut down four plutonium piles.

Our inventories of strategic and critical materials are being re-viewed to assure that they are necessary for current civil and militarydefense requirements. I recommend that the Congress enact legisla-tion to improve the management of these materials and simplify thedisposal of those no longer needed.

International affairs and finance.—The less-developed nationsare engaged in a critical struggle for political independence and eco-nomic betterment. This struggle takes many forms, from combatingarmed aggression and subversion in Vietnam to advancing na-tional efforts to reduce poverty and illiteracy in South Asia, LatinAmerica, and other areas. Upon the outcome of this struggle willdepend the stability and security of much of the world. Through ourprograms of foreign assistance, we provide aid to these free peoplesand thereby advance our own vital interests. It is essential that wecontinue, with a small portion of our great resources and technicalknowledge, to promote in the emerging nations hope and orderlyprogress, replacing misery, hostility, and violence.

The $2.4 billion of new obligational authority recommended for1965 in this budget for the programs of the Agency for InternationalDevelopment is $1.1 billion less than originally requested for 1964.It will make the total 1965 obligational availability for the programequivalent to the amount provided by the Congress for 1964 includingunobligated funds carried forward from the prior year. The 1965recommendation represents a prudent assessment of the funds requiredto fulfill the obligations we have undertaken and the opportunities weseek in a changing and challenging world.

The amount requested reflects a continuing effort to increase the


THE BUDGET MESSAGE OF THE PRESIDENT 2 1

effectiveness and efficiency of our assistance programs. We are reduc-ing AID staffing by several hundred employees, proportionately one ofthe largest reductions of any agency in Government. We are stress-ing the necessity for recipient countries to take adequate self-helpmeasures. The 1965 request reflects the successes we have had inreducing the dependence of some nations upon the low-cost foreignaid loans made by the Agency for International Development; by1965 a number of countries will have turned to other sources and typesof loans more consistent with their increasing economic strength.

On the other hand, the 1965 budget does not allow for suddenopportunities that sometimes present themselves in internationaleconomic affairs. We must be able to take quick advantage of situa-tions in which resolute and decisive actions can turn threats to thefree world into constructive evidence of our determination to pre-serve the peace. We must also be able to take advantage of oppor-tunities in which swift action can advance us dramatically alongthe road to free world cooperation and prosperity. Should suchopportunities arise, I will request prompt action by the Congress toprovide any additional funds needed to meet emerging requirements.

Our partners in the Alliance for Progress will continue to receiveour most determined support and generous cooperation. Recentimprovements in the organization of the Alliance should permit anacceleration of this program and foster ever greater hemispheric unity.I am therefore proposing an expanded bilateral program for theAlliance in 1965. Upon completion of negotiations and arrangementswith other member countries, legislation will also be proposed toprovide additional funds for long-term, low-interest loans by the Inter-American Development Bank.

The sincerity of our purpose overseas is exemplified by the highlysuccessful work of the Peace Corps. As a result of this record andthe gratifying flood of requests for the services of the Corps, fundsare requested in 1965 for 14,000 volunteers, as compared with 10,500in 1964.

Space research and technology.—Our plan to place a man on themoon in this decade remains unchanged. It is an ambitious and im-portant goal. In addition to providing great scientific benefits,it will demonstrate that our capability in space is second to noother nation's. However, it is clear that no matter how brilliantour scientists and engineers, how farsighted our planners and man-agers, or how frugal our administrators and contracting personnel,we cannot reach this goal without sufficient funds. There is nosecond-class ticket to space.

Appropriations enacted for 1964 for the National Aeronautics andSpace Administration were $600 million below the amount requested.



As a result, major development programs leading to the manned lunarlanding have fallen behind schedule. Careful replanning of the entireprogram, including a reduction in the number of test flights, will offsetsome of this delay. Even so, more funds are needed in 1964, and I amtherefore recommending a supplemental appropriation of $141 millionfor this year.

For 1965, I am requesting appropriations of $5.3 billion, $63million above the 1964 amount, including the proposed supplementalappropriation The 1964 and 1965 recommendations represent theminimum amount needed to achieve our goals in space. The estimatedincrease of $590 million in expenditures in 1965 is due principally topayments required by commitments made in 1964 and earlier years.With the leveling off of appropriations, annual outlays should remainrelatively stable in subsequent years.

In addition to the manned space flight program, though related toit, funds are included to support unmanned space flights for lunarexploration and supporting research and development. Funds arealso included for scientific satellites, planetary probes, and experimentswith meteorological and communications satellites.

Agriculture and agricultural resources.—At the present time, ourfarms are able to produce all we need for domestic use and all we canreasonably expect to sell abroad with substantially less land and man-power than are now being used. As a result, we have crop surpluses,inadequate farm income, underemployed rural people, and improperland use. A wide range of Government programs, including the feedgrain and wheat programs, rural area development, and the moreconstructive use of surplus production at home and in Food for Peace,have Improved this situation. Nevertheless, we need further effortsto help the farm economy adjust to its rapidly changing economic andtechnological environment and to help the Nation take advantage ofits remarkably productive agriculture.

I shall shortly transmit to the Congress my recommendations foragricultural legislation. Included will be cotton and dairy proposalsthat will decrease by $230 million the estimated expenditures of theCommodity Credit Corporation in 1965.

Titles I and I I of Public Law 480 (Agricultural Trade Develop-ment and Assistance Act), the principal authority for our Food forPeace program, should be extended beyond their expiration date ofDecember 31, 1964. Legislation also should be enacted to encouragethe shifting of more of our present cropland to less intensive uses.

Federal payments in 1965 for agriculture and agricultural resourcesare estimated at $5.1 billion, a reduction of $1.3 billion from 1964.



This reduction is expected to occur mainly in farm commodity pro-grams. A part, however, depends upon congressional approval oflegislation proposed last year authorizing the Farmers Home Ad-ministration to insure private credit for financing the rural housingprogram and a new proposal providing for fees to cover the costs ofmeat, poultry, and grain inspection services.

Natural resources.—We must manage and develop our naturalresources wisely, to meet the needs of an increasing population andgrowing economy. Even within the limits of a restrictive budgetarypolicy, public investments must be made in resource conservation anddevelopment and in research to enable us to use more effectively ourwater, land, minerals, forests, and other resources. Federal cashpayments of $2.7 billion are estimated in 1965 for these purposes.

The budget provides for continuing construction of going projectswhich will supply water to our cities, industries, and farms; abatewater pollution and improve water quality; control destructive floods;produce electric power; improve navigation; and provide recreationalopportunities. Provision is also made for the Corps of Engineersand the Bureau of Reclamation to start 44 new projects with an esti-mated total Federal cost of $512 million.

The need for outdoor recreational areas and facilities is growingrapidly. To help meet this need, legislation should be enacted toassist States in providing recreational opportunities. Legislationshould also be enacted to preserve seashore and other areas with im-portant recreation potential, and to protect our remaining wildernessareas.

Commerce and transportation.—To encourage continuing growthof our Nation's millions of privately owned businesses, the Govern-ment provides extensive aids, particularly to smaller businesses andareas of persistent unemployment, and helps assure the availability ofadequate transportation and communication facilities.

Enactment of legislation already approved by the Senate is essentialto provide the additional authorizations necessary for the area redevel-opment program to go forward and to permit necessary improvementsin that program.

Major proposed revisions in our national transportation policy arealso pending before the Congress. These proposals would make sub-stantial contributions toward a more efficient transportation systemby placing greater reliance on the forces of competition and improvingthe effectiveness of Government regulation. Extensive hearings havebeen held on these proposals and I recommend their prompt enactment.



Commerce and Transportation

Total Federal payments for commerce and transportation programswill amount to $6.6 billion in 1965. This is about the same amount asin 1964. Higher outlays from the Highway trust fund (financedby special taxes on highway users), increased loans and grants to re-develop depressed areas, and financing of a design competition for thecivil supersonic transport aircraft will be offset by reductions for thetemporary accelerated public works program and the postal service,and by strict economies in all programs.

Housing and community development.—In the Housing Act of1961, the Congress substantially broadened Federal aids to privateenterprise and local public agencies to help improve housing condi-tions and rebuild urban communities. The act also made funds avail-able to finance these programs for several years. In several cases,these funds are now almost depleted. I am therefore recommendinglegislation to provide authority and funds for continuing such pro-grams as urban renewal, urban planning and open space grants,housing loans for the elderly, and low-rent public housing. In addi-tion, I am recommending important revisions and expansions essentialto increase the effectiveness of these programs in meeting criticalneeds—particularly the needs of lower income groups whose inferiorearning power seriously handicaps their efforts to achieve adequateliving conditions.



Legislation is already being considered by the Congress tostrengthen Federal aids to urban communities in order to help mod-ernize and enlarge necessary mass transportation facilities. I urgethat action be completed soon on this vitally needed program.

To carry on and improve housing and community development pro-grams without adding to net budgetary requirements, we shall con-tinue to sell to private lenders federally owned mortgages acquiredin earlier years. New legislation is proposed to increase the effec-tiveness of the sales program. The proceeds of such sales and otherreceipts of housing and community development programs are ex-pected to more than offset payments for these programs in 1965, withresulting net receipts estimated at $40 million.

Health, labor, and welfare.—This budget places major stress onstrengthening the productivity of our labor force, improving thehealth of our people, and reducing the fear of economic insecurity.In 1965, the Federal Government will strengthen the health, labor,and welfare activities which contribute to these objectives. Paymentsfor these activities, mainly from self-financing trust funds, will be$28.6 billion, about $1.3 billion more than in 1964.

Most of the payments are for social insurance and public welfareprograms which complement efforts by individuals and families toprovide for their own security. These programs have been signifi-cantly improved by legislation enacted in recent years. To fostergreater self-sufficiency and reduced reliance on public welfare, theCongress should enact proposed legislation to create a National Serv-ice Corps and expand demonstration projects in community workprograms.

The budget proposals for health activities in 1965 will continueto strengthen the National Institutes of Health and the Food andDrug Administration and will improve environmental health pro-tection. The budget provides for rapid progress under the legis-lation passed in the last session of the Congress to combat mentalillness and retardation, increase the number of doctors and dentists,and reduce air pollution. New legislation is needed this year to im-prove nurse education and to extend the Hill-Burton program for con-struction of medical facilities, expanding and redirecting it to meetpressing needs for nursing homes and for modernizing urbanhospitals.

Pending legislation to provide urgently needed health insurancefor aged persons through the social security system should also beenacted. Provision should be made for benefits to be paid fromadministrative budget funds to those not eligible under the socialsecurity system. Since benefit payments would not start until 1966,this provision would not affect the 1965 budget.



Health, Labor, and Welfare

For manpower training and services, the budget recommends forboth 1964 and 1965 the full authorization provided under the recentamendments to the Manpower Development and Training Act, Morethan 275,000 unemployed workers, including youths found unqualifiedfor military service, will be trained on jobs and in classrooms during1965. Of these, about 60,000 will receive basic literacy education.Prompt enactment of the Youth Employment Act is needed to pro-vide work and training in camps and in hometown projects for anestimated 60,000 youths. Legislation is again recommended to im-prove the State unemployment insurance programs financed from theunemployment trust fund; this legislation would extend coverage tomore people and lengthen the duration of benefits.

Education.—Bills enacted last year for Federal assistance tohigher education and enlarged Federal support for vocational educa-tion mark important milestones in efforts to improve our educationalsystem on a national scale. The budget includes supplemental appro-priations for 1964 so that these measures can be implementedpromptly.

But much remains to be done. Important elements of the educationprogram proposed last year have not yet been enacted. In particular,attention must be turned to the basic foundation of our educationalsystem—the elementary and secondary schools. First, I recommendenactment of pending legislation providing grants to raise teachers'salaries and build critically needed classrooms. Second, to supple-



ment this general aid, I am also recommending an expanded programproviding project grants to meet special educational needs and toprovide special services for schoolchildren, particularly for use inconnection with community action programs to combat poverty.

The Congress should also enact the remaining portions of last year'sproposals, such as the federally guaranteed loan program and thework-study program for college students; and the proposals directedat special educational needs of other individuals, including graduatestudents, prospective and existing teachers, all citizens who appreciatethe advantages of good public libraries, adults who have missed theopportunity for basic schooling in the "3-BV, and those who seekto make learning a continuing process through university extensionservices.

In keeping with the continuing need to strengthen the scientific andtechnological resources of the Nation, the budget also provides for ex-pansion of the National Science Foundation's basic research andscience education programs. Major emphasis will be placed on in-creasing support for graduate students in the sciences and onstrengthening science instruction and facilities in colleges and uni-versities, one objective of which is to develop additional top-rankingcenters of graduate study in the sciences.

Expenditures for education are estimated at $1.6 billion in 1965, anincrease of $0.3 billion over 1964. New obligational authority of$3.1 billion is requested, up $1:2 billion from 1964.

Veterans benefits and services.—We have a lasting obligation tothose who died or were disabled in the defense of the Nation, and totheir dependents. During the past 3 years a cost-of-living increase indisability compensation rates has been provided, and increases in bene-fits have been granted for the widows, children, and dependent par-ents of veterans who died as a result of military service. In addition,vocational rehabilitation programs have been extended to disabledpeacetime ex-servicemen and to those wartime veterans who wereprecluded from entering training within the regular time limits.

In 1965, the Federal Government will spend $5.5 billion on its pro-grams for veterans. This is $425 million less than in 1964, mainly be-cause of an anticipated substantial rise in receipts from sales by theVeterans Administration of Government-owned mortgages, which areapplied against expenditures.

We will continue to make certain that veterans with service-relateddisabilities, and their dependents, are fairly provided for. Benefitsand services for other groups of veterans will also continue to be pro-vided, but with the recognition that veterans and their families aresharing to an increasing extent in Federal, State, and local programswhich are raising the standards of income maintenance, educationalopportunity, and health and welfare for all Americans.



SPECIAL ASPECTS OF THE GOVERNMENT PROGRAM

Certain additional elements of the proposed 1965 Government pro-gram deserve special note.

Federal expenditures and the balance of payments.—The recentimprovement in the U.S. balance of international payments representsprogress toward eliminating our persistent payments deficit. Pre-liminary estimates indicate that the gross balanee-of-payments deficitin the second half of calendar year 1963 was roughly one-third thatof the first half. For the year as a whole, these estimates show thedeficit to be the lowest since 1957.

Three factors in particular have contributed to the improvementduring the past year: the continued price stability of U.S. products, aproposed interest equalization tax on foreign securities, which wouldbe effective as of July 1963, and an increase in short-term interest rates.Anticipation of the proposed tax, which is intended only as a tempo-rary measure, has already had a favorable effect. To insure continu-ing benefits from the tax during the critical period ahead, I urge itsspeedy enactment by the Congress. Enactment of the tax reductionlegislation now before Congress will also help the balance of paymentsby making U.S. firms more competitive in world markets and by pro-moting the kind of economy which will be more attractive to U.S. andforeign investors.

During the past one and a half years, all Federal Government ac-tivities affecting the balance of payments have been under continuingscrutiny for the purpose of finding savings—large and small—whichcan be made in payments abroad. In some cases, purchases or activi-ties formerly conducted overseas have been restricted to the UnitedStates. In others, they have been eliminated. Over 80% of the cur-rent obligations by the Agency for International Development forloans and grants to developing countries now must be spent for goodsand services produced in the United States. In addition, defense off-set agreements with certain of our European allies, the prepayment offunds previously loaned to foreign governments, and the sale of specialnonmarketable, medium-term Treasury bonds to foreign central bankshave been particularly helpful to our balance of payments.

As a result of the reviews and actions undertaken, the net annualoutflow from Federal Government programs—payments less regularreceipts—is estimated to drop by $800 million between 1963 and 1965.This excludes special receipts of a nonrecurring nature, such as pre-payments of loans, sales of nonmarketable medium-term securities,and advances received on military exports.



Federal expenditures of an investment nature.—A large partof the civilian expenditures of the Federal Government contributesdirectly and indirectly to the growth and development of the Nation'sphysical and human resources. For example, budget and trust fundexpenditures for fiscal year 1965 include $3.7 billion for Federal civilpublic works, for the acquisition of major nondefense equipment andother physical assets, and for small business, rural electrification, andother loans and additions to civilian Federal assets. Another $5.3billion of Federal civilian budget and trust fund outlays representgrants for highways, hospitals, schools and other facilities whichincrease State, local, and private physical assets.

Federal expenditures in 1965 also include $1.8 billion for such devel-opmental activities as education, training and health, and $1.5 billionfor scientific research and development other than for defense andspace objectives. These outlays increase knowledge, enhance skills,and strengthen the physical vigor and quality of the labor force.Thus, of the total estimated Federal cash payments to the public in1965, about $12.3 billion or 10%, represent an investment in civilianprograms which will help promote the long run growth of our Nation.

Furthermore, during fiscal year 1965 an estimated $8.2 billion willbe spent on defense research and development, including atomic

Additions to Non-defense Assets

S Billions

JH9.722.7

FEDERAL RECEIPTS

Grants for /Other State-LocalPublic Work

FEDERAL PAYMENTS

feed Year Estimate 1965


30 THE BUDGET FOR FISCAL YEAR 196 5

energy, and $4.5 billion on space research and development. In thelong run these outlays will also make a valuable contribution to thetechnological development and economic growth of our country.

Federal expenditures and the national output.—Direct Federalpurchases of goods and services in 1965 are estimated at $69.1 billion,which is less than 11% of the gross national product; five-sixths of thesepurchases are for the defense and space programs. Total Federalpurchases of goods and services have remained at approximately 11%to 12% of the gross national product throughout the last decade.

Other large portions of the budget, such as social security payments,represent transfers of purchasing power to or within other sectorsof the economy. Such outlays, amounting to $52.4 billion in 1965, areestimated to fall somewhat as a percent of total national output.These include $31.8 billion for transfer payments—such as old-ageand survivors insurance benefits, unemployment compensation, andmilitary and veterans pensions—which improve the recipients' stand-ard of living by providing them with increased purchasing power.Similarly, grants-in-aid to State and local governments for such activ-ities as highways, public assistance, and public health increase theability of these governments to provide local public services. TheseFederal expenditures transferring purchasing power to other sectorsof the economy have more than doubled from 1955 to 1964, while Fed-eral purchases of goods and services have risen by about 50%.

Federal Debt, Purchases, and Employment Down Relative to Total Economy

Purchases of Goods and Services

V -Civilian EmploymentFederal as Percent of Total

•tm



In fiscal year 1965, the Federal Government will add to its direct useof total national output much less than will State and local govern-ments. In contrast to the estimated rise of $1.3.billion in direct Fed-eral purchases in 1965 as compared with 1964, present indications arethat purchases by State and local governments will continue to rise byat least as much as the $3 billion to $4 billion by which they havebeen increasing in recent years.

PUBLIC DEBT

Under present law the temporary debt limitation of $315 billion willcontinue in effect through June 29, 1964. The temporary limit thenbecomes $309 billion for one day, June 30, 1964, after which the per-manent ceiling of $285 billion again becomes effective.

PUBLIC DEBT AT END OF YEAR


Description

Owned by Federal agencies and trust funds. _Owned privately and by Federal Reserve

banks

Total

1962actual

$55

242

298

.7

.5

.2

1963actual

$57

248

305

.7

.1

.9

1964estimate

$60.3

251.5

311.8

1965estimate

$62.6

254.4

317.0

Note.—For further details see table 11 in part 2 of this document.



Net Public and Private Debt

The present temporary debt limits were enacted in November 1963.The House Committee on Ways and Means noted in its report ofNovember 4, 1963, that the ceilings were very restrictive, and cutsharply into the normal allowances for contingencies and flexibilityduring periods of peak requirements in March and June. The reportalso noted the concern of the Secretary of the Treasury that the debtcould not be reduced to the $309 billion limit set by statute for June 30,1964, without disrupting orderly management of Treasury finances.

Based on the latest estimates contained in this budget, the debtsubject to limit on June 30, 1964, is now estimated to be $312 billion.Accordingly, a change in the limit is necessary before June 30, 1964,if serious difficulties in the conduct of public debt management are tobe avoided. A further change will be needed to cover the anticipated,but reduced, deficit for 1965.



Debt limitations which are so restrictive or so temporary in applica-tion as to necessitate several legislative revisions in a single year—aslast year—conflict with economical operation of the Government andeffective financial management, and involve both the Congress andthe Executive in unnecessarily repetitive discussions of the same issues.Instead, the debt ceiling should provide sufficient flexibility for soundmanagement of the. Government's finances at the lowest cost, andalso permit the Treasury leeway for actively supporting the Nation'sbalance-of-payments position through timely debt operations. Withor without a restrictive debt ceiling, expenditures in this administra-tion will be held to the lowest possible level.

EFFICIENCY AND ECONOMY IN GOVERNMENT

I call upon all Government employees to observe three paramountprinciples of public service:

First, complete fairness in the administration of governmentalpowers and services;

Second, scrupulous avoidance of conflicts of interest; andThird, a passion for efficiency and economy in every aspect of Gov-

ernment operations.For its part, the Federal Government must be a good employer. It

must offer challenging opportunities to its employees. It must beprompt to recognize and reward initiative. It must pay well to attractand keep its share of dedicated and resourceful workers. It must wel-come fresh ideas, new approaches, and responsible criticism.

For 33 years I have been in Government service. I have known itschallenge, its rewards, and its opportunities. But all these will mul-tiply in the years to come. The time is at hand to develop the Federalservice into the finest instrument of public good that our will andingenuity can forge.

Controlling employment.—Although both our population and oureconomy are growing and placing greater demands upon the Govern-ment for services of every kind, I believe the time has come to get ourwork done by improving the efficiency and productivity of our Federalwork force, rather than by adding to its numbers.

This budget proposes a reduction in Federal employment in 1965—from 2,512,400 to 2,511,200 civilian employees—and I have directedthe heads of all departments and agencies to work toward reducingemployment still further. This reversal in the trend of Federal em-ployment results from a rigorous appraisal of personnel needs, de-termined measures to increase employee productivity and efficiency,and the curtailment of lower priority work. It will be accomplisheddespite large and unavoidable increases in workloads.

700-000 O—64 3



Selected Prosram Trends

' i 1 I I I I I I I I I V J I I I I I I I

Of the 9i/£> million civilian employees of governments in the UnitedStates today, 2y2 million are employed by the Federal Governmentand about 7 million by the State and local governments. In the decadefrom fiscal year 1955, Federal civilian employment in the executivebranch will rise by 6%, while the population of the United Stateswill increase by 17%. State and local employment will increase about65% during the same period.

In fiscal year 1955, we had 14 Federal civilian employees in theexecutive branch for every 1,000 people; in fiscal year 1965, we willhave fewer than 13 Federal civilian employees to serve every 1,000people.

Management improvement and cost reduction.—As substantialas are savings due to tightening up on Federal employment, evenlarger economies result from actions which eliminate waste and dupli-cation, simplify unnecessarily complex systems and procedures, andintroduce new and better business methods.



The emphasis on management improvement in the executive branchduring the past 3 years has led to impressive economies on a verywide front. Functions have been consolidated. Automatic data proc-essing equipment has improved efficiency and reduced operating costs.Excess property in the possession of one agency has been transferredto others, saving substantial funds budgeted for new purchases. Pro-ductivity has been increased in agencies with the heaviest volumeof workloads, thus avoiding payroll increases.

In the Department of Defense, the cost reduction program hasachieved exceptional results. Without impairing combat strength oreffectiveness, savings of over $1 billion were achieved in fiscal year1963, and annual savings by fiscal year 1967 are expected to reach theimpressive figure of $4 billion. As part of this effort, defense basesand installations no longer needed will be shut down. The number ofcivilian employees in the Department of Defense will decrease by 10,-000 in fiscal year 1964 and by another 17,000 in 1965—to the lowestlevel since 1950.

I have directed all departments and agencies to continue and in-tensify these efforts. When the search for economy is compromised,the taxpayer is the loser.

Government organization.—The organization of the Governmentmust be adjusted to cope with new and challenging problems resultingfrom scientific and technological advances, the development of newand the elimination of old programs, and changes in policies and pro-gram emphasis.

One of the most urgently needed improvements requiring congres-sional action is legislation to create a Department of Housing andCommunity Development to provide leadership in coordinating vari-ous Federal programs which aid the development of our urban areas.1 recommend that the Congress approve establishment of this newDepartment during its current session.

The authority of the President to transmit reorganization plansto the Congress expired on May 31, 1963. Legislation now pendingin the Congress should be enacted to renew this authority.

Salary reform and adjustment.—Although this budget is deliber-ately restrictive, I have concluded that government economy will bebest served by an upward adjustment in salaries. In the last yearand a half the Federal Government has taken far-reaching steps toimprove its pay practices. The Federal Salary Reform Act of 1962and the Uniformed Services Pay Act of 1963 established the principleof keeping military and civilian pay generally in line with pay inthe private economy. This is a sound principle, and it is reinforced



by the sound procedure of annual review. This principle is fair tothe taxpayer, to Government employees, and to the Government asan employer.

This budget provides for the costs of such action in this session ofCongress. Any pay action by the Congress should bring salary ratesfor top executive branch positions up to levels more nearly com-mensurate with their respective responsibilities, and increase ratesfor the Congress and the Judiciary. Economy and efficiency in gov-ernment will come primarily from the hard and conscientious workof our top managers, who are now plainly underpaid for what isexpected of them.

Government Civilian Employment



CONCLUSION

Approval of this budget will:

• Lift a major barrier to more rapid growth in the private sector ofthe economy by reducing tax burdens and providing investmentincentives.

• Meet the Nation's defense, international, and domestic require-ments.

• Provide generously for human needs and, with local communityaction, attack forcefully the pockets of human want and deprivationin our land.

• Advance efficient and economical administration in the Govern-ment so that each tax dollar will be a dollar well spent.

The program proposed for 1965 should provide ample assurance ofour determination to keep costs under tight control and move the taxreduction bill toward speedy approval. It should also provide ampleevidence that critical national problems need not go unsolved andhuman wants unmet in a Nation rich in moral as well as materialstrength.

A government that is strong, a government that is solvent, a gov-ernment that is compassionate is the kind of government thait endures.

There is no inconsistency in being prudent and frugal, in being alertand strong, and in being sensitive and sympathetic to the unfilledneeds of the people.

This is the objective of this Administration. It is an objectivethat will be met.

I firmly believe the proposals in this budget will serve the Nationwell and I ask the support of the Congress and the American peoplein putting them into efFect.

LYNDON* B. JOHNSON.January 21,1964.


PART 2

SUMMARY TABLES

39


THE GOVERNMENT DOLLAR

Where If comes from . . .

Where it goes . . .

iFix«<J Interest Charges

Agriculture

Fiscal Year 1965 Estbmrte

40


SUMMARY TABLES 41

Table 1. BUDGET RESUME (in billions of dollars)

ADMINISTRATIVE BUDGET AND TRUST FUND RECEIPTS AND EXPENDITURES

Description

RECEIPTS

Individual income taxes _ _Corporation income taxesEmployment taxes. _ _ _ _ _ _ _ _ _ _Excise taxes _ _ _Unemployment tax deposits by StatesEstate and gift taxesCustomsFederal employees retirementInterest on trust fundsVeterans life insurance premiumsMiscellaneous receiptsInterfund transactions

Total receipts _ _ _ _ _

EXPENDITURES

National defense. _ _ _ _ _ __ _ __International affairs and finance _Space research and technology _ _Agriculture and agricultural resources.Natural resourcesCommerce and transportationHousing and community developmentHealth, labor, and welfareEducation _ _ _ _Veterans benefits and services _ _InterestGeneral governmentDeposit funds (net)Allowance for attack on povertyAllowance for civilian pay comparabilityAllowance for contingenciesInterfund transactions. _ __ __.

Total expenditures.

ADMINISTRATIVEBUDGET FUNDS

1963actual

47.621.6

9.9

2.21.2

4.4- . 5

86.4

52.82.62.67.02.42.8

- . 14.81.25.2

10.02.0

- . 5

92.6

1964estimate

47.523.7

10.2

2.31.3

4.1- . 7

88.4

55.32.44.46.12.53.2

- . 25.51.35.4

10.72.2

.2- . 7

98.4

1965estimate

48.525.8

11.0

2.71.5

4.1- . 6

93.0

54.02.25.04.92.63.1

- . 35.81.75.1

11.12.2

.2

.5

.3- . 6

97.9

TRUST FUNDS

1963actual

14.93.33.0

1.91.5.5

3.2- . 5

27.7

.7*

.5

.12.9

*21.9

*.8*

.1

- . 5

26.5

1964estimate

16.83.52.9

2.01.6.5

3.4- . 5

30.2

.9

.1*

.5

.13.41.6

22 J*

.6

*

- . 1

- . 5

29.3

1965estimate

17.03.52.8

1.91.7.5

3.9- . 5

30.9

1.2.1*

.4

.13.5

.523.5

*.5

**

- . 5

29.4

CONSOLIDATED SUMMARY

Description

Cash receipts:Administrative budget receipts..Trust fund receiptsIntragovernmental transactions.

Total receipts from the public

Cash expenditures:Administrative budget expendituresTrust fund expendituresIntragovernmental and other noncash transactions.


Excess of receipts from ( + ) or payments to (—) the public.__

1963actual

86.427.7

-4.3

109.7

92.626.5

-5.4

113.8

-4 .0

1964

88.430.2

-4 .2

114.4

98.429.3

-5.0

122.7

-8.3

1965

93.030.9

-4.1

119.7

97.929.4

-4.6

122.7

-2.9

*Less than $50 million. Note.— Detail may not add to totals due to rounding.



Table 2. RECEIPTS FROM AND PAYMENTS TO THE PUBLIC(CONSOLIDATED CASH BASIS) (in billions of dollars)


1964estimate

1965estimate

RECEIPTS FROM THE PUBLIC

Individual income taxesCorporation income taxesEmployment taxesExcise taxesUnemployment tax deposits by States.Estate and gift taxesCustomsVeterans life insurance premiumsOther receipts

Total receipts from the public _


National defenseInternational affairs and financeSpace research and technologyAgriculture and agricultural resourcesNatural resourcesCommerce and transportationHousing and community developmentHealth, labor, and welfareEducationVeterans benefits and servicesInterestGeneral governmentDeposit funds, netAllowance for attack on povertyAllowance for civilian pay comparabilityAllowance for contingenciesOther undistributed adjustments:

Agency payments for employee retirementDeduction from employees' salaries for retirement.__Increase (—) or decrease in outstanding checks, etc.


Excess of receipts (+) or payments (—)

47.621.614.913.23.02.21.2.5

5.6

109.7

53.42.22.67.32.55.8

- . 325.71.26.07.42.0

- . 2

- . 9- . 9

113.8

-4 .0

47.523.716.813.72.92.31.3.5

5.7

114.4

56.02.54.46.32.66.61.3

27.31.36.08.12.2

- . 1

.2

-1 .0- . 9- . 1

122.7

-8 .3

48.525.817.014.52.82.71.5.5

6.4

119.7

55.22.45.05.12.76.6

*28.61.65.58.62.2

*.2.5.3

-1 .0-1 .0

*

122.7

-2.9

*Less than $50 million.Note.— This table shows the flow of money between the Government and the public on a cash

(collections and checks paid) basis. For fuller explanation, see special analysis A (pages 328 to 336).


SUMMARY TABLES 43

Table 3. NEW OBLIGATIONAL AUTHORITY BY TYPE AND FUNCTION(In billions of dollars)

Description

TYPE

Authorizations requiring current actionby Congress:

Appropriations 1

Rea ppropriationsAuthorizations to expend from debt

receiptsContract authorizations. _ _ _

Total authorizations requiring cur-rent action by Congress

Authorizations not requiring current actionby Congress (permanent):

Appropriations 1

Authorizations to expend from debtreceipts __ _

Contract authorizations

Total authorizations not requiringcurrent action by Congress (per-manent)

Total new obligational authority

FUNCTION

National defense ._International affairs and finance. __Space research and technologyAgriculture and agricultural resourcesNatural resources _ _ _Commerce and transportation_ _ _Housing and community developmentHealth, labor, and welfare.EducationVeterans benefits and services _InterestGeneral government _ __ _Allowance for attack on povertyAllowance for civilian pay comparabilityAllowance for contingencies



1963actual

89.1*

.51.0

90.6

10.7

.7

.3

11.6

102.3

54.35.73.77.12.44.0

.65.41.45.5

10.02.2

102.3

1964estimate

88.0* •

.51.5

90.0

11.5

.6

.5

12.6

102.6

53.83.05.26.42.62.92.05.81.95.6

10.72.3

.4

102.6

1965estimate

91.1

*.4

91.4

11.8

.5

.1

12.4

103.8

53.73.65.35.02.62.8

.56.63.15.5

11.12.4

.5

.5

.5

103.8

TRUST FUNDS

1963actual

0.4

3.6

3.9

23.6

.2

.9

24.7

28.6

.9***

.13.6

.622.6

*.7

*

28.6

1964estimate

0.4

.4

25.8

.15.4

31.3

31.7

\J.1**

.13.7.4

24.9

.7

*

31.7

1965estimate

0.4

3.8

4.2

26.1

.11.3

27.6

31.8

1.3.1**

.13.8

.625.1

*.7

*

31.8

"Less than $50 million.Note.— New obligational authority is the amount becoming available by act of Congress for th<

incurring of obligations which will result in expenditures. The various types of new obligationâuthority are explained on pages 146 and 147. For detailed information on new obligational authorit;by agency and account see pages 150 to 325.

1 Excludes appropriations to liquidate contract authorizations:Administrative budget funds, 1963, $0.8 billion; 1964, $0.9 billion; 1965, $1.4 billion.Trust funds, 1963, $4.1 billion; 1964, $4.5 billion; 1965, $4.9 billion.



Table 4. NEW OBLIGATIONAL AUTHORITY BY AGENCY (in millions of dollars)

Description


Legislative BranchThe JudiciaryExecutive Office of the President.Funds appropriated to the Pres-

identDepartment of AgricultureDepartment of CommerceDept. of Defense—MilitaryDept of Defense—CivilDept. of Health, Education, &

Welfare .Department of the InteriorDepartment of JusticeDepartment of LaborPost Office DepartmentDepartment of StateTreasury DepartmentAtomic Energy CommissionFederal Aviation AgencyGeneral Services Administration-Housing & Home Finance Agcy__National Aeronautics and Space

AdministrationVeterans AdministrationOther independent agenciesDistrict of ColumbiaAllowance for attack on poverty _Allowance for civilian pay com-

parabilityAllowance for contingencies.

Total administrative budget.

TRUST FUNDS

Department of CommerceDept. of Health, Education, &

WelfareDepartment of LaborVeterans AdministrationCivil Service CommissionRailroad Retirement BoardOther agencies

Total trust funds

1963enacted

1606424

5,6638,032813

51,1201,092

5,3331,134319362840423

11,0463,135755622785

3,6735,5341,285

70

102,283

3,611

14,9894,261711

2,2471,1151,667

28,602

1964 estimate

Enacted

1566725

2,2627,189

79249,913

1,148

5,2461,164

344350654353

11,8612,743

813631794

5,1005,5361,115

60

98,317

3,741

17,0734,192719

2,3821,2182,370

31,695

Supple-mentalneeded

768

1,0872

857201

120

8213

31,409

14117

400

4,237

Total

1566725

2,2627,265800

51,0001,150

6,1021,184345470654435

11,8742,743813635

2,203

5,2415,5531,116

60

400

102,554

3,741

17,0734,192719

2,3821,2182,370

31,695

1965 estimate

Trans-mittedherein

2007229

2,8016,209923

50,7081,214

6,5311,173368671551377

12,3942,693676632674

5,3045,4441,207

68

100,919

3,817

17,4393,933714

2,3911,2792,184

31,757

Latertrans-mittal

-253

172"

1,11840

160

75

75

-655

500

544500

2,870

60

60

Total

2007229

2,8015,956923

50,8801,214

7,6491,213368831551377

12,3942,693751632749

5,3045,4441,142

72500

544500

103,789

3,817

17,4993,933714

2,3911,2792,184

31,817

*Less than one-half million dollars.

Note .—For explanation of the columnar headings for 1964 and 1965, see pages 148 and 149.For detailed information on new obligational authority by agency and account, see pages 150 to 325.


SUMMARY TABLES 45

Table 5. EXPENDITURES BY AGENCY (in millions of dollars)

Description


Legislative BranchThe JudiciaryExecutive Office of the President.Funds appropriated to the Pres-

identDepartment of AgricultureDepartment of CommerceDept. of Defense—MilitaryDept. of Defense—CivilDept. of Health, Education, &

Welfare _Department of the InteriorDepartment of JusticeDepartment of LaborPost Office DepartmentDepartment of StateTreasury DepartmentAtomic Energy CommissionFederal Aviation AgencyGeneral Services Administration.Housing & Home Finance Ag'cy.National Aeronautics and Space

AdministrationVeterans AdministrationOther independent agenciesDistrict of ColumbiaAllowance for attack on poverty.Allowance for civilian pay com-

parabilityAllowance for contingencies

Subtotal,Interfund transactions.

Total administrativebudget

TRUST FUNDS

Department of CommerceDept. of Health, Education, &

WelfareDepartment of LaborVeterans AdministrationCivil Service CommissionRailroad Retirement BoardOther agencies

SubtotalInterfund transactions.

Total trust funds.

1963actual

1476323

2,2477,735

67649,973

1,128

4,9091,029

317257770408

11,0282,758

726464410

2,5525,173

29366

93,155- 5 1 3

92,642

3,043

15,7893,816

8281,1311,1121,332

27,050-505

26,545

1964 estimate

cted

1666725

2,8177,068786

51,2441,140

5,1351,103329340546355

11,8602,800790552212

4,3755,338

18866

97,301

3,581

16,7053,556634

1,2721,1292,927

29,803

Supple-mentalneeded

- 9 1*

1,0562

395111

76

3014

25115

250

1,788

Total

1666725

2,8176,978

78652,300

1,141

5,5301,114330415546385

11,8742,800790555212

4,4005,349

19366

250

99,089-685

98,405

3,581

16,7053,556634

1,2721,1292,927

29,803

29,315

1965 estimate

Trans-mittedherein

1797228

2,5336,183833

51,0081,192

5,4581,126343546475362

12,3352,735824578339

4,8905,161-2084

97,262

3,673

17,5193,273489

1,4351,1442,147

29,679

Latertrans-mittal

-368

192*

39622*

121

20*

-190

100-94-65

5250

544300

1,238

170

170

Total

1797228

2,5335,815833

51,2001,192

5,8531,148343667475382

12,3352,735829578149

4,9905,066-8588250

544300

98,500-600

97,900

3,673

17,5193,443489

1,4351,1442,147

29,849-477

29,372

*Less than one-half million dollars.Note.—For explanation of the columnar headings for 1964 and 1965, see pages 148 and 149.

detailed information on expenditures by agency and account, see pages 150 to 325.


46 THE BUDGET FOR FISCAL YEAR 1 9 6 5

Table 6. INVESTMENT, OPERATING, AND OTHER EXPENDITURES

(In millions of dollars)

Description

ADMINISTRATIVE BUDGET FUNDS

Additions to Federal assets:Civil:

Loans _ _Investments.Public works—sites and direct constructionOther

National defense

Total, additions to Federal assets

Additions to State, local, and private assets:CivilNational defense

Total, additions to State, local, and private assets

Expenditures for other developmental purposes:Civil:

Research and development _ _Other . _-_ _

National defense:Research and developmentOther

Total, other developmental expenditures

Current aids, special services, and operations:CivilNational defense

Total, current aids, special services, and operations

Allowance for attack on povertyAllowance for civilian pay comparabilityAllowance for contingenciesInterfund transactions

Total administrative budget *

TRUST FUNDS

Additions to Federal assets:Loans •-Public worksOther

Total, additions to Federal assets _

Additions to State, local, and private assetsExpenditures for other developmental purposes.

Retirement and social insurance benefits:Insurance and unemployment benefits _ ._ _ _ _Other

Total, retirement and social insurance benefits

Current aids, special services, and operations _ _District of Columbia, deposit funds, and other unclassified

items _ - _ . -Interfund transactions.. _ . . . . ._

Total trust funds

1963

1,78587

2,289899

17,947

23,007

1,31228

1,340

3,4391,333

7,87115

12,658

29,25626,893

56,150

-513

92,642

-28332*

-250

3.48154

17,9802,834

20,814

1,491

1,461-505

26,545

1964

1,08598

2,720-347

18,734

22,288

1,68628

1,714

5,2531,587

8,58116

15,436

31,46127,940

59,402

250-685

98,405

317431

3624,835

68

18,5862,822

21,409

1,834

1,294-488

29,315

1965

- 1 9176

2,815118

17,239

20,330

1,68322

1,706

5,9061,931

8,23319

16,090

30,81528,466

59,281

250544300

-600

97,900

550252

5763,583

74

19,4702,860

22,330

2,126

1,160-477

29,372


Note.— For more information on this classification see special analysis D (pages 354 to 372).


SUMMARY TABLES 47

Table 7. FEDERAL RECEIPTS AND EXPENDITURES IN THENATIONAL INCOME ACCOUNTS (in billions of dollars)

Description 1963 1964 1965stimate

RECEIPTS, NATIONAL INCOME BASIS

Personal tax and nontax receiptsCorporate profits tax accrualsIndirect business tax and nontax accrualsContributions for social insurance

Total receipts, national income basis

EXPENDITURES, NATIONAL INCOME BASIS

Purchases of goods and servicesTransfer payments __.Grants-in-aid to State and local governmentsNet interest paidSubsidies less current surplus of Government enterprises.

Total expenditures, national income basis

Surplus ( + ) or deficit (—), national income basis

50.121.615.621.9

109.3

64.429.27.97.63.5

112.6

- 3 . 3

50.123.316.523.7

113.6

67.830.59.48.03.5

119.1

-5.5

52.324.917.324.2

118.8

69.131.89.78.52.5

121.5

- 2 . 8

RELATION OF THE FEDERAL SECTOR IN THE NATIONAL INCOME ACCOUNTSTO RECEIPTS FROM AND PAYMENTS TO THE PUBLIC

RECEIPTS

Total receipts, national income accountsReceipts not included in Federal receipts in the national

income accounts:Realization on loans and other assetsDistrict of Columbia government receiptsInterest and other earnings __ _ _

Receipt adjustments to consolidated cash basis:Employer and employee contributions to Federal retirement

fundsAccrual to cash and other adjustments

Total Federal receipts from the public

EXPENDITURES

Total expenditures, national income accountsExpenditures not included in Federal activities in the national

income accounts:Loans, purchase of land, deposit funds, etcDistrict of Columbia government expendituresPortion of interest and other expenditures offset by receipts

Expenditure adjustments to consolidated cash basis:Employer and employee contributions to Federal retirement

fundsAccrual to cash adjustments .

Total Federal payments to the public __ _

109 .3

1.5

f. 1

-1 .9- . 6

109.7

112.6

2.7. 3

. 6

- 1 . 9- . 6

113.8

113.6

1.1

]'.2

- 1 . 9. 1

114 .4

119.1

4.6. 4

. 6

- 1 . 9

122.7

118.8

1.0. 4

1.3

- 1 . 9. 2

119.7

121 .5

2.9. 4

. 9

- 1 . 9- 1 . 1

122.7

Note.—This table shows Federal receipts and expenditures on the basis used in the nationalincome and gross national product statistics of the Department of Commerce. For a fuller expla-nation, see special analysis A (pages 328 to 336).



Table 8. RELATION OF AUTHORIZATIONS TO EXPENDITURES


Description


New obligational authority (tables 3 and 4): *Current authorizationsPermanent authorizations

Total new obligational authorityUnobligated balances brought forward, start of year (table

10).Appropriations available in prior yearAppropriations available from subsequent yearBalances no longer available:

Unobligated balances rescindedUnobligated balances lapsingCapital transfers from revolving funds to general fund

Unobligated balances carried forward, end of year (table 10).

Obligations incurred, net (table 9)Obligated balances brought forward, start of year (table 10)Adjustments of obligated balances in expired accountsObligated balances carried forward, end of year (table 10)__

SubtotalInterfund transactions (see note to table 14)

Total administrative budget expenditures (tables 1and 5)

From new obligational authorityFrom balances of prior obligational authority _

1963actual

90,63511,648

102,283

38,974- 6 3 9

647

-1,085-152

-45,309

94,72040,953

-210-42,308

93,155-513

92,642

1964estimate

90,00012,553

102,554

45,309-647796

-602-198

-43,874

103,33742,308

- 5-46,550

99,089-685

98,405

1965estimate

91,40412,384

103,789

43,874-796796

-510-152

-41,693

105,30846,550

- 6-53,352

98,500-600

97,900

70,54127.359

*Less than one-half million dollars.Note.— This table (administrative budget and trust funds) summarizes and brings into relationship

totals from the various other tabulations. The types of new obligational authority and the consider-ations involved in the various means of financing agency activities are explained on pages 146 to 149 .

1 Excludes ajlion; 1965, $1,3

propriations to liquidate contract authorizations: 1963, $804 million; 1964, $942 mil-• 0 million.


SUMMARY TABLES 49

Table 8. RELATION OF AUTHORIZATIONS TO EXPENDITURES—Con.

$ Billion,

m Expendituresin 1965

97.9

Expiring Authority

and Inteifund PaymentsUnspent AuthorizationsEnacted in Prior Years

90.4To be held for Expenditures

in Later Years 6 1 . 8

Unspent Authorizations >for. Expenditures in

Future Years

95.0


Description

TRUST FUNDS

New obligational authority (tables 3 and 4) : 2

Current authorizationsPermanent authorizations

Total new obligational authorityUnobligated balances brought forward, start of year (table 10)__Balances no longer available: Unobligated balances lapsingUnobligated balances carried forward, end of year (table 10)

Obligations incurred, net (table 9) _,Obligated balances brought forward, start of year (table 10)Adjustment for stock purchase, FNMAObligated balances carried forward, end of year (table 10)

Subtotal __Government-sponsored enterprise expendituresInterfund transactions (see note to table 14)

Total trust fund expenditures (tables 1 and 5)

From new obligational authorityFrom balances of prior obligational authority

1963actual

3,94024,661

28,60255,909

- 3 2-57,445

27,0348,226

-8,896

26,364685

-505

26,545

1964estimate

35431,341

31,69557,445

- 2 7-60,458

28,6568.896

101-9,316

28,3361,467-488

29,315

1965estimate

4,23627,581

31,81760,458

- 2 7-62,295

29,9539,316

-9,532

29,738111

-477

29,372

21,3508,021

2 Excludes appropriations to liquidate contract authorizations: 1963, $4,139 million; 1964, $4,482nillion; 1965. $4,856 million.

700-OOQ O—64 4



Table 9. OBLIGATIONS INCURRED, NET (in millions of dollars)

Description


Legislative BranchThe JudiciaryExecutive Office of the PresidentFunds appropriated to the PresidentDepartment of AgricultureDepartment of CommerceDepartment of Defense:

MilitaryCivil

Department of Health, Education, and Welfare..Department of the InteriorDepartment of JusticeDepartment of LaborPost Office DepartmentDepartment of StateTreasury DepartmentAtomic Energy CommissionFederal Aviation AgencyGeneral Services AdministrationHousing and Home Finance Agency -_.-National Aeronautics and Space Administration.Veterans AdministrationOther independent agenciesDistrict of ColumbiaAllowance for attack on povertyAllowance for civilian pay comparabilityAllowance for contingencies

Total administrative budget_

TRUST FUNDS

Department of CommerceDepartment of Health, Education, and Welfare-Department of Labor..-Veterans AdministrationCivil Service CommissionRailroad Retirement BoardOther agencies

Total trust funds.

1963actual

1426323

2,5827,991

776

49,0021,1045,1441,074

314262808407

11,0492,989

734580466

3,4605,214

47266

94,720

3,95115,7943,816846

1,1251,115387

27,034

1964estimate

1576725

3,0497,329896

51,6311,1806,1011,276342478651457

11,8833,079892658857

5,3975,3821,185

66

300

103,337

3,81616,7063,571642

1,2861,1291,507

28,656

1965estimate

1977229

2,5795,888958

51,9431,2407,9571,220365827551385

12,3882,693814773

1,1985,4215,0921,085

88500544500

105,308

3,81517,5343,459492

1,4521,1442,058

29,953

Note.—This table reflects the net obligations incurred, as explained on pages 146 and 147. Foradministrative budget funds, obligations are determined by deducting from the gross obligationsthe applicable receipts of public enterprise funds and intragovernmental funds, and the reimburse-ments to general fund and special fund appropriations. For trust funds, net obligations are de-termined by deducting from the gross obligations the applicable receipts of trust revolving fundsand the reimbursements to trust fund appropriations.


SUMMARY TABLES 51

Table 10. BALANCES OF OBLIGATIONAL AUTHORITY (in millions of dollars)

Description

Start 1963

Obli-gated

Un-obli-gated

Start 1964—End 1T63

Obli-gated

Un-obli-gated

Start 1965—End 1964

Obli-gated

Un-obli-gated

Start 1966—End 1965

Obli-gated

Un-obli-gated

ADMINISTRATIVE BUDGETFUNDS

Legislative BranchThe JudiciaryExecutive Office of the PresidentFunds appropriated to the PresidentDepartment of AgricultureDepartment of CommerceDepartment of Defense—MilitaryDepartment of Defense—CivilDept. of Health, Education, & Welfare..Department of the InteriorDepartment of JusticeDepartment of LaborPost Office DepartmentDepartment of StateTreasury Department .Atomic Energy CommissionFederal Aviation AgencyGeneral Services AdministrationHousing and Home Finance AgencyNational Aeronautics and Space Admin-

istrationVeterans AdministrationOther independent agenciesDistrict of ColumbiaSpecial allowances

4553

3,7653,376

52222,130

2791,519

2792114

36690

1381,013

352163

3,582

824295

2,171

6,4331,189

5389,870 21

7731417215

2167

40278191233371

9,283

3753

,098,631620012254720323

1714

40785

158,245357278

,630

451*

,508990531

,693 2066

365213

15307

1354

267336246396

,328

2453

,329,982731

,343293

,289485

2977

512158167

,524459381

,678771426

11,04135

47011914

3017

32255

334555

8,72796

1,730335

2,348

548851

9,43897

4,275

2,726368

3,340

10

167357

,493

50

392833

9,26481

100

3964

4,3754,056

85621,086

3414,391

55751

237588160219

1,482444576

5,324

3,157394.

4,510

34

8,899758391

9,9209

16211114

3047

24260

500

105212

9,813

2751,0349,197

64100

Total administrative budget

Recapitulation by type of balance:AppropriationsAuthorizations to expend from debt

receiptsContract authorizationsRevolving and management funds

Total administrative budgetTRUST FUNDS

Department of CommerceDept. of Health, Education, & Welfare __Department of LaborVeterans AdministrationCivil Service CommissionRailroad Retirement BoardOther agencies l

Total trust funds

40,953 38,974 42,308 45,309 46,550 43,874 53,352 41,693

30,201 9,747 30,130 14,773 32,044 12,938 36,041

6,782 202,1921,779

,6282,6495,949

6,0552,7493,374

21,1132,3827,040

7,635 202,8194,052

,9903,2456,702

9,8012,5224,988

11,835

20,4722,5826,804

40,953 38,974 42,308 45,309 46,550 43,874 53,352 41,693

5,231177

3319886

2,455

3,08522,1165,8246,517

12,3893,6982,279

6,13922 218

3499290

2,196

2,718,312

6,2696,383

13,5113,6993,555

6,37423 2123

35710690

2,344

2,617,679

6,8906,460

14,6073,7884,418

6,51637 2139

36112390

2,366

2,591,645

7,3646,682

15,5463,9234,545

8,226 55,909 8,896 57,445 9,316 60,458 9,532 62,295

Recapitulation by type of balance:Appropriations *Authorizations to expend from debt

receiptsContract authorizationsRevolving and management funds

Total trust funds

2,727

\75,029

453

44,203

8653,8976,944

2,953

-1845,538

589

45,105

1,8713,6296,841

2,812 47,290

476,076

382

2,0244,2146,930

2,863

696,218

382

48,863

2,0144,2357,183

8,226 55,909 8,896 57,445 9,316 60,458 9,532 62,295

"'Less than one-half million dollars.Note.—For explanation of balances carried forward see page 148.1 Obligated balances include deposit funds.



Table 11. THE PUBLIC DEBT (in millions of dollars)


1964 1965

PUBLIC DEBT HELD BY THE PUBLIC

Public debt held by public, start of year

Change in public debt held by public during the year:Consolidated cash deficit or surplus (tables 1 and 2)Receipts from exercise of monetary authorityIncrease or decrease in debt issued in lieu of checks (table

A-3).Increase or decrease in cash on hand

Net borrowing from or repayments to the publicDeduct net borrowing of Government enterprises from the

public (included on preceding line) (table B—10)

Net increase in public debt held by the public

Public debt held by the public, end of year

PUBLIC DEBT HELD BYGOVERNMENT-ADMINISTERED FUNDS

Public debt held by Government-administered funds, start ofyear

Change in public debt held by Government-administeredfunds during the* year X table B-11)

Public debt held by Government-administered funds, end ofyear

COMPARISON OF PUBLIC DEBT WITH STATUTORYLIMITATION AT END OF YEAR

Public debt:Held by the public v _Held by Government-administered funds

Total public debtPortion of Government enterprise debt subject to the public

debt limitationPortion of public debt not subject to limitation

Debt subject to limitation, end of year_

Statutory limitation on public debt, end of year:Under existing legislationUnder proposed legislation

242,473

4,012-451,0331,611

6,612

961

5,651

248,125

55,727

2,007

57,735

248,12557,735

305,860

607-368

306,098

307,000

248,125

8,338-50

810-3,921

5,177

1,787

3,389

251,514

57,735

2,552

60,286

251,51460,286

311,800

749-360

312,189

251,514

2,948-55

550

3,443

538

2,906

254,420

60,286

2,294

62,580

254,42062,580

317,000

705-355

309,0000)

317,350

285,0000)

Note.—The first portion of this table reflects borrowing (or repayment thereof) through theîssu-ance of U.S. securities to the public by both the Treasury and by certain "Government enterprises,"a term used here to refer to activities which have authority to issue their own securities. The bor-rowing by such enterprises is then deducted to arrive at the changes in the public debt^ (a termwhich relates to securities issued by the Treasury). "Government-administered funds" in thistable refers to activities which have authority to buy U.S. securities for investment purposes.

1 To be determined later, when more reliable estimate of requirements may be possible.


SUMMARY TABLES 53

Table 12. CIVILIAN EMPLOYMENT IN THE EXECUTIVE BRANCH

Description

As of June

1963actual

1964estimate

1965estimate

Executive Office of the PresidentDepartment of AgricultureDepartment of CommerceDepartment of Defense:

Military and military assistance 1

Civil2

Department of Health, Education, and Welfare.Department of the InteriorDepartment of JusticeDepartment of LaborPost Office DepartmentDepartment of State

Agency for International DevelopmentPeace Corps

Treasury DepartmentAtomic Energy CommissionFederal Aviation AgencyGeneral Services AdministrationHousing and Home Finance AgencyNational Aeronautics and Space AdministrationVeterans AdministrationOther:

Civil Service CommissionSelective Service SystemSmall Business AdministrationTennessee Valley AuthorityThe Panama CanalUnited States Information AgencyMiscellaneous independent agencies and other

Total

1,660112,48832,338

1.017,11732,64881,06269,55832,0819,567

587,16124,51916,7821,110

86,5797,120

46,31332,65014,16029,934172,864

4,0856,9163,38717,91714,96611,79323,513

1,621116,80034,603

1.007,00032,29386,00072,59232,75910,016

593,10025,32416,5001,150

88,4337,330

46,40035,94414,41032,600173,021

4,1256,9963,50018,04115,08312,22824,531

1,618115,37634,945

989,92031,83190,73072,77432,7599,954

597,90025,32015,7001,250

90,4277,330

46,45037,70015,14433,800173,754

4,0798,0363,50017,65015,22812,22825,797

32,490,288 2,512,400 2,511,200

Note.— The figures include tentative estimates for employment under appropriations proposed forlater transmittal. In accordance with definitions of the Civil Service Commission, the figures coverboth those employees who are working on June 30, and also part-time and intermittent employeeswho work at any time during the month of June.

1 Consists of civilian employment for military functions and military assistance.2 Employment of the Panama Canal and the U.S. Soldiers' Home is included under "Other" below.3 Excludes 7,41 1 project employees for the public works acceleration program.


PART 3

RECEIPTS

55


ANALYSIS OF RECEIPTS BY SOURCE

This section of the budget supplements the budget message withadditional information about the revenue estimates and the antici-pated tax changes.

Economic base of estimates.—Prompt enactment of the pendingtax bill, making sizable tax reductions effective as of January 1, 1964,will accelerate the growth of the economy toward full employment.Under these conditions the Nation's output of goods and services isexpected to reach $623 billion in calendar year 1964, an increase of$38 billion over calendar year 1963. This projection should betaken as the midpoint of a $10 billion range, from $618 to $628 billion.Substantial gains in personal income and corporate profits beforetaxes will accompany the growth in output. Specifically, the revenueestimates in the 1965 budget are based on the following economicassumptions:

ECONOMIC ASSUMPTIONS

Gross national product. _ _Personal incomeCorporate profits before taxes__

[Calendar year j. In billions]

1962actual

$554.9442.146.8

1963preliminary

$585.0463.0

51.7

1964estimate

$62349256

Estimates of tax revenues cannot be derived directly and simplyfrom the assumed levels of aggregate economic performance. Thedefinitions of taxable income in the tax statutes, which determinetax liabilities, differ from the economic or statistical definitions ofincome which are used to measure economic performance. Inaddition, tax payments are received by the Treasury after the periodin which tax liabilities are incurred. For example, corporation in-come tax collections now lag about 6 months behind the period whenthe taxable income was earned; there is also some lag between thetime when individual income and social security taxes are deductedfrom earnings and the time employers transfer these sums to theTreasury.

Estimated changes in revenues.—Total receipts from the publicare estimated at $119.7 billion in fiscal year 1965, an increase of $5.4billion over the level estimated for fiscal year 1964. These estimates

56


RECEIPTS 57

assume passage of the revenue legislation discussed in the proposedlegislation section of this analysis. Especially important is enactmentof the income tax program approved by the House of Representativesand currently under consideration in the Senate. The reductions inincome tax rates are assumed to be retroactive to January 1, 1964.

Under the new income tax rates, tax payments by individuals andcorporations will be reduced by approximately $2.6 billion in fiscalyear 1964 and $8.0 billion in fiscal year 1965, calculated on the basisof calendar 1963 income levels. These potential gross losses in taxreceipts, however, will be offset in part by increased revenues fromthe economic stimulus of the tax cut and a new schedule for quarterlycorporation tax payments. As a result, the net revenue declinefrom the tax changes is estimated to be $2.2 billion in fiscal year1964 and $3.1 billion in fiscal year 1965. Despite this loss, incometax collections, individual and corporate, are expected to be $3.1billion greater in fiscal 1965 than in the current fiscal year, chieflybecause of the anticipated continuing expansion of economic activity.

RECEIPTS FROM THE PUBLIC[Fiscal years. In millions]

Source

Administrative budget receipts:

Individual income taxesCorporation income taxesExcise taxesEstate and gift taxesCustomsMiscellaneous budget receipts

Subtotal, administrative budget receipts

Trust fund receipts:Employment taxesDeposits by States, unemployment insuranceExcise taxesFederal employee and agency payments for retirementInterest on trust fundsVeterans life insurance premiums, etcOther trust fund receipts

Subtotal, trust fund receipts

Intragovernmental transactions

Total, receipts from the public

1963actual

$47,58821,5799,9152,1671,2053,922

86,376

14,8623,0093,2791,8781,477494

2,690

27,689

-4,326

109,739

1964estimate

$47,50023,70010,2212,3351,2753,369

88,400

16,7772,9003,4781,9591,589501

2,958

30,163

-4,197

114,366

1965estimate

$48,50025,80010,9872,7401,4603,513

93,000

16,9962,8253,5041,9231,669499

3,457

30,872

-4,130

119,742



Individual income tax receipts are estimated at $48.5 billion infiscal 1965 compared with $47.5 billion in 1964. This change reflectsthe net effect of the anticipated reduction in tax rates and the asso-ciated rise in personal income subject to tax.

Corporation income tax receipts are estimated at $25.8 billion in fiscalyear 1965, an increase of $2.1 billion over fiscal year 1964. Thedecline in tax collections because of the reduction in corporation in-come tax rates will be more than offset by the receipts gained from thehigher profits arising from the stimulation to economic activity andfrom the acceleration of corporation tax payments under the terms ofthe pending tax bill.

Excise tax receipts show an estimated increase of $766 million duringthe coming fiscal year. Virtually all excise taxes will yield increasedrevenues, accompanying the expected general rise in economic activity.

Employment tax collections will rise by $219 million in fiscal year1965 to $17.0 billion. The increase reflects mainly higher levels ofemployment and earnings and the increase in the taxable wage basefor the railroad retirement system from $4,800 to $5,400 enacted lastyear.

Deposits by States for unemployment insurance are expected todecline by $75 million. Because of generally rising employment, manyfirms have maintained stable employment levels, and are qualifyingfor reduced rates of payroll taxes under experience rating clauses intheir State laws.

Miscellaneous budget receipts in total will rise by $144 million to$3.5 billion in fiscal year 1965. Increases estimated in a number ofcomponents, including proposals for new or higher user charges, arepartly offset by declines in others.

Proposed legislation.—The following are the major revenue pro-posals recommended for enactment this year.

Income tax rate and structural tax changes.—The pending revenuebill will reduce tax rates on individual and corporate incomes, maketax treatment among taxpayers more equitable, and bolster economicincentives. Part of the tax reduction will be in effect during calendaryear 1964 and the remainder during calendar year 1965. When fullyeffective, it will reduce income tax liabilities by over $11 billion a year.

The legislation is assumed to be enacted very early this calendaryear, with a 14% withholding rate on wages and salaries beginning in


RECEIPTS 59

February, and with the initial stage of the new income tax rateseffective for the entire calendar year 1964. Accordingly, the reducedwithholding rate will influence receipts only during the last monthsof fiscal 1964 and during the whole of fiscal 1965. When the secondstage of tax reductions goes into effect on January 1, 1965, the with-holding rate will remain at 14%.

The rates on taxable individual incomes then will be in a rangefrom 14% to 70%, compared with the present range from 20% to9 1 % . The present first bracket of taxable income up to $2,000 forsingle persons, and $4,000 for married couples, which is now taxedat 20%, will be divided into four equal brackets, each of which willbe taxed at a different rate below 20%.

The combined normal and surtax rates on corporation incomesabove $25,000 will become 48%, compared with the current 52%.Incorporated small businesses will receive an even larger tax ratereduction, since the normal tax rate on corporation income below$25,000 will decline to 22% from the current 30%.

Corporations with income tax liabilities in excess of $100,000 peryear will have their tax payments moved closer in time to the accrualof tax liabilities. The speedup of payments will start in calendar year1964 and will be completed in 1970, when payments of estimated taxliabilities greater than $100,000 will be made quarterly as the liabilitydevelops. During the transition to the new payment schedule totaltax payments by these corporations will not exceed the taxes theywould pay under present rates on the same income.

The major structural revisions contained in the bill will becomeeffective on January 1, 1964. They include (1) a minimum standarddeduction that will reduce the tax liability of many low-income tax-payers by more than the general rate reduction, (2) a limit on thedeductibility of certain State and local government taxes, and (3)repeal of the dividend credit and an increase in the amount of dividendincome excluded from taxable income. Other important provisionswill reduce such special exemptions as tax-free sick pay allowancesfor illnesses of short duration, limit the grouping of oil properties fordepletion allowances, and tighten the requirements on personal hold-ing companies.

Excise taxes.—Under present law, the excise rates on distilled spirits,beer, wines, cigarettes, passenger automobiles, and automobile partsand accessories will be reduced on July 1, 1964, and the tax on generaltelephone service will expire on July 1, 1964. The revenue estimatesin this budget are based on proposed legislation extending the presentrates of these taxes for 1 additional year.


6 0 THE BUDGET FOR FISCAL YEAR 19 65

Federal unemployment tax.—Legislation is pending to increase thepayroll tax rate on employers under the unemployment insurancesystem from 3.1% to 3.4%, effective on calendar year 1965 wages.Federal receipts under this program will not show the effects of thenew tax rate until fiscal year 1966 because of the lag in depositing thereceipts with the Treasury. This increased tax rate is designed tofinance proposed improvements in the system, including a longerperiod of eligibility for unemployment benefits.

User charges.—In keeping with the policy that a larger share of thecosts of programs which provide special benefits or privileges shouldbe met by those receiving the benefits, rather than by the generaltaxpayer, legislation authorizing certain additional user charges,and extending others, is recommended.

The most significant charges proposed affect commercial and otherusers of transportation, and would become effective on July 1, 1964.These include (a) continuing as a user charge the 5% excise tax on airpassenger transportation which would otherwise expire on July 1,1964; (b) instituting a 5% tax on air freight; (c) extending to jet fuels,currently untaxed, the present 2 cents per gallon tax on fuels used incommercial air transportation; (d) increasing from 2 cents to 3 centsper gallon the tax on all fuels used in general aviation; and (e) initi-ating user charges for the inland waterways through a tax of 2 cents pergallon on fuels used in transportation on these waterways. The re-ceipts from all of these charges will be retained in the general fund ofthe Treasury under the proposed legislation.

In addition, a land and water conservation fund has been proposedto finance planning, land acquisition and development of recreationfacilities, to be carried out chiefly through grants to States. Therevenues would come to this new fund from (a) existing and new ad-mission and user fees in national forests, parks, and other recreationareas, (b) the proceeds from the sale of surplus Government realproperty, and (c) transfer of certain motor boat fuel taxes from thehighway trust fund.

Legislation to increase the fees charged by the Patent Office hasbeen sent to the Congress; the new fee schedule would bring thePatent Office closer to a self-sustaining pattern of operations.

Rural Electrification Administration.—Legislation is again beingproposed to permit the Rural Electrification Administration to useits repayments on outstanding loans to finance new loans. Enact-ment of this legislation will reduce equally miscellaneous receipts andREA expenditures in fiscal years 1964 and 1965, and will not affectthe budgetary surplus or deficit.


RECEIPTS 61

ESTIMATED EFFECT OF PROPOSED LEGISLATION ON ADMINISTRATIVE BUDGETRECEIPTS

[In millions]

Proposal Fiscal year1965

Income tax rate and structure proposals (net)Excise tax rate extensions:

Alcohol taxes

Tobacco taxesPassenger automobilesParts and accessories for automobilesGeneral telephone service

Subtotal, excise tax rate extensionsTransportation user charge proposals:

Extend 5% tax on air passenger transportationTax transportation of air freight at 5%Credit existing 2 cents per gallon aviation gas tax receipts to general fundExtend 2 cents per gallon rate to jet fuelsIncrease rate to 3 cents per gallon on fuel used in general aviationTax fuel used on inland waterways at 2 cents per gallonCredit receipts from tax on gasoline used in motor boats to general fund (for use in

new land and water conservation fund)_

Subtotal, transportation proposals

Total, excise taxesOther user charges:

Land and water conservation fund A

Patent feesOther •_

Rural Electrification Administration revolving fund

Total

-$3,100

458269480

80

455

1,742

22473

27

213

1,955

38112

-178

-1 ,272

A In addition, the proposed legislation transfers $60 million of receipts from sales of surplus realproperty to the new land and water conservation fund.



Table 13. SOURCES OF RECEIPTS (in millions of dollars)

[Note.— Estimates include effect of proposed legislation.]

Description


Individual income taxes:

WithheldOther

Gross individual income taxesRefunds

Net individual income taxes

Corporation income taxes

Refunds

Net corporation income taxes. _ __

Excise taxes:Alcohol taxes:

Distilled spirits (domestic and imported)BeerRectification taxWines (domestic and imported)Special taxes in connection with liquor occupations _

Total, alcohol taxes

Tobacco taxes:Cigarettes (small) _ .Manufactured tobacco (chewing, smoking, and snuff)Clears flame)Cigarette papers and tubes _Allother

Total, tobacco taxes __

Taxes on documents, other instruments, and playing cards:Issues of securities,, stock and bond transfers, purchases

of foreign securities, and deeds of conveyancePlaying cards

Total, taxes on documents, other instruments, andplaying cards

Manufacturers' excise taxes:GasolineLubricating oilsPassenger automobilesAutomobile trucks, buses, and trailersParts and accessories for automobiles _Tires, inner tubes, and tread rubber

1963actual

38,71914,269

52,988-5,400

47,588

22,336-757

21,579

2,46882526

10221

3,442

2,0111650

12

2,079

1409

149

2,49774

1,560303225399

1964estimate

38,20014,900

53,100-5,600

47,500

24,600-900

23,700

2,55585028

10522

3,560

2,0751751

12

2,146

1609

169

2,61280

1,725349240411

1965estimate

35,50016,700

52,200-3,700

48,500

26,700-900

25,800

2,70088530

11022

3,747

2,140175212

2,212

19010

200

2,66583

1,800350255422


RECEIPTS 63

Table 13. SOURCES OF RECEIPTS (in millions of dollars)—Continued


1964estimate

1965estimate

ADMINISTRATIVE BUDGET FUNDS—Continued

Excise taxes—ContinuedManufacturers' excise taxes—Continued

Electric, gas, and oil appliances

Electric light bulbs _.Radio and television receiving sets, phonographs, phono-

graph records, and musical instrumentsMechanical refrigerators, quick-freeze units, and self-

contained air-conditioning unitsBusiness and store machinesPhotographic equipment

Matches _Sporting goods, including fishing rods, creels, etcFirearms, shells, and cartridgesPistols and revolversFountain and ballpoint pens, mechanical pencils. __

Total, manufacturers' excise taxes.

Retailers' excise taxes:Jewelry

FursToilet preparationsLuggage, handbags, wallets, etc

Total, retailers' excise taxes.

Miscellaneous excise taxes:Toll telephone service, telegraph and teletypewriter ser-

vice, wire mileage service, etcGeneral telephone serviceTransportation of personsTransportation of persons by airTransportation of freight by airFuel used on inland waterwaysJet fuelDiesel fuel used on highwaysUse tax on certain vehiclesAdmissions, exclusive of cabarets, roof gardens, etcCabarets, roof gardens, etcWagering taxes, including occupational taxesClub dues and initiation feesLeases of safe deposit boxes _

Sugar taxCoin-operated amusement and gaming devicesBowling alleys and billiard and pool tables

All other miscellaneous excise taxes

Total, miscellaneous excise taxes.

6836

232

6175254

241629

5,610

18229

15874

444

365516234

1139943406

717

1002052

1,620

7340

248

6670264

29172

10

6,002

19632

18078

486

380540106

12511047446

807

1022352

1,577

7844

283

7170284

35182

11

6,219

20534

20283

524

415585209888

471321155350

6858

10426

62

1,768




Description


Excise taxes—ContinuedUndistributed depository receipts and unapplied collections.

Gross excise taxes. _. ._ _Refunds:

Applicable to budget accounts _ _.Applicable to trust accounts

Transfer to Highway trust fund _ __

Net excise taxes

Estate and gift taxesRefunds

Net estate and gift taxes

CustomsRefunds _

Net customs

Miscellaneous receipts:Miscellaneous taxes _. _. _ _ _ _ _ _SeigniorageBullion charges

Fees for permits and licenses:Admission permits and fees . . _Business concessions _ _ _ _Immigration, passport, and consular feesPatent and copyright feesRegistration and filing feesLanding fees, airportsMiscellaneous fees for permits and licenses

Total, fees for permits and licenses

Fines, penalties, and forfeitures:Fines, penalties, and forfeitures—agriculture laws. _Fines, penalties, and forfeitures—customs, commerce,

and antitrust lawsForfeitures of unclaimed money and property-Proceeds from old series currency, act of June 30, 1961 _.Other fines, penalties, and forfeitures

Total, fines, penalties, and forfeitures

1963

66

13.410

- 8 9-126

-3.279

9.915

2.187- 2 0

2,167

1,241- 3 5

1,205

545

1

66

24982

46

101

2

411584

79

1964

-19

13,921

- 9 3-129

-3,478

10,221

2,360- 2 5

2.335

1.310- 3 5

1,275

5502

87

261682

16

82

1

426

4

35

1965

45

14.715

- 9 9-125

-3.504

10.987

2.765- 2 5

2.740

1,495- 3 5

1,460

555

1

337

282193

18

119

1

41

734

83


RECEIPTS 65


Description


Miscellaneous receipts—Continued

Interest:Interest on loans to Government-owned enterprisesInterest on domestic loans to individuals and private

organizationsInterest on foreign loans and deferred paymentsMiscellaneous interest collections

Total, interest _

Dividends and other earnings:Deposits of earnings, Federal Reserve SystemPayment equivalent to income taxesMiscellaneous dividends and earnings

Total, dividends and other earnings

Rents:Rent of landRent on Outer Continental Shelf landsRent of real property, not otherwise classifiedRent of equipment and other personal property

Total, rents

Royalties:Royalties on Outer Continental Shelf lands _ _ _ _Miscellaneous royalties on natural resourcesRoyalties on patents and copyrights

Total, royalties

Sale of products:Sale of timber and other natural land productsSale of minerals and mineral productsSale of power and other utilitiesSale of publications and reproductionsSale of miscellaneous products and byproducts

Total, sale of products

Fees and other charges for services and special benefits:Fees and other charges for administrative, professional,

and judicial services _ _Fees and other charges for communication and trans-

portation servicesCharges for subsistence, laundry, and health services

1963actual

499

9115718

765

8282210

860

143592538

437

7116

*

124

1619

18955

370

17

105

1964estimate

669

9516919

952

8801110

917

151742936

255

9122

132

17310

20966

404

21

115

1965estimate

583

10716722

880

9101611

937

162623333

343

10126

*

137

18510

22466

431

26

136

* Less than one-half million dollars.

700-000 <




Description


Miscellaneous receipts—Continued

Fees and other charges for services and special benefits—Con.Fees and other charges for services provided to the Dis-

trict of Columbia __ _ _Fees for general governmental servicesOther fees and charges

Total, fees and other charges for services and specialbenefits

Sale of Government property:Sale of real property.. . .Sale of equipment and other personal propertySale of scrap and salvage materials

Total, sale of Government property

Realization upon loans and investments:Repayments from States and other public bodiesRepayments of domestic loans to individuals and private

organizationsRepayment of foreign loansRepayment on miscellaneous recoverable costsMiscellaneous repayments on loans and investments

Total, realization upon loans and investments __

Recoveries and refunds:Recoveries under military occupationRecoveries of excess profits and costsRecoveries under foreign aid programs _Refunds of erroneous paymentsMiscellaneous recoveries and refunds

Total, recoveries and refunds

Gross miscellaneous receipts

Refunds. _

Net miscellaneous receipts

[nterfund transactions

Total, administrative budget receipts

1963actual

41361

110

1397352

263

467

187398

617

1,076

510

1545

26

200

4,436

-1

4,435

-513

86,376

1964estimate

61567

125

7522776

377

397

36108

715

563

465

635

35

155

4,054

- 1

4,053

-684

88,400

1965estimate

51578

142

75299101

474

193

49118

78

375

346

605

26

131

4.114

-1

4,113

-600

93,000


RECEIPTS 67


Description

TRUST FUNDS

Employment taxes:Federal old-age and survivors insurance trust fundFederal disability insurance trust fund.__Railroad retirement account _Unemployment trust fundRefunds

Net employment taxes. _

Unemployment tax deposits by States:Unemployment trust fund

Excise taxes:Highway trust fundRefunds

Net excise taxes

Federal employees and agency payments for retirement:Federal employees retirement funds

Interest on trust funds:Federal old-age and survivors insurance trust fundFederal disability insurance trust fundUnemployment trust fundRailroad retirement account _ _ _Federal employees retirement fundsHighway trust fundVeterans life insurance fundsIndian tribal fundsOther trust funds

Interest on trust funds

Veterans life insurance premiums, etc.:Veterans life insurance funds

Miscellaneous trust fund receipts:Military assistance advancesIndian tribal funds _ __District of Columbia __ _Other trust fund receipts... _.. .

Net miscellaneous trust fund receipts

Subtotal, trust fund receipts _

(nterfund transactions _ _

Total, trust fund receipts

1963actual

12.4791.005

572948

-143

14,862

3.009

3,405-126

3,279

1,878

51270

191105364

14210

83

1,477

494

95062

3411,842

3,195

28,193

-505

27,689

1964estimate

14,3531,062

617900

-155

16,777

2,900

3,607-129

3,478

1,959

52967

216132419

6209

83

1,589

501

99038

3672,051

3,446

30,651

-488

30,163

1965estimate

14,7001,089

682711

-186

16,996

2,825

3,629-125

3,504

1,923

55365

229134464

6207

83

1,669

499

1,29036

4252,183

3,934

31,349

-477

30,872


PART 4

THE FEDERAL PROGRAMBY FUNCTION

69


ANALYSIS OF FEDERAL ACTIVITIES BY FUNCTION

This part of the budget describes the recommended program ofthe Government for fiscal year 1965 in terms of the 12 major func-tions served.

These recommendations result from a critical review of prioritiesand costs. They provide for meeting the Nation's needs and respon-sibilities at home and abroad with a maximum of efficiency andeconomy.

Total Federal payments to the public in fiscal year 1965 are esti-mated at $122.7 billion. This includes not only expenditures in theadministrative budget but also outlays of Government trust funds,which finance such programs as social security and interstate high-way construction:

The $97.9 billion of administrative budget expenditures estimatedfor fiscal year 1965 is $0.5 billion below the estimate for the currentfiscal year. This has been accomplished despite growing workloads,increases in pay costs, and built-in and uncontrollable increases fora number of activities. Within the total, reductions have been madewherever possible, enabling selective increases for a number of domes-tic programs vitally needed to meet human needs and encourage eco-nomic growth.

About 80% of the estimated administrative budget expenditures in1965 will be devoted to our national defense, international, and spaceobjectives, and for veterans and interest payments which representthe continuing costs of the Nation's past wars. These activitiesrepresent a substantially smaller proportion of total Federal cash pay-ments, 63%, because most of the trust fund expenditures are relatedto other programs.

Of the remaining Federal payments to the public, more than three-fifths is for health, labor and welfare programs, primarily trust fundbenefit payments under old-age and survivors insurance, unemploy-ment insurance, and other retirement systems financed through spe-cial taxes.

In addition to the expenditures estimated in the 12 functional cate-gories, the budget includes special allowances, totaling $1.1 billion in1965, for programs to combat poverty, for civilian pay adjustments,and for contingencies.

Of this total, $250 million is provided as an allowance for expendi-tures under a new program to attack poverty in the Nation. Thesefunds will be used, in conjunction with funds from existing and else-where proposed legislation, as the resources for locally initiated com-munity action programs in urban and rural areas. Federal, State,

70


THE FEDERAL PROGRAM BY FUNCTION 71

and local programs—relating primarily to education and training,health, job opportunities, housing,, and welfare services—will befocused on the objective of striking at the root causes of poverty.Many of the other legislative proposals in this budget will also con-tribute to the attack on poverty, in particular the recommendationsfor improvements in education and youth employment opportunities.

The Federal agencies concerned are already giving special attentionto promoting the long run economic development of the Appalachianregion. A comprehensive program is now being planned jointly bythe various Federal agencies and the 10 States involved, which willinclude further Federal assistance in developing the economic base ofthe region.

An additional allowance of $544 million is provided in the expendi-ture estimate for 1965 for proposed legislation to make salary rates ofFederal civilian employees more nearly comparable with pay scalesin the private economy, along the lines recommended last year.Finally, an estimate of $300 million is included to cover contingenciesthat may arise during fiscal 1965.

NATIONAL DEFENSE

The very substantial investments which we have made to improveour military forces in recent years are proving their worth. TheNation has amassed forces which, in conjunction with those of ourallies, enable us to cope successfully with any intrusion into areas ofour vital national interest. Events have made clear to all our abilityto make swift, effective, and deliberate responses to acts of aggression,large or small, in any part of the world.

Along with these achievements have come important managementimprovements in the defense establishment which are resulting insubstantial cost reductions and related savings. Accordingly, in1965 we will be able to further strengthen our defense programs whileat the same time making significant reductions in total expenditures.National defense outlays are estimated to decline to $55.2 billion in1965 from the $56.0 billion estimated for fiscal year 1964.

Department of Defense.—Military expenditures of the Depart-ment of Defense are estimated at $51.2 billion in 1965, a decrease of$1.1 billion from the current year. New obligational authority of$50.9 billion is proposed for the Department, compared with $51.0billion for the current year.

This budget provides for further gains in combat effectiveness andcontinued maintenance of active forces in a high state of readiness.The reduction in defense expenditures is not based on any sacrifice inessential military capability. Instead, it reflects the diminishingneed fo# further large additions to force levels and stocks of supplies



NATIONAL DEFENSE

[Fiscal years. In millions]

Program or agency

Pay ments topublic

the

1963actual

1964estimate

1965estimate

Recom-mended

new obli-gationalauthorityfor 1965

Administrative Budget Funds:

Department of Defense—Military

Military personnel:

Present programsProposed legislation

Operation and maintenanceProcurementResearch, development, test, and evaluation.Military constructionFamily housingCivil defense.._Military assistanceRevolving and management funds

Subtotal, Department of Defense, military.Atomic energyDefense-related activities:

Stockpiling of strategic and critical materials.Expansion of defense productionSelective Service SystemEmergency preparedness activities

Subtotal, administrative budget.

Trust Funds:

Military assistance.Other

Subtotal, trust funds.

$13,000 $14,180

11,87416,6326,3761,144

427205

1,721-1 ,401

11,87016,3376,9431,107

680150

1,400-367

$14,499161

12,27814,7856,5801,056

660150

1,200-169

$14,597172

12,39613,7566,7221,168

711358

1,000

49,9732,758

22-57

3425

52,3002,800

161263718

51,2002,735

17- 3 8

4223

50,8802,693

4318

52,755 55,297 53,979 153,652

6745

8607

1,2256

1,3256

679 867 1,231 1,331

Intragovernmental transactions and other adjustments(deduct) 153

Total. 53,429 56,011 55,211

1 Compares with new obligational authority for 1963 and 1964 as follows:Administrative budget funds: 1963, $54,323 million; 1964, $53,837 million.Trust funds: 1963, $892 million; 1964. $1,689 million.

and equipment. It also reflects a stringent screening of existingand proposed programs, and increasing economies under the Depart-ment's cost reduction program. Savings achieved in 1963 under thecost reduction program totaled over $1 billion. Further actions thisyear and in fiscal 1965 are expected to raise the*rate.of ultimateannual savings to $4 billion.



The estimated strength and composition of the active forces at theend of fiscal year 1965 compared with the 2 preceding years and with1961 are shown in the accompanying table.

SUMMARY OF ACTIVE FORCES

DescriptionActual,

June 30,1961

Actual,June 30,

1963

Estimated

June 30,1964

June 30,1965

Military personnel (in thousands):

Army

Navy

Marine Corps

Air Force

Total, Department of Defense

Selected military forces:Strategic retaliatory forces:

Intercontinental ballistic missiles (squadrons):Minuteman

TitanAtlas

Polaris submarinesStrategic bombers (wings):

B-52 ___.B-58B-47

Continental air and missile defense forces:Manned fighter interceptor squadrons

Interceptor missile squadrons (BOMARC)Army air defense missile battalions A

General purpose forces:Army divisions (combat ready)Army surface-to-surface missile battalionsArmy air defense missile battalions. Ârmy special forces groupsWarships:

Attack carriersAntisubmarine warfare carriersNuclear attack submarinesOther

Amphibious assault shipsCarrier air groups (attack and ASW)Marine Corps divisions/aircraft wingsAir Force tactical forces squadrons

Airlift and sealift forces:Airlift aircraft (squadrons):

C-130 through C-141C-l 18 through C-l 24

Troopships, cargo ships, and tankers

858627177820

2,482

45

131

20

427

26%3

15913

328110283

93

163599

975664190869

972670190855

2,698 2,687

27

1312

142

13

428

31/ 2

16

15916

326132283

109

2631101

12121322

14210

408

26/2

163831%7

159

23320133283

110

342799

974678190839

2,681

16129

32

1425

406

163832%7

159

27325135283

113

38)799

A Decrease reflects phaseout of Nike-Ajax and transfer of Nike-Hercules battalions to ArmyNational Guard.



The financial requirements of the Department of Defense can bestbe described in terms of the total obligational availability proposedfor each of the major military programs. Total obligational availa-bility for any year is the sum of new obligational authority grantedby the Congress for that year plus obligational authority granted inprior years which is not required to complete prior }êar programs.

SUMMARY OF THE DEPARTMENT OF DEFENSE BUDGET PROGRAM[Fiscal years. In billions]

Major military programs

Total obligational availability

t963 1964 1965

Strategic retaliatory forcesContinental air and missile defense forces

General purpose forcesAirlift and sealift forces ___

Reserve forcesResearch and development (not included elsewhere) _General support _ _

Retired payCivil defenseMilitary assistanceProposed legislation - _

$8.41.9

17.91.41.85.1

13.11.0.1

1.6

$7.31.9

18.21.32.05.4

13.91.2.1

1.1

$5.31.8

18.51.42.05.5

14.81.4.4

1.1.2

Total obligational availability.Of which:

New obligational authorityPrior year funds

52.2

51.1

52.5

51.01.5

52.4

50.91.5

Strategic retaliatory forces.—Our strategic retaliatory forces nowconsist of more than 600 operational long-range ballistic missiles—Atlas, Titan, Minuteman, and the submarine-launched Polaris—together with a SAC bomber force of about 1,000 aircraft, includingthose on air alert training missions and about 500 on quick-reactionground alert. The present and planned forces are, and will con-tinue to be, vastly superior to the Soviet nuclear force. Most of theland-based missile force has been hardened and dispersed so that,with the highly invulnerable Polaris force at sea and the continuouslyalerted strategic aircraft, we are clearly capable of destroying anaggressor even if forced to absorb a surprise first strike.

Under these conditions, further substantial numerical increases inour strategic forces above those already planned would soon be ofdiminishing value. The 1965 budget provides for another incrementof an improved type of Minuteman missile, bringing to 1,000 thenumber of Minutemen approved through fiscal 1965. In addition,emphasis is being placed on improving the effectiveness of the stra-



tegic missile and bomber forces and their responsiveness to commandauthority.

The 1965 budget provides for an extensive missile improvementprogram, modifications to earlier versions of the Minuteman andPolaris missiles to increase their range and versatility, and a spe-cial modification program for the B-52 manned bomber designed toensure the continued effectiveness of this aircraft in future years.The 1965 budget also provides for further development and procure-ment of postattack command and control systems, continued researchon advanced ICBM systems, and design studies on intercontinentalstrike aircraft.

Total obligational availability for the strategic retaliatory forcesin 1965 is estimated to decline by $2.0 billion from 1964. The reduc-tion is possible mainly because funding for the planned fleet of 41Polaris submarines is being completed in 1964 and fewer additionalMinuteman missiles are included for 1965. Savings will also resultfrom the continued phase-out of the B-47 medium bomber force andof the older, unprotected Atlas missiles, which are particularly expen-sive to maintain.

Continental air and missile defense forces.—Our continental defenseforces are intended to provide warning of attack, to defend commandcenters and retaliatory forces, and to reduce casualties in the popula-tion and damage to industry. Total obligational availability forthese forces in 1965 is estimated to decline by $0.1 billion from 1964.

The strategic threat to the United States is shifting from mannedbombers to ballistic missiles. Moreover, a larger portion of the Sovietmissile forces is being deployed in submarines at sea or otherwiseprotected. Accordingly, the 1965 program provides for continueddevelopment work on a priority basis for the Nike X antimissilesystem along with continued exploration of advanced antiballisticmissile defense concepts. Research will also proceed on variousmissile warning and space surveillance systems.

The vulnerability of our defenses against bomber attack will bereduced by the further dispersal of interceptor aircraft and Nike-Hercules surface-to-air missile batteries, as well as by the furtherprogress expected in improving the survivability of control systemsfor interceptors. The Ballistic Missile Early Warning System willcontinue to provide notice of missile attack.

General purpose forces.—In the past several years there has beena great improvement in the ground, sea, and air forces designedprincipally for limited war, and the Nation now possesses the kindsof forces needed to deal with such a contingency. These expandedcapabilities have been achieved not only by increases in the size ofour forces, but also by a buildup of combat stocks, increases in mobility



and readiness, and by modernization of the weapons inventory. Thegap which once existed between requirements for equipment andsupplies and actual inventory levels has already been significantlynarrowed, and the 1965 budget provides for further gains. Totalobligational availability for the general purpose forces is estimatedat $18.5 billion in 1965, $0.3 billion more than in 1964.

The funds provided in this budget will maintain the present 16Army divisions and the 3 Marine division/aircraft wings, and willprovide for continued testing of an air assault division concept.Army and Marine Corps inventories of modern combat weapons andequipment, including aircraft, missiles, and helicopters, will be furtheraugmented.

The Navy general purpose force program provides for the con-struction of 47 new ships, including 6 nuclear attack submarinesand a submarine tender, 16 destroyer escorts for antisubmarinewarfare, 7 fleet support ships, 10 amphibious assault ships, and 1destroyer tender. Including all major programs, this budget pro-vides for construction of 53 new ships and 7 major conversions.

The 1965 budget also provides for further procurement of both thefighter and reconnaissance versions of the modern F-4 aircraft forthe Navy and Air Force; development and production of the VAL, anew Navy light attack aircraft; construction of tactical aircraftshelters in overseas areas; and procurement of additional conventionalordnance and equipment. Development of the advanced F - l l ltactical fighter aircraft for the Navy and Air Force will continue in1965.

Airlift and sealift forces.—Modernization and expansion of the air-lift forces during the past several years have greatly increased ourability to deploy forces rapidly to trouble spots all over the world.A dramatic example of this was operation "Big Lift," in which thepersonnel of a combat-ready Army division were airlifted from Texas toWest Germany in 63 hours and united with prepositioned equipment.

Total obligational availability of $1.4 billion estimated for thisprogram in 1965 is $0.1 billion more than in 1964. The 1965 budgetprovides for procurement of additional C-141 jet transports, procure-ment of a cargo ship designed for rapid loading and unloading ofmilitary equipment, and modernization of two tankers. In addition,funds are provided for a continuation of the program of large-scaleairlift exercises, and for initial design studies on a new jet cargo air-craft.



Reserve forces.—To the extent that the reserve components of theArmy, Navy, Marine Corps, and Air Force can respond in a timelymanner, the need for active forces is lessened. The major reorgani-zation of the Army Reserve and Army National Guard instituted lastyear has helped to increase the readiness and potential combateffectiveness of these forces.

In 1965, total obligational availability to support these forces isestimated at $2.0 billion.

RESERVE AND NATIONAL GUARD PERSONNEL

Component

Army Reserve _Army National Guard _

Naval Reserve

Marine Corps ReserveAir Force Reserve

Air National Guard

Total

Actual

June 30,1963

236,985360,714119,61146,25758,60774,325

896,499

Estimated

June 30,1964

264,000376,000126,00045,50061,00075,000

947,500

June 30,1965

285,000395,000126,00045,50061,00075,000

987,500

The paid drill training strength of the Army reserve componentsauthorized and programed for the end of fiscal years 1963 through1965 is 700,000. However, it is estimated that the strengths whichcan actually be attained in 1964 and 1965 are below this amount, aswas the case in 1963. The funds provided in this budget wouldsupport the lower levels anticipated.

Research and development.—Total obligational availability proposedfor this program category, which includes all research and develop-ment of weapons and other systems not included in the other programcategories, is $5.5 billion, $0.1 billion more than in 1964. Work willbe completed on a number of systems and will be canceled on someother programs, such as the Dynasoar manned spacecraft project.The Dynasoar project will be replaced by a broader and more prom-ising program for exploring problems and potentials of manned mili-tary operations in space, including development of a manned orbitinglaboratory.



General programs of basic research and exploratory development,which provide the building blocks for future weapons, will continueto be expanded in 1965. Projects included in the 1965 program rangefrom weapons for guerrilla warfare to sophisticated space programs.Examples are: the Titan III, a large booster rocket for the spaceprogram; the Nike X ballistic missile defense system; vertical takeofffighter and transport aircraft; penetration aids for our ballisticmissiles; antisubmarine warfare weapons; and the Medium-RangeBallistic Missile.

General support.—This program includes all costs which cannot beallocated meaningfully among the other major programs, such as thefinancing of individual training and education, communications, theNational Military Command System, logistic support, medicalservices, military housing, command operations, and certain otherdepartmentwide activities. Much of this program is influenced byother program decisions; for example, the costs of medical care andrecruit training are directly related to the size of the military forces.Total obligational availability required for this program in 1965 is$14.8 billion, compared with $13.9 billion in 1964. This increaseresults from military and civilian pay increases required by law andhigher costs for such functions as the Defense Atomic SupportAgency and Army communications.

Funds are provided for determining the effects of undergroundnuclear weapons tests and for maintaining readiness to test in theatmosphere in case of violation of the limited nuclear test ban treaty.

Civil defense.—An effective civil defense program is an importantelement of our total defense effort. It aims at the achievement of anationwide fallout shelter system. The 1965 program is based onenactment of legislation similar to that proposed last year to provideFederal assistance for fallout shelters in public buildings, schools,hospitals, and other nonprofit institutions. Total obligational availa-bility of $0.4 billion is proposed for the civil defense program for 1965,compared with $0.1 billion in 1964.

The 1965 program also provides for continued work on systems towarn the population of an attack, equipment for monitoring the levelof radioactivity, construction of protected regional centers for emer-gency governmental operation, training and education for emergencypreparedness, research and development, financial assistance to States,and procurement of provisions for fallout shelter spaces. The nation-wide shelter survey, under which 104 million spaces have already beenidentified, will continue.


THE FEDERAL PROGRAM BY FUNCTION 7 9

Military assistance.—The military assistance program is based onthe recognition that the security of the United States is interdependentwith that of the rest of the free world. In the 1965 budget, funds formilitary assistance have been included under the Department ofDefense, reflecting a new emphasis on closer coordination betweenthis program and the Department's other regular missions.

Under the military assistance program, equipment, training, andrelated services are provided for the armed forces of more than 60allied and friendly nations. The program also helps to maintain ouraccess to overseas bases, which allows optimum deployment of ourown military forces. To replace the forces of our allies with com-parable and similarly deployed American troops and facilities wouldcost us much more in terms of both manpower and expenditures.

The Western European nations in the North Atlantic TreatyOrganization now supply almost all the financial support for theirown military forces and also provide- military assistance to others.Continuing military assistance from the United States to theseEuropean countries is limited to the fulfillment of prior commitmentsand a modest amount of training, essential to the attainment of U.S.objectives. Today, in response to the changing nature and directionof the Communist threat, approximately 70% of the total programgoes to nine key countries on the periphery of the Soviet Union andCommunist China—Greece, Turkey, Iran, India, Pakistan, Thailand,Vietnam, arid the Republics of China and Korea.

In the less developed nations of Latin America and Africa, ourmilitary assistance is directed primarily toward strengthening internalsecurity and helping indigenous forces in civic action projects.

Recommended total obligational availability for the military assist-ance program in 1965 is $1.1 billion, the same as in 1964.

Proposed legislation.—-Further adjustments will be needed in militarycompensation rates to keep military pay abreast of changes in payscales in the private economy. To cover the costs of these adjust-ments, the budget includes $143 million of new obligational authorityfor 1965, on the assumption that the Congress will enact the necessarylegislation in time for it to become effective on October 1, 1964.

The Congress is again requested to enact legislation to:• Provide comparable subsistence standards among the militaryservices by establishing a single, uniform ration.• Modernize and make more uniform the statutes of militaryservices governing various aspects of officer career management inorder to aid in attracting and retaining qualified officer personnel.



• Authorize the military departments to offer an elective 2-yearReserve Officer Training Corps course leading to a commission inaddition to the presently authorized 4-year program.• Revise the present system for appointments to the Military,Naval, and Air Academies to provide more equitable opportunitiesfor those wishing to enter these schools.• Authorize disposal of the Government-owned communicationsfacilities in Alaska to private enterprise for operation and de-velopment under appropriate regulatory supervision.

Atomic energy activities.—Expenditures by the Atomic EnergyCommission in 1965 are estimated to be $2.7 billion, down $65 millionfrom 1964. Increases for research and development programs forpeaceful uses of atomic energy will be more than offset by a reductionof $126 million in the procurement of uranium concentrates and theproduction of special nuclear materials. The lower rate of productionof these materials (plutonium and enriched uranium) is consistentwith anticipated military and civilian requirements arrived at follow-ing extensive review by the Atomic Energy Commission and theDepartment of Defense.

Nuclear weapons.—Expenditures for the development and produc-tion of nuclear weapons in 1965 will remain at the levels attained in1964. Underground testing of nuclear weapons will continue in1965, along with preparations to achieve and maintain readiness toresume testing in the atmosphere, in the event that the limited nucleartest ban treaty is terminated.

Peaceful uses of atomic energy.—Expenditures in 1965 for the de-velopment of civilian nuclear power are estimated at $234 million, anincrease of $5 million from 1964. Increased emphasis will be placedon reactors which produce more fuel than they consume ("breeders"),and efforts will be continued to develop certain other advanced re-actors. However, there will be a decline in Federal expenditures forestablished types of light water-cooled reactors which are now cominginto increasing use in private utility systems. Continued emphasiswill be given to the nuclear safety program, including constructionof a third experimental facility.

Programs to develop the use of nuclear energy in space explorationwill be continued in 1965. Work will continue on the SNAP programto develop compact nuclear electric power units for satellites and spacevehicles, with particular emphasis on units fueled by radioisotopes.



The Kover nuclear rocket program will be reoriented to ground-based research and engineering, with deferral of flight objectives.

There will be continued growth in 1965 in basic research in thephysical and biomedical sciences. Particularly noteworthy in thephysical sciences program will be the start of construction of theworld's finest research reactor at Argonne National Laboratory nearChicago, which will serve many scientific disciplines. Researchactivities in the biomedical sciences will grow in several areas, in-cluding fallout studies.

Work on the peaceful application of nuclear explosives underProject Plowshare will be concentrated in 1965 on the developmentof suitable devices for excavation purposes.

Defense-related activities.—Expenditures for the various defense-related activities of agencies other than the Department of Defenseand the Atomic Energy Commission are expected to decline by $153million in 1965. The decrease is in defense production activities, re-flecting proposed legislation to eliminate requirements for furtherinterest payments on borrowings from the Treasury for certain pre-vious investments in defense production programs.

Expenditures for the Selective Service System are estimated to riseby $5 million in 1965 due to a more than one-third increase in regis-tration and classification workloads, as larger numbers of young menreach age 18 and become subject to registration. Special proceduresare planned to provide for examination of 18-year-olds as part of anational effort to help identify and overcome the disabilities whichresult in rejection of so many of our youth for service in the ArmedForces.

INTERNATIONAL AFFAIRS AND FINANCE

The international activities of the U.S. Government foster under-standing by educational, cultural, and economic exchange with othernations, and by providing information about this country and itsobjectives. They also promote world stability by supplying thecritical margin of economic resources and technical knowledge thatwill help developing nations to attack poverty and discontent, advancetoward economic independence, and maintain their political integrity.

New obligational authority of $3.6 billion is requested for inter-national affairs and finance activities for 1965, an increase of about$600 million over 1964. Administrative budget expenditures areestimated to be $2.2 billion in 1965, about $200 million less than in1964. This reduction primarily reflects greater anticipated sales ofcertificates of participation by the Export-Import Bank.

700-000 <



INTERNATIONAL AFFAIRS AND FINANCE


Program or agency

Payments to thepublic

1963actual

1964estimate

1965estimate

Recom-mended

new obli-gational

authorityfor 1965


Economic and financial programs:

Agency for International Development:Development loansDevelopment grantsAlliance for ProgressSupporting assistanceContingencies and other

SubtotalInternational financial institutionsPeace CorpsExport-Import BankFood for Peace (Public Law 480, title II)Other

Foreign information and exchange activities:U.S. Information AgencyDepartment of State

Conduct of foreign affairs:

Department of StateU.S. Arms Control and Disarmament AgencyTariff CommissionForeign Claims Settlement Commission

Subtotal, administrative budget

Trust Funds... „

Intragovernmental transactions and adjustment for netcash issuances or withdrawals by international financialinstitutions (deduct)

Total

$760245260494284

$790230325415340

$850225405335335

2,04312242

-39221610

15546

340231

2,10011273

-65024616

16074

2827323

2,1506290

-85624416

17256

2839319

2,588 2,447 2,248

44 86 99

390 81 -30

2,242 2,452 2,377

$925225550335357

2,392268115

26412

17654

2941132

13,591

M30

1 Compares with new obligational authority for 1963 and 1964, as follows:Administrative budget funds: 1963, $5,693 million; 1964, $2,994 million.Trust funds: 1963, $34 million; 1964. $68 million.

Agency for International Development.—The Agency for Inter-national Development administers and coordinates economic assist-ance programs in less developed countries where political stability,resistance to aggression, or accelerated economic or social progress isof importance to the United States. Expenditures for these programsare estimated to be $2.2 billion in 1965, an increase of $50 million over



1964. New obligational authority of $2.4 billion is requested for AIDfor 1965. This will make the total 1965 obligational availabilityequivalent to the amount provided for 1964 including unobligatedfunds carried forward from the prior year.

In determining the allocation of its funds, the Agency for Inter-national Development is carefully weighing U.S. objectives and apply-ing increasingly rigorous standards in evaluating recipient countryperformance and the availability of funds from other sources. Pro-curement procedures insure that more than 80% of AID commit-ments now finance procurement of goods and services produced inthe United States. Improved management will help the Agency toreduce its employment by 800 during 1965.

Agency (or International Development - Program Trends

| j | l | | | | | | Loans as a Percent of Total Assistance jj j j j | Percent of Total Goods Financed11111111 l l l i and Purchased in U.S.

Development loans and grants.—Increasingly, our commitments fordevelopment assistance are focused in a relatively small number ofcountries which are displaying the serious discipline essential toeconomic development; in such instances, we are attempting to en-courage and sustain the acquired momentum by providing long-termassistance on favorable terms until alternative sources of financingbecome available. Where evidence of the necessary discipline doesnot exist, our assistance is being reduced or withheld.

The bulk of our long-term assistance is in the form of loans repayablein dollars. Expenditures for loans are estimated to rise in 1965 by$60 million. Complementing these loans is technical assistance fi-nanced primarily through development grants. This assistance helpsprovide the human skills, education, and institutions that are basicto social and economic progress. Expenditures for such grants are



estimated at $225 million in 1965, approximately the same amountas estimated for 1964.

Alliance for Progress.—The principles of social and economic reform,which underlay the creation of the Alliance for Progress less than 3years ago, are taking root in the countries of Latin America. Thougheconomic and social change occurs only slowly, these countries areable to use our development assistance more effectively with eachpassing year. To encourage and accelerate passage of these countriesthrough the crucial early stages of progress, Alliance for Progressdevelopment assistance is being concentrated in those countrieswhich show evidence of adopting internal policies conducive toeconomic development.

This budget includes new obligational authority of $550 million forthe Alliance for 1965. In addition, the lending capacity of the Inter-American Development Bank will be augmented, and resources willbe provided through the Export-Import Bank, the Food for Peaceprogram, and the Peace Corps. Together, these funds will enable usto maintain our current level of contribution and will fulfill our com-mitment to progress in this hemisphere.

Other AID programs.—Our foreign assistance program provides sup-porting assistance grants where necessary to maintain political andeconomic stability in critical areas of the world, and to meet certainother security objectives. Expenditures for supporting assistance in1965 will be $335 million, $80 million less than in 1964, as more coun-tries become able to use development loans instead of grants.

In 1965, the Agency for International Development will continueto make voluntary contributions for international programs whichcomplement our long-range bilateral efforts, such as the United Na-tions Special Fund and Technical Assistance program and the IndusBasin Development program administered by the International Bankfor Reconstruction and Development.

Other economic and financial programs.—To advance furtherthe concept of partnership on which the Alliance for Progress is based,the United States is proposing to strengthen and expand the activitiesof the Inter-American Development Bank. Legislation will be pro-posed for the enlargement of the resources of the Bank used for long-term, low-interest loans, under arrangement subject to negotiationswith the Bank's members.

The new obligational authority recommended for 1965 for inter-national financial institutions includes $206 million as the first install-



ment of a $412 million increase in the U.S. subscription to callablecapital stock of the Inter-American Development Bank. No expend-iture is contemplated under this increase, but the move will facilitatethe Bank's issuance of its securities in financial markets in the UnitedStates and abroad.

The fifth and final installment of $62 million also requested in thisbudget for the International Development Association fulfills ourinitial pledge to finance, along with 15 other industrial countries,the development loans provided on favorable terms by this institution.An authorization request of $312 million is now pending before theCongress for U.S. participation in a second round of pledges, recentlynegotiated; the first expenditure under the new pledge will not berequired until fiscal year 1966.

Continuing its efforts to increase U.S. exports, the Export-ImportBank will expand its loans to foreign borrowers for the purchase ofU.S. exports and also its guarantees of the private financing of U.S.exports. Under the Bank's highly successful arrangement with therecently formed Foreign Credit Insurance Association, more than 70private insurance companies participate in insuring a rapidly growingvolume of private U.S. export financing against both commercial andpolitical risks. In 1965, the Bank is expected to have net receiptsof $856 million, about $200 million more than in 1964, reflectingprimarily an increase in the sale to private buyers of certificates ofparticipation in its portfolio.

In recognition of the growing overseas demand for the services ofPeace Corps volunteers and the continued increase in applicationsfor service in the Corps, the number of volunteers is expected torise from 10,500 in 1964 to 14,000 in 1965, requiring an estimatedincrease in expenditures of $17 million over the current year's level.

Grants of surplus agricultural commodities under the Food forPeace program are distributed for disaster relief and also made avail-able to support economic development projects. This part of theprogram provides milk and other nutritious foods to millions of schoolchildren around the world and makes possible more adequate diets forworkers on development projects. It is expected to continue in1965 at about the same level as in 1964.

Foreign information and exchange activities.—Primary re-sponsibility for improving mutual understanding with other countriesand for informing them about our aims and attitudes rests with theDepartment of State and the. United States Information Agency.

Expenditures for the exchange activities of the Department ofState are estimated to decline by $18 million in 1965, reflecting pri-



cnarily a nonrecurring grant of $25 million in the previous year for theestablishment of a Japan-America Foundation. The quality andimpact of educational and cultural exchange activities will beimproved.

The United States Information Agency will carry forward its pro-grams in 1965 with no increase in personnel. Nevertheless, theAgency will continue to expand and improve its television program-ing for Latin America, its radio broadcasts to Africa, and its world-wide motion picture activities.

Attention will be devoted to informational materials in support ofcounterinsurgency efforts in certain Far East countries. New obliga-tional authority is being requested for 1965 to complete one new Voiceof America radio facility and to modernize another.

Conduct of foreign affairs.—The Department of State continuesto face increasingly complex foreign affairs responsibilities. Fouryears ago, diplomatic and consular posts were maintained in 82countries; today they are maintained in 111 countries. As more newnations gain their independence, this upward trend will continue.Other workloads are also expected to rise. For example, in 1965 a10% increase over 1964 is expected in the number of passports andnonimmigrant visas issued.

Nevertheless, employment levels and total expenditures for theDepartment's conduct of foreign affairs are estimated to be virtuallythe same in 1965 as in 1964. While increased expenditures are esti-mated for support of the Foreign Service, including improved com-munications and needed office and housing facilities overseas, theywill be offset by a decrease in contributions to international organi-zations.

The budget includes amounts to pay the costs of U.S. membershipin the United Nations and other international organizations whichare vital elements in the multilateral approach to peace, stability,and progress. During the past year, new arrangements were approvedby the General Assembly, which reduce the U.S. share of U.N. peaceand security costs; the estimates in this budget are based on thosearrangements.

The U.S. Arms Control and Disarmament Agency, while makingsmall reductions in its staff, will expand its contract research programin 1965. Its main work will continue to be the research needed forthe formulation and presentation of U.S. positions at internationaldisarmament meetings.

Expenditures of the Foreign Claims Settlement Commission areestimated to be unusually high in fiscal years 1964 and 1965 because



of special payments of war claims to the Philippines. These pay-ments are scheduled for completion in December 1964.

SPACE RESEARCH AND TECHNOLOGY

The programs of the National Aeronautics and Space Administra-tion are designed to maintain American supremacy in space and todemonstrate this supremacy by achieving a manned landing on themoon in this decade. Besides manned space flight these programsinclude the exploration of space by unmanned spacecraft; the develop-ment of satellite technology for meteorological, communications, andother applications; and the advancement of basic research and tech-nological development on which both our aeronautical and space effortsdepend.

SPACE RESEARCH AND TECHNOLOGY[Fiscal years. In millions]

Program


Manned space Right _ _Unmanned investigations in spaceMeteorology, communications, and other space applica-

tions _ _ _ _Other research, technology, and supporting operations

Subtotal, administrative budget.Trust Funds

Total . _ . .

Payments topublic

1963actual

$1,533484

90445

2,552

2,552

1964estimate

$2,898645

105752

•4,400*

4,400

the

1965estimate

$3,370670

97

853

4,9902

4,992

Recom-mended


$3,580

733

98893

* 5.304*

15,304

*Less than one-half million dollars.1 Compares with new obligational authority for 1963 and 1964 as follows:

Administrative budget funds: 1963, $3,673 million; 1964, $5,241 million.Trust funds: 1963, $1 thousand; 1964, $2 million.

A total of $5.3 billion in new obligational authority for 1965 isrecommended to support these programs. In addition, a supple-mental appropriation of $141 million is requested for 1964, to regainin part the slippage in the manned lunar landing program resultingfrom reductions in 1964 appropriations below the amount requestedin the budget. The amount requested for 1985 is $63 million morethan the amount now estimated for 1964. This is a smaller increasethan in any year since this Nation launched its space program, made


THE BUDGET FOR FISCAL YEAR 1965

possible by a detailed review of all requirements, careful allocation ofresources, and improved program management over the past year.

Expenditures for the space program in 1965 are estimated at slightlyless than $5.0 billion, which is $590 million more than the estimatefor 1964. The increase is mainly to fulfill obligations already incurred,as payments are made for equipment, facilities, and services contractedfor in prior years and delivered in 1965.

Manned space flight.—Manned space flight activities, which accountfor over two-thirds of the budget of the National Aeronautics andSpace Administration, are focused on the top priority objective ofachieving a manned lunar landing in this decade. The launch vehicle,spacecraft, and supporting development programs required to meetthis objective will provide the broad technological capability forengaging in other space activities in the years ahead.

Reductions in the appropriations for 1964 from the amounts re-quested have delayed initial flight testing in the Saturn and Apolloprograms. These reductions will be partially offset by the proposed1964 supplemental appropriation. Other steps, such as a cutbackin the number of planned flights and adoption of a new approach oftesting complete space vehicles—instead of testing separate stages-will help to make up the delays in meeting the goal of landing menon the moon.

The level of activity in support of the 3-man Apollo lunar space-craft development program will reach its peak during 1965 with 13flight spacecraft in production by the end of the year. The Saturn Vrocket program will be proceeding rapidly along its development cyclein preparation for launching the Apollo spacecraft, and will accountfor about $850 million of the estimated 1965 expenditures. Thisrocket, standing 37 stories high, will be able to place in orbit a pay-load about 10 times heavier than that of the Saturn I, the largestrocket known to be in existence today.

The Saturn I first stage has successfully flown four times in fourattempts. With the addition of a high-energy upper stage, largepayloads will be orbited in 1965 to pave the way for manned Apolloflights. By the end of the year, the Saturn IB rockets, which willlaunch the manned Apollo spacecraft for earth orbital flights, will beundergoing acceptance testing in preparation for delivery to the JohnF. Kennedy Space Center for initial flight tests.

Manned flights of the 2-man Gemini spacecraft will be conductedduring 1965 to add to the Nation's store of spaceflight experience andto continue the training and preparation of astronauts for flights tothe moon.



Unmanned investigations in space.—Unmanned investigations inspace will continue in 1965 by means of large observatory satellitesable to conduct a variety of experiments. These satellites are themost economical for the amount of scientific data collected in relationto the number of spacecraft launched. As further economy measures,the number of observatory satellites ordered has been trimmed tomeet optimum production schedules, and incentive contracting hasbeen instituted.

Unmanned explorations of the moon preparatory to manned land-ings will be continued with additional flights of the Ranger spacecraft,which will televise the moon's surface as it approaches. Emphasiswill be placed on the development of the more advanced Surveyorspacecraft, which can "soft land" instruments on the moon, nowthat the liquid hydrogen fueled Centaur upper stage rocket has under-gone a successful flight test. The first Surveyor flights are scheduledfor 1965. Development of the Lunar Orbiter Spacecraft, which willexamine the surface of the moon from lunar orbit, will also moveforward.

Mariner space flights, one of which was so successful in exploringthe planet Venus, will be continued for investigations of the planetMars, with the next flight scheduled to take place during fiscal 1965.

Meteorology, communications, and other space applications.—Addi-tional research and development flights using the successful Tiros



spacecraft will be conducted in 1965 in support of the operationalmeteorological satellite system of the Weather Bureau. Experimentswith the larger Nimbus satellite will be continued.

In the communications field, Relay and Syncom satellites will bein orbit during the coming year for civil and military experiments.The Relay low-altitude satellite can receive and retransmit televisionand telephone signals from one ground station to another as it movesaround the earth. The Syncom high-altitude satellite is placed inorbit above the earth so that it is synchronized with the earth'sspeed and stays directly over the same spot on the earth's surface.

Development of a new advanced satellite for experiments in spacetechnology related to a variety of space applications, such as communi-cations, meteorology, and space science, will be continued in 1965.

Other research, technology, and supporting operations.—The support-ing programs on which space operations and long-term improvementsin the space program depend will continue in 1965. These programsinclude the NASA worldwide tracking system, research and develop-ment in aeronautics and space technology, and support of collegeand university programs in the space sciences, including the trainingof candidates for advanced degrees.

AGRICULTURE AND AGRICULTURAL RESOURCES

Agricultural productivity continues to increase. Total farm outputin calendar year 1963 was 12% above the 1957-59 average and repre-sented a new record high for the sixth consecutive year. Althoughthe rise in crop output since 1960 has been limited by acreage reduc-tions under the feed grain and wheat programs, rising yields for theseand other crops have accompanied such reductions. Crop harvestsin 1963 were greater than in 1960, despite the 5% decline in the acreageused for crops and an 11% reduction in total agricultural man-hours.Nonetheless, during the past 2 years the carryover of wheat has beencut from a high of 1.4 billion to 1.2 billion bushels and the carryoverof feed grains from 85 million to 62 million tons.

The longrun upward trend, in agricultural productivity has con-tributed heavily to the Nation's economic growth. But it is also afactor contributing to the current unsatisfactory incomes of manyof our farmers and the continued high budgetary costs of our farmprograms. While too large a part of our productive resources is stilldevoted to agriculture, we have derived important advantages from theresulting excess farm production by using agricultural commodities toraise the level of living of low-income people in our own Nation and toprovide needed food assistance to people of other nations. Farm



AGRICULTURE AND AGRICULTURAL RESOURCES


Program or agency


1963actual

1964 1965

Recom-mended

new obli-gational

authorityfor 1965

Administrative Budget Funds:Farm income stabilization and Food for Peace:

Price support, supply, and purchase programs:Present programsProposed legislation

National Wool ActFood for Peace (Public Law 480, titles I, III, and IV)..International Wheat Agreement.Transfer of commodities to supplemental stockpileRemoval of surplus agricultural commoditiesConservation reserve and cropland conversion:


Sugar ActOther .'

$2,857

631,824

74100112

309

77102

SubtotalFinancing rural electrification and rural telephones:


Financing farming and rural housing:Farmers Home Administration:


Farm Credit AdministrationAgricultural land and water resources:

Soil Conservation ServiceAgricultural conservation program payments (in-

cluding CCC loan)Other __.

Research and other agricultural services:Present programs.,Proposed legislation for inspection fees

5,517

342

296

4

182

2193

391


Trust Funds (mainly federally sponsored farm credit insti-tutions)

6,954

507

Intragovernmental transactions and other adjustments(deduct)

Total

194

7,266

$1,480

792,168

10186

271

3143393

120

$1,540- 2 3 0

551,676

81174

2104288

114

4,746

388-169

280

- 1

192

2215

409

3,750

394-178

86431

198

2205

433- 4 5

6,070 4,907

475 442

205 283

6,340 5,065

$1,124

1,95132

120174

2084088

122

3,938

440- 3 4 7

54103

3

204

225

443- 4 9

15,014

128

'"Less than one-half million dollars.1 Compares with new obligational authority for 1963 and 1964, as follows:

Administrative budget funds: 1963, $7,070 million; 1964, $6,385 million.Trust funds: 1963, $25 million; 1964, $28 million.



legislation designed to improve our present farm programs and pro-mote more effective use of present rural resources will be proposed tothe Congress early in this session.

Payments to the public for agricultural programs in 1965 are esti-mated at $5.1 billion, down $1.3 billion from 1964. The reductionreflects mainly substantial declines in anticipated expenditures for(1) farm price support and Food for Peace programs financed by theCommodity Credit Corporation, (2) the rural housing loan programof the Farmers Home Administration, and (3) the meat, poultry, andgrain inspection programs. Part of the reduction is also the resultof increased efficiency and reduced personnel requirements. Depart-ment of Agriculture employment is estimated to decline from 116,800at the end of 1964 to 115,376 by the end of the fiscal year 1965.

Farm income stabilization and Food for Peace.—Expenditures forfarm income stabilization and Food for Peace, accounting for 74%of total payments for agriculture and agricultural resources, areestimated to be $996 million less in fiscal year 1965 than in 196 4.Most of the decrease results from (1) estimated lower unit costs ofagricultural commodities, primarily wheat, shipped under the Foodfor Peace program and the International Wheat Agreement, and (2)anticipated budgetary savings from proposed legislation for cotton anddairy products.

Legislative proposals designed to make cotton available at lowerprices to domestic users, while still providing essential income supportto cotton producers, are now pending before the Congress. TheAdministration has supported the objectives of this legislation. It is,however, possible to accomplish these goals at a reduced budgetarycost, and proposals to this effect will be transmitted to the Congressshortly. There are several pending legislative proposals before theCongress, supported by the Administration, which would improvethe dairy program. The combined effect of the legislative proposalsfor cotton and dairy products would reduce the 1965 net budgetexpenditures of the Commodity Credit Corporation by $230 million.

Titles I and II of Public Law 480 (Agricultural Trade Developmentand Assistance Act) expire on December 31, 1964, and extension isrecommended. Title I, under which sales of agricultural commoditiesare made for foreign currencies, is the principal authority for andaccounts for most of the expenditures for the Food for Peace program.



Agriculture and Agricultural Resources Administrative Budget

Farm Income Stabilization and Food for Peace

Titles I, I I I , and IV of Public Law 480 are classified in the budgetunder agriculture and agricultural resources. Title II , under whichgrants of food and other agricultural commodities are made to needy-people abroad, is classified under international affairs and finance.The following table brings together the total expenditures underPublic Law 480 and shows the amount for each title separately:

FOOD FOR PEACE EXPENDITURES[Fiscal years. In millions]

Public Law 4801963

actual1964

estimate1965

estimate

Title I (sales for foreign currencies)Title II (grants abroad, primarily for emergency famine relief) __Title 111 (grants through private welfare agencies)Title IV (long-term credit sales)

Total, Public Law 480

$1,48321626180

$1,609246334225

$1,081244298297

2,040 2,414 1,920

Note.—The decline from 1964 to 1965 reflects principally lower unit costs of wheat shipped underthe program. The volume of commodities shipped is expected to remain at the same level as in 1964.



Rental contracts will expire during 1964 on 7.4 million acres ofcropland that was placed in the conservation reserve between 1956and 1960 and during the 1-year extension in 1963. Under this pro-gram, farmers contracted to retire cropland from production forspecified periods. Legislation is being proposed to establish anexpanded cropland conversion program under which the emphasis ison permanent rather than temporary shifts of cropland to less inten-sive uses. This approach would provide a lasting contribution toadjustment of agricultural production to available markets. Thebudget includes new obligational authority of $50 million for thisprogram in 1964 and $50 million to continue the program in 1965;of these requests, $40 million is under the proposed expanded programfor these years and $10 million is under existing legislative authority.

Financing rural electrification and rural telephones.—Funds recom-mended for the Rural Electrification Administration will permitelectrification loan commitments of $300 million in 1965, the samelevel as in 1964. Loan commitments of $85 million are estimated in1965 for the telephone program. In addition, a contingency reserveof $65 million is included to be available for both loan programs, tobe used to the extent necessary. Under new procedures now beingdeveloped by the Rural Electrification Administration for review ofloans for generation and transmission of electricity, it is expected thatlocal cooperatives and commercial power suppliers will be able toreach agreement more frequently. As a consequence, the volume ofFederal generation and transmission loans in 1964 and 1965 is esti-mated to be lower than in 1963.

New obligational authority recommended for the electrificationand telephone programs in 1965 reflects anticipated early enactmentof proposed legislation to authorize use of collections on outstanding-electrification and telephone loans to help finance new loans. Underthis legislation, estimated collections of $169 million in 1964 and $178million in 1965 will be available to help finance the 1965 loan programs,thereby reducing the amount of new obligational authority required.

Financing farming and rural housing.—The Farmers Home Ad-ministration deals with unsatisfactory farming, housing, and otherrural conditions that can be improved through the use of direct Federalloans and insurance of private credit. The substantial reduction of



$152 million in estimated budget expenditures for these programs from1964 to 1965 reflects mainly proposed legislation which would largelyreplace direct Federal loans with insured private credit in the financingof the rural housing program. This action is part of a Government-wide policy of using private rather than public funds in credit programsto the maximum extent feasible. The 1965 estimates for the FarmersHome Administration provide for an enlarged program to financerural housing for the elderly and for continuation of the pilot ruralrenewal program.

Agricultural land and water resources,—Expenditures for these pro-grams are estimated to increase moderately in 1965. The estimatesprovide for continuing a new pilot program, started in 1964, underwhich loans and grants are made to rural communities to promoteconservation and development of land and water resources on anareawide basis. Funds recommended for the upstream watershedprotection program will permit about 36 new starts in 1965, as well ascontinuation of work on projects already underway; a small expansionis provided for the Great Plains conservation program.

Expenditures in 1965 under the agricultural conservation programare estimated at $220 million, excluding administrative expenses, basedon the $220 million advance authorization by the Congress for the 1964program year. An advance authorization of $120 million is proposedfor the 1965 program year. This amount will be adequate to permit theGovernment to share with farmers the cost of high priority conserva-tion practices.

Research and other agricultural services.—Control of pesticides willbe an important part of the research program in both 14)64 and 1965.Ways will be sought to avoid pesticide hazards, the side effects of dis-ease and pest control will be evaluated, and pesticide regulationwill be improved. In addition, construction at Beltsville, Md., of along needed National Agricultural Library is expected to begin in 1965.

Greater workloads in inspection activities will result from continuedincreases in the production of meat and poultry products. Thenumber of establishments in which Federal meat inspection is per-formed is expected to rise from 1,696 in 1964 to 1,760 in 1965. Tofurther the general policy that beneficiaries of special Governmentservices should be charged for such services, legislation will be pro-



posed to finance directly the full cost of meat, poultry, and graininspection activities through a system of fees. Collections from thesefees are estimated at $49 million in 1965.

NATURAL RESOURCES

The United States is fortunate in having abundant natural re-sources. These resources must be wisely managed and developed tomeet the needs of a growing population and an expanding economy.Estimated payments to the public of $2.7 billion in 1965 for naturalresources will provide for continued investments in resource conserva-tion and development—investments which will contribute to ourfuture economic growth.

Land and water resources.—A large part of the $1.8 billion of esti-mated 1965 expenditures for land and water resources will advanceprojects started in prior years to supply water to our cities, industries,and farms; abate water pollution; prevent the ravages of floods;generate electric power; improve navigation; and increase recreationalopportunities. In addition, the budget provides for an orderly pro-gram of new construction starts.

The new obligational authority proposed for 1965 for the Corps ofEngineers includes appropriations of $16 million to start constructionof 34 projects with an estimated total Federal cost of $378 million.The program for the Bureau of Reclamation provides for 10 newstarts (including 3 small project loans) estimated to cost a totalof $134 million, and requiring appropriations of $7 million for 1965.Enactment of pending legislation is recommended to provide uniformstandards and- obtain appropriate cost sharing for the recreation andfish and wildlife aspects of water resources projects of these twoagencies.

Coordinated planning for the orderly and progressive developmentof water and related land resources in a number of river basins will becontinued in 1965 by the Departments of the Army, Interior, Agricul-ture, and Health, Education, and Welfare. The Senate recentlyapproved legislation which would further promote the coordination ofplanning between Federal and State agencies and authorize limitedFederal grants to assist State planning. Early enactment of thislegislation is recommended.

The Department of the Interior will continue its research programto find ways of reducing the cost of converting saline water to freshwater. Legislation has been recommended to provide a new program



NATURAL RESOURCES


Program or agency


1963actual

1964estimate

1965estimate

Recom-mended



Land and water resources:

Corps of Engineers.Department of the Interior:

Bureau of ReclamationPower marketing agenciesBureau of Indian AffairsBureau of Land ManagementOffice of Saline Water

Tennessee Valley AuthorityFederal Power CommissionInternational Boundary and Water Commission and

other

$1,072

34437

109509

53

15

SubtotalForest resources:

Forest ServiceBureau of Land Management

Recreational resources:Present programsProposed legislation

Fish and wildlife resourcesMineral resources:

Bureau of Land ManagementBureau of Mines and other

General resource surveys and administration_


1,699

28716

112

94

472473

2,352

Trust Funds:

Indian tribal funds.Other

6755

Subtotal, trust funds. 122

Intragovernmental transactions and other adjustments(deduct) 18

TotaL 2,456

$1,075

33550

10955115712

17

$1,133

32460

11056126813

32

1,720

33815

122

104

486076

32118

12315

110

4964

2,483 2,588

6969

5453

138 107

10

2,611 2,688

$1,152

32469

11661135113

18

1,817

33819

11840

114

496082

i 2,637

4455

MOO

Compares with new obligational authority for 1963 and 1964, as follows:Administrative budget funds: 1963, $2,447 million; 1964. $2,588 million.Trust funds: 1963. $134 million; 1964. $109 million.

700-000 0—64 7



of grants to States to stimulate further research to help us make themost effective use of our water resources.

Funds appropriated for 1964 are available to begin construction ofthe interconnection between the electric power systems of the PacificNorthwest and Pacific Southwest after enactment of Pacific Northwestmarketing area legislation and after the Secretary of the Interior hasnegotiated with non-Federal interests. Federal power marketingsystems will be strengthened in 1965 to meet increased requirements inareas served by Federal hydroelectric projects, including the provisionof a high-voltage power distribution system for the Bonneville PowerAdministration.

Funds are included in the budget to enable the Federal PowerCommission to step up its examination of interstate wholesale electricpower rates. Substantial progress has been made by the Commissionin reducing its backlog of natural gas cases, involving the ordering ofover $500 million in refunds of excess charges.

The Tennessee Valley Authority will carry forward the developmentof natural resources in the valley in cooperation with State, local, andprivate groups. Development of the Land Between the Lakesrecreation demonstration area will proceed. In 1965 TVA willproceed with the construction of steam-electric power units started inprior years to meet the growing demand for power in its marketingarea. These power facilities are financed with revenues from sales ofpower and with borrowings from the public.

The budget includes funds for the management and development of477 million acres of public domain lands and the administration ofmineral leasing on the submerged lands of the Outer ContinentalShelf. It provides additional funds to rehabilitate burned-over landsand to improve the maintenance of roads and buildings.

Indian affairs.—Since 1961, economic development programs forIndians have resulted in the establishment of 25 industrial plants on ornear Indian reservations. These will provide about 4,000 additionaljobs. To help Indian people achieve further economic and socialdevelopment, the 1965 budget continues emphasis on elementary,secondary, and adult education, and adult vocational and on-the-jobtraining. Educational assistance will be provided for 57,000 childrenand 12,000 adults in 1965, compared with assistance to 48,000 childrenand 8,000 adults in 1963.

To help meet the growing need for credit to develop Indian re-sources, legislation will be proposed to authorize Federal guaranteesof loans by private lenders and to increase the authorization for theexisting direct loan program.



Forest resources.—Expenditures for forest resources, estimated at$339 million iri 1965, will provide for construction of access roads,reforestation, and development of recreation areas on the 186 millionacres of the national forest system; these activities will provide sub-stantial employment opportunities in rural areas. Access roads areneeded to allow an increase in the amount of timber cut; over 11billion board feet of timber are expected to be harvested in nationalforests in 1965, compared with 10 billion board feet in 1963. Similarly,more recreation facilities are essential for the expected 155 millionvisits to national forests in calendar year 1965, compared with 125million in calendar year 1963.

An addition to the Forest Products Laboratory in Madison, Wis.,will be constructed in 1965. This will permit expanded research onwood utilization techniques and standards, resulting in benefits to thelumber industry, landowners, and consumers.

Recreational resources.—Expenditures for recreational resourcesunder existing legislation are estimated to remain at about the currentyear's level in 1965. Most of these expenditures are for the manage-ment and development of our 26-million-acre national park system.A total of 102 million visits to the parks is expected in calendar year1965, an increase of 9% over 1963.

A rapidly growing population, increased urbanization, and addedleisure time emphasize the importance of preserving additional sea-shore and other areas with important recreation potential. Accord-ingly, legislation already recommended should be enacted to authorizefurther Federal acquisition of several such areas, as well as to protectour remaining wilderness areas.

Legislation is also needed to authorize Federal grants to States forplanning, land acquisition, and development of recreation facilities.This legislation would provide for user charges so that direct bene-ficiaries of Federal recreation areas will help defray the costs.

Fish and wildlife resources.—The estimated expenditures of $110million in 1965 for these activities include amounts for acceleratingresearch on the effects of pesticides, for supporting the nationaloceanographic research effort, and for other studies to aid the fishingindustry. The budget also provides for the development and opera-tion of 100 fish hatcheries and 298 wildlife refuges and for the acqui-sition of wetlands for migratory waterfowl; these activities benefit 25million sport fishermen and 15 million hunters.

Mineral resources and general resource surveys.—Efforts will con-tinue in 1965 to find ways of increasing the utilization of the Nation's



coal supply, including the conversion of coal to gaseous and liquidforms that may economically be used to satisfy our growing energyrequirements. Added efforts will also be made to find methods ofreducing health and safety hazards in mining operations.

Topographic surveys and mapping, basic to many private andpublic development programs, will be extended. By the end of 1964,69% of the United States will have been surveyed for topographicmaps at a standard scale of 1 mile to the inch or larger; an additional2.5% will be surveyed during 1965. The budget also provides forincreased studies on the composition of the upper mantle of the earth'scrust. These studies will add to our knowledge of the formation ofmineral deposits and contribute to the development of techniques forlocating deep-lying mineral bodies.

Helium is important to our defense and space programs and forscientific, industrial, and medical uses. The Federal Governmentoperates five plants and contracts with four private firms for the pur-chase of helium extracted from natural gases for future sale and use.If not extracted, this limited and nonreplaceable resource is wastedas a noncombustible part of natural gas used for fuel. About 787million cubic feet of helium are expected to be produced by Govern-ment plants in 1965, and 3.7 billion cubic feet will be produced for theGovernment by private contractors. Of this total, about 3.9 billioncubic feet will be conserved for the Nation's future needs. -

COMMERCE AND TRANSPORTATION

The Federal Government provides a wide range of financial, tech-nical, and other aids to private business, particularly to small enter-prises and those in areas of persistent unemployment. It also helpsstrengthen our economy by improving transportation and communica-tion facilities, regulating certain types of business activity, and en-couraging competition where necessary to protect the public interest.

In 1965, payments to the public for these purposes will total anestimated $6.6 billion. Over half of this total represents trust fundexpenditures for Federal-aid highways, which are estimated to increaseby $99 million over the 1964 level.

Administrative budget expenditures of $3.1 billion are estimated tobe $82 million below the estimate for 1964. Federal loans and grantsto aid redevelopment of depressed areas will increase because ofprevious commitments, and minimum essential expansions areproposed for Federal aviation, weather activities, and certain otherprograms. However, these increases will be more than offset by re-ductions in outlays for the temporary public works acceleration pro-gram begun in fiscal 1963, for the postal service, and for various otherprograms.



COMMERCE AND TRANSPORTATION


Program or agency

Administrative Budget Funds:Advancement of business:

Department of Commerce:Weather Bureau .National Bureau of Standards _ _ _ _Other aids to business

Small Business AdministrationOther agencies

Area redevelopment:Department of CommercePublic works acceleration program

Aviation:Federal Aviation AgencyCivil Aeronautics Board—subsidies

Water transportation:Department of CommerceCoast Guard _Panama Canal CoSt. Lawrence Seaway _ __

Highways (mainly on national forests and public lands) __Postal serviceRegulation of business


Trust Funds:Department of Commerce:

Highway trust fund _Other

Federal Deposit Insurance Corporation.

Subtotal, trust funds

(ntragovernmental transactions and other adjustments(deduct) _

Total _

Payments topublic

1963actual

$854198

1421

3962

72682

364297101

4177084

2,843

3,01721

-161

2,877

-57

5,777

1964estimate

$9263

129141

•

98365

79085

350351

61

4554689

3,151

3,55122

-180

3,394

-57

6,601

the

1965estimate

$10165

148141

130245

82983

336380-1

242

47594

3,069

3,65018

-202

3,466

-54

6,588

Recom-mended

new obli-gational

authorityfor 1965

$10346

1507

2225

75184

357423

3655197

12,833

3,8056

13,811

'"Less than one-half million dollars.1 Compares with new obligational authority for 1963 and 1964, as follows:

Administrative budget funds: 1963. $4,020 million; 1964, $2,926 million.Trust funds: 1963. $3,605 million; 1964. $3,731 million.

Advancement of business.—Responsibilities of the Departmentof Commerce and the Small Business Administration for advancingbusiness enterprise include export promotion, aids to civilian research


1 0 2 THE BUDGET FOR FISCAL YEAR 1965

and technology, weather and census information, and loans andspecial services to small businesses.

To foster the expansion of U.S. exports, the 1965 budget provides$22 million in new obligational authority, $4 million more than in1964, to strengthen the export promotion program of the Departmentof Commerce. These funds will be used to encourage private firmsto increase their exports, expand the number of exporting firms,provide more trade centers in foreign countries, and enlarge thenumber of American firms exhibiting their products at commercialtrade fairs overseas.

Maintenance of the traditional U.S. leadership in technology isvital both to economic growth at home and effective competition inworld markets. Increases of $9 million in new obligational authorityare requested in this budget to expand the activities of the Bureauof Standards, the Patent Office, and the Office of Technical Servicesso that better services can be provided to business and industry.

The rapid growth of Government-sponsored research has increasedthe importance of making the results of this research available to theinterested public. Accordingly, the Commerce Department's roleas a clearinghouse for a great variety of technical information isbeing strengthened. For example, funds are provided for the Officeof Technical Services to assume responsibility for distribution of allunclassified research reports by the Department of Defense—a stepwhich is expected to bring economies as well as improve service. Inaddition, the Bureau of Standards is establishing a National StandardReference Data System to make verified data in the physical sciencesconveniently available to science and industry. By accomplishingthe time-consuming evaluation of information at a central point, re-search and engineering work should be made more efficient throughoutAmerican industry. In a few years, savings by Government con-tractors alone should exceed the additional budgetary costs.

During the past year, the responsibility for planning and coordi-nating the Government's extensive meteorological activities has beencentralized in the Department of Commerce in order to avoid dupli-cating expenditures for weather operations, supporting research, andequipment. A review of the meteorological satellite programs of theWeather Bureau and the National Aeronautics and Space Adminis-tration has disclosed that during the next few years operating require-ments can be met satisfactorily with a less sophisticated system thanhad previously been planned. By terminating the plan to launch anumber of Nimbus satellites, in their present design, for use in routineweather operations, and using instead a simplified spacecraft similarto the successful NASA Tiros, the Weather Bureau will be able tohold annual costs over the next several years roughly $20 millionbelow the level previously estimated.



Provision is made in the budget for continued improvement in1965 of the statistics used by both Government and private groupsto measure our economic and social development, as discussed inSpecial Analysis J. Work on the 5-year economic censuses coveringmanufacturing, mineral industries, transportation, and the distribu-tion and service trades will be almost completed in 1965. Enumera-tion of the Census of Agriculture will occur early in the fiscal year,requiring a temporary net increase of $5 million in expenditures by theBureau of the Census to $36 million. This latter census has beentaken regularly since 1840 and provides valuable benchmark dataneeded to understand changes occurring in agriculture.

Although net expenditures of the Small Business Administrationare estimated to remain level in 1965, the agency will continue toexpand the financial and other assistance it provides the small busi-ness community. This will be accomplished by using funds alreadyavailable and funds which will become available from repaymentsand sales of earlier loans. The level of new commitments for smallbusiness loans will be increased to $258 million in 1965, $31 millionmore than in 1964. Commitments to small business investmentcompanies and State and local development companies are estimatedat $126 million in 1965, an increase of $20 million over 1964. At thesame time, measures to simplify administrative procedures are en-couraging increased participation by private lenders, thus reducingthe need for Federal assistance.

Area redevelopment.—The Department of Commerce, with theassistance of other major departments and agencies, provides a broadrange of Government aids to help depressed areas rebuild their eco-nomic base and thus create additional permanent employment.Expenditures for the area redevelopment program enacted in May1961 will increase from $98 million in 1964 to $130 million in 1965,primarily for loans to finance construction of industrial and com-mercial facilities. The loans, grants, and technical assistance financedfrom prior authority and from the new obligational authority of $222million recommended for 1965 will help provide 150,000 workers withpermanent employment in these economically depressed areas. The1965 budget assumes enactment of legislation currently pending inthe Congress to increase the maximum authorization on the varioustypes of Federal assistance; these additional authorizations are re-quired to carry out the program planned in 1965.

No provision is made in the budget for extension of the temporaryaccelerated public works piogram initiated in fiscal year 1963. How-ever, an appropriation of $5 million remaining under the legislativeauthority is requested for contingencies and to administer ongoingprojects. Expenditures for projects already approved are estimated



at $245 million in 1965, down $120 million from 1964. These includeover 2,400 waste treatment plants and water supply facilities, morethan 1,000 street construction and repair projects, 281 hospitals andhealth facilities, and other useful public works.

Transportation policies.—Major steps have been taken to im-prove and coordinate the planning of Federal transportation pro-grams which should pay dividends in better transportation and re-duced costs to carriers, transportation users, and taxpayers. Sev-eral major legislative revisions of national transportation policy andprograms which are pending before the Congress would further theseobjectives. They include: (1) amendments to exempt from mini-mum rate control carriers of bulk commodities, agriculture and fish-ery products, and intercity passengers; (2) various proposals to pro-tect shippers, encourage rate and service experiments, foster through-routes and joint rates, and improve the effectiveness of regulation;and (3) Federal assistance for rehabilitation and expansion of masstransportation systems in urban communities, discussed underHousing and Community Development.

In fairness to the taxpayers and to encourage efficient use of Gov-ernment-financed transportation facilities, the substantial specialbenefits received by travelers and shippers from Federal expenditureson aviation and inland waterways should be paid for at least in partby the users of these facilities. Accordingly, recommendations havebeen made for increased transportation user charges; these recom-mendations are discussed in Part 3 of this budget.

Aviation.—The Federal Aviation Agency is continuing to expandand modernize the national system of air traffic control and navigationaids. The use of manpower is being improved and obsolete or unneces-sary facilities and services are being eliminated. Partly as a resultof these economies, the recommendation for $751 million in newobligational authority for 1965 is below the 1964 appropriation forthe Agency's regular programs.

The joint industry-Government program to develop a civil super-sonic transport aircraft for which $60 million was appropriated in1964, is proceeding on schedule. Design proposals have been receivedfrom prospective manufacturers and will shortly be evaluated fortechnical and economic feasibility. Expenditures for this programare estimated to increase in 1965 by $42 million. All other expendi-tures of the FAA, taken together, are estimated to decline slightlyfrom 1964 to 1965, despite increases in air traffic and the relatedworkloads.



Water transportation.—Expenditures by the Department of Com-merce for ocean shipping will decrease by an estimated $15 million in1965, primarily because operating subsidy payments in 1964 completedliquidation of an accumulation of prior year obligations which willnot recur. However, the new obligational authority recommendedis up by $12 million over 1964, principally for the ship replacementprogram, including increased provision of automated equipmentdesigned to reduce operating subsidies in future years. Starts on17 new ships will be made as part of the continuing program to re-place obsolete vessels in the subsidized fleet. Efforts to revitalizethe U.S. merchant marine will continue, with particular attention tolabor-management relations and application of new technology, inorder to improve the competitive position of the U.S. fleet and thusreduce over the long run the need for Government subsidies.

Expenditures by the Coast Guard will rise by an estimated $29million in 1965, primarily because of fixed commitments for increasedmilitary pay and related personnel costs and larger outlays necessaryfor maintenance of vessels. New obligational authority of $90 million,an increase of $39 million over 1964, is requested for acquisition, con-struction, and improvement of Coast Guard facilities; the requestrepresents the 1965 installment of a long-range program to acceleratereplacement of obsolete vessels and expand air rescue facilities.

Highways.—Federal highway expenditures are financed almost en-tirely from taxes on highway users which are deposited in the highwaytrust fund. They are financed on a pay-as-you-build basis with thelevel of revenues controlling expenditures. Trust fund expenditureswill increase by $99 million in 1965 to an estimated $3,650 million.About three-quarters of this total is for the Interstate Highway System,which is scheduled for completion in 1972. Over 15,400 miles of this41,000-mile system are now open to traffic and another 16,600 milesare in various stages of development. Almost all remaining trustfund expenditures are for the primary and secondary Federal-aidhighway systems. The budget assumes enactment of legislationextending these latter programs for two years at the present annuallevel of $975 million.

Postal service.—Expenditures of the postal service in 1965 willexceed postal revenues by an estimated $475 million. This compareswith $770 million in 1963 and an estimated $546 million in 1964. Thedecreases from 1963 result from the postal rate increases whichbecame effective in January 1963, an increase in parcel post ratesexpected to go into effect April 1, 1964, and provision of better



Commerce and Transportation - Program Trends

n-~:

$ 6 - Number Granted - 4 0

i I i [ i i i j j j i i \ 1 1 1 L - . 1 - 1 . ' ' ' * j

Landings and Takeoffs

FAA Controlled Miles Added

" -;J* •ÂV-:^^§^;^T\

service at less cost. The 1965 postal deficit, the amount by whichpostal revenues fail to cover postal costs after deducting public servicecosts, is estimated at $89 million.

Current programs to improve the efficiency of postal operationsare expected to accomplish substantial results in the years ahead.The cooperation of large mailers in converting their mailing lists tothe new ZIP Code will reduce mail processing costs by increasing theamount of presorted mail presented to post offices. An automaticaddress reader and a computer-controlled letter sorter to process ZIP-coded mail are being developed and are expected to be ready forinstallation in 1967. Establishment of new centers for the receiptand dispatch of mail, and the consolidation of the mail processingfunctions of small post offices into large central processing facilitiesare continuing—with further savings anticipated in transportationand mail processing costs as well as better service to the public.

Regulation of business.—Pending legislation should be enacted tohelp protect millions of small investors by extending the present dis-



closure safeguards to all companies whose securities are widelyowned, and by otherwise strengthening the securities laws.

Additional funds are requested for the Federal Maritime Com-mission to meet increased workloads and to permit the agency topursue actively its effort to assure that fair and reasonable ratesgovern the movement of commodities in our waterborne foreign com-merce in support of our export expansion program.

HOUSING AND COMMUNITY DEVELOPMENT

Since the enactment of the Housing Act of 1949, our national hous-ing policy has been directed toward the long-run goal, set in that act,of "a decent home and a suitable living environment for everyAmerican family." Through grants, direct loans and mortgagepurchases, and especially through insurance of private credit, Federal

programs have stimulated widespread investment by private individ-uals and groups, as well as by local communities, in housing construc-tion and community development. As a result, repayments andsales of mortgages and other assets acquired in earlier years, togetherwith other receipts, are now exceeding the amount required to financenecessary increases in Federal housing activities. Net receipts of$317 million are estimated in the administrative budget for housingand community development programs in 1965, compared with esti-mated net receipts of $191 million in 1964. Total Federal receiptsfrom the public for these programs are expected to exceed paymentsto the public in 1965 by $40 million.

Urban renewal and community facilities.—All the authorityavailable for urban renewal capital grants provided by the HousingAct of 1961 will have been earmarked for specific projects by the closeof the current fiscal year. Accordingly, legislation to authorize anadditional $1.4 billion in grants is recommended for prompt enact-ment. This will permit reservations of funds for projects to continuefor 2 additional years at about the current level, and will provide forproposed increases in payments to families and small businessesdisplaced by urban renewal.

Meanwhile, urban renewal projects financed in earlier years con-tinue to advance toward completion. The number of older projectscompleted during the year will rise from 51 to 65. Specific plans willbe submitted and approved for an estimated 200 projects in 1965,compared to 165 in the current year. This increased activity andthe proposed higher relocation payments will result in an increase of$75 million in expenditures for capital grants from 1964.

The rise in expenditures in 1965 for loans to assist smaller com-munities in financing essential public facilities will be more than offsetby higher receipts from sales of loans made in earlier years. Thesuccessful sale of such loans, which were originally made by the Gov-



HOUSING AND COMMUNITY DEVELOPMENT[Fiscal years. In millions]

Program or agency


1963actual

1964estimate

1965estimate

Recom-mended

new obli-gational

authorityfor 1965


Urban renewal and community facilities:Housing and Home Finance Agency:

Urban renewal:Capital grantsLoans

Public facility loans (excluding transportation loans).Urban mass transportation:


OtherPublic housing programsAids to private housing:

Housing and Home Finance Agency:Federal Housing AdministrationFederal National Mortgage Association:

Special assistance functionsManagement and liquidating programsSecondary market operations, preferred stock re-

purchaseProposed legislation for pool participation sales..

Housing for the elderly—direct loansOther

Federal Savings and Loan Insurance CorporationNational Capital Region:

District of ColumbiaOther _

$186- 1 3

27

17178

135

-277-162

1913

-264

664

Subtotal, administrative budget. -67

Trust Funds:

Federal National Mortgage Association, secondary marketoperations, net

District of Columbia municipal governmentFederal home loan banks, netOther

-730334363- 2

Subtotal, trust funds. -36

Intragovernmental transactions and other adjustments(deduct):

District of ColumbiaOther

10560

Total. -268

$2251834

10

29146

57

-365- 1 1 3

-101

$3001832

121039

222

- 1 7 3

- 3 1 3- 7 4

3316

-250

663

-2004919

-349

-191 - 3 1 7

30396

1,2002

138417

- 1 0 01

1,628 456

11543

15623

1,279 -40

*$7550

231

7518

721

523

147419

1566

*Less than one-half million dollars.1 Compares with hew obligational authority for 1963 and 1964, as follows:

Administrative budget funds: 1963. $559 million: 1964, $1,965 million.TrustJunds: 1963. $554 million; 1964. $449 million.



ernment because they were unacceptable to private investors, is asmall but significant part of the Government-wide efforts to substituteprivate for public credit wherever possible.

Pending legislation to assist urban mass transportation systemswould authorize Federal grants, direct loans, and loan guarantees in-volving new obligational authority totaling $375 million over a 3-yearperiod. The 1965 budget includes $75 million in new obligationalauthority and $10 million in expenditures for the first year of opera-tion under the new program.

New obligational authority of $25 million is needed to continue theurban planning assistance program. This program, while small interms of expenditures, offers potential savings by assuring that Federalaids to community development are put to the most effective use,particularly in our growing metropolitan areas.

Public housing programs.—The authority provided in the HousingAct of 1961 to make contracts for annual contributions to local hous-ing authorities to support construction of additional low-rent publichousing units will be exhausted by the end of the current fiscal year.Legislation is being requested to authorize contracts for an additional200,000 units over the next 4 years, together with amendments toimprove the flexibility and effectiveness of the present program.

Expenditures under present programs will rise to $222 millionin 1965, as additional units built under prior authorizations are com-pleted and become eligible for annual contributions, and as more unitsoccupied by elderly persons become eligible for the special additionalcontributions authorized in 1961. Estimated net expenditures in1964 are unusually low because of nonrecurring receipts from privaterefinancing of the last $53 million of local housing authority bondsowned by the Public Housing Administration.

Aids to private housing.—Federal assistance to private housing hasgenerally been accomplished by encouraging private credit markets tosupply more adequate financing. The Housing and Home FinanceAgency provides such assistance primarily by insuring loans made byprivate institutions and by maintaining secondary market facilitiesto improve the marketability of such loans. The Federal Savings andLoan Insurance Corporation, through insurance of savings and loanaccounts, encourages small savers to pool their funds for home mort-gage lending. The Federal home loan banks supplement such fundsby lending to member savings and loan associations which experienceloan demands temporarily greater than they can meet.

It is expected that private funds will continue to be available in1965 for a considerable volume of investment in federally insured



mortgages. As a result, sales of mortgages previously acquired bythe Government, together with repayments, will exceed the purchasesof new types of insured mortgages, even though an increase in suchpurchases is anticipated—especially for housing of moderate incomefamilies. The turnover of a limited Federal investment thus willpermit maximum support of new housing construction with minimumburden on the Federal budget.

The Federal Housing Administration will continue to make sub-stantial expenditures for mortgage and property acquisitions arisingfrom defaults on insured mortgages. However, these and otherexpenditures will be more than offset by receipts from (1) privatelyfinanced sales of properties, and (2) transfers of mortgages acquiredon previous sales of properties to the Federal National MortgageAssociation for management and sale through its unified mortgageadministration system. As a result, the FHA will have net receiptsestimated at $173 million in 1965, compared to estimated net expendi-tures of $57 million in the current year.

The Federal National Mortgage Association will continue its suc-cessful marketing policies under which all three of its programs lastyear were able not only to finance current operations from receipts, butalso to reduce substantially previous borrowings. Although someincrease is expected in mortgage purchases by the secondary markettrust fund in 1965, this trust fund is buying back this year a sub-stantial part of its preferred stock now held by the Treasury, since itdoes not currently need these funds to finance its operations. Thisrepurchase will reduce administrative budget expenditures by $101million in 1964, but will not affect payments to the public.

To broaden further the range of private investment in federallyinsured and guaranteed mortgage loans, legislation is being proposedto authorize FNMA to issue and sell participations in pools of FHA-insured and VA-guaranteed loans. Enactment of this legislationwould permit sales of such participations in these loans owned by theAssociation amounting to an estimated $200 million in 1965 over andabove sales of individual mortgages under present sales procedures.Sales of similar participations in loans owned by the Veterans Admin-istration are discussed under Veterans Benefits and Services.

The direct loan program for moderate-income rental and cooperativehousing for the elderly is expected to provide for commitments of$100 million in 1965, but expenditures are estimated at only abouthalf this amount because of the lower commitment levels of prioryears. Legislation will be proposed to remove the limit on appro-priations for this program, and an appropriation of $75 million isincluded in this budget for 1965.


THE FEDERAL PROGRAM BY FUNCTION 1 1 1

The continuing rapid growth of savings and loan associations insuredby the Federal Savings and Loan Insurance Corporation is producinga corresponding increase in receipts from insurance premiums, espe-cially from prepayments of premiums required under the 1961 legisla-tion to strengthen the reserves of the Corporation. These increasesin receipts, together with a reduction of outlays required to protectinsured accounts, will reduce net administrative budget expendituresby about $100 million from 1964.

During fiscal year 1964, the Federal home loan banks are expectedto increase their outstanding advances to member savings and loanassociations by $1.2 billion. The banks now anticipate that in 1965receipts from repayments of such advances will exceed new advancesby $100 million. Transactions of these banks are not included in theadministrative budget, but are recorded as trust fund expenditures.

National Capital Region.—The District of Columbia governmentprovides both State and local government services for the industriesand residents of the National Capital city. As the predominantindustry, the Federal Government recognizes a special responsibilityto bear its proper share of the costs.of such services, as well as toprovide long-term loans needed to carry out an orderly program ofcapital improvements. Legislation enacted in 1963 increased theauthorizations for both types of Federal assistance. Additionallegislative authority is needed to provide further increases in theseauthorizations and to base them on appropriate measures of theFederal impact on the community and of the District's ability to repayborrowings.

The specific programs and fiscal requirements of the District ofColumbia government are discussed more fully in the separateDistrict of Columbia budget.

The Federal Government has a unique interest in assuring abalanced transportation system for the National Capital Area.Legislation to authorize rapid rail transit and express bus systemswas transmitted to the Congress in May 1963. Early action topermit a beginning on an acceptable program is essential for theorderly development of the Nation's Capital.

HEALTH, LABOR, AND WELFARE

In 1965 Federal payments to the public for health, labor, andwelfare programs, largely from trust funds financed by special taxes,are estimated to total $28.6 billion, an increase of $1.3 billion overthe estimate for 1964. Most of this increase reflects the built-ingrowth of trust fund programs such as old-age and survivors insurance.



HEALTH, LABOR, AND WELFARE


Program or agency


1963 1964 1965

Recom-mended



Health services and research:

National Institutes of Health.. .Community and environmental health:

Construction of health facilities:Present programsProposed legislation (Hill-Burton)

Health professions education assistance __Proposed legislation for nurse educationEnvironmental and other community health. __Other. _ _

Labor and manpower:Unemployment compensation for Federal employees

and ex-servicemenManpower development and trainingProposed legislation for youth opportunitiesRepayable advances to unemployment trust fundOther.

Public assistance:Grants to States. .Proposed legislation for community work-trainingAssistance to Cuban refugees and other

Other welfare services:Vocational rehabilitationSchool lunch and special milk programsFood stamp program _Proposed legislation for military service creditsOther.

$724

189

192249

15352

- 8 5104

2,730

59

98263

20

42

Subtotal, administrative budget. 4,789

Trust Funds:

Old-age, survivors, and disability insurance-Unemployment insuranceCivil service retirement and disabilityRailroad retirementOther

15,7893,8151,1761,112- 3 7

Subtotal, trust funds. _ 21,855

Intragovernmental transactions and other adjustments(deduct) ,._. 946

Total. 25.698

$826

200

280326

14013610

- 8112

2,948

59

123280

45

51

$850

2025

1911

291355

11632596

- 4118

2,7813553

125293516051

5,533 5,832

16,7043,5551,3371,129- 5 6

17,5183,4431,4901,144- 4 6

22,669 23,549

937 786

27,265 28,595

1 Compares with new obligational authority for 1963 and 1964, as follows:Administrative budget funds: 1963, $5,382 million; 1964, $5,765 million,Trust funds: 1963. $22,621 million; 1964, $24,874 million.

$1,050

23270

8619

328378

126411160

119

2,9805054

146292516044

16,647

17,4993,9332,3911,279

10



Administrative budget expenditures in 1965 are estimated to increaseby $299 million for new and urgently needed programs such as man-power development and training, improved youth employmentopportunities, and medical education.

More than nine-tenths of the estimated payments for health, labor,and welfare in 1965 will be made through the social insurance trustfunds and through grants for public assistance. These paymentsprovide income support for the unemployed, retired, disabled, andother recipients. An estimated 32 million people will receive $30billion of Federal income maintenance payments in 1965, includingveterans payments, military retired pay, and other programs classifiedelsewhere in the budget. Of this amount, $17 billion will be paid to16 million aged persons. Other services and programs costing nearly$2 billion will also be provided for the aged, including the grants forcommunity services and work opportunities proposed in the SeniorCitizens Community Planning and Services Act pending in theCongress.

Health services and research.—The Department of Health,Education, and Welfare will spend an estimated $1,733 million in1965 for health research and training and for public health services,including related consumer protection activities.

Health research.—Annual Federal expenditures in this field exceed$1 billion, of which about three-fifths represents outlays by theNational Institutes of Health. Federal funds support nearly two-thirds of total national expenditures for health research and aboutone-half of such funds go to universities. In addition to providingsupport for specific research projects and for research facilities, thebudget includes funds for general research and training grants. Theseexpenditures make a significant contribution toward maintaining ourleadership in combating disease and in providing trained healthpersonnel.

Health manpower and facilities.—The Enactment of the HealthProfessions Education Assistance Act of 1963 launched a much neededprogram to increase the capacity of medical and dental schools.Construction grants and student loans are designed to increase thenumber of medical school graduates by 50% and to double the numberof dental graduates by 1970. The budget includes a supplementalappropriation of $30 million for 1964 and recommends $86 million ofnew obligational authority for the second-year cost of this program.

To meet the urgent need for more and better qualified professionalnurses, we must by 1970 increase the number of practicing professionalnurses by 25%. Legislation is therefore being proposed to extendand expand the current graduate nurse traineeship program, to au-

700-000 O—64 8



thorize the construction of facilities for teaching nurses, and to providefinancial aid for nursing students. Extension and expansion of pro-grams for training professional public health personnel are alsorecommended.

The authorization for the highly successful Hill-Burton Act to aidthe construction of medical facilities expires June 30, 1964, and legisla-tion is recommended to extend this program. During the past 17years the Federal Government has contributed $2 billion under thisact toward the construction of medical facilities costing $6 billion.The program has concentrated on the construction of general com-munity hospitals in rural areas, and has eliminated much of the back-log of need. The proposed legislation would shift the emphasis ofthe program toward modernizing the older general hospitals, largelycentered in urban areas, and toward stimulating construction oflong-term care facilities for the chronically ill and aged. Almost halfof all hospitals require some form of modernization; loan guaranteeswould be used to achieve greater results than are possible with Federalgrants alone. These proposals will provide expanded assistance tocommunities for meeting needs for health facilities.

Mental health.—In recognition of the need for energetic action tocombat mental illness, legislation was enacted in 1963 authorizing a3-year program totaling $150 million for construction of communitymental health centers. The budget includes an appropriation of $35million for 1965. This represents a vital first step in making adequatecare available in the patients' own communities, rather than sendingthem away to distant large mental institutions. Starting in 1964,project grants of $9 million are being made to State mental institutionsfor demonstrations in intensive therapy and training of personnel;these grants will be increased to $18 million in 1965. Including theseprograms, new obligational authority requested for 1965 for theNational Institute of Mental Health and for construction of mentalhealth centers totals $224 million, $48 million more than for 1964.

Mental retardation.—Legislation enacted during 1963, pursuant tothe recommendations of the President's Panel on Mental Retardation,provides a firm basis for a concerted national effort to combat mentalretardation on all fronts.

This legislation augments existing grant programs for services tomentally retarded children, and authorizes a new project grant pro-gram to help reduce the incidence of retardation by comprehensivematernity care to 300,000 mothers who otherwise could not afford it.Additional programs authorized to combat retardation include edu-cational research, teacher training, and community- and university-



based clinics and research centers. The budget provides for a 1964supplemental appropriation of $36 million to start these programs, andappropriations of $72 million are requested for 1965. Including thesenew programs, a total of $243 million in new obligational authorityis recommended for 1965 for services and benefits to the retardedby the Department of Health, Education, and Welfare. This request,including both administrative budget and trust funds, is nearly twicethe amount enacted 2 years earlier.

Public health services and health protection,—In 1965, the PublicHealth Service and the Food and Drug Administration will spend$333 million to improve community health services, combat environ-mental health hazards, and provide greater protection for" the healthand safety of consumers.

Control of environmental health hazards depends largely on in-creased research and the availability of specialized manpower. Thebudget includes $32 million of new obligational authority for research,training, and fellowship grants to stimulate further work in this fieldand funds for planning additional Federal research facilities.

This budget provides for a substantial strengthening of activitiesdesigned to increase our knowledge of the long-range effects of pesti-cides on man and other biological systems. Appropriations of $13million are requested for 1965 for the Department of Health, Educa-tion, and Welfare which, together with funds requested for theDepartments of Agriculture and Interior (under other functionalcategories), bring the total requested for this purpose to $56 millionfor 1965, $10 million more than for 1964.

The Clean Air Act of 1963 provides for major new Federal responsi-bilities in controlling and combating air pollution. A supplementalappropriation is proposed for 1964 to initiate activities under this actpromptly. Expenditures of $19 million are estimated in 1965 for allair pollution activities, an increase of $8 million from 1964. Increasedemphasis will also be given to water pollution control, Includingstrengthening of enforcement and research. Eight water pollutionlaboratories will be under construction in 1965 from funds authorizedin previous years.

The Food and Drug Administration will expand its consumerprotection program to carry out the Drug Amendments of 1962. Inaddition, a major reorganization completed in 1963 will enable theagency to give better health and safety protection to the consumer.Legislation is recommended to provide more adequate protectionagainst dangerous cosmetics, harmful and ineffective therapeuticdevices, and to make other needed improvements in the food anddrug laws.



The President's Advisory Commission on Narcotics and Drug Abusehas completed a study of measures needed to strengthen control overthe distribution and usage of narcotic and psychotoxic drugs and toimprove programs for rehabilitating addicts, and its recommendationsare under review.

Health, Labor, Welfare - Program Trends

'•- ** }

Recipients

Rehabilitations

1 I I I I I I I I I I 1 I I I I I I I

f*S4 56 StFUcal Years

64,

|p^ffi^§ifi:^5:; ;/.• "TV.

Labor and manpower.—Administrative budget expenditures in1965 for labor and manpower programs are expected to increase by$261 million over 1964, principally to provide training and employ-ment opportunities for unemployed workers and youths.

To help cope with the problem of the more than 900,000 currentlyunemployed among our younger people, the Youth EmploymentAct was proposed last year and is awaiting final action by the Con-gress. This act will provide work and training through conservationwork camps and work projects in local communities. The budgetincludes new obligational authority of $30 million in 1964 and $160



million in 1965 under this legislation, which will benefit an estimated60,000 youths during 1965.

A persistent need exists to train unemployed workers in skills whichwill enable them to find productive employment. This budget pro-vides for $165 million of appropriations for 1964, including a supple-mental appropriation of $55 million, and a total of $411 million inappropriations for 1965 to finance the recently broadened and strength-ened Manpower Development and Training Act program. The newamendments to the Act will make it possible to train 135,000 unem-ployed workers in 1964 and more than 275,000 in 1965, includingmany youths found unqualified for military service. The 1965 totalincludes an estimated 60,000 workers and youths who will receivebasic literacy training to enable them to go on to regular vocationaltraining. In addition to the regular flow of workers who seek train-ing, it is anticipated that more than 300,000 18-year-olds, foundunqualified for military service, will be referred to manpower conserva-tion units in the employment service.

The Federal-State employment service—financed through the un-employment trust fund—represents a key element in the total arrayof programs to assist unemployed workers in obtaining suitable em-ployment. Between 1961 and 1965 total nonagricultural job place-ments through this service will increase by 28%. To continuestrengthening the 1,900 local employment offices throughout thecountry—including special services for older workers—and to meetthe cost of rising State pay scales, the budget includes an increase of$30 million in trust fund expenditures to $452 million in 1965.

The newly established Labor-Management Services Administrationin the Department of Labor will expand its efforts to improve labor-management relations, including general research on collective bargain-ing. Total outlays in the field of labor-management relations areestimated at $41 million in 1965; this includes the labor-managementmediation agencies and the National Labor Relations Board. Legis-lation is being recommended to improve conditions for migrant agri-cultural workers. Legislation is also recommended to amend the FairLabor Standards Act to extend minimum wage and other protectionto more than 2 million additional workers and to authorize higherpenalty pay for overtime in covered industries in which it is foundto be appropriate.

Social insurance and welfare services.—Our economy providesa higher standard of living to a greater proportion of its people thanany other nation. This result has been achieved principally throughthe enterprise and industry of our citizens, but it has been reinforcedby public programs which provide social insurance and other aids orservices to help those families suffering a loss of income because ofunemployment, disability, retirement, or death.



Social insurance.—Trust fund expenditures under social security,railroad retirement, ajid retirement programs for Federal civilian em-ployees are estimated to be over $20 billion during 1965, an increase of$982 million over 1964.

The basic social security system now covers about 90% of ourworkers and their families. Legislation is recommended, effectiveJanuary 1, 1966, to expand this system to provide protection for theaged against the disproportionately heavy costs of hospital and nursinghome care. Financing for this hospital insurance would be providedby raising the combined employer-employee payroll tax by %% andby increasing the amount of earnings covered by social security. Theincrease in the earnings base will also raise benefits in future yearsand will help keep the system abreast of the general rise in levels ofearnings. Under the legislation, the cost of hospital benefits for thecurrently aged who are not covered by the social security system wouldbe met from regular appropriations.

Under the unemployment insurance system, $2.9 billion will be paidin benefits in 1965 (including $116 million from administrative budgetfunds for benefits to ex-servicemen and former Federal employees).These benefits will be paid to an estimated weekly average of 1.7million claimants. In many States, the coverage and duration ofunemployment insurance benefits are inadequate. Legislation hastherefore been proposed to extend coverage of the system, increase theduration of benefits, and assure the necessary revenues to financethese improvements. The expenditure estimate for the unemploy-ment trust fund includes $170 million for this legislation in 1965.

The 1965 budget also includes $60 million under proposed legislationto start liquidating, on a scheduled basis, the Federal Government'sobligation to the old-age, survivors, and disability insurance system forcredits for past military service.

Public assistance.—Expenditures of $2.9 billion, including $35million under proposed legislation to augment community work-training programs, are estimated for public assistance in 1965. Theseexpenditures are $138 million less than in 1964 because cash balancesheld by the States will be drawn down. However, the program willbe expanding to help States and communities provide for the basicneeds of more than 7 million persons, including 523,000 persons esti-mated to receive medical assistance for the aged under existing law.Legislation is proposed to improve certain features of the old-ageassistance program.

Other welfare services.—The Federal-State vocational rehabilitationprogram which provides coordinated services to the disabled, willrestore an estimated 133,000 individuals to economic independence in



1965, an increase of 21% over 1963. Federal expenditures for vo-cational rehabilitation will total $125 million in 1965. New legis-lation is proposed to expand vocational rehabilitation services, partic-ularly for the mentally retarded.

In the fiscal year 1965, 16.6 million school children are expected toparticipate in the school lunch program, 5 percent more than in 1964.To meet this growth in the number of participating children and toinitiate assistance on a selective basis to needy schools, grants toStates are estimated to rise by $12 million. New obligational author-ity of $100 million is recommended for 1965 for the special milk pro-gram, the same level as in 1964, to be financed by transferring fundsfrom the permanent appropriation for the removal of surplus agri-cultural commodities. The pilot food stamp program is financedfrom the same permanent appropriation. Legislation has been pro-posed to provide continuing authority for this program.

Legislation has also been proposed to extend beyond June 30, 1964,the authorization for Federal grants to support coordinated communityprojects combating juvenile delinquency and to train workers in thisfield.

EDUCATION

Education is essential to preserving our democratic society andadvancing our national economy. Every individual should have theopportunity to develop his abilities to the fullest, particularly in anage of increasing technology and rapidly growing demand for thehighly trained. This can be achieved only through concerted andcooperative efforts by private individuals and organizations and by alllevels of government. The Federal Government can best play its partthrough programs designed to meet selected, critical needs and tostimulate improvements throughout our educational system.

The 1965 budget provides for an increase of $339 million in expendi-tures for education programs. Most of this increase is for measuresrecommended last year which were recently enacted and for pendingmeasures on which the Congress has not yet completed consideration.Other increases are provided for expanding existing programs, mainlythose of the National Science Foundation, and for a substantiallyenlarged program to aid individuals who require special educationand related services, particularly as part of the attack on poverty.

The new obligational authority recommended for fiscal 1965 totals$3.1 billion, an increase of $1.2 billion over 1964.

Proposed education legislation.—The budget includes new obliga-tional authority of $718 million and estimated expenditures of $118million in 1965 for education programs recommended last year whichare still pending, and for an enlargement of the proposed aid for



EDUCATION


Program or agency

Pay ments topublic

the

1963actual

1964esti mate

1965estimate

Recom-mended

new obligational

authorityfor 1965

Administrative Budget Funds:Assistance for elementary and secondary education:

Assistance to schools in federally impacted areasDefense education: Science, mathematics, and foreign

language instruction, and guidance and testingAssistance for higher education:

Construction of academic facilitiesCollege housing loansDefense education: Student loans, fellowships, and

language and area centersAssistance for land-grant colleges, Howard University

and Gallaudet CollegeAssistance to science education and basic research:

National Science Foundation:Basic research and specialized research facilitiesGrants for institutional science programs. __.Science educationOther science activities

Other aids to education:

Vocational educationOther defense education assistanceIndian education servicesLibrary of Congress and Smithsonian InstitutionOther

Proposed education legislation


Trust Funds

Intragovernmental transactions and other adjustments(deduct) _ _

Total.

$343

49

284

116

28

106315118

5520783827

1,244

33

1,214

$350

61

3223

149

30

132377021

7324844841

3

$395

76

38208

162

33

148587422

12723925165

118

1,348 1,691

48 52

1,302 1,641

$418

84

464300

165

28

22498

13729

20523974579

718

13,115

1 Compares with new obligational authority for 1963 and 1964, as follows:Administrative budget funds: 1963, $ 1 , 4 2 0 million; 1964, $ 1 , 8 8 8 million.Trust funds: 1963, $2 million; 1964, $2 million.

elementary and secondary education. These proposals would au-thorize Federal support for—

• Strengthening of our elementary and secondary school systemthrough grants for teachers' salary increases and urgently neededclassroom construction;



• An enlarged program providing project grants for educationas a major weapon to support broad community action programsto combat poverty and to provide special educational and relatedservices for certain groups of children—the handicapped, theilliterate, the culturally disadvantaged, slow learners, children ofmigrant agricultural workers, and the gifted and talented as well;• Expansion of the National Defense Education Act fellowshipprogram to help meet the need for highly trained professionalpersonnel, particularly college teachers and scientists;• Work-study and student loan insurance programs to help assurethat needy students are not denied a college education;• Programs to train new teachers and specialists required for ourschools;• Upgrading and supplementing the training of our present teachers;• Special assistance to ease desegregation of public schools;• Construction of public libraries and expansion of public libraryservices in urban as well as rural areas ;• Basic adult education; and• University extension services.

The following discussion relates principally to existing programs.

Assistance for elementary and secondary education.—Expendituresfor assistance to schools in federally impacted areas and for defenseeducation programs which support science, mathematics, foreignlanguage instruction, and guidance and counseling programs areestimated at $471 million in fiscal year 1965. The increase of $45million over 1964 for schools in federally impacted areas reflects anincrease of 100,000 students whose parents work or reside on Federalproperties, and a 5% increase in the cost of instruction. As an aid toconsideration of the future of this program, a thorough study will bemade of the impact of Federal activities on the fiscal and economicresources of local communities.

Assistance jor higher education.—A new program to assist in con-struction of classrooms, libraries and laboratories for graduate andundergraduate schools, public junior colleges, and technical instituteswas authorized in Public Law 88-204, approved December 16, 1963.The budget includes a proposed supplemental appropriation toinitiate this program in 1964. About $570 million in grants and loanswill be committed in 1965, with expenditures estimated at $38 million.

New obligational authority of $300 million will be available forcollege housing loans in 1965, the same as in 1964. Estimated ex-penditures in each of these years reflect anticipated sales to privatelenders of $50 million in Government loans previously made. Re-



Education - Program Trends

National Science Foundation

Fellowships and

Tramceships ~ 2

- 1 0 0

60 62 64 65Estimate

payments on outstanding loans and increased private participationin new loans during 1965 will further reduce net expenditures by$15 million in 1965 to an estimated $208 million.

Under the National Defense Education Act, the number of studentloans is expected to increase by 45% between 1963 and 1965, when anestimated 314,000 loans will be made.

Assistance to science education and basic research.—The NationalScience Foundation continues to perform a vital role in support ofscience education and fundamental research. In keeping with pro-posals made a year ago as part of the Administration's educationprogram, substantial increases are again recommended in the scopeof the programs of the Foundation to develop additional academicinstitutions of scientific excellence and to strengthen science education.

The need for highly trained manpower for engineering, mathematics,and the physical sciences—to which these programs would contributesignificantly—was underscored by the President's Science Advisory



Committee last year. Over 10,000 fellowships will be granted in 1965,an increase of nearly 80% over 1964. Increases are also provided in1965 for the support of basic research, including funds to proceedwith major procurement for Project Mohole. Total new obligationalauthority for the Foundation will rise from $353 million in 1964 to$488 million in 1965.

Other aids to education.—Expenditures for vocational educationprograms are estimated to increase by $54 million in 1965 to carry outthe provisions of Public Law 88-210, approved December 18, 1963.The act authorizes grants to States for vocational education and con-struction of facilities, and provides Federal support for projects whichwill meet the vocational needs of youths with special handicaps tolearning. The budget includes a supplemental appropriation of $60million for 1964 to initiate programs under the new act, and a furtherincrease of $89 million is recommended for 1965.

Expenditures are also estimated to increase in 1965 for (1) expandedresearch supported by the Office of Education to improve coursematerials, teaching methods, and knowledge about the processes ofeducation; (2) increased construction of educational television facili-ties; and (3) expanded training of teachers for the handicapped, asauthorized in Public Law 88-164.

VETERANS BENEFITS AND SERVICES

Payments to the public in 1965 for veterans programs are estimatedto decrease by $425 million from the current year's level. Majorexpenditure decreases include (1) $275 million in the housing loanprograms, largely reflecting continuing high sales of mortgages heldby the Veterans Administration and proposed sales of certificates ofparticipation in a pool of VA-guaranteed housing loans; (2) $146million in life insurance payments from trust funds, mainly becauseof a speedup of some dividend payments into 1964; and (3) $23 millionin education and training readjustment benefits, principally becausethese benefits under the GI bill for veterans of the Korean conflictare ending.

Service-connected compensation.—Compensation for disability anddeath arising from military service is estimated at $2,120 million in1965. This is a reduction of $6 million from 1964, reflecting a declinein the number of veterans and their survivors receiving benefits.It is estimated that beneficiaries will total 2,354,000 in 1965, which is7,000 less than in 1964. However, average payments per recipientwill increase in 1965, because of a cost-of-living increase in benefits tocertain widows, orphans, and dependent parents provided by legisla-tion enacted last year.



VETERANS BENEFITS AND SERVICES


Program or agency


1963actual

1964 1965

Recom-mended

new obli-gationalauthority(or 1965


Service-connected compensationNon-service-connected pensions

Readjustment benefits:Education and trainingDirect housing loans:


Housing loan guarantees ___Proposed legislation for pool participation sales of

housing mortgagesOther

Hospitals and medical care:Medical care and hospital services.__ _Construction of hospitalsMedical administration, research, and other

Other veterans benefits and services:Insurance and servicemen's indemnitiesBurial and other allowancesVeterans Administration general operating expenses

and other

$2,1161,698

- 8 6

- 2 3

$2,1261,743

56

- 6 9

10

$2,1201,777

33

-171

8

1,0366643

1457

169

1,1157550

1360

175

- 6 3

-10011

1,1108550

- 463

169

Subtotal, administrative budget. 5,186 5,362 5,081

Trust Funds:

National service life insurance...U.S. Government life insurance.Other

747799

565689

430579

Subtotal, trust funds. 835 642 495

Intragovernmental transactions and other adjustments(deduct) 50 54 52

Total. 5,971 5,950 5,525

$2,1211,778

29

150-150

1,11610252

1563

172

15,460

664489

1721

1 Compares with new obligational authority for 1963 and 1964, as follows:Administrative budget funds: 1963, $5,546 million; 1964, $5,566 million.Trust funds: 1963, $718 million; 1964, $726 million.

Costs of compensation are expected to decline in future yearsbecause the number of beneficiaries being added to the rolls is less thanthe number whose benefits are terminated through death, remarriage,or recovery from disability.



Nonser'vice-connected pensions.—Pension expenditures for disabilityand death not connected with military service are expected to rise by$34 million in 1965, as the average number of recipients increases by anestimated 78,000 to a total of 2,106,000. World War I pensionersand their surviving beneficiaries constitute 72% of this number.Pensions for veterans of World War II and the Korean conflict and forsurvivors of veterans will continue to rise as increasing numbers ofveterans reach ages at which rates of disability and mortality mount.

Readjustment benefits.—Expenditures for education and trainingbenefits are estimated to decline in 1965, as these benefits, mainly forveterans of the Korean conflict, will terminate on January 31, 1965.The number of war orphans receiving education and training isexpected to level off at an average of 15,000 per year. In the voca-tional rehabilitation program for the disabled, a decline in wartimetrainees will be offset by the increase in ex-servicemen injured inpeacetime service who are now entitled to vocational rehabilitationbenefits under legislation enacted in fiscal year 1963.

An increase of $102 million in net receipts in 1965 compared with1964 is expected in the direct housing loan program for veterans inrural areas and small towns. This change reflects an anticipatedreduction in loans from 15,000 in 1964 to 10,000 in 1965, plus increasedreceipts from sales of Veterans Administration-held mortgage loans.About $635 million of unobligated funds is estimated to be carriedforward into 1965 for the direct loan program, an amount considerablyin excess of the new loans expected to be made in that year. Accord-ingly, the budget includes a proposal to cancel the $150 million ofnew obligational authority which otherwise would become availablefor 1965 under present law.

Under the veterans loan guarantee program, 175,000 loans areestimated to be guaranteed in 1965, 8% fewer than in 1964. Fore-closures of mortgages financed with guaranteed loans are expectedto continue high, resulting in expenditures for the payment of claimsand for property acquisition only slightly less than in 1964. However,.properties and loans previously acquired by the Veterans Adminis-tration will be sold in increasing volume, resulting in net receipts of$63 million in 1965 compared with net expenditures of $10 million in1964.

In addition, legislation is recommended under which an estimated$100 million in certificates of participation in a pool of previouslyacquired veterans housing loans will be sold to private lenders in orderto broaden private financing of housing loan programs.



Veterans Benefits and Services - Prosram Trends

1,5 -

1 . 0 -

. 5 -

Admissions

500

- 4 0 0

} I I I I I I I I I I t \ I I I I I I I I I

1954 s* m 6S

Hospitals and medical care.—The 1965 budget includes expendituresof $1,160 million for hospital and medical care services, includingadministration and medical and prosthetic research. Although thetotal is about the same as in 1964, provision is made for continuedimprovement in the quality of medical care, expansion of research,and activation of a new 710-bed hospital in Washington, D.C.

Hospital, domiciliary, and nursing home care will be provided in1965 for an average of 137,622 beneficiaries per day in VeteransAdministration, contract, and State facilities—approximately thesame total as in 1964. There will also be an estimated 6 million visitsby veterans to outpatient clinics operated by the Veterans Admin-istration or to private physicians at the expense of the VeteransAdministration.

Hospital construction.—Expenditures for hospital construction in1965 are estimated to be $85 million. New obligational authority of



$102 million is proposed for the year, representing the fifth step incarrying out the 15-year $1.2 billion hospital program initiated in 1961to modernize the 125,000-bed hospital system. Construction of onenew facility of 1,040 beds in Los Angeles, Calif., and replacement oftwo hospitals containing 1,940 beds in Hines, 111., and San Juan, P.R.,will begin in 1965, and planning will be initiated for one other hospital.Several new modernization projects will also be undertaken, and newobligational authority of $6 million in 1965 is provided for the con-struction and planning of new medical research facilities.

Veterans life insurance trust funds.—The National Service and U.S.Government life insurance trust funds finance over 5 million lifeinsurance policies, primarily for veterans of World Wars I and II.Receipts are chiefly from premiums and interest on investments;expenditures are mainly for death and disability claims and dividends.Trust fund expenditures are estimated to decline by $146 million infiscal year 1965, mainly because $113 million of the $234 million totalregular dividend payments due in that year are being acceleratedinto the winter months of fiscal year 1964.

Other veterans benefits and services.—Insurance and indemnityexpenditures made from administrative budget funds are estimatedto decline by $17 million in 1965 because of the completion of paymentsof special dividends and the gradual phase-out of the servicemen'sindemnity program as installment payments are completed.

Reductions in workloads and continuing improvements in produc-tivity will result in decreased costs for general administrative opera-tions of the Veterans Administration. These reductions will morethan offset the added cost in 1965 mandatory pay increases as providedin the Federal Salary Reform Act of 1962.

INTEREST

Interest payments will continue to rise in 1965, reflecting in part thehigher average level of the outstanding public debt. The higher pay-ments also take into account the effect in 1965 of interest rate increaseswhich have taken place in the last few years to stem the flow of short-term funds abroad. The impact on the budget is occurring graduallyas individual issues mature and are refunded with securities payinghigher interest.

Payments to the public in 1965 for interest, primarily on the publicdebt, will be $2.5 billion less than the estimated administrativebudget expenditures of $11.1 billion. The difference results fromtwo factors: (1) Interest payments to Federal trust funds and agencieson their investments in United States Government securities, esti-mated at $1.9 billion in 1965, are included in administrative budget



INTEREST


Item


1963actual

1964estimate

1965

Recom-mended



Interest on public debt

Interest on refunds of receipts

Interest on uninvested funds _

Subtotal, administrative budget __

Intragovernmental transactions and other adjustments(deduct):

Excess of interest accrued over interest paidInterest paid to trust funds and Government agencies

Total

$9,8957411

$10,6009011

$11,0009012

$11,0009012

9,9

8811,672

10,701

7721,809

11,101

6031,903

11,102

7,427 8,120 8,596

expenditures, but are excluded from cash payments to the publicsince they are transactions within the Government; and (2) accrualsof interest on savings bonds—included in administrative budgetexpenditures—are estimated to exceed by $603 million the actualpayments of cash to bondholders redeeming bonds during 1965.

Of the $8.6 billion of estimated payments to the public for interest,over $900 million of the interest paid on securities held by the FederalReserve banks will be offset by the customary payments of excessearnings by the Reserve banks to the Treasury, which are included in .miscellaneous budget receipts.

GENERAL GOVERNMENT

Expenditures in 1965 for the general administrative and law enforce-ment activities of the legislative, judicial, and executive branches ofthe Federal Government will amount to an estimated $2.2 billion,the same as in 1964. Increases from the 1964 estimate to improverevenue collection activities and to build, repair and operate Govern-ment buildings will be offset by decreases for other activities.

Central fiscal operations.—Expenditures of the Internal RevenueService are estimated at $592 million in fiscal year 1965, an increaseof $28 million over 1964. This increase will provide the resourcesnecessary to purchase the automatic data processing equipment andpay the related operating personnel required for the 1965 phase inthe establishment of a nationwide master file record of taxpayers.



GENERAL GOVERNMENT


Program or agency


1963actual

1964estimate

1965estimate

Recom-mended



Legislative functionsJudicial functionsExecutive direction and managementCentral fiscal operations:

Internal Revenue Service _.Other

General property and records management;General Services Administration:

Public Buildings Service:ConstructionOperation, maintenance, and other _ _

OtherCentral Intelligence Agency building

Central personnel management:Department of LaborCivil Service Commission:


Protective services and alien control:Department of JusticeOther

Other general government:Territories and possessionsGovernment Printing Office buildingClaims and other


Trust Funds

Intragovernmental transactions and other adjustments(deduct)

Total.

$1316321

497218

12027151

2

69

73

31112

115

24

1,979

19

14

,983

$1416824

564237

141294104

1

63

112

$1387224

592246

169315

77

32314

138

16

57

114- 6 5

33615

125167

2,238 2,238

18 18

15 16

2,241 2,239

$1241125

595259

19932590

57

114- 6 5

36115

14047

6

12,368

1 Compares with new obligational authority for 1963 and 1964, as follows:Administrative budget funds: 1963, $2,170 million; 1964, $2,297 million.Trust funds: 1963, $17 million; 1964, $17 million,

Increased appropriations are requested to construct the new U.S.mint in Philadelphia authorized by legislation enacted last August.The new facility is necessary to meet the steadily rising demand forcoins. It will permit large-scale production methods which willreduce coin manufacturing costs substantially.

700-000 0—64 9


130 THE BUDGET FOR FISCAL YEAR 1965'

General Government - Prosram Trends

Billions' '-;'-,_ vV ****%$; Check, and Bonds

1 —

I | i i | | i 1 \

t o -

I 1 i I

64 65 1954 56 60 62 64 65Estimate

Legislation is being requested to extend the Renegotiation Actbeyond its present expiration date of June 30, 1964, in order to con-tinue the Renegotiation Board's activities in recovery of excessiveprofits on procurement for the national defense program.

General property and records management.—To continue the Gov-ernment-wide program of providing more modern and efficient facil-ities for Government operations, new obligational authority of $199million is requested for fiscal year 1965 for acquisition of sites, plan-ning, and construction of new buildings by the General ServicesAdministration. This amount is about the same as the appropriationsfor 1964 for these purposes. Progress on construction financed inprior years, however, will cause expenditures for construction to riseby $28 million. Increases are also estimated for operation, repair,and maintenance of facilities. These increases for public buildingsactivities will be partly offset by a reduction in net expenditures for



the Federal Supply Service, primarily because larger advances areexpected to be received from agencies ordering supplies.

Central personnel management.—-Present law requires an appropria-tion from the administrative budget to the civil service retirementand disability trust fund, largely to pay increased annuities to presentretirees, effective January 1, 1963. Enactment of pending legislationwould permit payment of such benefits directly from the retirementfund, thus eliminating $65 million from the administrative budget for1965.

Protective services and alien control.—An increase of $13 million inexpenditures is anticipated in 1965 for the law enforcement and relatedactivities of the Department of Justice. New obligational authorityrecommended for 1965 will increase by $23 million, primarily to com-plete construction of the psychiatric prison hospital in North Carolinaand to build a new National Training School for Boys in West Virginiato replace badly deteriorated facilities in Washington, D.C.

Territories and possessions.—In accordance with legislation enactedlast fall to assist in the rehabilitation of Guam, supplemental appropri-ations of $11 million are recommended for 1964, and an almost equalamount for 1965, for loans and grants, mainly to replace public facili-ties destroyed by the typhoon in November 1962.

The programs for the Trust Territory of the Pacific will be expandedfurther to improve health, educational, and economic conditions ofthis area.



Table 14. NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BYFUNCTION AND AGENCY (in millions of dollars)

Description

ADMINISTRATIVE BUDGETFUNDS

050 NATIONAL DEFENSE051 Department of Defense—Military:

Military personnelOperation and maintenanceProcurement. _.Research, development, test; and eval-

uationMilitary constructionFamilv housing.Civil defense _Military assistanceRevolving and management funds

Total 051

058 Atomic energy:Atomic Energy Commission

059 Defense-related activities:Executive Office of the PresidentFunds appropriated to the PresidentDepartment of Health, Education, and

Welfare . _Treasury DepartmentGeneral Services Administration _ _Other independent agencies: Selective

Service System ,

Total 059

Total, national defense

150 INTERNATIONAL AFFAIRSAND FINANCE

151 Conduct of foreign affairs:Department of StateOther independent agencies:

Foreign Claims Settlement Commis-sion

Tariff CommissionUnited States Arms Control and Dis-

armament Agency

Total 151

152 Economic and financial programs:Funds appropriated to the PresidentDepartment of AgricultureDepartment of CommerceDepartment of StateOther independent agencies: Export-

Import Bank of Washington

Total 152

NEW OBLIGATIONALAUTHORITY

1963actual

12,73911,49616,647

6,9931,204

590126

1,3251

51,120

3,135

5

7

18

38

68

54,323

339

743

6

422

4,784250

1217

5,063

1964stimate

13,93811,70915.706

6,949948637112

1,000

51.000

2,743

6

28

24

38

95

53,837

288

13

8

300

2,208215

911

2,443

1965estimate

14,76912,39613,756

6,7221,168

711358

1,000

50,880

2,693

8

10

18

43

79

53,652

294

23

11

310

2,775264

48

3,051

EXPENDITURES

1963actual

13,00011,87416,632

6,3761,144

427203

1,721-1.401

49.973

2,758

5- 5 7

20*

22

3424

52,755

340

13

2

346

2.207216

37

-392

2.041

1964estimate

14,18011,87016,337

6.9431.107

680150

1,400-367

52,300

2,800

5126

13*

16

37197

55,297

282

233

7

316

2,285246

511

-650

1,897

1965stimate

14,66012,27814.785

6,5801,056

660150

1,200-169

51,200

2,735

8- 3 8

15*

17

42

44

53.979

283

193

9

315

2.302244

79

-856

1,705

See footnotes at end of table, p. 144.



Table 14. NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BYFUNCTION AND AGENCY (in millions of dollars)—Continued

Description

ADMINISTRATIVE BUDGETFUNDS—Continued

153 Foreign information and exchangeactivities:

Department of State _ _ _Other independent agencies: United

States Information Agency

Total 153

Total, international affairs andfinance

250 SPACE RESEARCH AND TECH-NOLOGY

251 Space research and technology:National Aeronautics and Space Ad-

ministration

350 AGRICULTURE AND AGRI-CULTURAL RESOURCES

351 Farm income stabilization and Foodfor Peace:

Department of Agriculture

352 Financing farming and rural housing:Department of AgricultureOther independent agencies: Farm

Credit Administration _ -

Total 352

353 Financing rural electrification andrural telephones:


354 Agricultural land and water re-sources:


355 Research and other agriculturalservices:

Funds appropriated to the PresidentDepartment of Agriculture

Total 355

Total, agriculture and agriculturalresources


1963actual

51

157

207

5,693

3,673

5,677

102

3

104

490

406

393

393

7,070

1964

85

166

251

2,994

5,241

4,977

72

3

74

506

417

410

410

6,385

1965

54

176

230

3,591

5,304

3,938

157

3

160

93

429

394

394

5,014

EXPENDITURES

1963actual

46

155

201

2,588

2,552

5,517

296

4

300

342

404

1390

391

6,954

1964

74

160

234

2,447

4,400

4,746

280

- 1

279

219

417

2406

409

6,070

1965

56

172

227

2,248

4,990

3,750

129

1

130

216

423

388

388

4,907




Description


400 NATURAL RESOURCES401 Land and water resources:

Department of Defense—Civil _ _ _ _Department of the Interior. _Department of StateOther independent agencies:

Federal Power CommissionDelaware River Basin CommissionTennessee Valley AuthorityU.S. Study Commission—Southeast

River BasinsU.S. Study Commission—Texas

Total 401

402 Forest resources:Department of AgricultureDepartment of the Interior _ _

Total 402..

403 Mineral resources:Department of the Interior

404 Fish and wildlife resources:Department of Defense—CivilDepartment of the InteriorDepartment of State

Total 404 . .

405 Recreational resources:Department of the InteriorOther independent agencies: Outdoor

Recreation Resources Review Com-mission

Total 405

409 General resource surveys and ad-ministration:

Department of the Interior

Total, natural resources

500 COMMERCE AND TRANSPOR-TATION

501 Aviation:Department of CommerceFederal Aviation Agency. _Other independent agencies: Civil Aero-

nautics Board. __

Total 501


1963

1,046587

14

11*

35

1*

1,694

33216

348

90

*104

2

106

134

134

75

2,447

755

83

838

1964

1,097616

49

12*

47

1,821

34116

357

91

*109

2

112

131

131

76

2,588

813

88

901

1965

1,152582

18

13*

51

1,817

33819

357

110

*112

2

114

158

158

82

2,637

751

84

835

EXPENDITURES

1963actual

1,072548

14

11*

53

1*

1,699

28716

303

71

*922

94

112

*

112

73

2,352

*726

82

808

1964

1,075559

16

12*

57

*

*

1,720

33815

354

107

*102

2

104

122

*

122

76

2,483

*

790

85

875

1965

1,13356232

13*

68

1,808

32118

339

113

*107

2

110

138

138

80

2,588

*829

83

912





Description


502 Water transportation:Department of CommerceDepartment of Defense—CivilTreasury Department-Other independent agencies: St. Law-

rence Seaway Development Corpora-tion

Total 502 .

503 Highways:Department of Commerce

505 Postal service:Post Office Department. _

506 Advancement of business:Department of CommerceDepartment of the InteriorOther independent agencies:

Alaska International Rail and High-way Commission

Small Business Administration.

Total 506

507 Area redevelopment:Funds appropriated to the PresidentDepartment of Commerce

Total 507

508 Regulation of business:Department of CommerceDepartment of JusticeOther independent agencies:

Civil Aeronautics BoardFederal Communications Commission-Federal Maritime CommissionFederal Trade CommissionInterstate Commerce CommissionSecurities and Exchange Commission. ~

Total 508

Total, commerce and transportation_

550 HOUSING AND COMMUNITYDEVELOPMENT

551 Aids to private housing:Housing and Home Finance AgencyOther independent agencies: Federal

Home Loan Bank Board

Total 551


1963actual

295

305

599

50

840

289

306

595

850162

1,012

46

9152

112413

854,020

247

247

1964estimate

345

365

710

42

654

247

98

345

30153

183

47

10163

122514

902,926

263

263

1965estimate

357

423

780

36

551

299

7

307

5222

228

57

11173

132615

972,833

93

93

EXPENDITURES

1963actual

36410

297

1

672

41

770

2251

*142

366

6239

101

46

9142

122413

842,843

- 2 7 3

- 2 6 4

- 5 3 7

1964estimate

3506

351

1

708

45

546

284*

141

426

36598

463

46

10163

122414

893,151

- 4 7 3

- 2 5 0

- 7 2 3

1965estimate

336- 1380

2

717

42

475

314*

141

455

245130

375

47

10163

132515

943,069

- 6 9 3

- 3 4 9

- 1 , 0 4 1

See footn at end of table, p. 144.




Description


552 Public housing programs:Housing and Home Finance Agency

553 Urban renewal and community facili-ties:

Housing and Home Finance Agency

555 National Capital region:Other independent agencies:

Commission of Fine ArtsNational Capital Housing Authority._National Capital Planning Commis-

sion..National Capital Transportation

AgencyInterstate Commission on the Poto-

mac River BasinDistrict of Columbia

Total 555

Total, housing and communitydevelopment..

650 HEALTH, LABOR, AND WEL-FARE

651 Health services and research:Department of Health, Education, and

Welfare _ -

652 Labor and manpower:Department of the Interior. _Department of LaborOther independent agencies:

Federal Coal Mine Safety Board ofReview

Federal Mediation and ConciliationService

National Labor Relations BoardNational Mediation BoardPresident's Advisory Committee on

Labor-Management Policy

Total 652 .

653 Public assistance:Department of Health, Education, and

Welfare


1963

195

43

**

1

3

*70

74

559

1,715

8292

*

521

2

*

329

2,814

1964

212

1,428

**

1

1

60

62

1,965

1,882

9407

*

6222

*

446

2,946

1965

231

125

**

1

1

*72

74

523

2.154

10773

*

6252

*

816

3,084

EXPENDITURES

1963

178

222

**

2

2

*66

70

-67

1,354

8187

*

5212

*

224

2,788

1964

146

316

**

2

1

*66

69

-191

1,638

8351

*

6222

*

390

3,007

1965

222

411

#

1

1

*88

90

-317

1.733

9609

625

2

*

651

2,869





Description


655 Other welfare services:Funds appropriated to the PresidentDepartment of AgricultureDepartment of Health, Education, and

WelfareOther independent agencies: Railroad

Retirement Board

Total 655

Total, health, labor, and welfare. __

700 EDUCATION701 Assistance for elementary and

secondary education:Department of Health, Education, and

Welfare

702 Assistance for higher education:Department of Health, Education, and

WelfareHousing and Home Finance Agency

Total 702

703 Assistance to science education andbasic research:

Other independent agencies: NationalScience Foundation

704 Other aids to education:Legislative branchDepartment of Health, Education, and

WelfareDepartment of the InteriorOther independent agencies: Smith-

sonian Institution

Total 704Proposed education legislation

Total, education. _ _ _

800 VETERANS BENEFITS ANDSERVICES

801 Veterans service-connected compen-sation:

Veterans Administration

802 Veterans non-service-connected pen-sions:

Veterans Administration

803 Veterans readjustment benefits:Veterans Administration


1963

25382

117

524

5,382

419

149300

449

322

20

11283

14

229

1,420

2,117

1,700

296

1964

20

327

144

491

5,765,

446

452300

752

353

20

19889

23

3315

1,888

2,121

1,739

217

1965

20344

216

14

593

6,647

502

658300

958

488

24

30897

21

449718

3,115

2,121

1,778

40

EXPENDITURES

1963

31

284

110-1

423

4,789

392

144284

428

206

18

10278

20

219

1,244

2,116

1,698

-13

1964

35325

139

498

5,533

411

182223

404

260

22

13884

26

2693

1,348

2,126

1.743

6

1965

23344

199

14

579

5,832

471

234208

442

302

23

21692

28

359118

1,691

2,120

1,777

-290




Description


804 Veterans hospitals and medical care:Veterans Administration

805 Other veterans benefits and services:Department of Defense—CivilDepartment of LaborVeterans AdministrationOther independent agencies:

American Battle Monuments Com-mission

Historical and Memorial Commission-

Total 805

Total, veterans benefits and serv-ices _ _.

850 INTEREST851 Interest on the public debt:

Treasury Department

852 Interest on refunds of receipts:Treasury Department

853 Interest on uninvested funds:Treasury Department

Total, interest _

900 GENERAL GOVERNMENT901 Legislative functions:

Legislative branch

902 Judicial functions:The JudiciaryOther independent agencies: Indian

Claims Commission

Total 902

903 Executive direction and management:Executive Office of the PresidentFunds appropriated to the PresidentTreasury DepartmentGeneral Services Administration

Total 903

904 Central fiscal operations:Treasury DepartmentOther independent agencies:

General Accounting Office _Renegotiation BoardTax Court of the United States

Total 904


1963actual

1,170

101

251

2

263

5,546

9,895

74

11

9,980

129

64

*

64

1812*

22

681

4422

729

1964estimate

1,222

111

253

2*

267

5.566

10,600

90

11

10,701

127

67

*

67

1912*

23

736

4632

787

1965estimate

1,270

131

234

2*

250

5,460

11,000

90

12

11,102

124

11

*

72

2112*

25

802

4732

854

EXPENDITURES

1963actual

1,145

111

227

2

240

5,186

9,895

74

11

9,980

131

63

63

1812*

21

669

4222

715

1964estimate

1,240

111

234

2*

248

5,362

10,600

90

11

10,701

141

67

*

68

2012

24

749

4622

800

1965estimate

1,246

121

214

2*

229

5,081

11,000

90

12

11,101

138

72

*

72

2012*

24

787

4732

838





Description


905 General property and records man-agement:

General Services AdministrationOther independent agencies: Central

I intelligence Agency.

Total 905

906 Central personnel management:Department of LaborOther independent agencies: Civil Serv-

ice Commission

Total 906

908 Protective services and alien control:Department of Justice __Treasury DepartmentOther independent agencies:

Civil Service Commission _Commission on Civil RightsSubversive Activities Control Board. _

Total 908

910 Other general government:Legislative branchFunds appropriated to the PresidentDepartment of Defense—Civil _Department of the InteriorTreasury DepartmentOther independent agencies:

Advisory Commission on Intergovern-mental Relations. _

Historical and memorial commissions. _Commission on International Rules of

Judicial Procedure

Total 910.. .

Total, general government

Allowance for attack on povertyAllowance for civilian pay comparabilityAllowance for contingencies

Inter fund transactions 1

Total, administrative budget


1963

603

603

69

73

142

31211

11*

325

113

353768

**

*

156

2,170

102,283

1964

610

610

63

110

173

33812

11*

352

93

424757

**

158

2,297

400

102,554

1965

614

614

57

49

106

36113

11*

376

52

484452

**

197

2,368

500544500

103,789

EXPENDITURES

1963

442

2

444

69

73

142

31110

*1*

323

- 33

353271

**

*

139

1,979

-513

92,642

1964

539

1

540

63

112

175

32312

11*

338

33

504058

**

*

154

2,238

250

-685

98,405

1965

561

561

57

49

106

33613

11*

351

18*

482952

**

148

2,238

250544300

-600

97,900





Description

TRUST FUNDS

050 NATIONAL DEFENSE051 Department of Defense—Military:

Department of Defense—MilitaryMilitary assistance ._

Total 051

058 Atomic energy:Atomic Energy Commission

059 Defense-related activities:Treasury Department


150 INTERNATIONAL AFFAIRSAND FINANCE

151 Conduct of foreign affairs:Department of JusticeDepartment of StateTreasury DepartmentForeign Claims Settlement Commission.

Total 1 5 1 . . _ . . ._

152 Economic and financial assistance:Funds appropriated to the PresidentDepartment of CommerceDepartment of State

Total 152

153 Foreign information and exchangeactivities:

Department of StateUnited States Information Agency

Total 153

Total, international affairs andfinance _ _

250 SPACE RESEARCH AND TECH-NOLOGY

251 Space research and technology:National Aeronautics and Space Ad-

ministration

350 AGRICULTURE AND AGRI-CULTURAL RESOURCES

351 Farm income stabilization and Foodfor Peace:



1963actual

6886

892

*

*

892

**

24

24

46*

10

**

*

34

*

*

1964estimate

51,682

1,687

2

1,689

*8

48

56

310*

13

**

*

68

2

*

1965estimate

51,325

1,330

1

1,331

*2

119

121

36*

9

**

*

130

*

*

EXPENDITURES

1963actual

5674

679

*

*

679

32*6*

38

15*

6

**

*

44

1964estimate

5860

865

2

867

52*1

22

75

38*

11

**

*

86

*

*

1965stimate

51,225

1,230

1

1,231

22*1

66

90

35*

9

**

*

99

2

nd of table, p. 144.




Description

TRUST FUNDS—Continued

352 Financing farming and rural hous-ing:

Department of AgricultureFarm Credit Administration

Total 352

354 Agricultural land and water re-sources:

Department of Agriculture __

355 Research and other agriculturalservices:


Total, agriculture and agriculturalresources

400 NATURAL RESOURCES401 Land and water resources:

Department of Defense—CivilDepartment of the Interior

Total 401...

402 Forest resources:Department of Agriculture

403 Mineral resources:Department of the Interior. _

404 Fish and wildlife resources:Department of the Interior

405 Recreational resources:Department of the Interior

409 General resource surveys and ad-ministration:

Department of the Interior.


500 COMMERCE AND TRANSPOR-TATION

501 Aviation:Federal Aviation Agency _

502 Water transportation:Department of CommerceTreasury Department

Total 502


1963actual

*

25

25

282

30

26

2

1

1

74

134

*

18*

18

1964estimate

1

27

28

212

23

27

1

1

1

55

109

22*

22

1965estimate

1

27

28

191

20

27

1

1

1

49

100

1*

1

EXPENDITURES

1963actual

*483

483

1

24

507

222

24

21

1

1

2

72

122

*

15*

15

1964estimate

1447

448

1

27

475

342

36

23

1

1

2

74

138

*

16*

16

1965estimate

1413

414

1

27

442

202

22

23

1

1

1

59

107

13*

13





Description


503 Highways:Department of Commerce

506 Advancement of business:Department of CommerceFederal Deposit Insurance Corporation.

Total 506

508 Regulation of business:Federal Communications Commission...

Total, commerce and transportation.

550 HOUSING AND COMMUNITYDEVELOPMENT

551 Aids to private housing:Housing and Home Finance AgencyFederal Home Loan Bank Board.__ ___

Total 551

555 Aids to National Capital area:National Capital Housing AgencyNational Capital Planning Commission. _District of Columbia

Total 555

Total, housing and community de-velopment

650 HEALTH, LABOR, AND .WEL-FARE

651 Health services and research:Department of Health, Education, and

Welfare

652 Labor and manpower:Department of Labor

654 Retirement and social insurance:The JudiciaryDepartment of Health, Education, and

WelfareDepartment of Labor _ _ _ _Department of State _ _Civil Service CommissionRailroad Retirement Board _

Total 654

Total, health, labor, and welfare


1963actual

3,584

4

4

3,605

208

208

*346

346

554

1

1,054

1

14,9893,206

82,2471,115

21,566

22,621

1964

3,706

4

4

3,731

100

100

1348

349

449

1

1,113

1

17,0723,079

92,3821,218

23,761

24,874

1965

3,806

4

4

3,811

147

147

419

419

566

*

766

1

17,4993,167

92,3911,279

24,346

25,112

EXPENDITURES

1963actual

3,019

4-161

-157

*

2,877

-730363

-367

- 2*

334

332

-36

1

348

*

15,7893,467

71,1311,112

21,506

21,855

1964

3,554

4-180

-176

3,394

301,200

1,230

11

396

398

1.«8

1

422

*

16,7043,133

81,2721,129

22,246

22,669

1965

3,651

4-202

-198

3;466

138-100

38

1

417

418

456

*

452

*

17,5182,991

81,4351,144

23,097

23,549





Description


700 EDUCATION703 Assistance to science education and

basic research:National Science Foundation _ _ _Smithsonian Institution __

Total 703 .

704 Other aids to education:Legislative branch

Total, education

800 VETERANS BENEFITS ANDSERVICES

805 Other veterans benefits and services:Department of Defense—CivilVeterans Administration__American Battle Monuments Commis-

sion

Total, veterans benefits and serv-ices ___

900 GENERAL GOVERNMENT904 Central fiscal operations:

Treasury DepartmentGeneral Accounting OfficeTax Court of the United States

Total 904.

905 General property and records man-agement:

General Services Administration_

906 Central personnel management:Department of Labor . _

908 Protective services and alien con-trol:

Department of Justice.

910 Other general government:Historical and memorial commissions _

Total, general government. _ _

Deposit fundsInterfund transactions 1

Total, trust funds _ . . .


1963actual

**

2

2

6711

*

718

16**

16

*

*

17

28,602

1964estimate

**

*

2

2

7719

*

726

\7**

17

*

*

*

17

31,695

1965estimate

**

*

2

'2

7714

*

721

18

18

*

*

18

31,817

EXPENDITURES

1963actual

**

*

2

2

7828

*

835

16**

16

2

*

*

19

146-505

26,545

1964estimate

**

*

2

2

8634

*

642

18**

18

*

*

*

18

-116-488

29,315

1965estimate

**

*

2

2

7489

*

495

18**

18

*

*

18

-17-477

29,372




1964estimate

19515441

170112750

318

1965estimate

268

~2l176

113250

323

*Less than one-half million dollars.1 Interfund transactions shown as deduct lines above are as follows:

1963Administrative Budget actual

Interest on loans to Government-owned enterprises:Commodity Credit Corporation 186Expansion of Defense Production 6Export-Import Bank of Washington 51Housing and Home Finance Agency 160Panama Canal Company 10Small Business Administration 20Veterans Administration 47St. Lawrence Seaway Development Corporation 2Other 16

Fees and other charges:Public enterprise funds * * *Panama Carnal Company for annuity payment and cost of Canal Zone

Government 14 15 16

Total, administrative budget _ 513 685 600

Trust FundsPayments to employees' retirement fund receipts:

District of Columbia government 7 7 8District of Columbia employees' pay deductions 7 7 8

Payments between funds:FOASI fund from Federal disability insurance fund 2 3 3Railroad retirement account from:

FOASI trust fund 423 423 418Unemployment trust fund 9 10 13Federal disability insurance fund ' 20 20 18

Civil service retirement and disability fund to Foreign Service retire-ment fund. * * *

Unemployment trust fund from railroad retirement account 38 18 8

Total, trust funds _ _ 505 488 477


PART 5

THE FEDERAL PROGRAMBY AGENCY

145

700-000 0—64 10


EXPLANATION OF MEANS OF FINANCINGAGENCY ACTIVITIES

TYPES OF FUNDS

Agency activities are financed both through administrative budgetfunds and through trust funds.

The administrative budget covers Federal (Government-owned)funds which are of four types. The general fund is credited withreceipts not earmarked by law, and is charged with expenditurespayable from such revenues and from general borrowing. Specialfunds account for Federal receipts earmarked for specific purposes,other than carrying out a cycle of operations. Public enterprise (re-volving) funds finance a cycle of operations in which expendituresgenerate receipts primarily from the public. Intragovernmental revolv-ing and management funds facilitate financing operations within andbetween Government agencies.

Trust funds are established to account for receipts which are heldin a fiduciary capacity by the Government for use in carrying outspecific purposes and programs. Within the category of trust fundsthere is a special category of trust revolving funds which carry on a cycleof business-type operations.

The budget also includes (in association with the trust funds)deposit funds, which are not used for Government programs but areessentially suspense or agent accounts, and some transactions ofcertain Government-sponsored enterprises. The following discussionis not generally pertinent to them.

NEW OBLIGATIONAL AUTHORITY AND OBLIGATIONS

New obligational authority.—Government agencies are permitted toenter into obligations, requiring either immediate or future paymentof money, only when they have been granted authority to do so bylaw. The amounts thus authorized by Congress are called newobligational authority (NOA). Such authority is related to theobligations expected to be incurred. Some new obligational authorityis granted for 1 fiscal year; some is for a longer period or is providedwithout a time limit on its use. In some cases NOA is requestedand granted to finance a project fully (especially construction, re-search, or procurement) at the time it starts, allowing the obligationsto be spread over 2 or more years.

New obligational authority usually takes the form of appropriationswhich permit obligations to be incurred and expenditures to be made.

146


THE FEDERAL PROGRAM BY AGENCY 147

Some is in the form of contract authorizations which permit obligations,but require an appropriation "to liquidate" in order to permit ex-penditures in payment of the obligations. Any part of NOA whichis not used for obligations during the period for which it is madeavailable by the Congress expires, and thus cannot be used at a latertime. However, reappropriations and reauthorizations are congres-sional actions to continue availability of unused balances whichwould otherwise expire. There are also authorizations to expend fromdebt receipts; such NOA permits the use of borrowed money to incurobligations and make expenditures. Authority to use Treasuryborrowing is an authorization to expend from public debt receipts;authority to borrow directly from private enterprise, granted only tocertain Government corporations, is called an authorization to expendfrom corporate debt receipts.

Most new obligational authority of administrative budget fundsis granted year by year (current authorizations). Some new obliga-tional authority in the administrative budget and most NOA in thetrust funds permit additional sums to become available from time totime without further action by the Congress (permanent authori-zations) .

The amount of new obligational authority is usually named specifi-cally in the act of Congress which makes it available (definite author-izations), but in a few cases the amount is left indefinite to be de-termined by subsequent circumstances (indefinite authorizations); anexample is the appropriation for interest on the public debt.

Obligations incurred.—Following the enactment of new obligationalauthority, obligations are incurred by Government agencies. Suchobligations include the currently accruing liabilities for salaries andwages, certain contractual services, and interest; entering into con-tracts for equipment, construction, and land; approval of agreementsto make loans; and other commitments requiring the payment ofmoney.

EXPENDITURES AND BALANCES

Expenditures.—Obligations are liquidated by the issuance of checks,disbursement of cash, the maturing of interest coupons in the case ofsome bonds, and, in a few special cases, by issuance of bonds or notes(or increases in the redemption value of bonds outstanding) in lieu ofchecks. Retirement of debt and purchase of the Government's ownsecurities are not counted as expenditures (or as obligations incurred).

Expenditures during any fiscal year may be payments of obligationsincurred in prior years or in the same year. The expenditures there-fore flow in part from balances of prior year NOA and in part fromNOA provided for the year in which the money is spent.

For three types of funds—public enterprise, intragovernmental, andtrust revolving funds—expenditures are stated net of receipts. If



receipts exceed expenditures the difference shows as a minus entry inthe expenditure tables. Moneys received from the issuance of debtinstruments or the sale of the Government's own securities are notcounted as receipts or netted against expenditures.

Expenditures of the individual accounts and funds include variouspayments to other accounts and funds. For example, a number ofpublic enterprise funds pay, to the general fund, interest on the capitalthey have received from the Government. Interfund transactions ofthis type within the administrative budget are deducted at the end ofthe expenditure tables (and identical deductions are made at the endof the receipt tables). Similar interfund deduc:ions are made in thetrust fund tables for those payments made by one trust fund to•another.

Balances.—Not all of the obligational authority enacted for a fiscalyear is paid out in the same year. In the case of salaries and wages,only 2 to 3 weeks elapse between the time of obligation and the timeof expenditure. On the other hand, in the case of major procure-ment and construction, several years may elapse. Amounts whichhave been obligated are always carried forward to cover the subsequentexpenditure in payment of such obligations.

Most appropriations for current operations are made available forobligation only within the year (1-year appropriations). Some arefor a specified longer period (multiple-year appropriations). Some,including most of those for construction, some for research, and nearlyall trust fund appropriations are made available by Congress untilexpended (no-year appropriations), and remain available for obligationuntil objectives have been completed.

Therefore, a change in the amount of new obligational authorityfor a given year does not necessarily change either the obligationsincurred or the budget expenditures in that same year by an equalamount. A change in new obligational authority in any one yearmay spread its effect over obligations for 2 or more years and overexpenditures for even a longer period.

ESTIMATES FOR 1964 AND 1965

Data for 1964.—Congress has already acted on appropriations andother new obligational authority for fiscal year 1964, but additionalsupplemental amounts are estimated to be required in certain cases.Where the word "enacted" is used in the budget in reference to 1964,as in tables 4 and 5, the amounts are those already voted by Congress(including the amounts likely to be available in the case of appro-priations made in an indefinite amount) or the expenditures there-under, unless otherwise indicated. Where the word "estimate" isused, the amounts include both those which are enacted and neededsupple mentals, including some pending before the Congress. Certain


THE FEDERAL PROGRAM BY AGENCY 149

standard footnotes are used in the following table to distinguish thestatus of pending or proposed items for 1964 in this part of the budget.

Data for 1965.—This budget is complete as to the estimates for1965 as now foreseen. The budget appendix generally includes theproposed appropriation language for the various items which areidentified in the budget. However, in some instances—mainly casesof proposed new legislation—estimates are included in the budget,but formal transmittal of the proposed text of the appropriationlanguage (or other proposal) will be made later. In certain tables,these items for later transmittal and expenditures therefrom areidentified in separate columns, or by special footnotes, as in the follow-ing table. In tables where there is no such specific identification, theestimate for 1965 is comprehensive, whether or not the necessaryappropriation language is formally transmitted at this time.

Changes from 1964 to 1965.—The table which follows gives data for1963, 1964, and 1965, with figures on increases or decreases of 1965compared with 1964. These changes include certain mandatory costchanges as well as proposals of the President with respect to programs.The 1965 estimates provide the full year's cost of the pay increaseseffective in January 1964, under the Federal Salary Reform Act of1962, for which only a half-year's cost was provided in fiscal year 1964.

Special allowances.—It is certain that additional needs, not nowknown, will arise during the remainder of 1964 and 1965, and supple-mental proposals will be transmitted to Congress when required tofinance them. Congress will also enact legislation which is not speci-fically provided for in the budget, either because it is not proposed bythe President, or because its cost in either of the 2 years is relativelysmall. Furthermore, some legislative proposals may involve all (asfor civilian comparability pay adjustments), or a number of agencies(as for the poverty program for 1965). In such cases it is not feasibleto show individual items under the agencies concerned. Lump-sumallowances are included in the summary tables of the budget to coversuch items.

Annexed budgets.—The expenditures and reveaues of seven self-supporting Government agencies or programs have heretofore beenomitted from the budget documents, except that partial figures onthree of them have been included in the trust fund and consolidatedcash totals (but with no supporting data in the appendix). Withoutmaking any changes in the totals, a memorandum section now coversthese activities at the end of part 5, and some details on them appearin the appendix. Like the budgets for the legislative branch and thejudiciary, the annexed budgets have not been reviewed by the Presi-dent but are included in the amounts submitted by the agencies(except for two cases, which are noted, where Bureau of the Budgetestimates are used because no agency estimates were submitted).


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)

This tabulation shows, for each appropriation and fund account, among the administrative budget funds, information on new obligational authority (called NOA herein)and expenditures. It includes appropriation requests for 1964 based on the amounts recommended by the President which are pending before the Congress and onwhich no or partial congressional action has been taken. Such requests are identified by footnote (c). Explanatory sentences relate primarily to NOA, and usuallyto increases or decreases for 1965. Functional code numbers are cross references to the lines in table 14, (pages 132 to 144) where the figures are summarized. TheNOA in this tabulation takes account of certain transfers between appropriations which are set forth in the Budget Appendix. Congressional action in the appropria-tion process occasionally is in the form of a limitation on the use of a trust fund or other fund, or an appropriation to liquidate contract authorizations; such items whichdo not involve NOA are also included here in parentheses, but are not added into the totals. NOA items in the administrative budget are current authorizations exceptwhere otherwise indicated. A final section of this tabulation shows similar information on the trust funds. Smaller funds are grouped in that section. Accounts ap-pearing there are permanent authorizations unless otherwise noted.

Account and functional code1963

enacted1964

estimate1965

estimateIncrease ordecrease Explanation of NOA requests

I

LEGISLATIVE BRANCH

SENATE

General and special funds:Compensation of the Vice Presi-

dent and Senators 901

Mileage of President of the Senateand of Senators 90 J

Expense allowances of the VicePresident, and majority andminority leaders 901

Salaries, officers and employees901

Office of the Legislative Counsel ofthe Senate 901

Contingent expenses of the Senate:Legislative reorganization __ 901

NOAExp.

NOAExp.

NOAExp.

NOAExp.

NOAExD.

NOAExp.

2,4712,460

5853

1414

20,04118,588

242233

132102

2,471

58

14

20,653

247

2,471

58

14

20,720

247

67

(For the Legislative Branch, explanations are shown only for those itemsfor which supporting data submitted to the Bureau of the Budgetindicate the reason for a change from the appropriation for the currentfiscal year.)


Senate policy committees__-901 NOAExp.

Automobiles and maintenance NOA901 Exp.

Vice President's automobile_901 Exp.

Automobile for majority and Exp.minority leaders 901

Furniture 901 NOAExp.

Inquiries and investigations.901 NOAExp.

Folding documents 901 NOAExp.

Mail transportation 901 NOAExp.

Miscellaneous items 901 NOAExp.

Postage stamps 901 NOAExp.

Stationery (revolving fund) _901 NOAExp.

Communications i 901 NOAExp.

Payments to estates and widows of NOAdeceased Members of the Sen- Exp.ate 901

344221

3732

1

2

3144

3,9513,912

3627

1710

2,4352,620

5653

195200

1512

68135

351

38

31

4,026

37

17

2,864

64

256

15

22

351

40

31

4,026

37

17

2,565

62

195

15

2

-299

-2

-61

-22

OO

ttf

Cn


ANALYSIS OF NEW OBUGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued

toAccount and functional code

1963enacted

1964estimate

1965 Increase ordecrease Explanation of NOA requests

LEGISLATIVE BRANCH—Continued

SENATE—Continued

General and special funds—Continued

Senate restaurant fund 901 Exp.

Recording studio revolving fund Exp.901

Joint items:Joint Committee on Reduction NOA

of Nonessential Federal Ex- Exp.penditures 901

Joint Economic Committee_901 NOAExp.

Joint Committee on Atomic NOAEnergy 901 Exp.

Joint Committee on Printing. _ NOA901 Exp.

Total, Senate NOA

Exp.

HOUSE OF REPRESENTATIVES

Compensation of Members 901 NOAExp.

Mileage of Members and expense NOAallowance of the Speaker. _ _901 Exp.

-94

15

2829

261259

305267

121113

30,85929,310

10,67210,598

200195

30

235

311

124

31,86329,910

10,622

200

30

235

311

124

31,54829,825

10,622

200

-315-85

wWdoo

GOO>


Salaries, officers and employees ._ NOA901 Exp.

Members'clerk hire 901 NOAExp.

Contingent expenses of the House:Furniture 901 NOA

Exp.

Miscellaneous items 901 NOAReappropr iation NOA

Exp.

Reporting hearings 901 NOAExp.

Special and select commit- NOAtees 901 Exp.

Office of the Coordinator of In- NOAformation 901 Exp.

Telegraph and telephone 901 NOAExp.

Stationery (revolving fund) .901 NOAExp.

Attending physician's office_901 NOAExp.

Postage stamps.... 901 NOAExp.

Folding documents 901 NOAE.xp.

Revision of laws 901 NOAExp.

8,1497,834

21,34820,425

270216

2,827139

2,806

175166

3,0593,058

120119

1,5001,480

788829

1716

184183

251221

2020

8,385

21,300

270

| 3,725

223

3,966

122

2,185

1,308

17

274

251

21

8,541

21,800

420

3,800

225

4,000

118

2,500

1,046

17

229

251

21

156

500

150

75

2

34

- 4

315

-262

3

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ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued


enacted1964 1965 Increase or

decrease Explanation of NOA requests


HOUSE OF REPRESENTATIVES—Con.

General and special funds—ContinuedContingent expenses of the House—Con.

Speaker's automobile 901 NOAExp.

Majority leader's automobile. _ NOA901 Exp.

Minority leader's automobile.. NOA901 Exp.

Portrait of Speaker 901 NOA

New edition of the United States NOACode 901 Exp.

Payments to widows and heirs NOAof deceased Members of Con- Exp.gress 901

New edition of the District of Co- NOAlumbia Code 901 Exp.

House of Representatives restau- Exp.rant fund 901

House recording studio revolving Exp.fund 901

1010

108

1010

43

45125

23

64

-25

11

10

10

68

11

11

11

150

100

1

1

150

- 6 8

100

wwdoo

i—i

O

COaOx


Joint items:Joint Committee on Internal NOA

Revenue Taxation 901 Exp.

Joint Committee on Immigra- NOAtion and Nationality Policy-_ Exp.

901

Joint Committee on Defense NOAProduction 901 Exp.

Capitol Police:General expenses 901 NOA

Exp.

Capitol Police Board 901 NOAExp.

Education of Pages 901 NOAExp.

Penalty mail costs 901 NOAExp.

Statements of appropriations _ _ 901 NOAExp.

Consolidated working fund 901 Exp.

Total, House of Representa- NOAtives. Exp.

338300

20

6861

3737

13690

7365

3,9863,986

88

14

54,32452,983

344

20

70

37

144

80

4,867

13

58,54357,114

344

160

91

37

144

80

4,800

13

59,74258,070

140

21

-67

1,199956

t1

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Or


ANALYSIS OF NEW

Account aod functional

OBLIGATIONAL

code1963

AUTHORITY AND

1964 1965

LEGISLATIVE

EXPENDITURES BY

decrease(-)

BRANCH—Continued

AGENCY (in thousands of dollars)—Continued

Explanation of NOA requests

Cn

ARCHITECT OF THE CAPITOL

General and special funds—ContinuedOffice of the Architect of the

Capitol:Salaries 901 NOA

Exp.

Contingent expenses 901 NOAExp.

Capitol buildings and grounds:Capitol buildings 901 NOA

Reappropriation 901 NOA

Exp.

Extension of the Capitol: Liq-uidation of contract authori- Exp.zation 901

Capitol Grounds 901 NOA

Exp.

Senate Office Buildings 901 NOA

Exp.

363355

5025

1,296337

1,443

(800)1,875

435

449

2,251

2,299

442442

5064

1,42882

A201,727

A20

(700)1,055

476A 4

515A4

2,535A31

2,621A 31

569569

5050

1,515

1,516

678

678

2,402

2,402

127127

-14

-15

-231

(-700)-1,055

198

159

-164

-250

Increase is for additional new positions and for positions on full-yearbasis presently on a part-year basis.

This item is for unforeseen expenses. About half is usually needed forsnow removal.

Supplemental in 1964 is for wage board pay increases. The 1965 require-ments are reduced mainly because 1964 included a nonrecurringreappropriation for elimination of fire hazards.

Supplemental in 1964 is for wage board pay increases. The 1965 require-ments are increased mainly to provide additional personnel andmaintenance for expanded areas, and for resurfacing the CapitolPlaza and Northeast and Southeast Drives.

Supplemental in 1964 is for wage board pay increases. The 1965 require-ments are reduced mainly because 1964 included nonrecurring itemsof fire protection improvements.

Q

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Restoration of Old Senate NOAChamber 901 Exp.

Legislative garage 901 NOA

Exp.

House Office Buildings 901 NOA

Exp.

Acquisition of property, con-struction, and equipment,additional House OfficeBuilding:

Contract authorization_901 NOALiquidation of contract

authorization. Exp.

Capitol Power Plant 901 NOA

Exp.

Expansion of facilities, Capitol Exp.Power Plant 901

Extension of additional Senate Exp.Office Building site 901

Additional office building for the Exp.United States Senate 901

Changes and improvements, Exp.Capitol Power Plant 901

A Proposed for separate transmitta!.

63

61

1,722

1,721

18,000(8,500)20,470

2,052

2,004

827

2

178

434

1

1

4(2019

2

2

1

3820

50M54M

,778M 3,804A13

,800,000),873

,213A 14,203M 4

,524

5

144

203

j

!

3

3

(814

2

2

1

18

52

52

,354

,254

,000),392

,706

,656

,807

- 3 8- 2

1

- 3

1,563

1,437

-4,800(-12,000)

-5,481

480

439

283

- 5

-144

-203

Supplemental in 1964 is for wage board pay increases.

Supplemental in 1964 is for wage board pay increases. The 1965 require-ments are increased mainly to provide additional personnel to staffthe Rayburn House Office Building.

(Appropriations are to liquidate contract authorization already granted.)

Supplemental in 1964 is for wage board pay increases. Principalincreases are to provide for additional electrical energy and additionalfuel required in 1965.

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ARCHITECT OF THE CAPITOL—Con.

General and special funds—ContinuedCapitol buildings and grounds—Con.

Furniture and furnishings, addi- Exp.tional Senate Office Build-ing . 901

Remodeling, Senate Office Build- Exp.ing ....901

Library buildings and grounds:Structural and mechanical NOA

care 901Reappropr iation 901 NOA

Exp.

Furniture and furnishings.901 NOAExp.

Additiona 1 library building. _901 Exp.

Total, Architect of the Capi- NOAtol.

Exp.

30

844

2721,202

225141

27,911

33,516

89

3,388A 13

2,597A 13180242

10

17,461A96

35,192A.96

2,396

3,878

229219

13,951

31,492

-89

- 2

-1,005

1,267

49- 2 3

- 1 0

-3,606

-3,796

Supplemental in 1964 is for wage board pay increases. The 1965 require-ments are reduced mainly because 1964 included a nonrecurring*itemfor city water distribution system and sewer and water systems servingthe main library building and grounds.

Increase is primarily for steel trays for Card Division.

COo

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BOTANIC GARDEN

Salaries and expenses 901 NOA

Reappropr iation 901 NOA

Exp.

Relocation of greenhouses 901 Exp.

Total, Botanic Garden___901 NOA

Exp.

LIBRARY OF CONGRESS

Salaries and expenses 704 NOAReappropria tion 704 NOA

Exp.

Copyright Office: Salaries and NOAexpenses 704 Exp.

Legislative Reference Service: NOASalaries and expenses 704 Exp.

Distribution of catalog cards: NOASalaries and expenses 704 Exp.

Books for the general collec- NOAtions 704 Exp.

Books for the law library 704 NOAExp.

Books for the blind: Salaries and NOAexpenses 704 Exp.A Proposed for separate transmittal.

452

62412

47

514

459

10,074}67 J

8,933

1,6741,659

1,9611,944

2,7542,649

570515

11091

1,8942,150

454A 5

578A510

454A 5588A 5

9,726

10,481

1,7811,781

2,1192,102

3,0422,999

670670

110121

1,9002,034

1 528

1 528

1 528

1 528

10,790

10,659

1,8281,818

2,3082,287

3,4403,392

670670

110110

2,4462,259

69

- 5 5

- 1 0

69

-65

1,064

178

4737

189185

398393

-11

546225

Supplemental in 1964 is for wage board pay increases. Increase in1965 results mainly from proposed improvements to main conserva-tory and its mechanical equipment.

Provides for increased activity in acquisition of materials by purchase,gift, exchange, and other means, in organization of the collections,and in reader and reference services.

Increase is needed to pay full year cost of last year's increase in per-sonnel.

Provides for additional research and analysis, preparation of indexesand digests and other reference and reader services.

Increase in sales activity is expected. Costs are generally recoveredfrom sales income.

Objective will be to continue to acquire research materials, foreignnewspapers and periodicals and materials in science and technology.

Objective will be to continue to improve the Library's coverage andto preserve deteriorating material.

Estimate will allow procurement of braille books, more titles and copiesof talking books and other improvements in service to the blind.

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ANALYSIS OF NEW OBLIGATIONAL

1963

AUTHORITY AND EXPENDITURES BY

1964 1965 Increase ordecrease




LIBRARY OF CONGRESS—Continued

General and special funds—ContinuedOrganizing and microfilming the NOA

papers of the Presidents: Sal- Exp.aries and expenses 704

Preservation of American motion NOApictures 704 Exp.

Revision, of Annotated Constitu- Exp.tion__." 704

Collection and distribution of NOAlibrary materials (special for- Exp.eign currency program) 704

Indexing and microfilming the NOARussian Orthodox Greek Catho- Exp.lie Church Records in Alaska. 704

Oliver Wendell Holmes devise fund NOA(permanent, indefinite, special Exp.fund) 704

Intragovernmental funds:Advances and reimbursements.704 Exp.

Total, Library of Congress._. NOAExp.

113114

6142

18

680634

151

2034

-521

19,99318,264

113131

5082

978969

14

850

294

20,49721,728

113131

5050

1,8601,850

650

23,62123,276

-32

882881

-14

- 2

-294

3,1241,548

Estimate continues the program authorized in 1959 to arrange, indexand microfilm papers in the Library's collections.

Estimate will allow continued conversion of paper prints and nitratefilms to safety film.

(Work is now completed.)

Program utilizes surplus foreign currencies to acquire and distributeforeign library materials.

Work is expected to be completed in 1964.

Principal and interest on the fund will be used primarily to continuepreparation of the history of the Supreme Court.

Q


GOVERNMENT PRINTING OFFICE

General and special funds:Printing and binding 901 NOA

Exp.

Office of Superintendent of Docu- NOAments: Salaries and expenses Exp.

910

Acquisition of site and construe- NOAtion of annex 910

Acquisition of site and construe- NOAtion of buildings 910 Exp.

Intragovernmental funds:Government Printing Office re- NOA

volving fund 910 Exp.

Total, Government Printing NOAOffice. Exp.

Total, Legislative Branch. _ _ _ NOA

Exp.

15,20015,191

4,7604,422

6,450

-6,939

26,41012,674

160,010

147,205

18,20018,074

5,2425,267

3,550-2,138

26,99221,203

155,810M01

165,735A101

18,00018,050

5,5625,597

46,72316,478

-4,569

70,28535,556

199,674

178,747

-200- 2 4

320330

46,72316,478

-3,550-2 ,431

43,29314,353

43,763

12,911

Appropriation covers all printing, binding, and distribution for theCongress, or as otherwise authorized by law.

Estimate covers costs of services and sales functions. Receipts usuallyexceed costs of the sales functions and are deposited in the generalfund of the Treasury.

(Funds were transferred to the Government Printing Office revolvingfund in 1964 as part of increase in capital.)

Increase is for the construction of an additional building.

aA Proposed for separate transmittal.


ANALYSIS OF NEW

ictional

OBLIGATIONAL

code1963

AUTHORITY

1964

AND EXPENDITURES

1965 Increase or

(-)

THE JUDICIARY

BY AGENCY (in thousands of dollars)—Continued


Oto

SUPREME COURT OF THE UNITEDSTATES

General and special funds:Salaries 902 NOA

Exp.

Printing and binding Supreme NOACourt reports 902 Exp.

Miscellaneous expenses 902 NOAExp.

Ca re of t h e b u i l d i n g and NOAgrounds 902

Exp.

Automobile for the Chief Justice NOA902 Exp.

Books for the Supreme Court_902 NOAExp.

Total, Supreme Court of the NOAUnited States.

Exp.

1,5031,492

138110

7976

323

292

77

3536

2,085

2,012

1,5881,576

138128

8584

348A 9349A 9

87

3534

2,201A 9

2,179A 9

1,6131,607

138138

87

87

305

305

8

3535

2,186

2,180

2531

10

2

3

-52

-53

- 2 4

- 8

Estimate provides for salaries of the Chief Justice and 8 AssociateJustices and all other officers and employees.

Estimate covers costs of printing and binding advance opinions,preliminary prints and bound reports of the Court.

Estimate allows for expenses as approved by the Chief Justice.

Supplemental for 1964 is for wage board pay increases. Estimatecovers work of the Architect of the Capitol in the care of Courtfacilities.

Expenses are estimated to continue at current level.

Expenses are estimated to continue at current level.

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COURT OF CUSTOMS ANDPATENT APPEALS


Exp.

CUSTOMS COURT


Exp.

COURT OF CLAIMS

Salaries and expenses 902 NOAExp.

Repairs and improvements 902 NOAExp.

Total, Court of Claims NOAExp.

COURTS OF APPEALS, DISTRICTCOURTS, AND OTHER JUDICIALSERVICES

Salaries of judges 902 NOAExp.

Salaries of supporting personnel. _ NOA902 Exp.

Fees of jurors and commissioners. NOA902 Exp.

Travel and miscellaneous ex- NOApenses 902 Exp.

A Proposed for separate transmittal.

370363

931903

1,0341.018

109

1,0441.026

10,96010.881

27,98827.784

5,5005,437

4,6704,668

388387

989987

1,1001,104

1010

1,1101,113

11,20011,185

30,65030,548

5,5005,500

4,5004,519

403400

1,0441,040

1,1761,175

1010

1,1861,184

11,20011,200

32,94032,890

5,5005,500

5,0655,015

1513

5453

7671

7671

15

2,2902,342

565496

Estimate includes an additional clerical position for the Clerk'soffice, and other increased expenses.

Estimate includes an additional court reporter, 3 additional bailiffs,and other increased expenses.

Increase includes $50 thousand to publish the Court's decisions.

Estimate will continue the structural and mechanical maintenanceof buildings.

No increase is requested.

Provides funds for additional officers and clerk-stenographers forthe probation system and additional deputy clerks.

No increase is requested.

Includes expenses in support of new personnel and a new require-ment for space alterations.

oo

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ANALYSIS OF NEW

Account and functional

OBLIGATIONAL

code1963

AUTHORITY

1964

AND EXPENDITURES

1965 Increase ordecrease

(-)

THE JUDICIARY—Continued



COURTS OF APPEALS, DISTRICTCOURTS, AND OTHER JUDICIALSERVICES—Continued

General and special funds—ContinuedAdministrative office of the United NOA

States courts 902 Exp.

Salaries of referees (special fund) _ NOA902 Exp.

Exixpensesfund)_.

of referees (special NOA902 Exp.

Total, courts of appeals, dis- NOAtrict courts, and other judi- Exp,cial services.

Subtotal, The Judiciary NOA

Exp.

Add: Court facilities and furnish- NOAings items requested in General Exp.Services Administration chapter(contra) 902

Total, The Judiciary, NOA

Exp.

1,530

2,5522,511

4,8984,460

58,09857,243

62,528

61,546

1,5841,514

64,112

63,060

1,5901,585

2,5502,533

5,2505,335

61,24061,205

65,928A 9

65,871A 9

1,0311,377

66,959A 9

67,248

2,0602,054

2,9052,855

5,9655,900

65,63465,414

70,453

70,218

1,4641,532

71,917

71,750

470469

355322

715565

4,3944,209

4,516

4,338

433155

4,949

4,493

Includes $420 thousand to begin a central disbursing program.

Provides for additional referees, conversion of part-time refereesto full-time, and some changes in salaries.

Includes $289 thousand for additional temporary clerks forreferees.

do

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COMPENSATION OF THE PRESIDENT

General and special funds:Compensation of the President NOA

903 Exp.

THE WHITE HOUSE OFFICE

Salaries and expenses _ _ _903 NOAExp.

SPECIAL PROJECTS

Special projects _ 903 NOAExp.

EXECUTIVE MANSION AND GROUNDS

Executive Mansion and grounds NOA903 Exp.

BUREAU OF THE BUDGET

Salaries and expenses 903

Advances and reimbursements_903

Total, Bureau of the Budget

NOAExp.

Exp.

NOAExp.

150150

2,5452,502

1,5001,039

658660

5,8725,829

- 5

5,8725,825

EXECUTIVE

150150

2,7302,720

1,5001,500

671665

6,5006,655

79

6,5006,734

OFFICE

150150

2,7302,730

1,5001,500

696696

6,8616,819

6,8616,819

O F T H E P R E S I D E N T

10

2531

361164

- 7 9

36185

This office provides the President with staff assistance and administra-tive services.

The President uses this appropriation for staff assistance on specialproblems.

These funds provide for care, maintenance, and operation of the Execu-tive Mansion and the surrounding grounds. Increase provides forquadrennial painting of the Executive Mansion.

The Bureau assists the President in the discharge of his budgetary, man-agement, and other executive responsibilities. Increase reflectsmandatory salary reform costs and slight increase in temporary andintermittent services.

F

OOS3


Ox




enacted1964

estimate1965 Increase or

decreas Explanation of NOA requests

EXECUTIVE OFFICE OF THE PRESIDENT—Continued

COUNCIL OF ECONOMIC ADVISERS

General and special funds:Salaries and expenses 903 NOA

Exp.

Intragovernmental funds:Advances and reimbursements_903 Exp.

Total, Council of Economic NOAAdvisers. Exp.

NATIONAL AERONAUTICS ANDSPACE COUNCIL


Exp.

NATIONAL SECURITY COUNCIL


OFFICE OF EMERGENCY PLANNING


601604

71

601675

530394

550485

5,2405,528

615626

615626

525492

575570

4,6954,921

645641

645641

525513

575575

5,7004,731

3015

3015

21

5

1,005-190

The Council advises the President on economic programs and policy.Increase primarily reflects salary reform costs.

The Council advises and assists the President on policies, plans, andprograms in aeronautical and space activities.

The Council advises the President regarding national security policies.

This Office advises and assists the President in determining policy forand in planning, directing, and coordinating the total nonmilitary de-fense program. Increase reflects mandatory salary reform costs anccontract research on problems of telecommunications and economicand resource management.

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State and local preparedness. -059 NOAExp.

Emergency preparedness functions NOAof Federal agencies 059 Exp.

Emergency supplies and equiment 0

uip-059 Exp.

Research and development 903 Exp.

Total, Office of Emergency NOAPlanning. Exp.

OFFICE OF SCIENCE AND TECHNOLOGY


SPECIAL REPRESENTATIVE FOR TRADENEGOTIATIONS


MISCELLANEOUS

Intragovernmental funds:Federal Radiation Council: Ad- Exp.

vances and reimbursements__903

Total, Executive Office of NOAthe President. Exp.

5,1904,792

13

609

10,43010,942

764464

-22

23,60123,113

1,500375

4,1904,261

7

336

10,3859,900

880860

465450

10

24,99624,677

1,5001,500

6,5006,269

13,70012,500

950940

540517

28,87227,581

1,125

2,3102,008

-7

-336

3,3152,600

7080

7567

-10

3,8762,904

This appropriation finances the development of State and local plans andpreparations for management of resources in time of war and after at-tack. This includes the use of resources to meet survival needs andthe role of the States and their political subdivisions as possessors ofresources required for restoration and rehabilitation of the Nation.

This appropriation assists other Federal agencies to prepare nationalemergency plans and develop preparedness programs under the guid-ance and review of the Office of Emergency Planning, as directed byExecutive orders.

(This activity was transferred to other agencies by Executive order.)

(Financing is transferred to the "Salaries and expenses" account.)

This Office advises and assists the President in developing policies andevaluating programs to assure that science and technology are usedmost effectively in the interests of national security and the generalwelfare.

This Office is responsible for the administration of the trade agreementsprogram. It will prepare for and direct U.S. participation in alltrade negotiations under the Trade Expansion Act of 1962, includingthe forthcoming major Sixth Round of negotiations under the GeneralAgreement on Tariffs and Trade.

(The Council is financed by advances from participating agencies.)

••3s

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33O



1963

AUTHORITY

1964

AND

1965

EXPENDITURES

(-)



FUNDS APPROPRIATED TO THE PRESIDENT

DISASTER RELIEF

General and special funds:Disaster relief 655 NOA

Exp.

ECONOMIC ASSISTANCE

Development grants 152 NOAExp.

American schools and hospitals NOAabroad 152 Exp.

American schools and hospitals NOAabroad (special foreign currency Exp.program) 152

Investment surveys 152 NOAExp.

Contributions to international or- NOAganizations 152 Exp.

Supporting assistance 152 NOAExp.

Contingency fund 152 NOAExp.

25,00030,803

224,800244,877

2,8001,127

148,90093,568

404,753493,693

250,000137,186

20,00035,000

154,898230,000

14,300500

4,700812

50

116,000142,000

330,000415,000

50,000145,000

20,00023,000

D225,000225,000

D12,0002,550

2,000

D2,100100

D135,600125,000

D335,000335,000

D150,000155,000

-12,000

70,102-5,000

-2,3002,050

-4,7001,188

2,10050

19,600-17,000

5,000-80,000

100,00010,000

Estimate for 1965 will cover possible disaster needs, based on recentexperience.

Estimate reflects continued emphasis on technical assistance programsparticularly in Africa, and expansion of research effort.

Estimate will permit continued U.S. support to American sponsoredschools abroad, primarily in the Near East.

(Expenditures cover U.S. contribution to complete U.S.-sponsoredchildren's hospital in Poland and to support the American Uni-versity at Cairo.)

Estimate will allow continued encouragement of private investors tosurvey investment opportunities in developing areas.

Estimate primarily will meet scheduled requirements for the IndusBasin Development project and match the contributions of other UN.members in support of the U.N. Special Fund and Technical Assistanceprogram.

This activity is expected to stabilize, after several consecutive years ofprogram reductions.

Estimate will provide flexibility to the President for meeting unforeseenemergencies and opportunities in foreign affairs.

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a


Alliance for Progress, grants. _ 152 NOAExp.

Social progress trust fund 152 NOAExp.

Administrative expenses, Agency NOAfor International Develop- Exp.ment 152

Administrative expenses, StateJ 52

Subtotal, grantsprograms.

and other

NOAExp.

NOAExp.

Public enterprise funds:Loan and guarantee programs:

Alliance for Progress: Develop- NOAment loans 152 Exp.

Development loans—revolving NOAfund 152 Exp.

Development Loan Fund (liqui- Exp.dation account) 152

Foreign investment guarantee NOAfund 152 Exp

Subtotal, loan and guaran- NOAtee programs. Exp.

D To carry out authorizing legislation to be proposed.

89,90094,942

49,000

50,89052.542

2,7572.059

1,174,8001,168,994

424,700116,315

974,400401,465

358,436

30,000-2,930

1,429,100873.286

80,00075,000

135,000100,000

49,98252,600

2,7002,700

937,5801,163.662

375,000150,000

687,300470.000

320,000

-4,610

1,062,300935,390

D85,00065,000

120,000

D54,50054,000

2,9002,900

1,002,1001,086,550

465,000220,000

925,000550,000

300,000

-7.500

1,390,0001,062.500

5,000-10,000

-135,00020,000

4,5181,400

200200

64,520-77,112

90,00070,000

237,70080,000

-20,000

-2,890

327,700127,110

Estimate will permit keeping pace with Alliance efforts by the countriesof Latin America. Loans appear under "Loan and guarantee pro-grams."

This program is expected to be part of expanded arrangements to beproposed for the Inter-American Development Bank. A small part of1964 appropriation will be used to finance the activities of the Organi-zation of American States related to the Alliance for Progress.

Estimate reflects pay increases, expanded training programs, and otheritems for administration of the program.

Provision is made for mandatory cost rises and more adequate provi-sion for nonsalary expenses.

Estimate provides for the U.S. share in accelerating joint Alliance forProgress effort. The U.S. also supports Latin American developmentthrough (a) use of agricultural surplus under the Food for Peace pro-gram, (b) Alliance development grants, (c) the facilities of the Export-Import Bank and the Peace Corps, and (d) subscriptions to the Inter-American Development Bank, all shown elsewhere.

Estimate reflects expanded requirements for overseas loan assistancemainly in the Near East and South Asia.

(The Fund ceased existence as a corporate entity in 1962, except forliquidation of loan commitments.)

Guarantees totaling $725 million are expected to be issued. Additionalguarantee authorization of $220 million will be requested to coverfuture guarantee requirements.

Ed>

a

3

CO



Account and functional code1963 1964 1965


FUNDS APPROPRIATED TO THE PRESIDENT—Continued

ECONOMIC ASSISTANCE—Continued

Intragovernmental funds:Advance acquisition of property— Exp.

revolving fund 152

Office of Inspector General, For- Exp.eign Assistance, State 152

Subtotal, intragovernmental Exp.funds.

Total, economic assistance.-- NOAExp.

EMERGENCY FUND FOR THEPRESIDENT

General and special funds:Emergency fund for the President NOA

903 Exp.

EXPANSION OF DEFENSEPRODUCTION

Public enterprise funds:Revolving fund, Defense Produc- Exp.

tion Act 059

2,6032,043

1

-57

86?

-51

811

,900,092

,000389

,069

1,000

-52

948

1,999,8802,100,000

1,0001,000

125,939

1,000

-50

950

2,392,1002,150,000

1,0001,000

-37,845

39250

-163

2

2

,220,000

,784

(The fund finances costs related to acquisition, renovation, and resaleof Government-owned excess property.)

(Advances of $825 thousand from other appropriations will finance thecontinued review of foreign assistance activities.)

This appropriation enables the President to provide for emergenciesaffecting the national interest, security, or defense.

(Estimate for 1965 reflects proposed legislation which would eliminatecertain payments of interest to Treasury after 1964.)

Wdao

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a


EXPENSES OF MANAGEMENTIMPROVEMENT

General and special funds:Expenses of management im- NOA

provement 903 Exp.

INTERNATIONAL FINANCIALINSTITUTIONS

Investment in Inter-American NOADevelopment Bank 152 Exp.

Subscription to the International NOADevelopment Association. _ _ 152 Exp.

Loans to the International Mone- NOAtary Fund 152

Total, international financial NOAinstitutions. Exp.

PEACE CORPS

Salaries and expenses 152 NOAReappropriation NOA

Exp.

* To carry out authorizing legislation now pending in the Congress.D To carry out authorizing legislation to be proposed.

200127

60,00060.000

61,65661.656

2,000,000

2,121,656121,656

58,556

42,259

100111

50,00050,000

61,65661.656

111,656111,656

92,1003,864

73,000

300267

*205,880

61,65661,656

267,53661.656

| D 115,000

90,000

200- 5

155,880-50,000

155,880-50,000

19,036

17,000

This enables the President to improve management, organization, andoperation of the executive branch.

NOA in 1965 will provide the first of 2 equal installments for callablecapital stock to be subscribed by December 31, 1964, and December31,1965.

This is the fifth and final installment of the initial subscription to be paidby members. The total U.S. share is $320.3 million.

NOA is available if needed as part of a multicountry commitment toforestall or cope with an impairment of the international monetarysystem.

Corps will expand to 14,000, an increase of 3,500 over 1964. Mainexpansion will continue to be in Latin America and Africa.

5d


ANALYSIS OF NEW

Account and, functional

OBLIGATIONAL

code1963

AUTHORITY

1964

AND

1965

EXPENDITURES

Increase or

( - )



FUNDS APPROPRIATED TO THE PRESIDENT—Continued

to

PUBLIC WORKS ACCELERATION

General and special funds—ContinuedPublic works acceleration 507 NOA

Exp.850,00062,460

30,000365.000

5,000245,000

-25,000-120,000

Funds are proposed for contingencies and administrative costs of the$880 million program now underway. A major cost element will befield inspection prior to making progress payments on projects de-veloped by communities. As of November 1, 1963, 7,021 projectswere approved which will generate over 1,120,000 man-months ofemployment. Estimated obligations and expenditures will acceleratefunctions covered by regular appropriations as follows (in millions ofdollars):

Estimated Expendituresobligations

(allocations) 1963 1964 1965Housing and community develop-

ment (553) 481 13 175 156Community health facilities and

waste treatment (651) 231 1 81 77Land, water, mineral, forest and

wildlife resources. *(400) 136 44 85 5Commerce, highways, and other

transportation J(500) 20 2 16 2Federal facilities, post offices, and

prisons J(900) 8 1 7Agriculture and agricultural re-

sources H300) 2 1 1Veterans and all other functions___ 2 0 20Unallocated (1965 NOA) 5 __ __. 5Lapsed appropriations 2

Total allocations 885 62 365 245

1 Includes more than one subfunction.2 Less than $500 thousand.

W

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COOiOx


SPECIAL FOREIGN CURRENCYPROGRAMS

Translation of publications and Exp.scientific cooperation 355

TRANSITIONAL GRANTS TO ALASKA

Transitional grants to Alaska_910 NO AExp.

MISCELLANEOUS

Obligations, defense aid, liquida-tion lend-lease program 152

Total, funds appropriated tothe President.

Exp.

NOAExp.

663

3,0003,110

8

5,663,3122,247,497

2.319

3,0003.000

2,261,6002,817.186

21

2,800,9362,533,099

- 2

- 3- 2

539- 2 8 4

,319

,000,979

,336,087

(Continuation of this program is provided under the National ScienceFoundation and the Department of Agriculture.)

1964 was the last year of a five-year authorized program of grants tofacilitate the transition to statehood.

(Account is used only to pay old obligations.)

DEPARTMENT OF AGRICULTURE

t"1

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}

AGRICULTURAL RESEARCH SERVICE


Reappropriation NOAExp.

Salaries and expenses (special NOAforeign currency program)..355 Exp.

State experiment stations 355 Exp.A Proposed for separate transmittai.

173,586

1,000166,733

5,2654,208

146

183,764A 8401,000

177,110A 800

1,2505,880

4

195,407A - 3 0 , 8 3 7

189,070A -28,570

5,0009,750

1 - 2 1 , 0 3 4

1-17,410

3,7503,870

- 4

Supplemental in 1964 is for increased workload and for salary reclassifi-cation of meat inspectors. Decreases in 1965 contemplate (a) enact-ment of legislation to finance meat inspection on a self-supporting feebasis, (b) closing nonessential research stations, and (c) slowing fireant eradication. These are partly offset by increases including staffingnew laboratories, pesticide research and regulation, research construc-tion, pay costs, meat and quarantine inspection.

Increase expands use of excess foreign currencies for agricultural andforestry research in the economic, biological, and physical sciences.

(Activities were transferred to Cooperative State Research Service.)

r



Account and functional code1963 1964 1965 Increase or


DEPARTMENT OF AGRICULTURE—Continued

AGRICULTURAL RESEARCH SERVICE—Continued

General and special funds—ContinuedConstruction of facilities 355 Exp.

Diseases of animals and poultry Exp.

Animal disease laboratory facili- Exp.ties 355

Research on strategic and critical Exp.materials 355

Establishment of an entomology Exp.research laboratory 355

Intragovernmental funds:Working capital fund, Agricul- Exp.

tural Research Center 355

Total, Agricultural Research NOAService.

Exp.

COOPERATIVE STATE RESEARCHSERVICE

General and special funds:Payments and expenses 355 NOA

Exp.

3,983

157

390

137

179,851

175,755

38,26237,992

2,390

13

149

1

10

186,014A840

185,557A 800

41,63341,630

543

200,407A - 3 0 , 8 3 7

199,363A - 2 8 , 5 7 0

42,46042,460

-1 ,847

- 1 3

- 1 4 9

- 1

- 1 0

I -17 ,284

1—15.564

827830

(New construction is funded under Salaries and expenses.)

(Expenditures from the account are expected to be completed in 1964.)

(Construction in 1964 completes this installation/at Ames, Iowa.)

(Expenditures from this account are expected to be completed in 1964.)

(Expenditures from this account are expected to be completed in 1964.)

Increase provides payments to State Agricultural Experiment Stations,partly offset by shift in financing of management to Office of Manage-ment Services.

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EXTENSION SERVICE

Cooperative extension work, pay- NOAments and expenses 355 Exp.


Total, Extension Service NOAExp.

FARMER COOPERATIVE SERVICE


Exp.


Total, Farmer Cooperative NOAService. Exp.

SOIL CONSERVATION SERVICE

General and special funds:Conservation operations 354 NOA

Exp.

Watershed protection 354 NOAExp.

Flood prevention 354 NOAExp.

Great Plains conservation pro- NOAgram 354 Exp.A Proposed for separate transmittal.

75,34374,678

-135

75,34374,543

704688

-34

704654

93,98892,997

61,35753,115

25,32526,493

12,3549,746

80,18080.110

-75

80,18080,035

1,2011,141

109

1,2011,250

98,04397,545

63,53958,000

25,43424,800

13,61710,940

77,67977,808

77,67977,808

1,1021,117

1,1021,117

98,75098,300

65,84862,100

22,65623,500

14,74411,725

-2,501-2,302

75

-2,501-2,227

-99-24

-109

-99-133

707755

2,3094,100

-2,778-1,300

1,127785

Estimate provides for payments to States at levd recommended in 1964budget and for mandatory salary reform costs and retirement costs.

Mandatory salary reform costs are more than offset by the shift in fi-nancing of management to Office of Management Services.

Increase provides for soil surveys and mandatory salary reform costspartly offset by savings due to management improvements.

Estimate will start construction of about 36 watershed projects, con-tinue 260, complete 35, provide advance engineering for 125, andincrease comprehensive river basin surveys.

Decrease assumes use of $3,800 thousand of the prior year unobligatedbalance to continue work in the 11 authorized watersheds.

Provides for increased cost-share funds for technical services, and formandatory salary reform costs.

ttf




enacted1964

estimate1965

estimateIncrease o

decrease)



SOIL CONSERVATION SERVICE—Con.

General and special funds—ContinuedResource conservation and devel- NOA

opment _ __ _ __354 Exp.

Total, Soil Conservation Serv- NOAice. Exp.

ECONOMIC RESEARCH SERVICE

Salaries and expenses. _ __355 NOAExp.

STATISTICAL REPORTING SERVICE

Salaries and expenses _355 NOAExp.

AGRICULTURAL MARKETING SERVICE

Marketing research and service.._ NOA355

Exp.

Payments to States and posses- NOAsions 355 Exp.

193,023182,351

9,8349,742

10,01210,019

41,018

40,615

1,4251,425

1,500394

202,133191,679

9,9099,795

11,27211,108

42,476A 173

41,242M66

1,5001,500

2,0442,400

204,042198,025

9,4769.511

11,43111,402

43,975A - 1 8 , 6 3 5

43,652A-16,393

1,4251,425

5442,006

1,9096,346

-433-284

160294

1-17,309

1-14,149

- 7 5- 7 5

Program includes planning and starting up to 10 pilot projects to main-tain and enhance the level of economic activity.

Mandatory salary reform costs are more than offset by the shift in fi-nancing of management to Office of Management Services.

Increases for enumerative survey for crop and livestock estimates,cattle-on-feed reports, and mandatory salary reform costs, more thanoffset decreases for consumer surveys and the financing of managementunder Office of Management Services.

Supplemental in 1964 is for salary reclassification of poultry inspectors.Net decrease reflects a net reduction in research and legislation tofinance certain marketing services on a fee basis, with increases inmarket news and mandatory salary reform costs.

Estimate is reduced to the 1963 level of matching payments to the Statesfor programs to improve marketing.

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en


Special milk program 655 NOAPermanent NOA

Exp.

School lunch program 655 NOAPermanent NOA

Exp.

Perishable agricultural commodi- NOAties act fund (permanent, in- Exp.definite, special fund) 355

Removal of surplus agriculturalcommodities (permanent, indef-inite) 351 NOA

Exp.

655 NOAExp.


Total, Agricultural Market- NOAing Service.

Exp.

FOREIGN AGRICULTURAL SERVICE


Permanent, indefinite NOAExp.

Salaries and expenses (special NOAforeign currency program) _355 Exp.

Total, Foreign Agricultural NOAService. Exp.


99,997

95,370

124,99345,000169,596

746773

244,611111,536

20,24820,248

-5

578,038

439,556

17,1283,11711,934

4,0004,628

24,24516,562

100,000

98,500

137,00045,000181,500

832884

271,276271,276

44,62544,625

7

642,709M 7 3

639,534A 166

18,7003,11715,459

4,000

21,81719,459

99,83199,800

147,61045,000193,000

893908

173,727173,727

51,12551,125

563,586A -18,635

563,637A-16,393

20,5613,11718,142

3,200

23,67821,342

-100,00099,8311,300

1 10,610

11,500

6124

-97,549-97,549

6,5006,500

-7

|-97,931

1-92,456

| 1,861

2,683

-800

1,8611,883

Decrease in the direct appropriation and the increase in the permanentappropriation (transferred from "Removal of surplus agriculturalcommodities"), reflect a shift in financing in 1965.

Increase provides for growth in the program and includes $2 million foraid to needy schools.

An increase in license fee rates effective Jan. 1, 1963, allows improvedadministration of the license system.

3 0 % of certain customs receipts is available to finance this and relatedFederal programs. Reduction reflects transfer to finance special milkprogram in 1965, partly offset by slight increase in receipts.

These funds available to finance the pilot food stamp program in 1965provide for some expansion.

Increase is largely for expanded market development work abroad in bothdollar and soft currency areas, and for mandatory salary reform costs.

There are adequate carryover balances of excess foreign currencies forthis account.

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ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued00


enacted1964




COMMODITY EXCHANGE AUTHORITY

General and special funds—ContinuedSalaries and expenses 355 NOA

Exp.

AGRICULTURAL STABILIZATION ANDCONSERVATION SERVICE

Expenses, Agricultural Stabiliza- NOAtion and Conservation Service.

351 Exp.

Sugar Act program 351 NOA

Exp.

Agricultural conservation pro- NOAgram 354 Exp.

Cropland conversion program:Contract authorization 351 NOA

Appropriation to liquidate con-tract authorization.

Exp.

1,0601,048

95,344

88,484

77,650

76,929

212,900210,788

25,000

(2,000)

3,996

1,0951,085

106,550A 15,200100,386

A15,200

78,000A6,40086,938

A6,400

215,000220,760

10,000A40,000(11,350)

(A 43,000)11,350

A 43,000

1,1191,119

114,562

113,562

87,500

87,659

225,000220,090

10,000M0,000(10,000)

(A 47,000)10,000

A41,670

2434

-7,188

-2,024

3,100

-5,679

10,000-670

(2,650)

-2,680

Estimate will continue licensing, auditing, supervisory and investigativeactivities, and provide for mandatory salary reform costs.

Supplemental in 1964 is to finance the administrative expenses of thefeed grain program enacted after submission of the 1964 budget.Decrease results from savings to be realized from reducing the per-centage of farms measured under wheat and feed-grain programs.

Supplemental in 1964 is for payments resulting from unanticipated in-creases in production. Increase in 1965 assumes payments to sugarproducers under existing law for increased production.

NOA in 1965 is for cost-sharing payments to farmers authorized in 1964;1965 proposal is $120 million (excluding administration), to beappropriated in 1966.

Supplemental in 1964 expands the program to shift cropland to less in-tensive usage. Proposed legislation would provide for $50 millionannually. Supplemental in 1965 would continue program at the new1964 level.

d

SSB

2

5CO


Conservation reserve program _ 351 NOAExp.

Acreage allotments and marketing Exp.quotas 351

Emergency conservation meas- Exp.ures_._ 354

Intragovernmental funds:Administrative expenses, sec. 392, Exp.

Agricultural Adjustment Act of1938 355

Local Administration, sec. 388, Exp.Agricultural Adjustment Act of1938 355

Total, Agricultural Stabiliza- NOAtion and Conservation Serv-ice. Exp.

FOREIGN ASSISTANCE ANDCOMMODITY CREDIT CORPORATION

Foreign Assistance Programs

General and special funds:

Public Law 480:Sale of commodities for foreign NOA

currencies 351 Exp.

Grants of commodities for NOAfamine relief 152 Exp.

Losses on long-term sales con- NOAtracts 351 Exp.

International Wheat Agreement NOA351 Exp.


304,000305,378

78

2,701

2,761

8,249

714,894

699,364

1,588,8041,483,030

250,000215,593

40,00080,223

81,21874,167

294,000293,129

11

5,000

16

65

703,550A 61,600717,655A 64,600

1,452,0001,609,270

215,451245,860

52,515225,305

86,218100,603

198,000200,000

4,936

635,062A40,000636,247A 41,670

1,893,0001,081,000

264,000243,547

58,000297,015

31,838179

-96,000-93,129

-11

-64

-16

-65

1-90,088

1-104,338

441,000-528,270

48,549-2,313

5,48571,710

-54,380-100,424

Requirements for annual rental payments will decrease in 1965 withcontracts expiring on about 6.7 million acres during 1964.

(This account is merged with "Expenses, Agricultural Stabilization andConservation Service.")

(Payments are for cost-sharing assistance to farmers to rehabilitatelands damaged by natural disasters.)



Expenditures for the five following items are the expenditures madeby the Government (through Commodity Credit Corporation) ineach year for the respective program.

Decrease in expenditures results primarily from estimated reduction inunit costs of .agricultural commodities (principally wheat) soldabroad for foreign currencies.

Volume of commodities donated is estimated to continue at a slightlyhigher level in 1965 with some reduction in ocean transportation costs.

It is estimated that long-term sales for dollars will continue to increasein 1965.

It is estimated that domestic wheat prices will not exceed Agreementprices and subsidies will not be required in 1965.

3

Wfel

Jfel

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FOREIGN ASSISTANCE AND COMMOD-ITY CREDIT CORPORATION—Continued

Foreign Assistance Programs—Continued

General and special funds—ContinuedBartered materials for supple- NOA

mental stockpile 351 Exp.

Subtotal NOAExp.

Increase (—) or decrease in Exp.amount owed by general fund toCommodity Credit Corporation.

Total, foreign assistance NOAprograms. Exp.

Commodity Credit Corporation

Price Support and Related Programs

Public enterprise funds:Price support and related pro-

grams: 351Contract authorization NOAAppropriation to liquidate con-

tract authorization.Reimbursement for net realized NQA

losses.Limitation on administrative

expenses. Exp.

125,00099,662

2,085,0221,952,675

138,347

2,085,0222,091,022

740,513

2,278,455

(43,188)3,117,377

82,86086,338

1,889,0442,267,376

-388,347

1,889,0441,879,029

(315,067)

2,384,333

(41,650)1,813,227

120,00081,000

2,366,8381,702.741

674,112

2,366,8382,376,853

(599,932)

1,124,068

(37,650)1,838,717

A -230,000

37,140-5,338

477,794-564,635

1,062,459

477,794497,824

(284,865)

-1,260,265

(-4,000)-204,510

Estimate is for the value of strategic materials acquired by barter andtransferred to the supplemental stockpile.

Expenditures shown above have been made by the Commodity CreditCorporation in advance of appropriations in some years. Thisadjustment line brings the total of this group to the amounts paid bythe appropriation to the Corporation during each year.

Request is for needed capital for the Corporation, reimbursing it for aportion of its 1963 realized losses.

(Reduction in expenditures of $230 million is based on proposed legisla-tion for new programs for cotton and dairy products.)

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Special milk program: 655Reimbursement for costs for NOA

special milk program. Exp.

Total, price support and NOArelated programs. Exp.

Special Activities

Intragovernmental funds:Military housing, barter and ex- Exp.

change 351

National Wool Act (permanent, NOA

indefinite) 351 Exp.

Migratory waterfowl feed 351 Exp.

Surplus grain for game birds. _351 Exp.

Loans for conservation pur- Exp.poses 354

Transfer of long-staple cotton Exp.from national stockpile for saleby Commodity Credit Corpora-tion 351

Subtotal NOAExp.


92,243-1.643

3,111,2113,115,734

-1,635

69,16563.165

42

36

7,900

167

69,16569,675

2,384,3331,813,227

-2,416

90,17979,292

45

305

90,17977,226

1,124,0681,838,717A-230,000

-2,000

80,50054.538

45

80,50052.583

-1,260,2651-204,510

416

-9,679-24.754

-305

-9,679-24,643

(Program is now being financed through an appropriation under theAgricultural Marketing Service.)

The facilities of the Commodity Credit Corporation are available bylaw for carrying out the various programs listed. Subsequent re-covery of costs incurred is made from special revenues, appropriationsor from other agencies.

(Receipts are from Department of Defense for housing constructed inFrance, using foreign currencies acquired by sale of agriculturalcommodities.)

Decrease in 1965 results from non-recurring doubling-up of paymentsin 1964 to coincide with marketing year.

(This item now included in Department of Interior.)

(Grain is made available to Department of Interior and to States to feedstarving migratory birds.)

(Corporation funds may be loaned to the Secretary of Agriculture tocarry out the agricultural conservation program. No net borrowingsare expected in 1965.)

(The Corporation is authorized to sell cotton released from the nationalstockpile. Proceeds, less costs incurred, are deposited in the Treasuryas miscellaneous receipts.)

I

00


ANALYSIS OF

id fui


code1963

DEP

1964

ARTMENrr

AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued

1965

(-)Explanation of NOA requests

OF AGRICULTURE—Continued

FOREIGN ASSISTANCE AND COMMOD-ITY CREDIT CORPORATION—Continued

Commodity Credit Corporation—Continued

Special Activities—Continued

Intragrovernmental funds—ContinuedI ncrease or decrease (—) in amount Exp.

owed by general fund for foreignassistance programs.

Total, special activities fi- NOAnanced by Commodity Exp.Credit Corporation.

Total, Commodity Credit Cor- NOAporation price support and Exp.related programs, and spe-cial activities.

Total, foreign assistance pro- NOAgram and Commodi ty Exp.Credit Corporation.

FEDERAL CROP INSURANCECORPORATION

General and special funds:Operating and administrative ex- NOA

penses 351 Exp.

-138,347

69,165-68,672

3,180,3763,047.062

5,265,3985,138,084

6,7956,794

388,347

90,179465,573

2,474,5122,278,800

4,363,5564,157,829

7,0587,752

-674,112 -1,062,459

80,500-621,529

1,204,5681,217,188

A -230,000

3,571,4063,594,041

A-230,000

6,9426,799

-9,679-1,087.102

-705,8651-1,291,612

-792,150-793,788

-116-953

Expenditures made through the Commodity Credit Corporation forforeign assistance programs are included on the respective lines ofthe foreign assistance group. This adjustment brings the total ofthis group to the net expenditures for special activities funded by theCorporation during each year.

Decrease in 1965 is from shift in financing of activities to Office of In-spector General. Program is maintained at the 1964 level.

00to

wd

ICO


Public enterprise funds:Federal Crop Insurance Corpora-

tion Fund:Limitation on administrative

expenses 351 Exp.

Total, Federal Crop Insur- NOAance Corporation. Exp.

RURAL ELECTRIFICATION ADMIN-ISTRATION

General and special funds:Loans (authorization to expend NOA

from debt receipts) 353Exp.

Salaries and expenses. 353 NOAExp.

Total, Rural Electrification NOAAdministration.

Exp.

FARMERS HOME ADMINISTRATION

Rural housing grants and loans.352 Exp.

Loan authorizations 352Authorization to expend from NOA

debt receiptsAppropriations NOA

Exp.


(3,265)7,713

6,79514,507

480,000

331,656

10,44010,396

490,440

342,052

1,006

50,000

183,197

(3,505)-1,744

7,0586,008

495,000

377,000A-169,000

11,24711,056

506,247

388,056A-169,000

4,355

25,000135,900

(3,649)-4,096

6,9422,703

428,000A-347,000

383,000A-178,000

11,51811,446

439,518A-347,000

394,446A-178,000

2,500

20.766

(144)-2,352

-116-3,305

1-414,000

11 -3,000

1271390

1-413,729

f1 -2,610I

-1,855

-25,000-115,200

(Increase is for mandatory salary reform costs and expansion of thecrop insurance program in 1964.)

NOA of $428 million, plus balance from previous years, will providefor estimated loan commitments of $300 million for electrificationand $85 million for telephone and for $65 million reserve. Proposedlegislation permits loan receipts to be used to reduce expenditures in1964, and both NOA and expenditures in 1965.

Increase provides for additional staff and for mandatory salary reformcosts, partly offset by decrease from shift in financing of activitiesto the Office of Inspector General.

(Existing funds are sufficient for enlargement and development loans andrepair and improvement grants through 1965.)

NOA provided in 1963 was for a new program of housing loans to elderlyindividuals in rural areas. NOA provided in 1964 is for rural housingloans to other than the elderly. Expenditures (including use ofbalances of prior NOA) will decline in 1965 as the proposed loan insur-ance program becomes operative.

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00




DEPARTMENT OF AGRICULTURE—Continued W

oa

CDO

CO

FARMERS HOME ADMINISTRATION—Continued



Exp.

Rural renewal 352 NOAExp.

Public enterprise funds:Direct loan account 352 Exp.

Emergency credit revolving fund Exp.

Agricultural credit insurance fund NOA(indefinite permanent authori- Exp.zation to expend from debtreceipts) 352

Rural housing for the elderly re- NOAvolving fund 352 Exp.

35,742

35,690

55,012

7,384

15,07113,549

1,000

38,831

38,809

1,2001,185

77,002

13,438

3,1315,063

3,5004,500

40,284A3,00040,800

A2,850

2,1902,185

3,431

5,865

6,5415,744

5,0004,525

1 4,453

1 4,841

9901,000

-73,571

-7.573

3,410681

1,50025

Increase in 1965 is for administrative costs of expanded programs andmandatory salary reform costs and is partly offset by decrease fromshift in financing of activities to Office of Inspector General. Supple-mental in 1965 is for administrative expenses related to the proposedinsured loan program.

Estimate provides for 6 projects in a pilot program of technical and loanassistance to local public bodies for rural economic development.

(Receipts and balances will more than cover proposed $325 million loanprogram, interest and incidental costs.)

(Receipts and balances will finance estimated $69 million programincluding administrative expenses.)

The agency has permanent authority to borrow from Treasury for thisaccount. Sale of loans will increase in 1965. Contingent liabilitiesfor insured loans are estimated at $804 million.

Estimate in 1965 will increase capital, used for loans to nonprofit institu-tions to finance rental housing for the elderly in rural areas.


Rural housing insurance fund NOA(proposed legislation) 352 Exp.

Total, Farmers Home Admin- NOAistration.

Exp.

OFFICE OF RURAL AREASDEVELOPMENT


Exp.


Total, Office of Rural Areas NOADevelopment. Exp.

OFFICE OF THE INSPECTOR GENERAL


Exp.

OFFICE OF THE GENERAL COUNSEL


Exp.

OFFICE OF INFORMATION



101,813

295.838

-156

-156

174174

3,8503,774

1,6611.577

71,662

280.252

120110

367

120477

3,9673,860

1,6841,668

A100,000A40,000

54,015A 103,000

85,750A42,850

124124

124124

9,8749,850

3,8533,-853

1,6481,664

100,00040.000

| 85,353

1-151.652

414

-367

4-353

9,8749,850

-114- 7

-36- 4

Legislation will be proposed to authorize a revolving fund to financeinsured rural housing loans.

Increase is for mandatory salary reform costs.

Provides departmentwide audit and investigation services. Financedin past years within other accounts.

Mandatory salary reform costs are more than offset by the shift infinancing of management to Office of Management Services.


§a

00Ox




decreas)



CENTENNIAL OBSERVANCE OFAGRICULTURE

General and special funds—ContinuedSalaries and expenses. _ __ 355 Exp.

NATIONAL AGRICULTURAL LIBRARY

Salaries and expenses _ 355 NOAExp.

Library facilities 355 NOAExp.

Total, National Agricultural NOALibrary. Exp.

OFFICE OF MANAGEMENT SERVICES

Salaries and expenses. _ _. .355 NOAExp.

GENERAL ADMINISTRATION

Salaries and expenses _ _ 355 NOAExp.

59

1,1851,154

1,1851,154

3,4773,250

1,4261,395

450450

1,8761,845

3,7503,830

1,3471,254

7,000335

8,3471,589

2,5272,513

3,3723,372

- 7 9-141

6,550-115

6,471-256

2,5272,513

-378-458

(The purposes of the account have been met.)


Increase provides for construction of the National Agricultural Library,Beltsville, Md. Planning funds were provided in 1964.

Provides central financing of management services for a number ofsmaller Department agencies, previously financed from other accounts.

Mandatory salary reform costs and additional assistants in the imme-diate Office of the Secretary are more than offset by the shift infinancing of management, audit, and investigation to the Office ofManagement Services and the Office of the Inspector General.

H

as

1a


Intragovernmental funds:W or king capital fund 355 Exp.

Total, general administration. NOAExp.

FOREST SERVICE

General and special funds:Forest protection and utilization NOA

402Cooperative range improvements NOA

(special fund) 402 Exp.

Forest roads and trails 402Contract authorization:

Current.. NOAPermanent NOA

Appropriation to liquidate con-tract authorization. Exp.

Access roads 402 NOAExp.

Acquisition of lands for nationalforests:

Superior National Forest _. _ 402 NOAExp.

Special acts (indefinite, special NOAfund) 402 Exp.

Cache National Forest 402 Exp.

Wasatch National Forest.__402 NOAExp.

A Proposed for separate transmittal.D To carry out authorizing legislation to be proposed.

241

3,4773.491

198,392

700198.238

80,000

(44.500)39,390

2,000842

2,000785

303

6

3,7503,830

189,025A13,000

700197,874

A12,500

85,000(63,200)72,349

2,500

1,250

70

63

50

250100

-14

3,3723.358

1 197,318

700192,600

A500

D85,000

(72,300)72.300

596

650

70

70

50

150200

-14

-378-472

| -4,707

1—17.274

(9,100)-49

-1,904

-600

7

-100100

Supplemental in 1964 is for firefighting. Decrease in 1965 results froma lower estimate for firefighting offset by increases for forest landmanagement, research activities, and mandatory salary reform costs.

Program will construct or reconstruct about 1,900 miles of multi-purpose roads mostly to harvest timber. Additions to liquidatingcash in 1965 will provide funding for expanded construction program.

Prior balances will acquire interests in roads or rights-of-way; futureactivity will be financed in Forest roads and trails.

(Prior balances are used to acquire lands in the Superior National Forest.)

Certain forest receipts, otherwise payable to counties in Utah, Nevada,and California, are used to acquire lands within national forests.

(Prior balances are used to acquire lands in the Cache National Forest.)

Completes authorization for purchases of land authorized by PublicLaw 87-661.

>F

OO

3O• 4

00




enacted1964 1965



FOREST SERVICE-Continued

General and special funds—ContinuedAssistance to States for tree plant- NOA

ing 402 Exp.

Expenses, brush disposal (perma- NOAnent, indefinite, special fund) _ _ Exp.

402

Roads and trails for States, na- NOAtional forests fund (permanent, Exp.indefinite, special fund) 402

Forest fire prevention (permanent, NOAindefinite, special fund) 402 Exp.

Restoration of forest lands and NOAimprovements (permanent, in- Expdefinite, special fund) 402

Payments to Minnesota (Cook, NOALake, and St. Louis Counties) Exp.from the national forest fund(permanent, indefinite, specialfund) , 402

Payments to counties, national NOAgrasslands (permanent, indefi- Exp.nite, special fund) 402

1,0001,201

8,7587,642

10,90010,900

2811

217

125125

390394

1,0001,000

9,0008,800

12,00112,001

4529

100100

131131

438438

1,0001,000

9,2009,100

12,40012,400

2530

100100

133133

450450

200300

399399

-201

22

1212

Aid is given, mainly through grants, for reforestation work.

Certain receipts from purchasers of timber are applied to restoration oftimber sale areas.

Permanent law makes available 10% of national forest receipts forconstruction and maintenance of roads and trails in national forestswithin the States from which the receipts were derived.

Fees for use of "Smokey Bear" are available for forest fire preventioncampaign.

Receipts from claims settlements and forfeitures of deposits are used forrestorations.

Certain receipts are distributed to three counties in which SuperiorNational Forest lands are located.

Permanent law makes available 25% of national grassland receipts forpayment to counties for schools and roads.

aWdoa


Payments to school funds, Arizona NOAand New Mexico, act of June Exp.20, 1910 (receipt limitation)(permanent, indefinite) 402

Payments to States, National for- NOAests fund (permanent, indefinite, Exp.special fund) _ _ 402

1 ntragovernmental funds:Advances and reimbursements.402 Exp.

Working capital fund, Forest Exp.Service 402

Total, Forest Service NOA

Exp.

Total, Department of Agri- NOAculture.

Exp.

8080

27,23527.235

273

-17

331,659

287,116

8,031,720

7.735,260

100100

29,99429,994

4

-910

327,854A13,000325,873

A12,500

7,189,287A75,613

7,068,485A-90,934

110110

31,10031.100

-303

1 337,756

I 320,5861A.500[

6,209,4241A -253,472|6,182,5081

A -367,943]

1010

1,1061,106

- 4

607

-3,098

-17,287

-1,308,948

-1,162,986

These States are paid a share of the national forest receipts for schoolpurposes.

With minor exceptions, 25% of the national forest receipts goes to theStates for schools and roads.

DEPARTMENT O F C O M M E R C E

Oa

to

iGENERAL ADMINISTRATION


Exp.

Participation in Century 21 Ex- Exp.position 506

Participation in New York World's Exp.Fair 506A Proposed for separate transmittal.

3,8513.864

1,561

2,294

4,0003,750

41

9.232

4,3504.100

2,957

350350

- 4 1

-6 .274

Increase is to staff approved positions for the full fiscal year and to meetmandatory salary reform costs.

(Activity was completed in 1962. Payments are prior obligations.)

(Fair opens Apr. 21, 1964. Government personnel will manage andmaintain exhibits in the Federal pavilion.)

00o






DEPARTMENT OF COMMERCE—Continued

GENERAL ADMINISTRATION—Con.

Public enterprise funds:Aviation war risk insurance re- Exp.

volving fund 501

Intragovernmental funds:Working capital fund _ 506 Exp.

Total, general administration. NOAExp.

ECONOMIC DEVELOPMENT

Area Redevelopment Administration

General and special funds:Operations 507 NOA

Exp.

Grants for public facilities 507 NOAExp.

Public enterprise funds:Area redevelopment fund 507 NOA

Exp.

Total, Area Redevelopment NOAAdministration.

Exp.

-13

-51

3,8517,656

12,37111,166

35,0002,853

115,05024,945

162,421

38,964

-23

4,00013,000

13,48013,000

A D 8,00010,000

132,00074,600

145,480A D 8,000

97,600

- 7

4,3507,050

F17,50015,000

D 35,00011,000

G 170,000104,000

| 222,500

130,000

15

350-5,950

4,0202,000

27,0001,000

38,00029,400

69,020

32,400

(Contingent liability is estimated at $7,312 million.)

Technical assistance to disadvantaged areas will be substantially ex-panded.

Grants are made to local communities for construction of facilities whichpermanently increase employment.

Cumulative loan reservations at the end of 1965 will total $550 million.Increase is primarily for urban industrial and public facility loans.

wd

CO

%


Office of Business Economics


Exp.

Advances and reimbursementS-506 Exp.

Total, Office of Business Eco- NOAnomics. Exp.

Bureau of the Census


Exp.

1963 censuses of business, trans- NOAportation, manufactures, and Exp.mineral industries 506

1964 census of agriculture 506 NOAExp.

Modernization of automatic data NOAprocessing equipment 506 Exp.

Preparation for 19th decennial NOAcensus 506 Exp.

National housing inventory. _ _ 506 NOAExp.

A Proposed for separate transmittal.c 1964 appropriation pending in Congress.D To carry out authorizing legislation to be proposed.v Includes $3,000 thousand to carry out authorizing legislation to be proposed.0 Includes $1 10,000 thousand to carry out authorizing legislation to be proposed.

1,8751,844

4

1,8751,848

12,827

13,813

3,0712,581

700366

4,000196

2,0001,900

2,0001,900

13,637c 210

13,035c 190

8,5006,900

1,3451,300

4,5008,000

740600

2,5502,400

2,5502,400

j 15,000

14,590c 2 0

7,0005,600

16,50014,000

200100

1,100800

1,7001,100

550500

550500

1,153

1 1,385

-1 ,500-1 .300

15,15512,700

-4 ,300-7 .900

360200

1,7001.100

Increase is to improve balance of payments computations and selectedportions of the national income accounts. Regional economic workand the use of automation will be expanded.

Supplemental is for special analysis of data on footwear imports. In-crease will provide additional population estimates for local areas,improve construction put-in-place estimates and the quality of exportdata, and permit the design of a new retail area sample.

Major enumeration of the economic censuses will be performed in 1964;funds in 1965 will provide for processing the data.

Enumeration of the Nation's farms will take place after the fall harvestof calendar year 1964.

Estimate will permit developmental work in automated documenthandling and high-speed input techniques. Decrease reflects com-puter purchases in 1963 and 1964.

Increase will finance a large-scale field test to complete evaluation ofthe mail enumeration technique.

Estimate will provide a current survey of changes in occupancy anduse of various housing units.

w

oo

13


ANALYSIS OF NEW


OBLIGATIONAL

code1963

AUTHORITY

1964

AND

1965

EXPENDITURES

Increase or

( - )




ECONOMIC DEVELOPMENT—Continued

Bureau of the Census—Continued

1962 census of governments. _-506 NOAExp.

18th decennial census 506 NOAExp.

1958 censuses of business, manu- Exp.factures, and mineral industries

506

Advances and reimbursements .506 Exp.

Total, Bureau of the Census. NOA

Exp.

Business and Defense ServicesAdministration

General and special funds:Salaries and expenses _ _ 506 NOA

Exp.

1,050780

382,840

21

-1,20521,687

19,393

3,9933,993

350800

335

29,072c210

30,970c190

4,6004,500

20

20

j 41,500

36,230c 20

5,0004,900

-350-780

-315

12,218

1 5,090

400400

Final reports and volumes will be printed in 1964.

(Activity was completed in 1963. Expenditures are prior obligations.)

(Activity was completed in prior years.)

Increased emphasis will be devoted to analyzing commodity data foruse by U.S. exporters and to domestic marketing analysis.

d

U

otr1

COOS


Office of Field Services


Exp.

Internationa] Activities


Export control 508

Total, international activi-ties.

Office of Trade Adjustment

Trade adjustment assistance. _506

Trade adjustment loans and loanguarantees 506

Total. Office of Trade Adjust-ment.

U.S. Travel Service


Total, economic develop-ment.

NOAExp.

NOAExp.

NOAExp.

NOAExp.

NOAExp.

NOAExp.

NOA

Exp.

3,4343.388

7,1986.299

3,8383.727

11,03510.026

253

253

3,3312.902

207,801

80.518

3,7253,600

9,2308.000

4,1004.050

13,33012.050

10090

10090

2,6002,500

200,907A D 8,000

c210153,210

c 190

4,4504,300

12,60011,300

4,6254,500

17,22515,«00

350150

500150

850300

3,9503,650

1 298,025

197,580c 2 0

725700

3,3703,300

525450

3,8953.750

25060

500150

750210

1,3501.150

88,908

1 44.200

Increase provides additional foreign trade staff to stimulate Americanfirms to seek and expand foreign markets for their products.

Increase will further strengthen the export expansion program byproviding additional trade centers and commercial trade fairs whichwill enable more American firms to exhibit and develop sales abroad.

Increase will provide for expected rise in number of export licenses issued.

Estimate will provide technical assistance to import-injured firms underthe Trade Expansion Act.

Estimate will provide financial assistance to firms that have sufferedbecause of increased imports.

Increase will substantially expand the overseas advertising program.Visitors from overseas have increased 49% since 1961.

ooS3

a

9

A Proposed for separate transmittal.c 1964 appropriation pending in Congress.|} To carry out authorizing legislation to be proposed.

CO00


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND

1963 1964 1965

DEPARTMENT OF

EXPENDITURES BY AGENCY (in thousands of dollars)—Continued

Increase or


COMMERCE—Continued

SCIENCE AND TECHNOLOGY

General and special funds—ContinuedCivilian industrial technology.506 NOA

Exp.

Coast and Geodetic Survey


Exp.

Construction of surveying ships NOA506 Exp.

Construction and equipment. .506 NOAExp.

Construction and equipment, geo- Exp.magnetic station 506

Total, Coast and Geodetic NOASurvey.

Exp.

6253

22,956

20,693

14,4004,326

32

26

37,356

25,077

1,000100

24,967A55

B19523,775

A55»170

13,00010,000

37,967A 55

B19533,775

A 55»170

800

29,000

27,975

9,00014,500

600100

38,600

42,575B25

-1,000700

3,783

4,000

-4,0004,500

600100

383

8,600

Contracts for textile research will be executed in 1964 and 1965, andactivity phased out.

Supplemental ($55 thousand) is for wage board pay increases. Esti-mate provides funds to operate oceanographic survey ships to becommissioned in 1965, for workload increases in data processing andchart production, and for expansion of research and developmentactivities. A worldwide seismological network, equipped and orga-nized by Department of Defense, will be maintained and operated.

The estimate provides for construction of a 2,800-ton semiautomatedoceanographic survey vessel.

The estimate provides for construction of a magnetic and seismologicalobservatory.

(Work is completed. Payments are for prior obligations.)

W

3


Patent Office


Intragovernmental funds:Advances and reimbursements306 Exp.

Total, Patent Office NOAExp.

National Bureau of Standards

General and special funds:Research and technical services.. NOA

506 Exp.

Research and technical services NOA(special foreign currency pro- Exp.gram) 506

Plant and facilities 506 NOAExp.

Construction of facilities 506 NOAExp.

Intragovernmental funds:Working capital fund 506 Exp.

Advances and reimbursements Exp.506

Total, National Bureau of NOAStandards. Exp.

A Proposed for separate transmittal.B Proposed for separate transmittal. Uniformed Services Pay Act of 1963.

27,49026.520

-16

27,49026,504

28,16527,198

500359

2,0001,527

30,00015.833

-3,517

4

60,66541,405

29,19528,300

29,19528,300

28,70027.914

500513

3,0005,350

7,71329,529

-407

1

39,91362,900

32,00031,200

32,00031,200

35,00032,315

500787

3,9006,800

7,00025,881

-783

46,40065,000

2,8052,900

2,8052,900

6,3004,401

274

9001,450

-713-3,648

-376

-1

6,4872,100

Increase will improve basic examining functions and cover workloadincreases. Research and development will be expanded; automationof the patent copy supply system will be undertaken.

Estimate will allow development of the National Standard ReferenceData System and increase research by contract, permit initiation ofan engineering standards program of measurement methodologiesof value to industry, and replace research equipment.

Grants are made in "excess currency" countries to support research,supplementing domestic programs in the physical sciences.

The estimate will provide for the design and installation of a neutronphysics laboratory, replacement of a standard frequency transmitter,an isotope separator, and other items.

Estimate will cover the final construction expenses of the new labora-tory complex at Gaithersburg, Md.

(Estimated Government equity in the fund will be $168 million on June30. 1965.)




enacted1964



SCIENCE AND TECHNOLOGY-Con.

Office of Technical Services

General and special funds:Salaries and expenses.- . _506

Weather Bureau

Salaries and expenses .506

Research and development.. .506

Research and development (spe-cial foreign currency program)

506Establishment of meteorological

facilities 506

NOAExp.

NOAExp.

NOAExp.

NOAExD.

NOAExp.

DEPARTMENT

1,1131,099

60,69760,538

11,11910,818

4,3253.617

1,020950

64,49862,800

10,4009,500

250

4,8003,500

OF COMMERCE—Continued

1,7501,300

68,80066,150

14,10012,000

500250

1,7254,000

730350

4,3023,350

3,7002,500

250250

-3,075500

Increase will strengthen the Office as a clearing house for the acquisition,indexing, processing, and sale of unclassified Federal research reportsand technical documents.

Increase will improve upper air observations, add to centrally producedforecasts, and disseminate additional data to the field.

Increase will finance projects to improve efficiency of Bureau operations,improve understanding of weather phenomena pertinent to aviation,develop high altitude sensing equipment, and contribute to atmos-pheric research and water resources programs.

Excess currencies will be used to improve foreign observations and tostudy problems of climatic and hydrologic cycles in arid regions.

Estimate continues the modernization program begun in 1956.


Meteorological satellite opera- NOAtions 506 Exp.

Intragovernmental funds:Advances and reimbursements_506 Exp

Total, Weather Bureau.__. NOAExp.

Total, science and technol- NOAogy.

Exp.

TRANSPORTATION

Inland Waterways Corporation

Public enterprise funds:Inland Waterways Corporation

Fund_ 502Limitation on administrative

expenses. Exp.

Maritime Administration

General and special funds:Ship construction 502 NOA

Exp.

Operating-differential subsidies:Permanent, indefinite, contract NOA

authorization 502Liquidation of contract authori-

zation. Exp.A Proposed for separate transmittal.B Proposed for separate transmittal, Uniformed Services Pay Act of 1963.

40,00010,299

22

116,14085,294

243,389

179,382

(2)-825

64,200107,912

200,000

(220,400)220,677

16,500

79,94892,300

189,043A55

B195218,325

A55»170

(2)-800

112,500103,000

200,000

(216,500)218,000

18,00019,000

103,125101,400

1 221,875

242,275B25

124,900103.000

200,000

(190,000)208.000

18,0002,500

23,1779,100

32,582

1 23,750

(-2)800

12,400

(-26.500)-10.000

Estimate includes spacecraft, launches, facilities, and services to obtainobservations of worldwide cloud patterns from satellites.

(On July 19, 1963, Public Law 88-67 repealed the Inland WaterwaysCorporation Act. Fund balance has been returned to Treasury.)

Program includes contracts for 17 ships ($108.6 million), acquisition ofreplaced ships ($13.2 million) and administrative expenses.

Voyages undertaken under subsidy contracts are estimated to increaseto 1,941 in 1965 from 1,920 in 1964.

WOO




enacted1964 1965

estimateIncrease ordecrease Explanation of NOA requests

DEPARTMENT OF COMMERCE—Continued»3W

do

TRANSPORTATION—Continued

Maritime Administration—Continued

General and special funds—ContinuedResearch and development 502 NOA

Exp.


Maritime training 502 NOAExp.

State marine schools 502 NOAPermanent, indefinite, contract NOA

authorization .502Liquidation of contract authori-

zation. Exp.

Public enterprise funds:Federal ship mortgage insurance NOA

fund (permanent, indefinite au-thorization to expend from pub- Exp.lie debt receipts) 502

Vessel operations revolving fund__ Exp.502

3,5507,542

15,24914,738

3,3193,284

2501,948

(1,948)1,431

6,000

8,100

1,392

7,0008,000

15,50015,000

3,4953,218

2501,155

(1.155)1,355

5,100

2,965

-390

10,1009,000

15,75015,000

4,4843,500

5501,185

(1.185)1,857

-4,288

37

3,1001.000

250

989282

30030

(30)502

-5,100

-7,253

427

Increase is principally assumption of certain costs of experimentaloperation of the nuclear ship Savannah previously paid by AEC.

Estimate provides for continuing of program at substantially the samelevel as 1964.

Increase is for improvements to the Federal Maritime Academy andincludes a new library building.

Increase is primarily for preparation of a training ship for Texas acad-emy. Federal aid to State schools will continue at substantially thesame level as 1964.

NOA occurs when requirements for payments under guarantees arise.None are anticipated in 1965. Guarantees involving a contingentliability of $578 million are estimated to be outstanding at the closeof 1965.

(Fund is substantially self-supporting.)


War risk insurance revolving Exp.fund 502

Intragovernmental fund:Advances and reimbursements Exp.

502

Total, Maritime Administra- NOAtion. Exp.

Bureau of Public Roads

Trust funds:Limitation on general administra-

tive expenses.

Federal-aid highways (liquidationof contract authorization).

Improvement of the Pentagonroad network.

General and special funds:Forest highways: 503

Contract authorization:Current _. NQAPermanent NOA

Liquidation of contract authori-zation. Exp.

Public lands highways: 503Contract authorization:

Current NOAPermanent NOA

Liquidation of contract authori-zation Exp.

Control of outdoor advertising.503 NOAExp.

° To carry out authorizing legislation

-361

81

294,516364,796

(38,178)

(3,249,200)

(2.000)

33,000

(36,900)38,794

15,000

(2,500)2,136

2,000

-148

345,000351.000

(43,800)

(3,249,150)

(500)

33,000(33,000)34,144

9.000(4,000)7,690

2,000

-106

356,969336,000

(48,750)

(3,650,000)

D33,000

(33,000)33,000

D3,000

(9,000)9,000

42

11,969-15,000

(4.950)

(400.850)

(-500)

33,000-33,000

-1,144

3,000-9,000(5,000)1,310

-2,666

42 (Contingent liability in event of war is estimated at $13 billion.)

(Increase provides for expanded programs and increased emphasis onright-of-way investigation, planning, and contract research.)

(Appropriation is to liquidate contract authorization and meet adminis-trative expenses for interstate, primary, secondary, and urban high-ways. These costs are payable from the highway trust fund.)

(Financing required to implement a 1961 law has been completed.)

Legislation will be proposed to extend this program at the current level.

Legislation will be proposed to continue this program.

(The appropriation is available for incentive payments to States agreeingto control highway advertising.)

W

to be proposed.


ANALYSIS OF NEW


OBLIGATIONAL

code1963

AUTHORITY

1964

AND EXPENDITURES

1965 Increase or

( - )




TRANSPORTATION—Continued

Bureau of Public Roads—Continued

General and special funds—ContinuedInter-American Highway 152 NOA

Contract authorization: Cur- NOArent.


Woodrow Wilson Memorial Bridge Exp.503

Access roads (act of Sept. 7, 1950) Exp.503

Construction, operation, and Exp.maintenance of roads, Alaska

503

Study of highway program for NOAAlaska 503 Exp.

Surveys and plans 503 Exp.


Total, Bureau of Public NOARoads. Exp.

12,000

2,961

241

95

4

400

95

-206

62,40044,121

9,000

(6,000)5,400

127

130

400

10

51,00049,900

4,000

7,000

40,00049,000

-5,000

(-6.000)1,600

-127

-130

-400

-10

-11,000-900

The Highway Act of 1962 authorized $32 million to complete theInter-American Highway. The 1965 request will permit theprogram to proceed on schedule.

(The bridge was officially opened to traffic in December 1961.)

(The purpose of the appropriation has been met.)

(The purpose of the appropriation has been met.)

(The 1963 appropriation financed a study authorized in 1962.)

3

a


Transportation Research

General and special funds:Transportation research 506 NO A

Exp.

Total, transportation NOAExp.

Total, Department of Com- NOAmerce.

Exp.

623I

357,539408,094

812,580

675,650

2,0001,000

398,000401,100

791,950A 8,055

B 195c 210

785,635A 55

B 170c190

2,0001,500

398,969386,500

923,219

833,405B 2 5C20

500

969-14,600

122,809

47.400

Provides for continuation of program at 1964 level.

DEPARTMENT OF DEFENSE—MILITARY

MILITARY PERSONNEL

(Functional code 051)

General and special funds:Military personnel, Army NOA

Exp.

Military personnel, Navy _ NOA

Exp.

3,612,848

3,903,592

2,707,081

2,713,509

3,784,317A 24,400

B234,0003,905,000

A23,700B230,300

2,614,683A44,000

B201,0002,748,000

A 41,400B197,600

1 4,231,000

J 4.202,600A.700

B 3,700

3,055,000

3,035,000A 2,600B3,400

188,283

1 48,000

J195,317

54,000

Supplemental in 1964 is to support an average of 962.995 militarypersonnel and for part-year costs for military pay increaseseffective Oct. 1, 1963. Increase in 1965 is for an increase inaverage strength to 974,849, the full year effect of the payincrease, and lower financing by transfers from revolving funds.

Supplemental in 1964 is to support an average of 666,546 militarypersonnel and for part-year costs for military pay increaseseffective Oct. 1, 1963. Increase in 1965 is for an increase in aver-age strength to 673,657, the full year effect of the pay increase,and lower financing by transfers from revolving funds.

A Proposed for separate transmittal.B Proposed for separate transmittal. Uniformed Services Pay Act of 1963.c 1964 appropriation pending in Congress.


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY

1963 1964


1965 Increase or

( - )Explanation of NOA requests

DEPARTMENT OF DEFENSE—MILITARY—Continued 3

CO

MILITARY PERSONNEL-Continued

(Functional code 051)—Continued

General and special funds—ContinuedMilitary personnel, Marine Corps. NOA

Exp.

Military personnel, Air Force NOA

Exp.

Reserve personnel, Army NOA

Exp.

Reserve personnel, Navy_ NOA

Exp.

664,951

666.468

4,056,507

4,102,712

222,456

186,714

80,800

79,140

678,600B47,000678,000

B47,000

3,943,000M46,000B 286,0003,973,000A.138,200B277,800

210,100B500

209,578B422

92,300B2,80091,700

B2,300

747,000

735,000

4,389,000

4,363,000A 7,800B8.200

242,900

235,922B78

99,200

97,300B500

21,400

10,000

14,000

-10,000

32,300

26,000

4,100

3,800

Supplemental in 1964 is for part-year costs for military pay in-creases effective Oct. 1, 1963. Increase in 1965 is for the fullyear effect of the pay increase.

Supplemental in 1964 is to support an average of 865,089 militarypersonnel and for part-year costs of military pay increases effec-tive Oct. 1, 1963. Increase in 1965 is for the full year effect ofthe pay increase.

Supplemental in 1964 is for part-year costs for military pay in-creases effective Oct. 1, 1963. Increase in 1965 is for the fullyear effect of the pay increase and to provide for an estimatedyear-end paid drill strength of 285,000 compared with 264,000 for1964.

Supplemental in 1964 is for part-year costs for military pay in-creases effective Oct. 1, 1963. Increase in 1965 is for the full yeareffect of the pay increase. The estimate continues a year-endpaid drill strength of 126,000 but provides for an increase inaverage strength from 121,200 to 125,300.


Reserve personnel, Marine Corps. NOA

Exp.

Reserve personnel, Air Force NOA

Exp.

National Guard personnel, Army. NOA

Exp.

National Guard personnel. Air NOAForce.

Exp.

Retired pay. Defense NOA

Exp.

Increased military compensation NOA(proposed legislation). Exp.

Uniform rations (proposed legis- NOAlation). Exp.

Total, military personnel NOA

Exp.

A Proposed for separate transmittal.B Proposed for separate transmittal, Uniformed Services Pay Act of 1963.

26,800

26,504

48,700

48,589

243,474

212,242

49,300

45,366

1,025,700

1,014,673

12,738,617

12,999,509

28,500B1,40028,800B1,200

55,100B2,60053,700B2.300

242,800B 8,500239,800B 7,200

58,300B3,20056,300

B 2,700

1,143,000A20,000B66,000

1,140,000A19,400B64,600

12,850,700A234,400B853,000

13,123,878A222,700B833,422

] 30,900

30,800B200

1 59,200

56,900B300

1 274,500

264,700B1,300

| 69,300

64,500B500

1 1,399,000

1,382,000A600

B 1 ,400

A143,000A 136,000

A29,000A25,000

14,597,000M72,000

14,467,722A172,700

B19,578

1,000

1 1,000

1,500

| 1,200

23,200

| 19,000

7,800

1 6,000

170,000

1 160,000

143,000136,000

29,00025,000

1 830,900

1 480,000

Supplemental in 1964 is for part-year costs for military pay in-creases effective Oct. 1, 1963. Increase in 1965 is for the full yeareffect of the pay increase. The estimate continues a year-endpaid drill strength of 45,500.

Supplemental in 1964 is for part-year costs for military pay in-creases effective Oct. 1,1963. Increase in 1965 is for the full yeareffect of the pay increase. The estimate continues a year-endpaid drill strength of 61,000.

Supplemental in 1964 is for part-year costs for military pay increaseseffective Oct. 1, 1963. Increase in 1965 is for the full year effectof the pay increase and to provide for an estimated year-endpaid drill strength of 395,000 compared with 376,000 for 1964.

Supplemental in 1964 is for part-year costs for military pay increaseseffective Oct. 1, 1963. Increase in 1965 is for the full year effectof the pay increase. The estimate continues a year-end paid drillstrength of 75,000.

Supplemental in 1964 is for an average of 412,446 retired personneland for part-year costs for retired pay increases effective Oct. 1,1963. Increase in 1965 is for an increase in average retiredstrength to 466,074 and for the full year effect of the pay increase.

Legislation to be effective Oct. 1, 1964, will be proposed to providefor increased compensation for military personnel on active duty.

Legislation has been proposed to provide a uniform ration for allservices.

1

>s3

too



1963 1964


1965 Increase or

( - )Explanation of NOA requests

DEPARTMENT OF DEFENSE—MILITARY—Continued

OPERATION AND MAINTENANCE


General and special funds—ContinuedOperation and maintenance, NOA

Army. Exp.

Operation and maintenance, NOANavy. Exp.

Operation and maintenance, Ma- NOArine Corps. Exp.

Operation and maintenance, Air NOAForce. Exp.

Operation and maintenance, NOADefense agencies. Exp.

Operation and maintenance, Army NOANational Guard. Exp.

Operation and maintenance, Air NOANational Guard. Exp.

3,362,5543,581,763

2,825,7582.863,985

188,189190,743

4,355,8194,488,812

356,077318,421

174,379174,221

194,400193,301

3,355,9023,415,000

2,908,9552,926,000

191,306189,000

4,336,8874,414,000

477,654461,000

180,790179,000

222,700221,000

3,463,0003,457,000

3,159,0003,107,000

188,000188,000

4,606,0004,549,000

516,986506,000

188,000187,000

236,000230,000

107,09842,000

250,045181,000

-3 ,306-1 ,000

269,113135,000

39,33245,000

7,2108,000

13,3009,000

Increase includes expanded testing of air assault concepts, increasedunit training, existence of higher average aircraft inventory, andmandatory salary reform costs.

Increase includes costs of greater numbers of replacement fuel coresfor nuclear-powered ships, improvements in submarine safety,additional Polaris submarines in the fleet, and higher costs ofoperating and maintaining more complex ships and aircraft.

Estimate continues support of 3 divisions and 3 air wings at a highstate of combat readiness.

Increase reflects higher operating costs of modern and improvedelectronic equipment and aircraft, and an increase in jointexercises with other services, including airlift of Army troopsand equipment to oversea areas for short periods of field training.

Increase reflects further consolidation of intelligence activities fromthe military departments and the cost of the Defense Communi-cations System.

Increase reflects completion of conversion from Nike-Ajax to Her-cules air defense units, mandatory salary reform costs, and costof maintaining higher equipment levels.

Increase is mainly to allow additional flying hours and to coverhigher aircraft operating costs and mandatory salary reformcosts.

3w

3


National Board for the Promotion NOAof Rifle Practice, Army. Exp.

Claims, Defense NOAExp.

Contingencies, Defense NOAExp.

Court of Military Appeals, De- NOAfense. Exp.

Operation and maintenance, Exp.Alaska Communication System,Army.

Miscellaneous expired accounts, Exp.Department of Defense.

Total, operation and main- NOAtenance. Exp.

PROCUREMENT


Procurement of equipment and NOAmissiles, Army. Exp.

Procurement of aircraft and mis- NOAsiles, Navy. Exp.

D To carry out authorizing legislation to be proposed.E Partly to carry out authorizing legislation to be proposed.

622650

22,30021,211

15,00010,909

472462

688

28,451

11,495,56911,873,616

2,519,1862,370,713

3,034,6602,725,779

528500

19,00020,000

15,00014,000

509500

13

29,987

11,709,23111,870,000

2,931,0942,604,000

2,889,1452,862,000

484500

23,00021,800

15,00015,000

530500

16,200

12,396,00012,278,000

El,779,0002,376,000

D2,515,0002,640,000

-44

4,0001,800

1,000

21

-13

-13,787

686,769408,000

-1,152,094-228,000

-374,145-222,000

Lease costs of the national match site will be lower in 1965.

Additional lump-sum settlements and higher costs of foreign claimsare expected.

This account provides the Secretary of Defense with funds to meetemergencies and extraordinary expenses.

Caseload is expected to continue at about the 1963 level of 834.

(Transferred to "Operation and maintenance, Air Force." Ex-penditures are from 1962 and prior appropriations.)

Program is directed at filling combat essential equipment allowancesfor the reorganized Army division (ROAD) active and reserveforce, and providing inventories adequate for sustained combatoperations. Modernization of older materiel is continued. De-crease reflects reduced procurement of materiel as stocks approachinventory objectives.

Decrease results mainly from (a) major reprograming of prior yearfunds for 1965 needs; (b) decline in aircraft modifications withcompletion of the heavy reconnaissance (A-5C) program, and(c) drop in procurement of Polaris missiles upon attainment ofimproved inventory position.

Q

to


ANALYSIS OF NEW

Account and funttional

OBLIGATIONAL

code1963

AUTHORITY

1964

AND EXPENDITURES

1965 Increase or

( - )


Explanation of NOA request*

DEPARTMENT OF DEFENSE—MILITARY—Continued

PROCUREMENT—Continued


General and special funds—ContinuedShipbuilding and conversion, NOA

Navy. Exp.

Other procurement, Navy NOAExp.

Procurement, Marine Corps NOAExp.

Aircraft procurement, Air Force. _ NOAExp.

Missile procurement, Air Force. __ NOAExp.

2,919,2002,550.881

903,600826,633

256,000185,305

3,562,4003,746,089

2,459,0002,675,807

2,059,5892,290,000

1,175,231947,000

201,960205,000

3,385,5754,010,000

2,141,9902,118,000

D1,966,0002,120,000

1,058,000991,000

E181,000188,000

D3,663,0003,460,000

D1,730,0002,050,000

-93,589-170,000

-117,23144,000

-20,960-17,000

277,425-550,000

-411,990-68,000

Funding includes new construction of 6 nuclear attack submarines,16 escort ships, 10 amphibious assault ships, 7 ships to replenishwarships at sea, and additional supporting ships, gunboats, andsmall craft. Decrease reflects completion of funding for Polarissubmarines in 1964.

Modernization of fleet equipment and weapons will continue, withemphasis on antisubmarine forces. Decrease reflects priorfinancing available for 1965.

The program will continue to improve firepower, mobility, andcommunications. Decrease reflects reduced procurement ofammunition and ordnance, support vehicles, engineer and otherequipment as stocks approach inventory objectives.

Provides for procurement of 889 new aircraft, compared with 840in 1964. Emphasis continues on tactical and airlift aircraft.Increase reflects higher procurement of spares and repair parts,and modification of B-52 strategic bombers, partly offset byreduced sales and recoupments from prior year programs.

Program continues procurement of the Minuteman intercontinentalballistic missile and Bullpup, Sparrow, and Shrike missiles.Modifications to existing ballistic missiles are also provided for.Decrease reflects reduction in ballistic missile requirements.

ao

iCO

en


Other procurement, Air Force NOAExp.

Procurement, Defense agencies. __ NOAExp.

Aircraft and related procurement, Exp.Navy.

Total, procurement NOAExp.

RESEARCH, DEVELOPMENT, TEST,AND EVALUATION


Research, development, test, and NOAevaluation, Army. Exp.

Research, development, test, and NOAevaluation, Navy. Exp.

Research, development, test, and NOAevaluation, Air Force. Exp.

Research, development, test, and NOAevaluation, Defense agencies. Exp.


956,1621,251,222

36,9026,774

292,353

16,647,11016,631,555

1,329,4341,354.425

1,510,6021,429,341

3,697,5923,300,374

450,755291,424

878,2991,110,000

43,16440,000

151,000

15,706,04716,337,000

1,386,0911,373,000

1,540,7131,487,000

3,481,4343,623,000

439,942410,000

802,000900,000

62,00050,000

10,000

13,756,00014.785.000

D1,397,0001.365,000

D1,451,0001,458,000

D3,205,0003,237,000

D519,000470,000

-76,299-210,000

18,83610,000

-141,000

-1,950,047-1,552,000

10,909-8,000

-89,713-29,000

-276,434-386,000

79,05860,000

The program will continue procurement of conventional ordnanceand intelligence, warning, communications and control systems,primarily to improve air defense and conventional war capabilities.Principal decreases are in procurement of electronics, telecom-munications, and automatic data processing equipment forcommunications and intelligence programs.

Increase reflects higher procurement of electronic equipment by theDefense Communication Agency and by other departmentwideactivities.

(Program needs are now provided in other appropriations above.)

Increase is for additional work in development of advanced anti-ballistic missile defense, and continued emphasis on improvedweaponry and equipment for limited and remote area warfare.

Increases for antisubmarine warfare development are more thanoffset by phasing down improvement work on the Polaris missile.

Decrease reflects the phaseout of research and development onmajor missile and aircraft programs and the reorientation of themilitary space program. These developments more than offsetnew programs to be initiated.

Increase is primarily to attain readiness posture for nuclear weaponseffects tests and for accelerated development of nuclear testdetection techniques as safeguards under the test ban treaty.

fed

fed

td

O


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued 800


enacted1964

estimate1965


RESEARCH, DEVELOPMENT, TEST,AND EVALUATION—Continued


General and special funds—ContinuedEmergency fund, Defense NOA

Exp.

Total, research, development, NOAtest, and evaluation. Exp.

MILITARY CONSTRUCTION


Military construction, Army NOAExp.

Military construction, Navy NOAExp.

Military construction, Air Force. _ NOAExp.

DEPARTMENT OF

4,904

6,993,2876.375,564

151,407145.078

161,354190.186

780,068715,438

101,00050,000

6,949,1806,943,000

200,646175,000

198,853202,000

468,275614.000

DEFENSE—MILITARY—Continued

150,00050,000

6,722,0006,580.000

E408,000251,000

E278,000225,000

1 406,000500,000

49,000

-227,180-363,000

207,35476,000

79,14723,000

-62,275-114.000

This appropriation provides funds for transfer to program appro-priations for prompt exploitation of research and developmentopportunities.

Increase is largely for construction in relocating Nike-Hercules airdefense units, replacement of World War II troop housing andbachelor officer quarters, classified facilities, and other essentialprojects previously deferred.

Increase is for essential projects previously deferred and construc-tion to replace deteriorated hospital facilities.

Estimate includes construction for an additional hardened Minute-man squadron, improvement of previously authorized Minute-man and Titan missile sites, and new facilities for strategic, tac-tical, and air defense aircraft forces. Decrease reflects offsettingreductions in construction of missile facilities.

Wd

a

CO


Military construction, Defenseagencies.

Military construction, Army Re-serve.

Military construction, Naval Re-serve.

Military construction, Air ForceReserve.

Military construction, Army Na-tional Guard.

Military construction, Air Na-tional Guard.

Loran stations, Defense

NOAExp.

NOAExp.

NOAExP.

NOAExp.

NOAExp.

NOAExp.

NOAExp.

Exp.

NOAExp.

NOAExP.


Construction, Alaska Communica-tion System, Army.

Total, military construction.

FAMILY HOUSING


Family housing, Defense

49,7777,468

8,00014,816

7,0005.598

5,0004.633

7,00018,383

14,00021.913

20,00020,000

4

1,203,6061,143.518

590,326426,658

24,00039,000

4,50010,500

6,0008,000

4,0006,000

5,70015.000

16,00017.000

20,50020.500

948,4741,107.000

637,406680.000

E34,00030.000E5,0008,000

E7,0007,000

E5,0005,000

E6,00010,000

E14,00015,000

5,0005.000

1,168,0001.056.000

D711,000660,000

10,000-9.000

500-2.500

1,000-1,000

1,000-1,000

300-5,000

-2,000-2.000

-15,500-15.500

219,526-51.000

73,594-20,000

Increase is for essential projects previously deferred.

Estimate will continue construction at about the 1964 level.

Estimate provides for continuation of the 1964 program level. Re-programing in 1964 permitted reduction in funding for that year.

Estimate provides for continuation of the 1964 program level.Savings in 1963 permitted a reduction in 1964 funding.

Completion of the most urgent requirements allows a declininglevel of armory construction in 1964 and 1965.

Decrease reflects a declining level of construction as the mosturgent requirements are completed.

Estimate provides for continued expansion of this navigation sys-tem.

Provides the third increment of a construction program for militaryhousing—12,500 units, or 5,000 more than in 1964.

oo

CO


ANALYSIS OF NEW


OBLIGATIONAL

code1963

AUTHORITY

1964

AND EXPENDITURES

1965 Increase or

( - )



CIVIL DEFENSE


General and special funds—ContinuedOperation and maintenance, civil NOA

defense. Exp.

Shelter, construction and research NOAand development, civil defense. Exp.

Civil defense, Department of De- Exp.fense.

Construction of facilities, Depart- Exp.ment of Defense.

Total, civil defense NOAExp.

MILITARY ASSISTANCE


Military assistance, Defense NOAExp.

DEPARTMENT OF

72,84534,457

53,00010,070

156,347

1,740

125,845202,614'

1,325,0001,720,755

70,31275,000

41,25047,500

27,003

500

111,562150,000

1,000,0001,400,000


92,40080,000

E265,60068,000

1,000

1,000

358,000150,000

D1,000,0001,200,000

22,0885,000

224,35020,500

-26,000

500

246,438

-200,000

Increase reflects improved attack warning, radioactivity detection,and emergency broadcasting systems; expanded defense trainingprograms; and additional matching funds to support the expand-ing civil defense efforts of State and local governments.

Estimate includes additional public shelters, under proposed legisla-tion, funds to stock available shelters with survival supplies andequipment and for additional studies on population survivaltechniques.

(Obligations incurred in 1962 and prior years are liquidated underthis account.)

(Funds to construct Federal regional operating centers for both day-to-day and emergency operations were used for one facility atDenton, Tex.; remaining funds will provide a center in Massachu-setts and for site surveys and preliminary planning for 6 others.)

The 1965 program of grant military assistance remains at the 1964level. Program composition, however, reflects the increasedability of some countries to finance their own military needs.

too

wdoo

GO

o


REVOLVING AND MANAGEMENTFUNDS


Public enterprise funds:Defense production guarantees, Exp.

Army.

Defense production guarantees, Exp.Navy.

Defense production guarantees, Exp.Air Force.

Laundry service, Naval Academy- Exp.

Civil defense procurement fund. _ _ Exp.

Intragovernmental funds:Army stock fund Exp.

Navy stock fund Exp.

Marine Corps stock fund (contract NOAauthorization.) Exp.

Air Force stock fund Exp.

Defense stock fund Exp.

Army industrial fund Exp.

D To carry out authorizing legislation to be proposed.E Partly to carry out authorizing legislation to be propos

-72

-696

4,436

-24

-41

-71.421

67.459

88912.776

21,954

-216,735

-389,847

-80

3,008

785

6

100

-75,800

2,000

-22,000

-170,000

-72,887

-75

294

785

5

100

-43,800

-60,000

-11,000

-4,200

-150,000

49,000

5

-2,714

-1

32,000

-60,000

-13,000

17,800

20,000

121,887

(A reduction in loan activity is forecast resulting in reduced reve-nues.)

(A reduction in loan activity is forecast with an accompanyingreduction in revenues.)

(No change in the level of purchase of defaulted loans is forecast.)

(Estimate contemplates receipts and expenditures of approximately$725 thousand, the same as the 1964 level.)

(No change is anticipated in the level of equipment procurementfor State and local government emergency centers.)

(Estimate reflects lesser availability of stock for sale without re-placement.)

(Sales will exceed purchases in 1965 reflecting the sale of stock notrequiring replacement.)

(Sales will exceed purchases in 1965 reflecting the sale of stock notrequiring replacement.)

(Collections will exceed expenditures in 1964 as a result of inventoryreductions and mechanization of fuels billing procedures.)

(Estimate reflects lesser availability of stock for sale without re-placement.)

(Expenditures will exceed collections in 1965 as work is accom-plished on prepaid orders.)

dWOo


to



enacted1964

stimate1965

:stimat<Increase or

decrease Explanation of NOA requests3

W

do

h-1

otr1

REVOLVING AND MANAGEMENTFUNDS—Continued


Navy industrial fund Exp.

Air Force industrial fund Exp.

Defense industrial fund Exp.

Army management fund Exp.

Navy management fund Exp.

Air Force management fund Exp.

Defense agencies management Exp.fund.

Naval working fund ___ Exp.

DEPARTMENT OF

-812,293

-4,195

-2,325

-4,617

-16,172

190

5,542

4,313

-9,684

-7,411

-1,300

-17,693

100

61

2,042


63,787

-794

75

-15,000

309

1,514

73,471

6,617

1,300

75

2,693

209

-61

-528

(Work performed in 1965 will be partly financed from customers'prepayments in prior years.)

(Collections were very high in 1964 because of improved billingprocedures.)

(Collections exceed expenditures in 1964 because of customers' pre-payments.)

(Fund will operate at $295 million level in 1965.)

(Total activity of $1.6 billion is forecast for 1965.)

(Expenditures reflect the liquidation of prior year obligations.)

(Fund is not to be used in 1965.)

(Estimate reflects a decrease in activity with the 1965 level at $18million.)


Consolidated working funds, Exp.Army,

Total, revolving and manage- NOAfunds. Exp.

Total Department of De- NOAfense—Military.

Exp.

1,157

-1,400,613

51,120,250

49,973,176

1,753

-367,000

49,912,600A 234,400B 853,000

51,243,878A222,700B833,422

-169,000

50,708,000A172,000

51,007,722A172,700

B19,578

-1 ,753

198,000

1-120,000

-1,100,000

(Use of this account has been discontinued. Estimate reflectsliquidation of prior year obligations.)

DEPARTMENT OF DEFENSE—CIVIL

DEPARTMENT OF THE ARMY

Cemeterial Expenses


Exp.

Corps of Engineers—Civil

General investigations 401 NOAExp.

Construction, general. _401 NOAExp.

18,10016,797

792,870813,273

10,80010,900

19,11519,300

827,146811,300

13,29511,865

19,76019,600

880,143865,800

2

5254

,495965

645300

,996,500

Increases of 7% in interments and 5% in headstone applications areexpected, as well as higher maintenance workload. Increase alsoincludes $1.5 million in construction activity.

Provides funds for 211 flood control, navigation, and beach erosionstudies, of which 20 will be initiated in 1965, and maintains progress on19 comprehensive river basin surveys and 5 special studies. A programto develop construction uses of nuclear explosives will continue.

Continues construction on 217 projects. Forty-eight projects, costing$526 million, will be completed, and construction on 34 projects,costing $378 million will be started. Also, provides for preconstruc-tion planning on 105 projects, including 14 on which planning willstart in 1965.

A Proposed for separate transmittal.B Proposed for separate transmittal, Uniformed Services Pay Act of 1963.

tr1

a

3

!

toCO


ANALYSIS OF NEW


OBLIGATIONAL

code1963

AUTHORITY

1964

AND

1965

EXPENDITURES

(-)



to

DEPARTMENT OF DEFENSE—CIVIL—Continued

DEPARTMENT OF THE ARMY—Con.

Corps of Engineers—Civil—Continued

General and special funds—ContinuedOperation and maintenance, gen- NOA

eral 401Exp.

Flood control, hurricane and shore NOAprotection emergencies 401 Exp.

General expenses 401 NOAExp.

Flood control, Mississippi River NOAand tributaries 401 Exp.

United States section, Saint Law- NOArence River Joint Board of Exp.Engineers 401

International navigation con- Exp.gresses 401

Payments to States, Flood Con- NOAtrol Act of 1954 (permanent, Exp.indefinite, special fund) 401

145,850

141,200

14,16514,268

73,50482,042

202

14

1,7191.614

154,000A1,800154,800A.I ,700

15,00015,000

77,86273,600

1010

7

1,8281,719

1 158,676f

155,400A 100

4,1506,000

15,57515,500

71,86072,100

1,8281,828

2,876

1 -1,000

14,1506,000

575500

-6,002-1,500

- 1 0-10

- 7

109

A supplemental for 1964 is for increased wage board pay. Workloadin 1965 involves maintenance of 456 projects.

Provides for emergency operations to combat flood disaster situations,previously funded under "Operation and maintenance, general."

Increase provides for management and supervision of greater programworkload.

Provides for increased operation and maintenance requirements andcontinues construction on 12 major project features. Two floodcontrol studies will be started.

Activities of the Board are expected to terminate in 1964.

(Final costs will be liquidated in 1964.)

Three-fourths of receipts from lease of Federal lands acquired for floodcontrol, navigation and allied purposes are paid to States in which theprojects are situated.

todaa

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CO


Hydraulic mining in California, NOAdebris fund (permanent, indefi- Exp.nite, special fund) 401

Maintenance and operation of NOAdams and other improvements Exp.of navigable waters (perma-nent, i n d e f i n i t e , specialfund) 401

Intragovernmental funds:Advances and reimbursements, Exp.

Corps of Engineers—Civil __ 401

Revolving fund, Corps of Engi- Exp.neers—Civil 401

Total, Corps of Engineers— NOACivil.

Exp.

UNITED STATES SOLDIERS' HOME

Trust fund:Limitation on operation and main-

tenance and capital outlay.

RYUKYU ISLANDS, ARMY

General and special funds:Administration 910 NOA

Exp.

Construction of power systems Exp.910

Total, Ryukyu Islands, Army NOAExp.


1817

154154

-10

2,552

1,046,401

1,071,923

(6,272)

8,9548,387

8,9548,387

1824

154154

28

-2.500

1,095,133A1,800

1,073,442A 1,700

(6.622)(A 120)

10,0009.600

7.900

10,00017,500

1818

154154

-3.500

11,152,164

1,132.900A 100

(6,888)

14,44112,300

2.200

14,44114,500

- 6

-28

-1,000

55,230

57,858

(146)

4,4412,700

-5,700

4,441-3.000

Fees paid by mine operators for depositing mine debris in restrainingworks are used for their maintenance.

Half of the receipts from licenses issued by the Federal Power Commis-sion for non-Federal projects on navigable waters are used for mainte-nance and operation of dams and other navigational structures andfor navigation improvements.

(The fund provides centralized services and facilities to agency pro-grams. Repayments will rise in 1965 in relation to expenditures.)

Increase provides for estimated rise from 1,798 to 1,991 domiciliarymembers, and from 423 to 449 hospital patients.

Grants for assistance to the Ryukyuan economy and government willincrease by $4.1 million to a total of $12 million, the full amountauthorized.

(Expenditures are in the form of loans from prior year funds.)

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ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands cf dollars)— Continued to



THE PANAMA CANAL

General and special funds:Canal Zone Government:

Operating expenses 910 NOAExp.

Capital outlay 910 NOAExp.

P a n a m a Cana l C o m p a n y : Exp.Thatcher Ferry Bridge 502

Public enterprise funds:Panama Canal Company: Panama

Canal Company fund 502Limitation on general and

administrative expenses.Exp.

Total, The Panama Canal. NOAExp.

MISCELLANEOUS ACCOUNTS

General and special funds:Wildlife conservation, etc., mili- NOA

tary reservations, Army (per- Exp.manent, indefinite, specialfund) 404

DEPARTMENT

23,40622,645

3,1204,075

1,716

(8,058)

8,364

26,52636,800

325

25,72526,000

6,5006,000

137

(9,285)

5,506

32,22537,643

8076

OF DEFENSE—CIVIL—Continued

28,77428,549

4,8215,245

(10,639)

-944

33,59532,850

9090

3,0492,549

-1,679-755

-137

(1.354)

-6,450

1,370-4,793

1014

Increase will permit expanded operation of schools and hospitals to ac-commodate added Zone-based military personnel and dependents.

Provides $2,842 thousand for needed educational facilities, $795 thou-sand for health and sanitation, and $ 1,184 thousand for other needs.

(Thatcher Ferry Bridge went into service on Oct. 12, 1962.)

(Provides for strengthening the direction and management of adminis-trative services.)

(Decrease results from a net drop in capital outlay and operating ex-penses of $1.8 million and an increase in revenues of $4.6 million.)

Game permit fees are used to carry out a program of fish and game con-servation.

Xflo>

Ox


Wildlife conservation, etc., mili- NOAtary reservations, Navy (per- Exp.manent, indefinite, specialfund) 404

Wildlife conservation, etc., mili- NOAtary reservations, Air Force Exp.(permanent, indefinite, specialfund) 404

Total, miscellaneous accounts NOAExp.

Total, Department of De- NOAfense—Civil.

Exp.

2828

6033

1,092,274

1,128,066

3029

115

no1,148,274

A1,8001,139,595

A 1,700

3029

125124

1,213,620

1,192,239A 100

1014

63,546

1 51,044

Game permit fees are used to carry out a program of fish and game con-servation.

Game permit fees are used to carry out a program of fish and gameconservation.

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DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE

FOOD AND DRUG ADMINISTRATION


Exp.

Buildings and facilities 651 NOAExp.

Pharmacological-animal labora- Exp.tory building 651

Salaries and expenses, certification NOAand other services (indefinite spe-cial fund) 651 Exp.A Proposed for separate transmittal.

29,06226,672

651

1,890

1,907

35,68733,287

4,466852

1,001

39,50038,100

11,0254,052

142

3,8134,813

6,5593,200

-859

Consumer protection will be strengthened with emphasis on researchand scientific evaluations required to set tolerances for pesticides,food and color additives, and drugs.

Provides new headquarters laboratory, new and improved districtfacilities, and preparation of a master plan for Beltsville, Md., site.

(Laboratory will be completed in 1964 from prior year's financing.)

(Account was converted into a self-sustaining public enterprise fund in1964.)

to



1963

DEPARTMENT OF

1964

HEALTH


1965 Increase orExplanation of NOA requests

, EDUCATION, AND WELFARE—Continued

to00

FOOD AND DRUG ADMINISTRATION—Continued

Public enterprise funds:Certification and other services_651 Exp.

Intragovemmental funds:Advances and reimbursements _651 Exp.

Total, Food and Drug Ad* NOAministration Exp.

OFFICE OF EDUCATION

General and special funds:Expansion and improvement of NOA

vocational education 704Exp.

Higher education facilities con- NOAstruction 702 Exp.

Further endowment of colleges of NOAagriculture and the mechanic a rts Exp.

702

Grants for library services 704 NOAExp.

- 4

30,95129,227

34,716

34,330

11,95011,950

7,5007,257

-40

40,15335,100

34,756A 60,000

34,370A16.600

A 266,750A2,800

11,95011,950

7,5007,500

506

50,52542,800

1 183,296

69,900A35,400

464,00020,400

A17,700

11,95011,950

7,5007,500

546

10,3727,700

88,540

1 54,330

197,2501 35,300

(Industry fees finance the certification of antibiotic drugs, insulin, andcolor additives and establishment of tolerances for pesticides.)

Supplemental in 1964 will initiate programs authorized in the Voca-tional Education Act of 1963. Estimate in 1965 provides for increasesas authorized in the Act and for costs of activities authorized byearlier legislation.

Supplemental in 1964 will initiate programs authorized in the HigherEducation Facilities Act of 1963. Estimate in 1965 provides forincreases in grants and loans to assist in construction of classroom,laboratory, and library facilities at colleges and technical institutes.

Grants for land-grant colleges will continue at maximum authorizedlevel.

Continues support for rural library services at maximum authorizedlevel.

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Payments to school districts _ _ 701 NOA

Exp.

Assistance for school construction NOA701

Exp.

Defense educational activities:(Assistance for elementary and NOA

secondary education) 701Exp.

(Assistance for higher educa- NOAtion) 702

Exp.

(Other aids to education) _ _704 NOAExp.

Total, Defense educational NOAactivities.

Exp.

Expansion of teaching in education NOAof the mentally retarded. __704 Exp.

Expansion of teaching in education NOAof the deaf 704 Exp.

Educational improvement for the NOAhandicapped 704

Exp.

A Proposed for separate transmittal.c 1964 appropriation pending in Congress.

282,322

276.869

63,686

66.242

72,750

48.690

118,697

116.476

38,00333,169

229,450

198,336

1,000960

1,5001,383

104,466A216,204145,000

A145,000

23,740A 36,60658,200A1,800

62,750A2,50058,880A 2,500

118,650A32,758118,280

A31,100

38,22038,840

219,620A35,258216,000A33,600

850

1,594

2,500c11,685

150c1,930

) 359,450

263.796A71.204

1 58,400

41,700A18.300

1 84,100

1 75,785

| 165,390

160.511A1,658

38,40038,346

1 287,890

274,642A1.658

) 16,500

3.205C9,755

38,780

1 45.000

-1,946

i -•18,850

14.405

13,982

1 12,789

180-494

33,012

1 26,700

-850

-1,594

2,315

1 10.880

Supplemental in 1964 finances recently enacted legislation extendingauthorization for part of program which expired June 30, 1963. Pay-ments will be made in 1965 on behalf of 100,000 additional childrenwhose parents work or reside on Federal property.

Supplemental in 1964 finances recently enacted legislation extendingauthorization for part of program which expired June 30, 1963.Grants will be made in 1965 for construction of about 2,700 classroomsfor 80,000 pupils whose parents live or work on Federal property.

The 1964 supplemental will initiate programs authorized in Part B ofthe Vocational Education Act of 1963. The Act authorizes an ex-pansion of grants to States for science, mathematics, and foreignlanguage laboratory equipment and for guidance and counselingprograms. It also authorizes expansion of student loans and refillingvacated graduate fellowships. Grants for vocational training in theskilled trades, support for teacher training institutes, and researchprograms will continue at about the 1964 level.

(Account is merged with Educational improvement for the handicappedin 1964.)

(Account is merged with Educational improvement for the handicappedin 1964.)

Supplemental in 1964 will initiate program, authorized in recent legis-lation, which provides grants for teacher training and for researchrelating to the education of handicapped children.

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1963 1964

DEPARTMENT OF HEALTH


1965 Increase or

(-)

, EDUCATION,


AND WELFARE—Continued

OFFICE OF EDUCATION—Continued

General and special funds—ContinuedCooperative research 704 NOA

Exp.

Educational research (special for- NOAeign currency program) 704 Exp.

Foreign language training and area NOAstudies 704 Exp.


Exp.

Proposed education program (pro- NOAposed legislation) 700 Exp.

Colleges of agriculture and the NOAmechanic arts (permanent) .702 Exp.

6,9855,015

40020

12,645

12,041

2,5502,550

11,5008,300

500300

1,500300

14,761M,00014,000

A900

A 5,000A3,000

2,5502,550

17,00013,000

500400

1,5001,500

J 19,699

18,790MOO

A 718,400A118,000

2,5502,550

5,5004,700

100

1,200

3,938

1 3,990

713,400115,000

Increases are to develop course content material, improve teacher train-ing, demonstrate research findings, and identify research gaps.

Excess foreign currencies support research in foreign countries, supple-menting studies to improve education in the United States.

Grants are awarded for academic year and short-term study abroad toimprove the teaching of modern foreign language and area studies.

Supplemental in 1964 will provide for administrative costs of the HigherEducation Facilities and Vocational Education Acts of 1963. Em-phasis in 1965 is on data collection, surveys, and consultative servicesto improve the quality of education.

Pending legislation will increase educational opportunities for individualsin higher education, upgrade and strengthen training of teachers,expand library services and facilities, stimulate basic education and ex-tension programs for adults, improve teachers' salaries and public schoolclassrooms, and facilitate public school desegregation. An enlargedproposal provides grants to assist in meeting special educational needsof disadvantaged and other children, particularly to combat poverty.

Annual grants of $50 thousand are made to each State and Puerto Rico.

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Promotion of vocational educa- NOAtion, Act of February 23, 1917 Exp.(permanent, indefinite) 704

Intragovernmental funds:Advances and reimbursements.__ Exp.

704

Total, Office of Education. _ _ NOA

Exp.

VOCATIONAL REHABILITATIONADMINISTRATION

General and special funds:Grants to States 655 NOA

Exp.

Research and training 655 NOAExp.

Research and training (special NOAforeign currency program).655 Exp.


Total, Vocational Rehabilita- NOAtion Administration. Exp.

PUBLIC HEALTH SERVICE



7,1617,144

-392

661,865

623,705

72,94070,652

25,50024,145

2,000392

2,4862,405

102,92697,594

33,2002,224

7,1617,150

28

442,504A 620,818

c11,685508,242

A 203,700c1,930

88,70086,111

34,81032,698

2,0001,180

2,8972,839

128,407122,828

16,31114,000

7,1617,150

1

11,437,396\ A 718,400

736,484A262,362

C9,755

100,10089,550

40,62030,900

2,0001,200

3,1603,100

145,880124,750

21,51218,500

-27

11,080,789

1 294,729

11,4003,439

5,810-1,798

20

263261

17,4731,922

5,2014,500

7,161 Grants to States will continue at a maximum authorized level.

Permits matching of available State funds to rehabilitate 133,000 handi-capped persons—10% over 1964.

Provides for 432 research and demonstration projects, 7,849 trainee-ships, 523 teaching grants, and 8 research and training centers. Achange in scheduling of payments causes expenditures to drop in1965.

Excess foreign currencies permit use of overseas facilities for rehabilita-tion research and interchange of experts.

Provides for strengthening administration of expanding grant programsand for additional specialized services to States.

Provides $13.3 million for the National Institutes of Health, $3.8 millionfor an Arctic Health Research Center, and $1.8 million for environ-mental health facilities.

3

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ANALYSIS OF NEW


OBLIGATIONAL

code1963

AUTHORITY

1964

AND

1965

EXPENDITURES

Increase or

( - )



tototo

DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE—Continued

PUBLIC HEALTH SERVICE—Continued

Community Health

General and special funds—ContinuedAccident prevention 651 NOA

Exp.

Chronic diseases and health of the NOAaged 651

Exp.

Communicable disease activities NOA651

Exp.

Community health practice and NOAresearch 651

Exp.

Control of tuberculosis 651 NOA

Exp.

3,664

3,679

22,936

16,303

18,892

10,750

26,706

23,947

6,993

6,819

4,163B18

3,682B18

53,372B252

c2,27741,938

B 2 5 2c1,077

28,380B184

29,016» 184

29,605B67

26,133B67

6,828B22

5,978

1 3,823

f1 3,500

153,769

47,915c1,200

1 30,017

1 28,300

22,644

1 20,000

16,364

| 5,700

-358

-200

-2,132

1 5,848

11,453

-900

-7,028

-6,200

-486

-300

Provides for fewer new research grants than in 1964, and reduces directoperations relating to research, training, and technical services.

Pending supplemental in 1964 is for comprehensive State planning grantsfor a coordinated approach to action on mental retardation. Decreasein formula grants to States and in research grants in 1965 is partly off-set by increases to support new projects for cancer detection, and im-proved community control and training programs for neurologicaland sensory diseases, including mental retardation.

Increase will expand hepatitis research, epidemic and medical trainingaids, improvement of State medical laboratories, and will continuethe program to eradicate the yellow fever mosquito.

Estimate reflects deemphasis of general health grants and the expira-tion of authority for the public health traineeship program, but in-creases by $1 million for the migrant agricultural workers healthprogram.

Elimination of the State formula grant will allow concentration of in-creased project grants in areas of greatest TB prevalence.

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Control of venereal diseases 651 NOA

Exp.

Dental services and resources. _651 NOA

Exp.

Nursing services and resources,651 NOA

Exp.

Hospital construction activities. __ NOA651

Exp.

Health professions educational NOAassistance 651 Exp.

George Washington University NOAHospital construction 651 Exp.

Salaries and expenses, hospital Exp.construction services 651

Construction of mental healthfacilities, Alaska 651

Exp.

8,000

7,844

2,999

2,603

8,437

8,374

226,214

189,117

315

9,588B19

8,568BJ9

6,194B60

5,440B60

11,216B41

9,859B41

226,219B26

c5,049199,974

B26

c30,390C6,000

2,500625

9,725

8,745

6,671

6,000

4,062A 19,285

3,700A11,000

I 23,346[A 270,000

201,000A5,000c1,000

85,78215,000

c4,100

191

1,875

118

158

417

500

12,090

4,800

62,052

7,000

55,39213,100

-2,5001,250

-191

A Proposed for separate transmittal.B Proposed for separate transmittal, Uniformed Services Pay Act of 1963.c 1964 appropriation pending in Congress.

Estimate continues the renewed effort to eradicate venereal disease.

Increase is for a small expansion of the program to train dental studentsin the use of dental assistants.

Legislation is proposed to continue the expiring graduate nurse traininggrant program and provide assistance to undergraduates throughstudent loans and to provide for construction of teaching facilities.

Proposed legislation will continue community hospital grants at a lowerrate; initiate support for modernization of facilities and providegrants to coordinate area planning of medical facilities. A pendingsupplemental will initiate grant assistance for university-based mentalretardation clinics. Estimate in 1965 includes $17.5 million for thispurpose and for construction of community clinics.

Supplemental in 1964 will initiate newly authorized program of supportfor medical and dental education. Estimate in 1965 includes $10.2million for student loans and $75 million for grants for construction ofmedical, dental, and allied professional teaching facilities.

The Federal contribution was appropriated in 1964. These funds willbe fully expended by the end of 1965.

toto00



DEPAR

1963enacted

1964

TMENT OF HEALTH


1965 Increase

(-)

, EDUCATION

or

, AND


WELFARE—Continued

toto


Community Health—Continued

General and special funds—ContinuedGrants to States for poliomyelitis Exp.

vaccination 651

Total, community health NOA

Exp.

Environmental Health

Environmental health sciences NOA651

Exp.

Air pollution 651 NOA

Exp.

-22

324,842

269,733

11,065

10,101

378,065»689

C37,716331,404

B689c7,077

4,220B15

c1,2003,585

B15ci.OOO

12,933A 2,200

B 5911,273

A200B59

246,203A289,285

341,735A16,000

c6,300

10,890

9,700C200

22,030

17,400A2.000

119,018

24,865

5,455

5,300

6,838

7,868

Pending supplemental will initiate studies on pesticides recommendedby the President's Science Advisory Committee. Research will beexpanded in 1965 to determine the health effects of the continueduse of pesticides.

Supplemental in 1964 will initiate the program authorized by the CleanAir Act. Increases in 1965 are principally for full-year costs of newgrant-in-aid and enforcement programs.

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a


Environmental engineering and NOAsanitation 651

Exp.

Occupational health.._ .651 NOA

Exp.

Radiological health 651 NOA

Exp.

Water supply and water pollution NOAcontrol 651

Exp.

Grants for waste treatment works NOAconstruction 651 Exp.

Environmental health activities Exp.651

Total, environmental health. NOA

Exp.

8,530

8,725

4,121

4,059

15,825

13,438

24,668

22,551

90,00051,738

924

154,209

111,537

9,009B 7 4

8,626B74

4,990B49

4,451

19,120B245

15,755B245

28,930B130

25,870B 130

90,00075,000

168

169,202A2,200

B572c1,200144,728

A 200B572

cl,000

9,215

8,700

5,215

4,500

19,640

16,000

34,420

30,000

90,00075,000

191,410

161,300A2,000

^200

132

176

275

5,360

4,000

-168

18,236

17,000

The program will continue at about the 1964 level except for small in-creases in training State and local health personnel.

Program will be continued at about the 1964 level of operations.

Grants to States will be expanded and increased emphasis given toX-ray control and technical training of State personnel.

Comprehensive river basin planning for pollution abatement, specialpollution studies, enforcement, and research will be expanded.

Program provides for continuation of the 1964 level and will allow 900new grants.

(Activities now appear in other accounts.)

3

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A Proposed for separate transmittal.B Proposed for separate transmittal. Uniformed Services Pay Act of 1963.c 1964 appropriation pending in Congress.



toto




PUBLIC HEALTH SERVICE-Continued

Medical Services

General and special funds—ContinuedHospitals and medical care.. .651 NOA

Exp.

Foreign quarantine activities,.651 NOA

Exp.

Indian health activities 651 NOA


48,820

50,025

5,910

6,317

56,391

(432)55,175

49,957A99

B1,23248,768

A97B1,232

6,456A31B77

5,573A30B77

58,961M71B566

56,178A 167B566

1 52,710

1 51,5691 -21 6,893

) 5,999

1 *•| 61,576

] 59,318M

1,422

1,474

329

320

1,878

} 2,411

Supplemental in 1964 are proposed transfers from National HeartInstitute for wage board and commissioned officers' pay increases.Increased 1965 costs are due to expected increase of 47,000 outpatientvisits, mandatory salary reform costs, equipment replacement, andtransfer of funding of maintenance and repair costs from the Genera]Services Administration.

Supplementals in 1964 are proposed transfers from National HeartInstitute for wage board and commissioned officers' pay increases.Increase in 1965 permits expansion of overseas visa examinationprogram. These additional costs are offset by examination feeswhich are deposited in general funds of the Treasury.

Supplementals in 1964 are proposed transfers from National HeartInstitute for wage board and commissioned officers' pay increases.Increases in hospital patients, outpatient visits, contract patient careand extension of field health services to additional Indian com-munities result in increases in 1965.

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Construction of Indian health NO Afacilities 651 Exp.

Total, medical services NOA

Exp.

National Institutes of Health

General research and services. _651 NOAExp.

Biologies standards 651 NOA

Exp.

National Institute of Child Health NOAand Human Development _ _ 651 Exp.

National Cancer Institute 651 NOAExp.

National Institute of Mental NOAHealth 651 Exp.

Construction of community men- NOAtal health centers 651 Exp.

National Heart Institute 651 NOA

Exp.A Proposed for separate transmittal.B Proposed for separate transmittal, Uniformed Services Pay Act of 1963.

9,3357.281

120,456

118.799

159,703113.618

155,697119.223

143,578111,544

147,374

111.127

5,35010,000

120,724A301

B1,875120,519

A294B1,875

154,206124,000

4,787B30

4.470B30

34,00029.500

143,158122,000

176,165149,000

127,408A - 3 0 1

B -3,215106,000

8,6438,500

1 129,822

1 125,3861 *7163,745111.840

| 4,992

| 4,700

43,16934,200

140,962119,540

188,917158,820

35,0003,000

1 125,398

106,300

3,293-1,500

6,922

1 2.705

9,539-12,160

175

200

9,1694,700

-2,196-2.460

12,7529.820

35,0003.000

1,506

300

Includes planning and construction of 1 hospital, 2 health centers, 5health stations, 56 quarters, alterations at 12 locations and 38 sanita-tion projects.

Estimate will support an increase chiefly in research grants from anestimated 2,197 projects in 1964 to 2,307 in 1965. A change inscheduling of payments causes expenditures to drop in 1965.

Increase will permit expansion in testing of new vaccines and in theinspection of blood banks and blood preservation methods.

Estimate will expand intramural research and increase research grantsfrom 820 projects in 1964 to approximately 1,150 in 1965.

Provides chiefly for a small expansion in research grants from 1,950projects in 1964 to 1,992 in 1965 and an increase in collaborative stud-ies with public and private organizations. Decrease results fromtransfers to other accounts.

Increase will allow 2,274 research grants in 1965 compared with 2,097in 1964 and 1,960 training grants, up from 1,742 in 1964.

Estimate provides for new program to construct public and other non-profit community mental health centers.

Increase will provide for approximately 2,700 research grants in 1965 ascompared with 2,589 in 1964. Supplemental in 1964 are proposedtransfers to other accounts for wage board and Uniformed ServicesPay Act increases.

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1963

DEPARTMENT C

1964

)F HEALTH


1965 Increase

(-)

, EDUCATION

or

AND


WELFARE—Continued


National Institutes of Health—Continued

General and special funds—ContinuedNational Institute of Dental Re- NOA

search 651 Exp.

National Institute of Arthritis and NOAMetabolic Diseases 651 Exp.

National Institute of Allergy and NOAInfectious Diseases 651 Exp.

National Institute of Neurological NOADiseases and Blindness 651 Exp.

Grants for construction of health NOAresearch facilities 651

Exp.

Grants for cancer research facili- Exp.ties 651

21,19917,664

103,38888,009

66,13756,857

83,472

67,802

50,000

36,244

1,444

19,16617,300

107,69994,500

67,11761,500

84,44374,500

50,000c6,00040,000

c l ,000

2,000

20,13519,000

113,176102,059

68,44563,000

88,42879,000

| 58,000

41,000c4,000

1,441

i

9691,700

5,4777,559

1,3281,500

3,9854,500

2,000

4,000

-559

Increase is primarily for 3 new clinical research centers and an increasein training grants from 89 in 1964 to 93 in 1965.

Increase is chiefly to provide 3,270 research grants in 1965 as comparedwith 3,140 in 1964.

Increase will provide primarily for an expansion in training grants from180 in 1964 to 186 in 1965.

Increase will provide for continuation of prior year grants and an increasein research grants from 1,708 in 1964 to 1,713 in 1965.

Pending supplemental in 1964 and increase in 1965 provide funds formatching grants for mental retardation research facilities.

(Expenditures are payments of prior obligations.)

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Construction of mental health-neu- Exp.rology research facility 651

Total, National Institutes of NOAHealth.

Exp.

Scientific activities overseas (spe- NOAcial foreign currency program) Exp.

651

National health statistics 651 NOAExp.

National Library of Medicine. 651 NOAExp.

Retired pay of commissioned offi- NOAcers (indefinite) 651 Exp.

Salaries and expenses, Office of the NOASurgeon General 651 Exp.

Emergency health activities. _ .059 NOAExp.

Public enterprise funds:Operation of commissaries, nar- Exp.

cotic hospitals 651A Proposed for separate transmittal.B Proposed for separate transmittal, Uniformed Services Pay Act of 1963.c 1964 appropriation pending in Congress.

66

930,547

723,596

2,8001,588

5,1495,056

3,3352,347

5,5264,581

5,6615,741

7,00019,998

3

200

968,149A - 3 0 1

B -3 ,185c6,000

824,970B30

c1,000

4,0003,900

5,9495,400

4,0743,900

6,5175,000

6,195B49

5,734B49

27,50013,000

2

2,100

1,050,367

1 846,000\ c4,000

1,0004,500

6,1845,900

3,6333,338

7,2725,900

j 6,033

| 5,800

9,53915,000

- 2

1,900

79,704

1 24,000

-3,000600

235500

-441-562

755900

-211

17

-17,9612,000

- 4


The program will continue at about the 1964 level through use of priorbalance of excess foreign currencies.

Provides for augmentation of the existing programs for the collectionand analysis of health statistics and health survey methods.

Provides for improvements in the acquisition, organization, preserva-tion, and dissemination of literature on research in the biomedicalsciences. The increase is more than offset by a decrease in non-recurring equipment costs.

Retired officers will increase from 468 to 521. This account includesthe PHS cost of medical care of dependents of commissioned officers.

Apparent decrease results from transfers to other accounts.

Provides for management of inventory and stockpile; 1964 appropriationfinances procurement of additional medical supplies.

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1963

DEPARTMENT

AUTHORITY

1964

OF HEALTH

AND EXPENDITURES BY AGENCY (in thousands of dollars) —Continued

1965 Increase

<-)

, EDUCATION,

orExplanation of NOA requests

AND WELFARE—Continued


Intragovernmental funds:Bureau of State Services manage- Exp.

ment fund__ 651

National Institutes of Health man- Exp.agement fund 651

Service and supply fund 651 Exp.

Working capital fund, narcotic Exp.hospitals 651

Advances and reimbursements _ 651 Exp.

Advances and reimbursements for Exp.general research supportgrants 651

Total, Public Health Service. NOA

Exp.

-276

-2,191

-264

61

-241

-7,688

1,592,726

1,254,604

50

5

596

12,678

1,706,686A2,200

c44,9161,485,886

A 494B3.215c9,077

50

3

11,672,975A289,285

1,533,410A 18,007c10,500

- 2

-596

-12,678

1 208,458

1 63,245

(Accumulated advances will be paid out in 1964. Advances and pay-ments in 1965 are expected to be equal.)

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SAINT ELIZABETHS HOSPITAL

General and special funds:Salaries and expenses (indefinite) NOA

651Exp.


Intragovernmental funds:Advances and reimbursements. 651 Exp.

Total, Saint Elizabeths Hos- NOApital.

Exp.

SOCIAL SECURITY ADMINISTRATION

Trust funds:Limitation on salaries and ex-

penses.

Limitation on construction

General and special funds:International Social Security Asso- NOA

ciation meeting 655 Exp.

Payments for military service NOAcredits (proposed legislation) 655 Exp.

Public enterprise funds:Operating fund, Bureau of Federal Exp.

Credit Unions 655A Proposed for separate transmittal.B Proposed for separate transmittal, Uniformed Services Pay Act of 1963.c 1964 appropriation pending in Congress.

6,332

5.540

8,0951.920

30

14,427

7.490

(286.398)

-132

7,434M628,365M50

6272,056

1

8,061A462

10,422A 450

(317,900)

9237

235

| 8,461

8.374A12

2,0324.697

3

| 10,493

13.074A12

(330.370)

(5.750)

22

A60,000A60,000

133

565

1 -429

1,4052.641

2

1,970

| 2.214

(12,470)

(5.750)

- 9 2- 1 5

60,00060,000

-102

Supplemental in 1964 is for wage board and other pay increases. Esti-mate in 1965 provides for greater prisoner patient security and im-provement in quality of patient care.

Provides for air conditioning geriatrics building and other improvementsto existing facilities.

Estimate provides for 7% increase in beneficiaries, 6.7% increase inhearings and appeals, and higher costs for disability determinations.

Provides for the construction of 25 district offices and the planning ofadditional headquarters construction.

Prior-year's appropriation provides for planning and conducting 1964meeting in the United States.

Estimate is to meet the first of 50 annual equal installments to OASDItrust funds under proposed legislation.

(Program is financed by fees for services performed.)

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ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued toCOto

nd fu al code1963

enacted1964

stimat<1965

stimateIncrease or

decreas)



SOCIAL SECURITY ADMINISTRATION—Continued


Total, Social Security Ad- NOAministration. Exp.

WELFARE ADMINISTRATION

General and special funds:Grants to States for public assist- NOA

ance 653Exp.

Assistance for repatriated United NOAStates nationals 653 Exp.

Salaries and expenses, Bureau of NOAFamily Services 653 Exp.

Grants for maternal and child wel- NOAfare 651

Exp.

32

-100

2,738,300

2,729,582

467412

3,7603,708

76,795

76,058

92272

2,725,000A159,6002,788,000A159,600

467437

4,9564,995

82,943c16,500

82,676c16,400

A60,000155

A60,000

2,980,000

12,781,000

310300

5,6835,500

131,830

122,000c100

59,90859,883

95,400

-166,600

-157-137

727505

32,387

23,024

Supplemental in 1964 is needed for increase in caseload and payments torecipients. Increase in 1965 is for expansion of medical assistance forthe aged, aid to dependent children and aid to the permanently andtotally disabled. Reduction in expenditures is from a change inscheduling of payments.

Provides assistance to mentally ill repatriates. Reduction results fromlegislation expiring June 30, 1964. Proposed legislation to extendprogram is being recommended.

Increase will strengthen review of State and local operations and helpStates improve administration of programs.

Supplemental covers funds for grant programs, under recent legislation,and will provide new and expanded services to prevent mental retarda-tion. Increases are for child welfare services, research and training,and full-year cost of the new program.

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Salaries and expenses, Children's NOABureau 651

Exp.

White House Conference on Chil- Exp.dren and Youth 651

Juvenile delinquency and youth NOAoffenses 655 Exp.

Salaries and expenses, Office of NOAAging 655 Exp.

Cooperative research or demon- NOAstration projects 653 Exp.

Research and training (special NOAforeign currency program) __651 Exp.

Salaries and expenses, Office of NOAthe Commissioner 653 Exp.

Assistance to refugees in the NOAUnited States 653

ReappropriationExp.

Community work training (pro- NOAposed legislation) 653 Exp.

I nongovernmental funds:Advances and reimbursements.653 Exp.

Total, Welfare Administra- NOAtion.

Exp.

A Proposed for separate transmittal.C 1964 appropriation pending in Congress.

2,943

2,768

1

5,810

4,474

1,100953

117

736552

70,110

52,902

-24

2,900,021

2.871.502

3,401C3753.204C375

6,9506.796

545505

1,4551,301

212

1,025

881

39,717

14,08351,364

16

2,880,542A159,600

c16,8752,940.387A 159,600

c16,775

\ 4,3151j 4,095

3,905

600580

1,8001,100

372

1,0721,042

I 45,400

44,552

A50,000A35,000

13,171,010| A50,000

2.964,446]A35,(KKH

ciOOJ

539

516

-6,950-2,891

5575

345-201

160

47161

-8,400

-6,812

50,00035,000

- 1 6

1 163,993

-117,216

Provides staff on a full-year basis for the implementation of the new pro-gram to emphasize the prevention of mental retardation.

(Conference costs have been paid in full.)

Legislation is being proposed to extend program which expires June 30,1964.

Provides for increased service to State and local community agingorganizations.

Provides for 40 comprehensive research and demonstration projectsaimed at reducing dependency.

Studies on social welfare programs will be undertaken using availableexcess foreign currencies from a 1962 appropriation.

Increase will strengthen regional direction.

Estimate reflects decline in requirements for financial assistance, edu-cation, training, and health services for Cuban refugees.

Legislation will be proposed to authorize training and work experiencefor the rehabilitation of welfare recipients.

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Account and functional code1963 1964 1965 Inc



SPECIAL INSTITUTIONS

American Printing House for the Blind

General and special funds:Education of the blind 704 NOA

Exp.

Freedmen's Hospital


Exp.

Gallaudet College


Construction 702 NOAExp.

Total, Gallaudet College. _ . . NOAExp.

Howard University


739719

3,9093,740

1,4791,459

1,065524

2,5441,983

7,9358,363

775775

3,8803,831

1,8221,807

2,919856

4,7412,663

8,8198,600

865865

3,8733,838

1,9261.911

3672,174

2,2934,085

9,6609,300

9090

-77

104104

-2,5521,318

-2,4481,422

841700

Increase reflects larger school enrollment of blind children and increasein costs of producing educational material for the blind.

Increased reimbursement income from patient fees offsets costs of im-provements in both training program and quality of patient care.

Additional faculty and higher operating costs will accompany the esti-mated 16% increase in enrollment in 1965.

Provides principally for improvement of existing facilities.

Increase provides principally for a 5% larger enrollment in the liberalarts and graduate schools and for increased costs of operating newlyconstructed facilities.

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Total, Howard University _ _. NOAExp.

Total, special institutions NOAExp.

OFFICE OF THE SECRETARY

General and special funds:Salaries and expenses, Office of the NOA

Secretary 655Limitation payable from OASI

trust fund. Exp.

Salaries and expenses, Office of NOAField Administration 655

Limitation payable from OASItrust fund and Bureau of Fed- Exp.eral Credit Unions operatingfund.

Surplus property utilization. __ 655 NOAExp.

Salaries and expenses, Office of the NOAGeneral Counsel 655

L:*mitation payable from OASItrust fund and Food and Drug Exp.Administration revolvingfund.

5,6172,764

13,55211,127

20,74417,569

2,718

(375)2,702

3,418

(1.538)3,347

890880

832

(739)770

6,2453,800

15,06412,400

24,46019,669

2,833

(467)2,760

3,675

(1,337)3,600

950930

970

(900)950

1,8105,400

11,47014,700

18,50123,488

3,185

(479)3,123

3,848

(1,288)3,806

970940

1,328

(907)1,276

-4,4351,600

-3,5942,300

-5,9593,819

352

(12)363

173

(-49)206

2010

358

(7)326

Provides for construction of graduate social work building, new boiler,and for planning of student-faculty center.

Estimate provides for increased emphasis in analysis, evaluation, andcoordination of the Department's programs.

Estimate provides increase in administrative services to meet increasesin workload.

Estimate anticipates continued allocation to States of about $390 millionof surplus property for education, health, and civil defense.

Increases are to meet additional workload resulting from enactment ofnew legislation.

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DEPARTMENT OF HEALTH, EDUCATION, i

OFFICE OF THE SECRETARY—Con.General and special funds—Continued

Educational television facilities NOA704 Exp.

[ntragovernmental funds:Working capital fund 655 Exp.

Advances and reimbursements.655 Exp.

Total, Office of the Secretary NOAExp.

Total, Department of Health, NOAEducation, and Welfare.

Exp.

1,5002

84

-36

9,3587,749

5,333,019

4,909,340

6,5004,000

-29

20

14,92812,231

5,245,833A 783,080

c73,4765,135,037A364,244

»3,215c27,782

15,30010,000

- 6

24,63119,139

6,531,411A 1,117,685

5,457,746A375,381c20,355

8,8006,000

23

-20

9,7036,908

11,546,707

323,204

\ND WELFARE—Continued

Provides expansion in grants to public and nonprofit private educationaltelevision agencies for construction of transmission apparatus.

DEPARTMENT OF THE INTERIOR

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PUBLIC LAND MANAGEMENTBureau of Land Management

General and special funds:Management of lands and re- NOA

sources 401Exp.

44,062

40,218

44,066A2,50040,915

A2,300

i *447

42,800200

-1 ,119

1 -215

Supplemental in 1964 is for fire suppression. Estimate in 1965 willaccelerate adjudication of grazing privileges and inventories on publicforested lands. Rehabilitation of burned-over lands will receiveadditional funds. More adequate provision is made for accomplishingthe maintenance of buildings, sanitation and protection facilities, androads on the public domain.



Oregon and California grant lands NOA(receipt limitation) (indefi- Exp.nite) 401

Public lands development roadsand trails: 401

Contract authorization:Current NOAPermanent .__- NOA


Range improvements (receipt limi- NOAtation) (indefinite) 401 Exp.

Permanent appropriations:General fund. 401 NOASpecial fund 401 NOA

Exp.

Special fund_ 402 NOAExp.

General fund 403 NOASpecial fund 403 NOA

Exp.A Proposed for separate transmittal.B Proposed for separate transmittal. Uniformed Services Pay Act of 1963.c 1964 appropriations pending in Congress.D To carry out authorizing legislation to be proposed.

1,0001,260

7,7036,727

2,000

697846

2491,2321,266

16,09116,098

647,14847,154

300450

9,0007,700

4,000(760)760

1,248925

2311,6581,675

16,00815,319

647,65047,656

1,4001,000

8,2507,272

»2,000

(2,000)2,000

1,5231,000

2331,6961,765

18,75218,052

1049,30149,311

1,100550

-750-428

2,000-4 ,000

(1,240)1,240

27575

23890

2,7442,733

41,6511,655

Provides for construction of facilities to house fire control operationsin Alaska, and for construction of sanitation and protection facilitieson public domain lands in areas of heavy public use.

A sum equal to 25% of revenues from these lands is available for roadconstruction and maintenance, reforestation, protection, and thedevelopment and maintenance of recreational facilities.

It is anticipated that 1965 NOA will be provided in the Federal-AidHighway Act. 184 miles of road construction is programed for J965.

A sum usually equal to 33% of grazing revenues is used for range im-provements. Increase in revenue is expected.

Revenues from mineral leasing, sale of timber, grazing leases and permits,and other public domain revenue-producing operations are used inresource programs, or are paid to the States and counties in variousproportions, as specified by law. Permanent appropriation of receiptsfrom land and water resources are devoted, in general, to such im-provements as roads, recreational facilities, and on grazing lands.Those from forest resources may be used for the costs of timber sales,or for State or county roads, schools, etc. Minerals revenues arelargely paid to States for educational and other uses.

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decrease Explanation of NOA requeststo0000

DEPARTMENT OF THE INTERIOR—Continued

PUBLIC LAND MANAGEMENT—Con.

Bureau of Land Management—Continued


Total, Bureau ofManagement.

Land NOA

Exp.

Bureau of Indian Affairs

General and special funds:Education and welfare services:

Appropriation 704 NOAContract authorization (perma-

nent) 704 NOAAppropriation to liquidate con-

tract authorization. Exp.

Resources management 401 NOA

Exp.


Road construction: 401Contract authorization:

Current NOAPermanent NOA


1

120,188

113,568

81,736

772(569)

78,490

35,533

33,280

53,69246,314

16,000

(17,995)18,261

124,167A 2,500115,400^2,300

88,446

900(772)

83,720

37,673A 500

35,984A400

58,23841,193

18,000(15,000)16,273

1 128,612

123,200A200

96,070

900(900)

91,425

1 40,728

38,228A 100

51,17648,322

D 18,000

(17,000)17,000

1,945

1 5,700

7,624

(128)7,705

2,555

1 1,944

-7,0627,129

18,000-18,000

(2,000)727

The increase is primarily to support an additional 2,493 students inFederal elementary and secondary schools and 1,865 more persons inthe vocational training program.

The 1964 supplemental is for fire fighting. The increase in 1965 isprimarily for maintenance of new schools and school bus roads, andfor economic development on and near reservations.

The program includes construction of new schools, additions to existingschools, and construction of utility and irrigation systems.

It is anticipated that 1965 NOA will be provided in the Federal-AidHighway Act. The 1965 program includes 482 miles of grading anddraining and 556 miles of surfacing.

do

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General administrative expenses NOA409 Exp.

Menominee educational grants-704 NOAExp.

Miscellaneous accounts 409 NOAExp.

Claims and treaty obligations NOA(permanent, indefinite) 409 Exp.

Other miscellaneous appropria- NOAtions (permanent, indefinite, Exp.special hinds) _ 401

Other miscellaneous accounts NOA(permanent, indefinite, special Exp.funds) 409

Public enterprise funds:Revolving fund for loans 401 NOA

Exp.

Liquidation of Hoonah housing Exp.project revolving fund 409

Intergovernmental funds:Advances and reimbursements.409 Exp.

Total, Bureau of Indian Af- NOAfairs.

Exp.

4,1884,006

176396

5,7715,791

159161

6,0095,793

4

4,000

4,861

2

-1,162

208,040

196,193

4,2654,237

132132

145

161188

6,3756,382

10109

2,000A9007,385A900

106

2,046

216,201A1,400197,900A1.300

4,3314,321

8888

161161

6,5296,342

1010

1

f1}

3

1 217,993

205,900A 100

6684

- 4 4- 4 4

-145

-27

154- 4 0

-99

-2,900

-8,285

-103

-2,046

392

1 6,800

Increase is for mandatory salary reform costs.

Estimate provides for the fourth of five decreasing grants for schoolcosts to lessen the impact of the termination of Federal services tothe Menominee tribe.

Payments are made to various tribes as authorized by special laws.

Payments are authorized to meet treaty obligations with certain Indiantribes.

Revenue from irrigation and electric power projects is used to operateand maintain the projects.

Revenue from mineral deposits is used for acquisition of lands and forloans to Indians in Oklahoma.

Supplemental for 1964 is for loans to tribes for hiring expert assistance inclaims cases before the Indian Claims Commission. Legislation willbe recommended to increase the appropriation authorization whichhas expired.

(Balances are being used for liquidation.)



ANALYSIS OF NEW


OBLIGATIONAL

code1963

AUTHORITY

1964

AND EXPENDITURES

1965 Increase or

( - )





National Park Service

General and special funds:Management and protection. _405 NOA

Exp.

Maintenance and rehabilitation of NOAphysical facilities 405

Exp.

Construction 405 NOA

Exp.

Contract authorization: 405Current NOAPermanent NOA



Supplemental in 1964 is for fire suppression. Increase in 1965 is foroperation of 2 new park areas and newly constructed facilities and toserve the increasing visitation to the 207 areas. Natural scienceand wildlife management studies will be initiated and U.S. Park Policestrengthened.

Supplemental in 1964 is for wage board pay increases. The 1965 in-crease will cover 1 new area and permit more adequate maintenance ofroads and facilities throughout the system.

The 1964 supplemental is for acquisition of lands at Point Reyes Na-tional Seashore, Calif. In 1965, the program is limited to construc-tion of facilities and acquisition of water rights. Land acquisition,funded in this account in 1964 ($5.3 million), will be financed in theLand and water conservation fund under proposed legislation.

Work on 7 parkways will continue and road and trail construction willinclude work on 119 miles of major roads. It is anticipated that 1965NOA will be provided in the Federal Aid Highway Act.

Increase provides for strengthening administrative services for the ex-panding park program.

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Other miscellaneous appropria- NOAtions (permanent indefinite Exp.special funds) 405

ai Tu

Advances and reimbursements Exp.405

Total, National Park Service. NOA

Exp.

Bureau of Outdoor Recreation


Exp.

Land and water conservation fund NOA(proposed legislation) 405 Exp.

Total, Bureau of Outdoor NOARecreation.

Exp.

Office of Territories

General and special funds:Administration of Territories. _910 NOA

Exp.

Trust Territory of the Pacific NOAIslands 910 Exp.

Alaska public works 910 Exp.A Proposed for separate transmittal.D To carry out authorizing legislation to be proposed.

267162

585

132,610

110.543

1,201969

1,201

969

13,796

13.648

15,0009,703

148269

178

124,601A4,375117.170A3,330

1,9001,900

1,900

1,900

13,000A 11,464

13,025A 4,000

15,00015.502

13

133136

1 115,163

119.555A 1.045

2,7002,700

M0,000A 14,800

2,700A40,000

2,700A14,800

| 18,814

4,617A 5,659

17,50012,260

- 1 5-133

-178

-13,813

I 100

800800

40,00014,800

) 40,800

j 15,600

-5,650

1 -6.749

2,500-3,242

- 1 3

Certain revenues from park operations are used for the purposes au-thorized by law.

Increase provides for preparation of nationwide outdoor recreation planand coordination of Federal recreation programs.

Legislation is recommended to establish a fund to which certain receiptswill be credited. Upon appropriation the receipts will be available forFederal and State recreational purposes.

A program to restore and improve public facilities on Guam damaged bya typhoon will be initiated with the 1964 supplemental. Decrease in1965 reflects completion of the major part of the Samoan constructionprogram.

Increase reflects another step in the program to raise the standard ofliving of the Micronesians.

(Payments are prior obligations. Program was completed in 1962.)

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Office of Territories—Continued

General and special funds—ContinuedInternal revenue collections for NOA

Virgin Islands (permanent, in- Exp.definite, special fund) 910

Public enterprise funds:Loans to private trading enter- Exp.

prises, Trust Territory of thePacific Islands 910

Total, Office of Territories.910 NOA

Exp.

The Alaska Railroad

Alaska Railroad revolving Exp.fund 506

Total, public land manage- NOAment.

Exp.

7,6837,683

23

36,479

31,056

-942

498,518

451,387

7,0427,042

35

35,042A 11,46435,617A 4,000

34

501,911A19,739468,021A10,930

8,0008,000

72

| 44,314

24,949A 5,659

-422

508,782A40,000475,882A21,804

958958

37

-2,192

1 -9,009

-456

1 27,132

1 18,735

Payments are made to the Virgin Islands from taxes collected on islandproducts sold in the United States.

(Loans made are expected to exceed collections on loans.)

(Receipts of $15.1 million are expected to exceed estimated expendi-tures for railroad operations.)

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en


MINERAL RESOURCES

Geological Survey

General and special funds:Surveys, investigations, and re- NOA

search 409 Exp.

Payments from proceeds, sale ofwater, Mineral Leasing Act of1920, sec. 40 (d) (permanent,indefinite, special fund) 401

Intragovernmental funds:Advances and reimbursements.409

Total, Geological Survey

NOA

Exp.

NOAExp.

Bureau of Mines

General and special funds:Conservation and development of NOA

mineral resources 403 Exp.

Health and safety 652 NOAExp.


General administrative expenses403

NOAExp.

Drainage of anthracite mines. 403 Exp.A Proposed for separate transmittal.

57,94356,802

1

-312

57,94456,491

27,46826,985

8,4268,201

425723

1,3911,376

40

63,70061,100

300

63,70061,400

29,36928,500

8,6628,300

500

1,4601,351

200

69,22367t200

1

200

69,22467,400

30,37729,000

9,5309,200

351

1,4251,400

369

5,5236,100

1

-100

5,5246,000

1,008500

868900

-149

-3549

169

Estimate provides increases for work on the National Atlas; major ac-celeration of studies of the earth's crust and upper mantle; additionalground-water studies and stream gaging stations; and extension ofmarine geologic and hydrologic studies to the Pacific shelf. A labora-tory for research that uses radioactive materials will be built atDenver.

Receipts are appropriated to maintain and develop water wells on thepublic domain.

Increased emphasis will be on research to eliminate methane outburstsin mines, and to develop methods for in-place retorting of oil shale.

Provides for accelerated research and increased educational effort toreduce health and safety hazards in mining operations.

Funds appropriated in 1963 will be used for advance planning ofresearch facilities.

Savings from reorganization result in decreased requirements for 1965.

(Balance of a 1956 appropriation will be spent in Pennsylvania.)

*1

oo

33o

toCO


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousand* of dollars)—Continued


enacted1964 1965 r

estimateIncrease ordecrease

)Explanation of NOA requests


MINERAL RESOURCES—Continued

Bureau of Mines—Continued

Public enterprise funds:Helium fund (authorization to ex- NOA

pend from debt receipts) 403 Exp.


Total, Bureau of Mines NOAExp.

Office of Coal Research


Exp.

Office of Minerals Exploration


Lead and zinc programs 403 NOAExp.

Total, Office of Minerals NOAExploration. Exp.

6,000-9,508

39

43,71027,858

3,4501,470

750569

2,4501,491

3,2002,060

6,00021,149

45,49160,000

5,0754,361

850895

1,928

8502,823

20,00024,480

61,33264,800

6,8364,790

900900

1,650

9002,550

14,0003,331

15,8414,800

1,761429

505

-278

50-273

Increase in borrowing from Treasury is for the purchase of helium; it is tobe repaid later as helium is sold.

Increase will provide expansion of research by contract to find newmarkets and to develop new methods of mining, preparing andutilizing coal.

Increase provides primarily for additional financial assistance to privateindustry in exploration for minerals.

Program provides stabilization payments to small domestic producers oflead and zinc. Funds appropriated in 1963 will be used to financeprogram in 1965.

tdcj

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GOO

CD

Or


Office of Oil and Gas


Total, Mineral Resources NOAExp.

FISH AND WILDLIFE SERVICE

Office of the Commissioner of Fish andWildlife


Bureau of Commercial Fisheries

Management and investigations of NOAresources 404

Exp.

Management and investigations of NOAresources (special foreign cur- Exp.rency program) 404


Construction of fishing vessels_404 NOAExp.


c 1964 appropriation pending in Congress.

558556

108,86288,435

374376

15,854

15,685

300100

8,4732,737

750557

622557

616616

115,732129,200

386380

17,824c100

16,900ciOO

300200

4,4506,210

750250

653600

j

}

138140

20

17

48

660660

,952,200

393387

,681

,500

300200

,788,337

300

676600

4444

23,22011,000

77

2,757

500

3382,127

-75050

23

Increased emphasis will be placed on coordination of petroleum and gasmatters.

Estimate continues program at current level and provides for mandatorysalary reform costs.

Supplemental in 1964 is for pesticides studies. In 1965, increased em-phasis will be given to pesticides studies and to biological research anddevelopment activities of the national oceanography program.

Biological and technological research is carried on abroad using excessforeign currencies.

Program includes construction of a shellfisheries research center, a bio-logical research laboratory, and a replacement for the exploratoryvessel Oregon. It also provides for fish production and migrationfacilities in the Columbia River system, and equipment for a newresearch vessel being constructed in 1964.

Subsidies are paid for construction of vessels. Authorization for theprogram terminated in 1964, but payments continue into 1965.

Estimate continues program at current level and provides for mandatorysalary reform costs.

a

a

to


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued to



FISH AND WILDLIFE SERVICE—Con.

Bureau of Commercial Fisheries—Con.

General and special funds—ContinuedAdministration of Pribilof Islands NOA

(indefinite, special fund) _ _ _ 404 Exp.

Promote and develop fishery prod- NOAucts and research pertaining to Exp.American fisheries (permanent,indefinite) . _. 404

Payment to Alaska from Pribilof NOAIslands fund (permanent, in- Exp.definite, special fund) _ __ _404

Public enterprise funds:Federal ship mortgage insurance Exp.

fund, fishing vessels.__ ___ 404

Fisheries loan fund _ 404 Exp.Limitation on administrative

expenses.

Total, Bureau of Commer- NOAcial Fisheries.

Exp.

DEPARTMENT OF THE

2,0171,918

5,0714,908

703703

-20

-1,382(250)

33,790

25,764

2,4682,200

5,3735,000

589589

- 2 9

-1,000(270)

32,407c100

30,920c100

2,4422,000

5,2004,500

1,6061,606

- 3 0

-1,000(277)

| 35,693

| 34,013

INTERIOR—Continued

-26-200

-173-500

1,0171,017

-1

(7)

3,186

2,993

Part of the proceeds from sales, mostly of fur sealskins, is used in admin-istration of the Pribilof Islands.

A sum equal to 30% of customs duties on fishery products is appropriatedfor biological research, market development, and general administra-tive services.

Alaska is paid 70% of net proceeds from sales of wildlife products of thePribilof Islands.

(Premiums and fees are reserved for possible losses. Contingentliability will be $7 million in 1965.)

(Program of $1.3 million is financed by receipts and fund capital.Administrative needs increase to cover mandatory salary reformcosts.)

w

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o


Bureau of Sport Fisheries and Wildlife

General and special funds:Management and investigations NOA

of resources 404Exp.

Construction. _404 NOAExp.

General administrative expenses.. NOA404 Exp.

Migratory bird conservation ac- NOAcount 404 Exp.

Federal aid in fish restoration and NOAmanagement (permanent, re- Exp.ceipt limitation) 404

Federal aid in wildlife restoration NOA(permanent, indefinite, special Exp.fund) 404

Migratory bird conservation ac- NOAcount (receipt limitation) (per- Exp.manent) 404

Payments to counties, national NOAgrasslands (permanent, indefi- Exp.nite, special fund) 404c 1964 appropriation pending in Congress.

27,695

26,516

6,9226,223

1,2931,314

7,0005,000

6,0325,667

14,91215,526

3,4193,425

30,560C300

29,750c250

5,2447,000

1,3591,400

10,0008,000

6,3585,454

16,23813,000

4,0003,000

34,419

33,450c 50

3,5933,500

1,3841,300

8,0008,000

6,0005,700

16,00015,600

4,0003,000

22

3,559

1 3,500

-1,651-3,500

25-100

-2,000

-358246

-2382,600

. . . . . . . . . .

Supplemental in 1964 is for pesticides studies. Increase in 1965 is foroperation of new and expanded fish hatcheries, wildlife refuges, andresearch facilities, and further expansion of pesticides research.

Program includes * construction of a fish-pesticide laboratory and awildlife-pesticide screening center; plans and specifications for aNational Fisheries Center and Aquarium; replacement of a fishhatchery water supply line; development at 12 wildlife refuges; andcontinued construction of a waterfowl management research center.

Estimate continues program at current level and provides for manda-tory salary reform costs.

Estimate of $8 million to be advanced from general revenues (to berepaid later) is for acquisition of migratory waterfowl lands.

Matching assistance to States is provided by appropriations equal to10% excise tax on sport fishing equipment.

Matching assistance to States is provided by appropriations equal to11 % excise tax on manufacture of firearms and cartridges.

Estimated receipts from sale of Federal duck-hunting stamps are usedfor the acquisition of migratory waterfowl lands.

The sum of 25% of revenue from submarginal lands goes to counties inwhich such lands are located, for schools and roads.

H

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OO

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o


to00




3tddooH

00

o


FISH AND WILDLIFE SERVICE—Con.

Bureau of Sport Fisheries and Wildlife-Continued

General and special funds—ContinuedPermanent appropriations from NOA

national wildlife refuge receipts Exp.(indefinite, special funds) __ 404

Total, Bureau of Sport Fish- NOAeries and Wildlife.

Exp.

Total, Fish and Wildlife NOAService.

Exp.

WATER AND POWER DEVELOPMENT

Bureau of Reclamation

General investigations 401 NOAExp.

2,4452,119

69,720

65,79]

103,884

91,930

8,6088,329

2,4952,444

76,256C300

70,050C250

109,049c400

101,350C350

10,28910,000

2,4162,398

1 75,814f

72,950C50

1 111,900

f 107,350C50

10,50010,500

- 7 9- 4 6

- 7 4 2

1 2,700

f2,451

1 5,700

1

211500

Of net proceeds from sales of refuge products, 75% is used for refugemanagement and enforcement of game protection laws, and 25% goesto counties in which such refuges are located for schools and roads.

Program includes engineering and economic investigations and researchactivities. Increase strengthens river basin surveys.


Construction and rehabilitation. _ NOA401 Exp.

Operation and maintenance. __ 401 NOAExp.

General administrative expenses. _ NOA401 Exp.

Loan program- _40l NOAExp.

Emergency fund. _401 NOAExp.

Recreational and fish and wildlife NOAfacilities, Colorado River storage Exp.project 401

Other miscellaneous appropria- NOAtions (permanent, special funds) _ Exp.

401Public enterprise funds:

Continuing fund for emergency Exp.expenses, Fort Peck project,Montana 401c 1964 appropriation pending in Congress.

163,451167,670

35,83532,470

9,6659,574

12,21714,507

1,000

3,2322,390

3,7453,704

-996

185,387168,485

37,78134,400

10,0009,900

12,36715,000

500

3,9523,100

3,9544,062

-1,188

182,730182,650

40,30040,000

10,40010,400

13,57014,600

1,000

4,5004,500

3,8123,810

-1,311

-2,65714,165

2,5195,600

400500

1,203-400

500

5481,400

-142-251

-123

Construction continues on 23 projects and 18 Missouri River Basin proj-ect units estimated to cost $4.3 billion; construction will start on 6new projects and features estimated to cost $113 million, includingthe Riverton, Wyo., project for which authorizing legislation is pend-ing in Congress. Funds for this project will be requested followingenactment of the legislation. Rehabilitation and betterment will becarried out on 11 projects. Facilities for 134,800 acres of irrigatedland and 100,900 acre-feet of municipal and industrial water supplywill be completed.

Provides for operation and maintenance of 42 projects and MissouriRiver Basin units for irrigation, power, and water use. Increase pro-vides for operation of new projects and expanded channel improve-ments on the Colorado River.

Provides overall administration and the technical direction of Bureauprograms.

Estimate finances loans started in prior years and provides for 3 newirrigation project loans costing $4.2 million; 6 loan projects will becompleted.

This account insures continuing operation of Federal water supply sys-tems and powerplants in emergency situations.

Provides for development of recreational and fish and wildlife resources.

Includes appropriations of Colorado River Dam fund revenues for pay-ment of interest to Treasury and other specific items.

(Receipts from power sales are used for operation and maintenance ofpower generation and transmission facilities and for continued opera-tion in emergency situations. Receipts exceed expenditures.)

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to



Accoun nd fu al code1963 1964 1965 Increase or



WATER AND POWER DEVELOP-MENT—Continued

Bureau of Reclamation—Continued

Public enterprise funds—ContinuedUpper Colorado River Basin fund. NOA

401 Exp.

Total, Bureau of Reclamation. NOAExp.

Bonneville Power Administration

General and special funds:Construction 401 NOA

Exp.

Operation and maintenance...401 NOAExp.

Continuing fund for emergency NOAexpenses, Bonneville project, Exp.Oregon (permanent, indefinitespecial) 401

Total, Bonneville Power Ad- NOAministration. Exp.

108,566106,529

346,319344,177

29,80016,023

13,12113,056

1,140891

44,06229,970

93,99190,741

357,721335,000

36,17427,100

13,68913,700

202200

50,06541,000

57,80057,501

323,612323.650

43,82033.720

14,98014,980

58,80048.700

-36,191-33,241

-34,109-11,350

7,6466,620

1,2911,280

-202-200

8,7357,700

Construction continues on 3 storage units and the transmission facilities,and on 8 participating projects. Crystal Dam will be started in 1965.

Increase is mainly for construction of 500 kv transmission lines as themain backbone of the Pacific Northwest power grid, and for a trans-mission line to southern Idaho.

Increase will provide for the operation and maintenance of transmissionfacilities added to the power system.

This account is used to insure continued operation of the power systemin emergencies. Emergency work begun in 1963 to repair damagecaused by severe windstorms will be completed in J964.

Wd

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o


Southeastern Power Administration

Operation and maintenance. __401 NOA

Exp.

Southwestern Power Administration


Operation and maintenance-.-401 NOAExp.

Continuing fund (indefinite, spe- NOAcial fund) 401 Exp.

Total, Southwestern Power NOAAdministration. Exp.

Office of Saline Water


Operation and maintenance. __401 NOAExp.

Construction, operation and main- Exp.tenance 401

Total. Office of Saline Water. NOAExp.

Total, water and power de- NOAvelopment. Exp.

796457

7,1931.212

1,4751,464

5,0003,540

13,6686,216

7,5575,843

1,985816

2,015

9,5428,674

414,387389,494

999600

2,9994,200

1,5001,490

4,5002,910

8,9998,600

10,0008,150

1,8501,850

1,000

11,85011,000

429,634396.200

1,000700

2,7705,850

1,6801.650

4,5003,500

8,95011,000

10,6508,760

2,3002,300

940

12,95012.000

405,312396,050

1100

-2291,650

180160

590

- 4 92,400

650610

450450

- 6 0

1,1001.000

-24,322- 1 5 0

Provides for continuation of power marketing program.

Construction program provides for approximately 205 miles of trans-mission lines, additional substation capacity and related facilities.

Increase is required to maintain additional power facilities.

Provides for energy purchases and rental of transmission lines.

Provides for continuation of the research program to develop low costprocesses for converting saline water to fresh water.

Provides for operation of four demonstration plants throughout 1965.

(Financing for construction of scheduled demonstration plants was com-pleted in 1962. Operation and maintenance is now financed above.)

OQftJ

3QH33O

}

to


ANALYSIS

Account an

OF NEW

d functional

OBLIGATIONAL

code1963

AUTHORITY

1964

AND

1965

EXPENDITURES

Increase or

( - )



SECRETARIAL OFFICES

Office of the Solicitor


Exp.

Office of the Secretary

Salaries and expenses _ .409 NOAExp.

Intragrovern mental funds:Working capital fund 409 Exp.

Advances and reimbursements_409 Exp.

Total, Office of the Secretary. NOAExp.

Total, secretarial offices NOAExp.

VIRGIN ISLANDS CORPORATION

Public enterprise funds:Operating fund: 910

Contributions NOARevolving fund NOA

Loans to operating fund (au- NOAthorization to expend fromdebt receipts).

DEPARTMENT OF THE

3,8513,677

3,4803,441

-120

3,4803,322

7,3316,999

480200

200

3,9993,850

3,8553,686

- 8

72

3,8553,750

7,8547,600

4,1734,000

4,1254,003

- 2

-1

4,1254,000

8,2988,000

INTERIOR—Continued

174150

270317

6

-73

270250

444400

Increase is primarily for mandatory salary reform costs.

Departmental direction and management services will be strengthenedwith the increase.

(Revenues are expected to be sufficient to cover the cost of operations.)

toto

s9

5


Limitation on administrative ex-penses. Exp.

Total, Virgin Islands Corpora- NOAtion. Exp.

Total, Department of the In- NOAterior.

Exp.

(184)554

880554

1,133,862

1,028,800

(186)249

249

1,164,180A19,739

c4001,102,620

A 10,930C350

(156) ( -30 )-1,186 -1 ,435

-1 ,186

1,173,244A 40,000

1,126,296A 21,804

C50

-1 ,435

28,925

34,250

(The anticipated sale of the corporation's power and water desaliniza-tion plants in 1964 will permit a reduction in administrative expenses.)

DEPARTMENT O F JUSTICE

LEGAL ACTIVITIES AND GENERALADMINISTRATION

General and special funds:Salaries and expenses, general ad- NOA

ministration 908 Exp.

Salaries and expenses, general legal NOAactivities ___ 908 Exp.

Trust fund:Limitation on general administra-

tive expenses, alien propertyactivities.

General and special funds:Salaries and expenses, Antitrust NOA

Division 508 Exp.

Salaries and expenses, U.S. attor- NOAneys and marshals 908 Exp.

4,4284,436

17,09617,047

(690)

6,2186.272

28,16227,775

4,6604.550

18,52618.000

(690)

6,5996.500

29,22728.352

4,8714.760

19,59019.140

(690)

6,8546.700

30,82530,100

211210

1,0641,140

255200

1,5981,748

Increase will finance mandatory salary reform costs.

Increase is for full year cost of staff added in 1964, primarily to handleincreasing tax and civil rights caseloads, and for mandatory salaryreform costs, partly offset by reductions from improvements in landacquisition procedures.

(Estimate contemplates that most of the work of the Office of AlienProperty will be completed by June 30, 1965.)


Increase provides for continuation of promotion plan for assistant U.S.attorneys, increased costs of travel, communications, reporting, andprinting, and mandatory salary reform costs.

L Propo:1964 a

6O

13

ppropriation pending in Congress.

toOr00




enacted1964

estimate1965i

Increase ordecrease Explanation of NOA requests

DEPARTMENT OF JUSTICE—Continued

LEGAL ACTIVITIES AND GENERALADMINISTRATION—Continued

General and special funds—ContinuedFees and expenses of witnesses

908

Salaries and expenses, Adminis-trative Conference of the UnitedStates 908

Intragovernmental funds:Advances and reimbursements:

Committee to study the feasi-bility of establishing a Na-tional Service Corps 908

President's Committee on Juve-nile Delinquency and YouthCrime 908

Total, legal activities andgeneral administration.

NOA

Exp.

NOAExp.

Exp.

Exp.

NOA

Exp.

FEDERAL BUREAU OF INVESTIGATION


Exp.

2,500

2,492

100127

-25

-39

58,503

58,083

135,889135,527

2,300A 4002,250A 370

25

23

61,312MOO

59,700A370

146,828142,750

11

1f

3,000

2,870A30

65,140

63,570

150,445148,700

\\

i

300

280

-25

-23

3,428

3,530

3,6175,950

Supplemental in 1964 and increase in 1965 are to provide for costsrelated to increasing caseload.

(The Conference completed its work in 1963).

(The Committee completes its work in 1964,)

(The Committee will continue to operate in 1965 if proposed legislationto extend grant program under Department of Health, Education,and Welfare is enacted.)

Increase in 1965 provides for continuation of promotion plan for specialagents and mandatory salary reform costs.

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i


IMMIGRATION AND NATURALIZATIONSERVICE


FEDERAL PRISON SYSTEM

Salaries and expenses, Bureau of NOAPrisons 908

Exp.


Support of U.S. prisoners 908 NOA

Exp.

Intragovernmental funds:Federal Prison Industries. Inc.:

Prison industries fund 908Limitation on administrative

and vocational training ex- Exp.penses.

TotaJ, Federal Prison Sys- NOAtern.

Exp.

Total, Department of Jus- NOAtice.

Exp.

66,24166,323

50,242

49.586

3,5456.553

4,100

4.083

(K774)-3,121

57,887

57,102

318,521

317,035

69,00067.570

52,996A201

49,750A 150

9,5258,950

4,100A2004,050A 150

(2,100)-3,450

66,621A401

59,300A300

343,761A 801

329,320A670

71,80071,000

1 55,141

51,949A51

21,2126,845

| 4,400

4,350A50

(2,180)-3,445

I 80,753

59,699A101

j 368,138

342,969A131

2,8003,430

1,944

1 2,100

11,687-2,105

100

| 200

(80)

13,731

1 200

23,576

I 13,110

Estimate includes funds for replacement of border inspection and patrolstations, repair and maintenance of stations, continuation of a recordsimprovement program, a special analysis of alien registration reportsand mandatory salary reform costs.

Supplemental in 1964 is for wage board pay increases. Increase in1965 provides for full-year cost of employees added in 1964 and formandatory salary reform costs.

Estimate includes funds for completion of construction of a psychiatricinstitution, construction of a replacement for the National TrainingSchool for Boys, and repairs and improvements at several institutions.

Supplemental is for increased cost of prisoners in local facilities. Esti-mate in 1965 provides care of prisoners in 749 non-Federal institutionsand anticipates an average of 3,425 prisoners, the same as in 1964,at a cost of $3.52 per man-day, $0.16 higher than in 1964.

(Estimate provides vocational training for 12,150 inmates, employmentof 5,500 inmates full time in various industries, and assistance in jobplacement upon release.)

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toAccount and functional code

1963enacted

1964estimate

1965 Increase ordecrease Explanation of NOA requests

DEPARTMENT OF LABOR

BUREAU OF LABOR STATISTICS

General and special funds:Salaries and expenses _652 NOA

Exp.

Revision of the consumer price NOAindex __ 652 Exp.

IntragoverriVnental funds:Advances and reimbursements.652 Exp.

Total, Bureau of Labor Sta- NOAtistics. Exp.

BUREAU OF INTERNATIONALLABOR AFFAIRS


Exp.

1 ntragovernmental funds:Advances and reimbursements. 652 Exp.

Total, Bureau of Interna- NOAtional Labor Affairs. Exp.

MANPOWER ADMINISTRATION

General and special funds:Salaries and expenses, Office of NOA

Manpower, Automation, and Exp.Training—_ 652

14,59014,484

1,3641,488

r̂-147

15,95515,825

779720

71

779791

781452

16,34516,265

1,3201,377

31

17,66517,673

842818

143

842961

329

18,38818,000

110

245

18,38818,355

863770

41

863811

2,0431,735

- 1 , 3 2 0- 1 , 2 6 7

214

723682

21- 4 8

-102

21-150

-329

Increase will improve and extend manpower and employment statisticsand will provide additional and improved data in other fields.

Revision of the index will be completed in 1964.

Estimate reflects mandatory salary reform costs.

(This account has been merged with "Manpower development andtraining activities.")

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GO


I

Manpower development and train- NOAing activities 652

Exp.

Area redevelopment activities, sal- NOAaries and expenses 652 Exp.

Trade adjustment activities, sal- NOAaries and expenses 652 Exp.

Salaries and expenses, Bureau of NOAApprenticeship and Training Exp.

652

Salaries and expenses, Bureau of Exp.Employment Security 652

Limitation on salaries and ex-penses, Unemployment trustfund.

Grants to States for unemploy- Exp.ment compensation and Em-ployment Service Administra-tion 652

Limitation on grants to States forunemployment compensationand Employment Service Ad-ministration, Unemploymenttrust fund.

Unemployment compensation for NOAFederal employees and ex-serv-icemen 652 Exp.


69,914

51,824

11,0606,632

1001

5,1995,291

(11,936)

(400,000)

151,000

152,859

109,977A55,000106,000

A 30,000

8,5008,237

150165

5,4605,466

5

(12,400)

13

(425,000)

110,000A30,000110,000

A30,000

411,000

300,000A 25,000

9,0008,343

345350

5,5415,590

(13,471)

(455,076)

1 126,000

1 116,000

246,023

189,000

500106

195185

81124

- 5

(1,071)

-13

(30,076)

-14,000

-24,000

Supplemental in 1964 will provide for retraining of workers under recentlegislation. In 1965 the number of unemployed receiving training inneeded skills will more than double, to about 275 thousand, includingtraining under the recently authorized basic literacy program.

The program is planned at the same general level as last year—about$4.5 million for occupational training and $4.1 million for retrainingand subsistence payments. About 12 thousand unemployed workerswill be retrained.

Increase will provide support and starling to carry out the Depart-ment's responsibilities in tariff negotiations.

No change in the level of operation is contemplated. Increase is formandatory salary reform costs partly offset by productivity gains.

(Program is now financed from trust fund.)

(Increase provides for improvement and extension of manpower re-search and statistics and improved financial management.)

(Program is now financed from trust fund.)

(Increase is for continued expansion and improvement of the employ-ment service, improvement in unemployment compensation admin-istration, and increases in State salary rates.)

Supplemental in 1964 is to meet additional claims. Expected improve-ment in the economy is estimated to result in an average decrease of8 thousand initial claims per week.

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ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY

1963 1964

DEPARTN

1965

IENT OF

(-)

LABOR—-Continued



to00

MANPOWER ADMINISTRATION—Con.

General and special funds—ContinuedCompliance activities, Mexican NOA

farm labor program 652Exp.

Salaries and expenses, Mexicanfarm labor program 652

Limitation payable from, farm Exp.labor supply revolving fund

652Temporary unemployment com- Exp.

pensation 652

Payment to Federal extended com- Exp.pensation account 652

Youth employment opportunities NOA(proposed legislation) 652 Exp.


employment security 652Advances and reimbursements, Exp.

Manpower, Automation, andTraining 652

Public enterprise funds:Farm labor supply revolving fund Exp.

652

1,369

1,207

(1785)

1,815

- 7

- 8 5

- 1 7

- 1 , 2 2 6

870A 430

933A 430

(1.135)( A 165)

916A 165

A 30,000A 10,000

84

16

-1 ,041

| 870

1 850

j (850)1 840

A 160,000A 96,000

-141

-430

-513

(-450)

-241

130,00086,000

-84

-16

900

Supplemental in 1964 covers cost of extension of the program after De-cember 1963. Estimate in 1965 provides 6 months financing. Pro-gram expires December 31, 1964.

(Limitation is for 6 months. Program expires December 31,1964.)

(This program is no longer in effect.)

2,392 (This program is no longer in effect.)

Proposed legislation will provide work and training through conserva-tion camps and work projects in local communities for an estimated60,000 youths in 1965.

O

I—I

I3

(Estimate is for 6 months. Program expires December 31, 1964.)


Advances to Employment SecurityAdministration account, Unem-ployment trust fund 652

Exp.

Total, manpower administra- NOAtion.

Exp.

LABOR-MANAGEMENT RELATIONS

General and special funds:Salaries and expenses, Bureau NOA

of Labor-Management Reports Exp.652

Salaries and expenses, Labor- NOAManagement Services Adminis- Exp.

tration 652

Salaries and expenses, Bureau of NOAVeterans' Reemployment Rights Exp.

805

Total, labor-management re- NOAlations. Exp.

WAGE AND LABOR STANDARDS

Salaries and expenses, Bureau of NOALabor Standards 652 Exp.

Salaries and expenses, Women's NOABureau 652 Exp.A Proposed for separate transmittal.

-85,248

239,423

135,890

5,8845,929

652653

6,5366,582

4,6254,156

911898

-7,602

234,957A115,430223,521A70,595

465

7,4997,050

784765

8,2838,280

3,4703,631

784825

-3,500

552,756A160,000428,332

A121,000

7,7367,550

791780

8,5278,330

3,5453,650

772750

4,102

1 362,369

1 255,216

-465

237500

715

24450

7519

-12-75

(Payments are made to the Unemployment trust fund pending later re-turn of tax receipts. Repayments in excess of current advances arereflected as minus expenditures.)

The Bureau of Labor-Management Reports has been merged into theLabor-Management Services Administration. Estimate reflects ad-ditional research and assistance in the field of collective bargaining,partly offset by increased productivity in the processing of labor-management and welfare-pension reports.

Estimate reflects phaseout of staff added to handle workloads resultingfrom the Berlin callup.

Increase relates primarily to mandatory salary reform costs.

Decrease reflects primarily termination of the President's Commissionon the Status of Women upon completion of its report in October 1963.

OxCO


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continuedto


enacted1964



WAGE AND LABOR STANDARDS—Con.

General and special funds—ContinuedSalaries and expenses, Wage and NOA

Hour Division 652 Exp.


Women's Bureau 652

Total, wage and labor NOAstandards. Exp.

EMPLOYEES' COMPENSATION

General and special funds:Salaries and expenses, Bureau of NOA

Employees' Compensation _ 906 Exp.

Employees compensation claims NOAand expense 906

Exp.

Total, Employees' compen- NOAsation.

Exp.

18,08917,789

16

23,62522,859

3,982

3,894

65,221

65,263

69,203

69,157

DEPARTMENT OF

19,27519,724

23,52924,180

4,2754,466

53,838A 5,00053,838

A 5,000

58,113A 5,00058,304

A 5,000

20,52820,500

24,84524,900

4,401

4,400

1 52,650

| 52,650

| 57,051

| 57,050

LABOR—Continued

1,253776

1,316720

126

- 6 6

-6,188

-6,188

-6,062

-6,254

Increase reflects the addition of work in enforcement of the EqualPay Act, which prohibits discrimination in wages paid to women.

Estimate reflects mandatory salary reform costs.

Supplemental in 1964 will provide for higher compensation rates resultingfrom base wage and salary increases, and higher medical costs.Decreases in 1964 and 1965 reflect rising reimbursements from agenciesemploying workers injured on the job.

os50

I


OFFICE OF THE SOLICITOR

Salaries and expenses 652 NOALimitation payable from Unem-

ployment trust fund. Exp.


Salaries and expenses _ _ _652 NOALimitation payable from Un-

employment trust fund. Exp.

Working capital fund_ 652 Exp.


Total, Office of the Secretary. NOAExp.

Total, Department of Labor_ NOA

Exp.

4,298(125)

4,306

2,093(136)

2,027

- 5 4

-103

2,0931,870

361,911

257,279

4,420(127)

4,425

2,219(138)

2,304

28

103'

2,2192,435

350,028A 120,430

339,779A 75,595

4,857(132)

4,990

3,223(139)

3,030

- 3 0

44

3,2233,044

670,510A 160,000

545,812* 121,000

437

JS

1,004(1)

726

- 5 8

- 5 9

1,004609

1,360,052

| ?51,438

Estimate provides for mandatory salary reform costs.

Increase reflects one-time costs, on a departmentwide basis, for consoli-dating and improving leased office space and for increased department-wide services and mandatory salary reform costs.

(Decrease represents excess of advances over expenditures, involvingmostly services which will not be completed at the end of 1965.)

POST OFFICE DEPARTMENT

M

Public enterprise funds:Contribution to the postal fund NOA

(indefinite) 505 Exp.840,241770,335

654,399546,015

550,700474,700

-103,699-71,315

Estimated obligations of $5,134 million, less estimated postal fund reve-nues and reimbursements of $4,583 million, leaves $551 million to becontributed. This is an increase of $ 132 million in obligations (largelymail volume) and $233 million in revenues (mail volume and rate in-crease). Included are estimated net revenues of %77 million fromproposed parcel post rate increases, assumed to be effective April 1,1964. After deducting costs determined by law to he public services,the deficit in postal rates and fees is estimated to be $89 million,compared with $183 million for 1964 and $407 million for 1963.

toA Proposed for ^separate transmittal.


ANALYSIS

Accost a,

OF NEW OBLIGATIONAL

1963

AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued

P

1964 1965 Increase or


OST OFFICE DEPARTMENT—Continued

to

Public enterprise funds—ContinuedAuthorizations and limitations on

use of postal fund:Administration and regional

operation.

Research, development, andengineering.

Operations

Transportation

Facilities

Plant and equipment

Total authorizations out ofpostal fund.

Total, Post Office Depart- NOAment. Exp.

(78,517)

(12.115)

(3,701,632)

(587,500)

(172,504)

(96,584)

(4,648,852)

840,241770,335

(83,007)

(11.913)

(3,925,000)

(605,500)

(195,904)

(104,075)

(4,925,399)

654,399546,015

(86,455)

(13,000)

(4,034,900)

(601,000)

(205,069)

(90,276)

(5,030,700)

550,700474,700

(3,448)

(1.087)

(109,900)

(-4,500)

(9,165)

(-13,799)

(105,301)

-103,699-71,315

(Increase is mainly for strengthening management.)

(Increase provides for additional procurement of experimental mail han-dling equipment, including an automatic address reader and computermemory for existing letter sorters to mechanize the processing of ZIP-coded and other typewritten mail.)

(Increase is due to growth in mail volume (2.8%) and delivery stops(3.4%), partly offset by savings estimated to result from improvedmanagement and presorting of ZIP-coded mail by large-volumemailers.)

(Decrease results from savings in transportation costs, partly offset byincreased costs due to growth in mail volume.)

(Increase is due principally to added rental costs for additional space tohandle an increasing mail volume.)

(Decrease is due to deferral of building extension and modernizationprojects until current backlogs are reduced, partly offset by increases inprocurement of mechanical equipment for new and existing postoffices.)

Q

3

15

CO


DEPARTMENT OF STATE

ADMINISTRATION OF FOREIGNAFFAIRS


Exp.

Representation allowances 151 NOAExp.

Acquisition, operation, and main- NOAtenance of buildings abroad _ 151 Exp.

Acquisition, operation, and main- NOAtenance of buildings abroad (spe- Exp.cial foreign currency program)

Emergencies in the diplomatic and NOAconsular service 151

Exp.

Extension and remodeling, State Exp.Department Building 151A Proposed for separate transmittal.

147,456

151,915

950942

10,00011,658

2,2051,769

1,800

1,611

200

152,953A5,000150,000A1,000

973950

18,12514,000

2,7502,700

1,500M001,600A 200

300

166,000

160,000A3,000

22,25716,000

300

Supplemental for 1964 will finance equipment, personnel, and otherexpenses for improved communications. Major increases in 1965are for mandatory cost rises and more adequate provision for non-salary expenses to increase effectiveness of personnel.

Increase is due to rising costs.

Increase is for construction and acquisition of office and housingfacilities.

Increase is to permit a greater portion of the total building program tobe financed from excess foreign currencies.

Provides for relief and repatriation loans to U.S. citizens abroad andother emergencies. Supplemental for 1964 is for requirementsin excess of earlier estimates.

(All funds will be obligated or withdrawn by the end of 1964.)

B

3oo

513

toCO


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued to


enacted1964



ADMINISTRATION OF FOREIGNAFFAIRS—Continued

General and special funds—ContinuedReplacement of passenger motor NOA

vehicles sold abroad (perma- Exp.nent, indefinite, special fund)

151[ntragovernmental funds:

Advances and reimbursements. 151 Exp.

Total, administration of for- NOAeign affairs.

Exp.

INTERNATIONAL ORGANIZATIONSAND CONFERENCES

General and special funds:Contributions to international or- NOA

ganizations 151 Exp.

Missions to international organi- NOAzations 151 Exp.

International conferences and con- NOAtingencies 151 Exp.

234205

-1,450

162,645

166,849

69,22794,554

2,3221,953

3,1172,267

DEPARTMENT OF

304300

176,605A 5,400169,850A1,200

99,67999,679

2,5002,450

1,9432,400

272273

1 197,297

184,073A 3,200

87,61787,500

3,2383,000

2,7782,600

STATE—Continued

-32- 2 7

15,292

| 16,223

-12,062-12,179

738550

835200

Proceeds available in 1965 will replace 140 vehicles.

Normal activities of most international organizations will continue toexpand. Decrease reflects expected termination of U.N. peace and se-curity operation in the Congo and that the need for a U.N. workingcapital fund advance will not recur.

Increase is primarily transfer from salaries and expenses; remainder isfor servicing expanded conference activity in Geneva.

Increase reflects consolidation under Department of State of inter-national conference expenses previously financed by other agenciesand a larger conference program.

tdd

CDO


International tariff negotiations NOA151 Exp.

Loan to the United Nations. _ _ 151 NOAExp.

United States Citizens Commis- Exp.siononNATO 151

Total, international organi- NOAzations and conferences. Exp.

INTERNATIONAL COMMISSIONS

International Boundary and WaterCommission, United Statesand Mexico:


Operation and maintenance _401 NOA

Exp.

Construction 401 NOA

Exp.

American sections, international NOAcommissions 401 Exp.

International fisheries commis- NOAsions 404 Exp.

Passamaquoddy tidal power sur- Exp.vey 401A Proposed for separate transmittal..

7

100,00072,070

4

174,666170.855

692683

1,9722.020

10,998

11.003

415416

1,9101,873

3

365240

4,466

10

104,487109,245

715720

2,0152,000

6,497A39,31012,404A650

430425

2,0001,909

1,5001.150

95,13394.250

785785

1,9631.960

| 14,623

14.532A 14.160

474450

2,1892.100

1,135910

-4,466

-10

-9,354-14,995

7065

-52-40

-31,184

1 15.638

4425

189191

Negotiations will begin late in 1964 and continue throughout 1965.

Estimate reflects U.S. matching of currently known pledges by othercountries to purchase U.N. bonds.

(Commission terminated in 1962. Obligations will be paid by 1964.)

Six project feasibility studies will be continued.

Equipment acquisition will be reduced and levee rehabilitation workwill decline.

Supplemental in 1964 is needed to make effective the Chamizalsettlement with Mexico. Estimate for 1965 will continue constructionof Amistad Dam and powerplant and the lower Rio Grande floodcontrol project, and complete two sanitation proiects.

Increase will finance additional sanitation and stream flow studies underjoint plans with Canada.

Increase is for lamprey control and restoration of Fraser River salmonfisheries.

(Previously appropriated funds may be used for additional review ofthe survey.)

a

fcO


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY

1963 1964 1965 Increase or

(-)

DEPARTMENT OF STATE—Continued



INTERNATIONAL COMMISSIONS—Continued

General and special funds—ContinuedRestoration of salmon runs, Fraser Exp.

River system, International Pa-cific Salmon Fisheries Commis-sion 404

Total, international commis- NOAsions.

Exp.

EDUCATIONAL EXCHANGE

Mutual educational and cultural NOAexchange activities 153 Exp.

I nternational educational exchange Exp.activities (special foreign cur-rency program) 153

Center for Cultural and Technical NOAInterchange Between East and Exp.West 153

Preservation of ancient Nubian NOAmonuments (special foreign cur- Exp.rency program) 153

Educational and cultural exchange NOAwith Japan 153 Exp.

2

15,987

15,999

41,94826,385

10,829

8,3407,345

505

51

11,657A 39,310

17,509A.650

42,62531,092

7,500

5,1005,600

A12,000873

A 3 ,000

A25,000A25,000

| 20,034

19,827A 14,160

47,67940,060

6,500

5,9325,600

A 3,000

-51

-30,933

1 15,828

5,0548.968

-1,000

832

-12,000| -873

-25,000-25,000

(Activities under this account will be completed in 1964.)

Increase represents shift in financing from the account immediatelyfollowing.

(Expenditures will continue until prior appropriations are exhausted.)

Increase is to maintain 1964 program level at slightly higher cost.

Grants were made in 1962 primarily to help UNESCO preserve certaintemples in Egypt and the Sudan. Supplemental in 1964 is for U.S.contribution to UNESCO to save Abu Simbel monuments.

Supplemental in 1964 is to establish an educational and cultural founda-tion in Japan with yen credits which the United States and Japan haveagreed shall be used for educational exchange.

d

3O

COaox


Educational, scientific, and cul- Exp.tural activities 153

Educational exchange fund, pay- NOAments by Finland, World War I Exp.debt (permanent, indefinite,special fund) 153

Educational fund, interest pay- Exp.ments by the Government ofIndia 153

Total, educational exchange. NOA

Exp.

OTHER

Rama Road, Nicaragua 152 NOAContract authorization 152 NOALiquidation of contract author-

ization Exp.

Migration and refugee assistance NOA152 Exp.

Payment to the Republic of NOAPanama (permanent) 151 Exp.

Total, other NOAExp.

Total, Department of State__ NOA

Exp.

53

396460

2

50,684

45,580

1,500850

1,087

14,9476,193

1,9301,930

19,2279,211

423,209

408,493

33

396450

68

48,121A 37,00045,616

A28,000

(850)1,000

10,55010,000

1,9301,930

12,48012,930

353,350A81,710355,150A29,850

396400

| 54,007

52,560A3,000

1,000

8,2008,000

1,9301,930

10,13010,930

1 376,601

361,640A20,360

-33

-50

-68

-31,114

1-18.056

-2,350-2,000

-2,350-2,000

-58,459

1 -3,000

—33 (These funds are expected to be fully expended in 1964.)

Current payments by Finland on World War I debt are used for educa-tional exchanges with Finland.

(Certain interest paid in the past by India is being used for educationalexchanges with India.)

(Contracts to complete the road, being constructed under internationalagreement, are expected to be let in 1964.)

Decrease reflects a smaller number of refugees to be resettled and morecost-sharing by other countries.

Annual payment is made, under treaty, for Panama Canal rights.$430 thousand of this is recovered from the Panama Canal Company.

W

oo

>2




nd fu al code1963 1964 1965 Increase or


TREASURY DEPARTMENTWd

DOO



Exp.

Expenses of administration of set- NOAtlement of War Claims Act of Exp.1928 (permanent, indefinite, spe-cial fund) 904

Federal control of transportation Exp.systems 904

Public enterprise funds:Liquidation of corporate assets: Exp.

Reconstruction Finance Cor-poration liquidation fund 904

Civil defense loans: Civil defense Exp.program fund 059

4,686

4,612

1112

1

3,127

-135

5,195A29

5,373A2

1213

1

-924

-58

1 5,580

f 5,532A 27

1313

1

-538

-61

356

1 184

11

386

- 3

Supplemental is for wage board increases. Increase will strengthen thesupervision of bureau operations, and legal and administrativeservices.

Funds are appropriated from a receipt account for administrativeexpenses of paying awards under the act.

(Prior year balance is used to pay compensation to employees injuredduring World War I.)

(Receipts and expenditures will be lower in 1965.)

(Repayments and interest earnings exceed expense.)

CO

as


Liquidation of Federal Farm Mort- Exp.gage Corporation 904

I nongovernmental funds:


Total, Office of the Secretary. NOA

Exp.

BUREAU OF ACCOUNTS


Exp.

Salaries and expenses, Division of NOADisbursement. 904 Exp.

Claims, judgments, and relief acts: NOACurrent definite 910 Exp.

Permanent, definite 910 NOAExp.

Permanent, indefinite 910 NOAExp.

Interest on uninvested funds (per- NOAmanent, indefinite) 853 Exp.

Public enterprise funds:Fund for payment of Government NOA

losses in shipment 904 Exp.

Total, Bureau of Accounts. __ NOAExp.


-533

- 1

4,697

829

3,8823,680

28,23928,256

21,22021,936

22

4,3104,310

10,91710,917

525536

69,09669,637

-274

5,207A29

4,131A2

4,0554,105

30,55729,140

7,2497,549

22

5,0005,000

11,45811,458

550364

58,87157,618

-278

1 5,593

4,669A 27

33,39027,125

5,803

22

5,0005,000

11,85711,857

114

50,24949,901

- 4

357

1 563

29,33523,020

-30,557-23,337

-7,249-7,549

399399

-550-250

-8,622-7,717

—4 (Estimate reflects collection of receivables from a Federal land bank.)

The increase is due to the merger of "Salaries and expenses, Division ofDisbursement." The net overall decrease is due to a nonrecurringpurchase of electronic equipment in 1964.

This appropriation is merged with "Salaries and expenses, Bureau ofAccounts" in 1965.

Appropriations are made in individual private relief acts. For certainclaims and for judgments over $100 thousand, the specific items arepresented to Congress.

Awards totaling $1,620 are paid annually to 2 persons as a result ofprivate relief acts.

Judgments of $100 thousand or less are paid from this permanent appro-priation.

Interest is paid on open book balances of 8 trust funds.

Fund covers losses in shipment of certain Government property, andlosses in redemption of savings bonds.

w

oo

4

>g3

toa*CO






BUREAU OF THE PUBLIC DEBT

General and special funds:Administering the public debt.904 NOA

Exp.

OFFICE OF THE TREASURER

Salaries and expenses _ _ _904

Public enterprise funds:Check forgery insurance fund.904

Total, Office of the Treasurer.

BUREAU OF CUSTOMS

General and special funds:Salaries and expenses 904

NOA

Exp.

NOAExp.

NOA

Exp.

NOA

Exp.

48,29648,787

16,450

16,111

- 2

16,450

16,109

67,875

67,268

TREASURY

47,99248,527

16,700c - 1 , 1 7 5

13,869

5010

16,750c —1,175

13,879

72,317A 115

74,078A 105

i

i

}

DEPARTMENT—Continued

49,25048,650

6,290

6,392

7

6,290

6,399

78,200

76,265A10

1,258123

-9,235

-7,477

- 5 0- 3

9,285

7,480

5,768

1 2,092

Increase will provide funds to purchase electronic equipment, reimburseFederal Reserve banks for increased maintenance, replenish savingsbond stock, and pay increased bond redemption costs.

The substitution of Federal Reserve notes for $1 silver certificatesreduces the procurement of currency. Reduction also occurs fromnonrecurring purchase of electronic equipment in 1964.

The fund covers settlements of checks paid on forged endorsements.

Supplemental is for wage board pay increases. Increase in 1965 willadd manpower to meet greater work volume and strengthen enforce-ment.

CO


INTERNAL REVENUE SERVICE


Refunding internal revenue collec- NOAtions, interest (permanent, in- Exp.definite) 852

Internal revenue collections for NOAPuerto Rico (permanent, in- Exp.definite special fund) 910

Total, Internal Revenue Serv- NOAice Exp.

BUREAU OF NARCOTICS


Exp.

UNITED STATES SECRET SERVICE


Salaries and expenses, White NOAHouse Police 903 Exp.

Salaries and expenses, guard NOAforce 904 Exp.

Contribution for annuity benefits NOA(permanent, indefinite) 903 Exp.

Total, U.S. Secret Service, _. NOAExp.


502,170497,273

73,93173,857

42,46544,780

618,566615,911

4,7674,659

5,7845,389

1,5241,445

383370

336336

8,0287,540

549,900563,500

89,70089,625

45,00045,076

684,600698,201

5,3505,448

6,8257,043

1,7001,705

400404

380380

9,3059,532

595,300592,400

89,70089,625

47,00047,000

732,000729,025

5,5505,517

7,5507,483

1,7301,784

420432

400400

10,10010,099

45,40028,900

2,0001,924

47,40030,824

20069

725440

3079

2028

2020

795567

Tax returns filed are expected to increase from 99.3 million to 101.5million in 1965. Increase will also continue expansion of the dataprocessing system.

Interest is paid at 6% per annum on internal revenue collections whichmust be refunded.

Taxes on articles produced in Puerto Rico are paid to Puerto Rico.

Increase provides for the final phase of revised staffing structure and foradded enforcement abroad.

Increase is for added caseloads, increased protective responsibilities, andadditional equipment.

Increase provides for longevity step increases and additional equipmentand supplies.

An additional guard post must be covered in 1965.

The District of Columbia is reimbursed for benefit payments made forSecret Service employees.

w

Oo

3I3

to



1963

AUTHORITY

•

1964

fREASUR Y

AND EXPENDITURES BY

1965 Increase or

(-)




BUREAU OF THE MINT

Qeneral and special funds—ContinuedSalaries and expenses 904 NOA

Exp.

Construction of mint facilities . 904 NOAExp.

Minor coinage profits, etc. (perma- NOAnent, indefinite, special Exp.fund) 904

Silver profit fund (permanent, in- NOAdefinite, special fund) 904 Exp.

Total, Bureau of the Mint. _ NOA

Exp.

BUREAU OF ENGRAVING ANDPRINTING

Emergency repairs to Bureau of Exp.Engraving and Printing AnnexBuilding 904

Air-conditioning the Bureau of NOAEngraving and Printing (build- Exp.ings) 904

7,025

6,552

523448

661534

8,209

7,534

43

300

7,500C6757,707c650

c500C500

496538

548614

8,544cl,175

8,859c l , 150

300

1 9,980

9,778C25

16,0008,000

605605

1,1751,175

1 27,760

19,558C25

5,7502,500

1,805

| 1.446

15,5007,500

10967

627561

18,041

1 9,574

5,7502,200

Supplemental provides for the production of 50 million silver dollars.The 1965 increase will allow production of an additional 100 millionsilver dollars and 450 million other coins and will finance the 3d yearincrement of the equipment replacement program.

Supplemental provides planning funds for a new mint in Philadelphia.Increase in 1965 will cover site, construction, and equipment costs.

Increase in appropriation of seigniorage is for transportation and othercosts related to production of additional minor coins.

Increase in appropriation of seigniorage is for transportation and othercosts related to production of additional silver coins.

(Repairs to the Annex Building were completed in 1963.)

The installation of air-conditioning will be complete in 1967.

totsD

3

g

CO

Of


Intragovernmental funds:Bureau of Engraving and Print- Exp. —2,272

ing fund 904

§ Total, Bureau of Engraving NOA 300© and Printing. Exp. —2,229

o COAST GUARD

3? General and special funds:Operating expenses. 502 NOA 222,531

Exp. 216,240

Acquisition, construction, and im- NOA 33,330provements 502 Exp. 34,571

Retired pay 502 NOA 32,350

Exp. 31,850

Reserve training 502 NOA 16,498

Exp. 16,117

Intragovernmental funds:

Coast Guard supply fund 502 Exp. —513

Coast Guard yard fund 502 Exp. -1,682

Total, Coast Guard NOA 304,708

Exp. 296,582

886

1,186

248,992B10,800246,592

B10,800

51,00038,339

33,600B1,12533,604

B1,125

18,800B960

18,800B960

900

148

352,392B12,885338,383

B12,885

2,477

5,7504,977

274,400

270,700

H 90,00050,490

37,900

37,900

21,000

21,000

-25

| 423,300

1 380,065

1,591

5,7503,971

14,608

13,308

39,00012,151

3,175

3,171

1,240

1,240

-900

-173

58,023

28,797

(Increase provides for purchase of equipment.)

B Proposed for separate transmittal, Uniformed Services Pay Act of 1963.c 1964 appropriation pending in Congress.H Includes $71,799 thousand to carry out authorizing legislation to be proposed.

Supplemental will cover the costs of military pay legislation. Increasein 1965 will operate new vessels, aircraft, and shore establishments,extend loran navigational service, expand efforts in oceanography,and improve military readiness.

Includes construction of 15 replacement and 9 additional vessels and 2off-shore structures to replace lightships, the acquisition of 9 replace-ment and 8 additional helicopters and other increases to improve ex-isting facilities.

A net average increase of 659 persons on the retired rolls is expected.

Increase will provide for 1,040 additional reservists in the 6-month train-ing program and operate a newly activated training vessel.

(Receipts will equal expenditures in 1965 with sales of $18.8 million.)

(Receipts will exceed expenditures slightly in a $15.3 million program.)

W

a

to


ANALYSIS

A c c o u n l . ,

OF NEW OBLIGATIONAL

1963

AUTHORITY

1964

TREASURY


1965 Increase orExplanation of NOA requests


INTEREST ON THE PUBLIC DEBT

General and special funds:Interest on the public debt (per- NOA

manent, indefinite) 851 Exp.

Total, Treasury Department. NOA

Exp.

9,895,3049,895,304

10,600,00010.600,000

11,861,328M44

B12,88511,859,842

A 107B12,885

c1,150

The increase reflects a higher average level of outstanding debt, and at ahigher average rate of interest.

tdd

s

3

ATOMIC ENERGY COMMISSION

General and special funds:Operating expenses 058 NOA

Exp.

Plant and capital equipment. _058 NOAExp.


Total, Atomic Energy Com- NOAmission. Exp.

2,872,0312,507,296

262,745250,648

- 6 8

3,134,7762,757,876

2,342,6692,365,000

400,000435,000

2,742,6692,800,000

12,323,0002,300,000

J370,000435,000

2,693,0002.735,000

-19,669-65,000

-30,000

-49,669-65,000

Estimate provides increases for basic research in the physical and bio-medical sciences, and for civilian applications of radioisotopes. Thesewill be more than offset by decreases in procurement of uranium con-centrates and production of special nuclear materials.

Estimate provides for procurement of equipment and for constructionof production, research and development facilities, including reactorsand particle accelerators, in support of all operating programs.

Ox


FEDERAL AVIATION AGENCY

General and special funds:Operations 501 NOA

Exp.

Facilities and equipment 501 NOAExp.

Grants-in-aid for airports 501 NOAPermanent NOALiquidation of contract author-

ization 501 Exp.

Research and development 501 NOAExp.

Operation and maintenance, Wash- NOAington National Airport 501 Exp.

Operation and maintenance. NOADulles International Airport Exp.

501

Construction, Washington Na- NOAtional Airport 501 Exp.

Construction, Dulles International NOAAirport 501 Exp.

Construction and development, NOAadditional Washington airport Exp.

501

488,187472,691

125,000113,183

75,000(20,000)51,002

35,00054,953

3,4753,491

3.2773,631

2,0001,124

3,20018,931

527,864517,000

100,250112,000

75,000(20,000)75,000

40,00047,000

3,5823,600

3,9853,800

2,0753,300

450200

9,800

549,000539,000

75,00095,000

A75,000

(7,000)70,500

A5,000

42.00046.000

3.6313,600

4,6194,400

1,8003.600

200200

1,500 -8 ,300

Increase is chiefly for operating newly commissioned air navigation andtraffic control facilities and mandatory salary reform costs.

Air navigation aids, instrument landing systems, traffic control displaydevices and other equipment will be procured and installed to im-prove and expand the Federal airways system.

Legislation is pending to continue the program at an annual level of$75 million for the years 1965, 1966, and 1967. Budget proposes thatappropriations be made for both 1965 and 1966.

Work on improved air traffic control, air navigation, and related systemswill be continued at approximately the 1964 level.

Services at the airport will be provided at approximately their presentlevel. Receipts to the general fund recover the costs.

Increase is chiefly to handle expected traffic growth and to cover higherutilities and maintenance costs associated with new tenants.

Estimate is for replacement of an obsolete hangar.

Estimate provides for construction of interior service roads.

(Expenditures decline with completion of construction of Dulles Air-port.)

A Proposed for separate transmittal.B Proposed for separate transmittal, Uniformed Services Pay Act of 1963.c 1964 appropriation pending in Congress.1 Includes $2,3 10,432 thousand to carry out authorizing legislation to be proposed.J Includes $34 1, 1 10 thousand to carry out authorizing legislation to be proposed.

toOr


ANALYSIS

Account an

OF NEW

d functional

OBLIGATIONAL

code1963

AUTHORITY

1964

AND

1965

EXPENDITURES

(-)



General and special funds—ContinuedCivil supersonic aircraft develop- NOA

ment__ 501 Exp.

Grants-in-aid for airports, Federal Exp.Airport Act 501

Claims, Federal Airport Act _ .501 Exp.

Construction of public airports in Exp.Alaska 501

Total, Federal Aviation NOAAgency.

Exp.

FEDERAL AVIATION

20,0006,792

491

20

755,139

726,311

60,00018,000

297

3

813,206

790,000

60,000

200

676.250A75.000824.000A5,000

AGENCY—Continued

-60.00042,000

- 9 7

- 3

1-61,956

1 39,000

Funds appropriated in 1964 are to finance a detailed design competitionfor development of a supersonic transport.

3

o

GENERAL SERVICES ADMINISTRATION

Real Property Activities

General and special funds:Operating expenses, Public Build- NOA

ings Service 905Exp.

Repair and improvement of public NOAbuildings 905 Exp.

65,00062,502

219,122A 3,350213,500A 3,350

75,00068,000

224,895

224,320

90,00075,000

2,423

7,470

15,0007,000

Supplemental in 1964 is for wage board increases. Increase in 1965 isprimarily for operation of new Federal buildings being acquired in 1964and 1965.

Increase provides for maintenance of new Federal buildings and contin-uation of long-range program of general repairs and improvements.

CO


Construction, public buildings NOAprojects 905 Exp.

Sites and expenses, public build- NOAings projects 905 Exp.

Payments, public buildings pur- NOAchase contracts 905 Exp.

Expenses, U.S. court facilities.905 NOAExp.

Additional court facilities 905 NOAExp.

Construction, Federal Office Build- Exp.ing Numbered 7, Washington,D.C 905

Hospital facilities in the District NOAof Columbia 905 Exp.

Improvements, national industrial NOAreserve plant No. 485 905 Exp.

Acquisition of land and building, Exp.Chicago, 111 905

Construction, Federal Office Build- Exp.ing Numbered 6, Washington,D.C 905

Construction, public buildings_905 Exp.

Construction, U.S. Mission Build- Exp.ing. New York, N.Y 905A Proposed for separate transmittal.

180,95691,779

30,50027,700

5,1505,035

8,5002,722

544

37575

1,100

2,921

11

193

31

157,601115,000

40,00025.000

5,2005,200

1,031928

5,000

1,000

1.522

58

15

117

12

169,613131.500

29,50028,000

10,35010,350

1,4641,400

4,000

9,000

2,038

850

12,01216,500

-10,5003,000

5,1505,150

433472

-1,000

8,000

516

792

-15

-117

-12

Estimate includes 151 new projects and an increase in one other, partlyoffset by savings from 3 projects which have been otherwise providedfor or abandoned.

Estimate provides for design and site acquisition where necessary, for 41projects.

Request provides for payment on 7 projects and prepayments on 13projects constructed through lease-purchase contracts.

Request provides for space expansion and for furniture and furnishingsof U.S. courts.

(Appropriations in prior years will complete facilities for 73 additionaljudges.)

(Construction is financed by 1962 appropriation.)

The 1963 amount provided for costs over original estimates for a Federalgrant for construction of a new hospital in southeast Washington.

This appropriation provided improvements essential to national defense.

(Acquisition completed in 1963.)


(Construction of the last of 5 border stations was completed in October1963.)


Oa

to


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued to00


enacted1964 1965


GENERAL SERVICES ADMINISTRATION—Continued

Real Property Activities—Continued

General and special funds—ContinuedDefense public works, community Exp.

facilities 905

Sites and planning, public build- Exp.ings outside the District ofColumbia 905

[ntragovernmental funds:Buildings management fund _ _ _ 905 Exp.

Construction services, public Exp.buildings 905


Total, real property activities. NOA

Exp.

PERSONAL PROPERTY ACTIVITIES

General and special funds:Operating expenses, Federal Sup- NOA

ply Service _ _ 905 Exp.

Expenses, supply distribution 905 Exp.

1

5,991

-256

- 2 8

485,367

392,408

41,52237,721

2,369

14

-2,817

194

497,954A 3,350432,743A 3,350

48,28047,200

37

-1,154

| 525,822

| 485,304

54,80052,800

- 1 4

1,663

-194

24,518

49,211

6,5205,600

- 3 7



(Operating costs are estimated at $379.8 million. Increase is mainlymodernization work for the Post Office Department.)

(Operating costs are estimated at $15.6 million, an increase of $1.7million, mainly in repair and improvement work and projects assignedto GSA by other agencies.)

Increase is primarily for further increased supply support to the Depart-ment of Defense.

3w

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Intragovernmental funds:General supply fund 905 NOA

Exp.


Total, personal property ac- NOAtivities. Exp.

UTILIZATION AND DISPOSALACTIVITIES

General and special funds:Operating expenses, Utilization NOA

and Disposal Service 905 Exp.

Expenses, disposal of surplus real NOAand related personal property Exp.(permanent, indefinite, specialfund) 905

Total, utilization and disposal NOAactivities. Exp.

RECORDS ACTIVITIES

Operating expenses, National NOAArchives and Records Service Exp.

905

TRANSPORTATION AND COM-MUNICATIONS ACTIVITIES

Operating expenses, Transporta- NOAtation and Communications Exp.Service - 905A Proposed for separate transmittal.

38,500-18,531

637

80,02222,196

9,1268,604

1,0471,095

10,1739,699

14,41614,389

4,6074,652

30,00025,335

78,28072,572

9,3888,866

1,2001,200

10,58810,066

14,73014,400

4,9504,700

-8,595

54,80044,205

10,15010,050

1,2001,200

11,35011,250

15,50015,400

6,0005,600

-30,000-33,930

-23,480-28,367

7621,184

7621,184

7701,000

1,050900

The 1965 program will continue increases in sales to the military witha slight increase in sales to other agencies. Additional interagencymotor pools are also estimated. Additional capital is unnecessary in1965 with substantial increases in customers' advances.

Estimate provides for further emphasis on reuse or prompt disposal ofproperty.

Proceeds of sales are appropriated for certain expenses of disposals.

Increase is primarily for records management assistance and recordscenter activities. Records in custody will total 8.9 million cubic feet;5.4 million reference services will be performed.

Increase is primarily for continued development and management of theFederal Telecommunications System.

3W

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CO




enacted1964



GENERAL SERVICES ADMINISTRATION—Continued

TRANSPORTATION AND COM-MUNICATIONS ACTIVITIES—Con.

Intragovernmental funds:Federal telecommunications fund NOA

905 Exp.

Total, transportation and com- NOAmunications activities. Exp.

DEFENSE MATERIALS ACTIVITIES

General and special funds:Strategic and critical materials _059 NOA

Exp.


Total, defense materials NOAactivities. Exp.

GENERAL ACTIVITIES

General and special funds:Salaries and expenses, Office of NOA

Administrator. 905 Exp.

Allowances and office facilities for NOAformer Presidents _.. __ __903 Exp.

9,000

13,6074,652

18,09522,671

-859

18,09521,812

1,4051,347

310261

1,404

4,9506,104

23,92517,000

-1,000

23,92516,000

1,4381,438

300300

-502

6,0005,098

18,23017,600

-1,000

18,23016,600

1,5501,550

310310

-1,906

1,050-1,006

-5,695600

-5,695600

112112

1010

(The 1963 amount was for initial capital for the fund established byPublic Law 87-847.)

Provides $13.8 million, mainly for inventory management, includingstorage and disposal of material excess to stockpile needs; $1.4 millionfor national industrial equipment reserve activities and $3 millionfor operating expenses.

Increase is for additional activity in business service centers.

Account provides for 3 former Presidents and the widow of a formerPresident.

H3

wH

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COOS


Office of Mrs. Jacqueline Bouvier NOAKennedy 903 Exp.

Refunds under Renegotiation Act Exp.(interest) 905

Public enterprise funds:Reconstruction Finance Corpora-

tion liquidation fund 905Limitation on administrative

expense. Exp.

Intragovernmental funds:Administrative operations fund_905

Limitation on use of fund. Exp.

Working capital fund 905 NOAExp.

Total, general activities NOA

Exp.

Subtotal NOA

Exp.

Less: Court facilities and furnish-ings items transferred to TheJudiciary Chapter (contra) _905

Total, General Services Ad-ministration.

NOAExp.

NOA

Exp.

(25)-168

(11,911)-656

-44

1,715740

623,396

465,896

1,5841,514

621,812

464,382

6543

25

-147

(18,150)-400

-142

1,8031,117

632,230A3,350553,002A3,350

1,0311,377

631,199A3,350551,625A3,350

22

-89

(21,840)-500

20088

2,0601,381

1 633,762

1 579,238

1,4641,532

\ 632,298

[ 577,706

-65-21

-25

58

(3,690)-100

200230

257264

-1,818

22,886

433155

-2,251

22,731

Funds appropriated in 1964 will remain available in 1965 for payment ofobligations authorized by recent legislation.

(Interest on remaining refunds is covered by balances of prior appro-priations.)

(Volume of activity declines as liquidation continues.)

(Increase in financing is to provide necessary staff services for GSAprograms and programs of other agencies.)

Request would provide additional capital mainly for replacement ofobsolete printing and reproduction equipment.

Oo

3

A Proposed for separate transmittal.to00


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued fcO

to



OFFICE OF THE ADMINISTRATOR

General and special funds:Salaries and expenses 551

Limitation on nonadministra-tive expenses.

Urban planning grants 553

Urban studies and housing re-search __ 551

Administrative expenses, masstransportation demonstrations

553

Urban transportation assistance(proposed legislation) 553

Open-space land grants 553Liquidation of contract author-

ization.

NOA

Exp.

NOAExp.

NOAExp.

NOAExp.

NOAExp.

NOA

Exp.

14,565(3.250)14,210

18,000\2,389

375243

200190

250(14,750)

265

HOUSING AND HOME

15,322(3,250)15,100

21,15018,000

387400

195195

262(14,738)

9,000

16,915(3,700)16,500

K25,00020,000

1,5001,200

200200

A75,000A10,000

L12,694(17,306)15,000

FINANCE AGENCY

1,593(450)

1,400

3,8502,000

1,113800

55

75,00010,000

12,432(2,568)6,000

Increase provides additional staff in supervision and coordinationactivities and in the planning advances and urban renewal pro-grams. The appropriation will be consolidated with $14 millionin administrative funds from other accounts. Nonadministrativeexpenses (recovered through fees) provide inspection and audit ofcertain projects and loans.

Increase will provide expansion in comprehensive planning assist-ance to States, small cities, and metropolitan and regional areas.

Increase will provide for expansion of statistical series on housingmarkets to cover rental and existing housing, and special analyt-ical surveys and studies on housing and urban problems.

Estimate provides administrative costs of the existing programs ofmass transportation loans and demonstration grants.

Authorization is proposed to finance direct Federal assistance forconstruction, improvement, and modernization of mass trans-portation systems. Expenditures under the current transporta-tion program are included under "Public facility loans" and"Urban renewal fund."

Previous authorization for grants will be used up in 1965, requiringnew appropriations. Increase in number of grants is reflectedin higher liquidating appropriation.

tddaa

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CO

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Low-income housing demonstra- NOAtion programs 551

Contract authorization NOALiquidation of contract authori-

zation. Ex p.

Farm housing research 551 Exp.

Public enterprise funds:College housing loans (permanent NOA

authorization to expend frompublic debt receipts) __ _ _ -702

Limitation on administrativeexpenses. Exp.

Public facility loans______.___553 NOALimitation on administrative

expenses. Exp.

Public works planning. _553 NOA

Exp.

Revolving fund (liquidating pro-grams) : Limitation on adminis- Exp.trative expenses 551

Urban renewal fund (contract NOAauthorization) 553

Liquidation of contract au-thorization. Exp.

Community disposal operations Exp.552

A Proposed for separate trans mittal.D To carry out authorizing legislation to be proposed.K Includes $22,650 thousand to carry out authorizing legislation to be proposed.L Includes $12,294 thousand to carry out authorizing legislation to be proposed.M Includes $4,957 thousand to carry out authorizing legislation to be proposed.

40

(2,960)146

2

300,000

(1,848)283,574

12,534(1,188)30,048

12,000

5,864

(145)-2,014

(319,766)173,208

-̂ -1,160

43A5,000(1,157)2,000

300,000

(1,903)222,635

(1.220)33,915

2,000A 4,0003,528

(135)-1,931

A1,400,000

(104,805)251,567

-2,153

75

M (5,666)3,100

300,000

(1,900)208,028

(1,300)31,274

D12,000

5,170

(110)-1,919

(265,000)329,700

-417

32

-5,000(3,843)1,100

(-3)-14,607

(80)-2,641

6,000

1,642

(-25)12

—1,400,000

(160,195)78,133

1,736

Estimate provides for administrative costs of the low-income housingdemonstration program. Additional contract authorization isproposed in 1964 to continue grants for testing and demonstrationof new and improved methods of housing low-income families.

The Housing Act of 1961 authorized $300 million each in 1962-65 forloans financing student housing and related facilities.

Appropriations in 1963 were for mass transportation loans. Ex-penditures include substantial loans for other facilities, financedfrom 1961 NOA. Increased administrative costs result fromhigher levels of activity.

Proposed 1964 supplemental is to provide funds for interest-freeadvances totaling $15 million, financed in part by repayments andother available funds. In 1965, approvals total $24 million.

(Decreased administrative costs result from reduced size of invest-ments to be managed and liquidated.)

New legislative authority in 1964 will provide funds for 1965 and1966. Accelerating progress under existing contracts requireshigher payments and higher liquidating appropriation.

(Repayments and sales of mortgages will continue to exceed risingexpenses of advance preparations to sell properties at LosAlamos, N. Mex.)


to

ANALYSIS

Account an

OF NEW

d functional

OBLIGATIONAL

code1963

AUTHORITY

1964

AND EXPENDITURES

1965 Increase or

( - )



HOUSING AND HOME FINANCE AGENCY—Continued

OFFICE OF THE ADMINISTRATOR—Continued

Public enterprise funds—ContinuedHousing for the elderly fund. _551 NOA

Limitation on administrativeand nonadministrative ex- Exp.penses.

Total, Office of the Adminis- NOAtrator.

Exp.

FEDERAL NATIONAL MORTGAGEASSOCIATION

Loans to secondary market opera- Exp.tions 551

Special assistance functions 551 Exp.

70,000

(744)18,856

427,965

535,821

-277,044

100,000

(885)33,246

439,359A1,409,000

585,502

-100,820

-364,513

N 75,000

(U50)49,181

443,384A75,000677,017

A10,000

-313,000

-25,000

(265)15,935

-1,329,975

101,515

100,820

51,513

Appropriations in 1965 and balances brought forward from 1964will allow funds to be reserved for loans amounting to $100million in 1965, compared to $75 million in 1964. Increased1965 administrative costs result from higher program level.

(The trust fund will purchase from Treasury in 1964 the holdingsof preferred stock not currently needed as the basis for financingnew mortgage purchases.)

(Expenditures will rise in 1965 primarily because of increasingpurchases of below-market-interest-rate mortgages on rentalhousing for moderate-income families. New commitments formortgage purchases will increase by $155 million to $500 million.Mortgage sales are estimated at $350 million (par) in both1964 and 1965.)

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Management and liquidating func-tions 551

Exp. -

Sale of participations in mortgage Exp.pools (proposed legislation) __ .551

Limitation on administrative ex-penses.

Total, Federal National Mort- Exp.gage Association.

FEDERAL HOUSINGADMINISTRATION

Federal Housing Administration NOAfund (permanent indefinite au-thorization to expend from cor-porate debt receipts) 551

Limitation on administrative ex-penses.

Limitation on nonadministrativeexpenses. Exp.

A Proposed for separate transmittal.N Includes $50 million to carry out authorizing legislation to be proposed.

-162,265

(8,392)

-439,309

162,413

(10,732)

(69,305)134,951

-112,782

(8,750)

-578,115

142,395

(9,500)

(76,565)56,511

-74,500

A-200,000

(8,800)

-387,500A - 2 0 0 , 0 0 0

(10,375)

(79,750)-173,180

38,282

-200,000

(50)

1 -9,385

-142,395

(875)

(3,185)-229,691

(Acquisitions of mortgages from the FHA for administration andliquidation will increase by $155 million (par), but sales of $170million (par) and mortgage repayments will continue to producenet receipts for the fund.)

(Legislation is proposed to authorize the sale of participations inpools of mortgages held by FNMA.)

Decrease results from increased use of private rather than FHAfinancing of resales of properties acquired as a result of defaultson insured mortgages, and from transfer of $250 million (par) inmortgages to FNMA for consolidated administration and liquida-tion. Property acquisitions will continue to rise but are expectedto be matched by resales in 1965. Mortgage insurance outstand-ing is estimated at $48.4 billion by the end of 1965. Increasedapplication levels, insurance-in-force, and claims activities willrequire increased administrative support and operating expenses.

tooo


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued00O

nd fu al code1963 1964 1965 Increase or


HOUSING AND HOME FINANCE AGENCY—Continued

PUBLIC HOUSINGADMINISTRATION

Low-rent public housing program:Annual contributions 552 NOA

Administrative expenses 552 NOALimitation on administrative

expenses.Limitation on nonadministra-

tive expenses. Exp.

Total, Public Housing Ad- NOAministration. Exp.

Total, Housing and Home NOAFinance Agency.

Exp.

180,000

14,882(14,882)

(1,224)178,867

194,882178,867

785,259

410,330

197,000

15,484(15,484)

(1,420)148,441

212,484148,441

794,238A 1,409,000

212,339

214,000

16,670(16,670)

(1.605)222.713

230,670222,713

674,054A 75,000339,050

-190,000

17,000

1,186(U86)

(185)74,272

18,18674,272

-1,454,184

-63,289

Increase primarily reflects approximately 27,000 additional unitsreceiving contributions for the first time under contracts previ-ously executed.

Administrative expenses rise with the heavier management work-load.

(Increase will cover inspection of increased construction activityand permit acceleration of repair and maintenance at 3 federallyowned and operated projects.)

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CD



NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

General and special funds:Research and development 251 NOA

Exp.

Construction of facilities 251 NOAExp.

Administrative operations 251 NOAExp.

Salaries and expenses 251 Exp.

Total, National Aeronautics NOAand Space Administration.

Exp.

2,929,407

2,308,384

743,634225,267

18,695

3,673,041

2,552,347

3,909,615A141,0003,495,000

A25,000

673,500475,000

516,851405,000

5,099,966A141,0004,375,000

A25,000

D 4,382,000

3,805,000A100,000

281,000520,000

D 641,000565,000

| 5,304,000

4,890,000A100,000

331,385

385,000

-392,50045,000

124,149160,000

63,034

590,000

The 1964 supplemental is to regain in part the slippage in schedulesin the manned lunar landing program resulting from reductionsin the 1964 appropriations. The increase in 1965 is for continu-ing manned space flight programs required for achieving a mannedlunar landing by the end of the decade. Effort on meteorologicaland communications satellites will continue at a slightly lowerlevel than in 1964. Effort will continue on unmanned investiga-tions of the lunar andfplanetary environments. Aeronauticsresearch will continue in support of civil and military require-ments with increased emphasis in the supersonic transport pro-gram. Funding is also included for supporting research and forthe operation of worldwide tracking and data acquisition net-works to meet increased flight program requirements.

Facilities required for the manned lunar landing program have beenlargely funded in prior years. The major portion of the 1965funds is to provide further facilities for the manned space flightprogram, including the Saturn V launch complex and supportingfacilities.

Additional amount provides for heavier workload at NASA installa-tions to support manned space flight and other programs.

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to00


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued to0000


enacted1964



VETERANS ADMINISTRATION

General and special funds:General operating expenses. __805 NOA

Exp.

Medical administration and mis- NOAcellaneous operating expenses

804 Exp.

Medical and prosthetic research NOA

804 Exp.

Medical care 804 NOA

Exp.

Compensation and pensions:(Veterans service-connected NOA

compensation) 801 Exp.

(Veterans non-service-connected NOApensions) 802 Exp.

161,245158,443

13,982

16,576

30,500

26,534

1,048,142

1,035,762

2,117,1792,116,179

1,699,9521,698,390

159,710162,000

14,800

15,076

33,74234,300

1,081,170A10,579

1,105,299A 9,865

2,121,3812,126,000

1,738,5851,743,000

156,524155,000

14,915

14,000

36,98735,905

1,115,935

1.109,571A714

2,121,4882,120,000

1,778,1601,777,000

-3,186-7,000

115

-1,076

3,2451,605

24,186

1 -4,879

107-6,000

39,57534,000

Reduction reflects declining workloads, increased productivity andtransfers of costs of tort claim settlements and burial flags to the Com-pensation and pensions appropriation. Decreases are offset in part bymandatory salary reform costs.

Increase provides for mandatory salary reform costs.

Increase provides for program growth consistent with 10-year plannedobjective.

Supplemental in 1964 is for wage board increases. The 1965 estimateprovides for mandatory salary reform costs; activation of 2,000 nurs-ing home beds; activation of the new Washington, D.C., hospital;completing activation of a new restoration center at East Orange,N.J.; increased maintenance and repair requirements; establishing 5new day care centers; increased utilization of utilities, drugs andmedical supplies; and increases in medical and dental fees for home-town care.

Increases include new cost-of-living increases in dependency and in-demnity payments to widows, parents, and children, offset mainly bydecreases due to deaths of World War I and World War II veteransand transfers to pension rolls.

Increase arises mainly in caseloads among World War II and Koreanconflict veterans and among survivors of veterans of World War I andWorld War II.

iow

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(Other veterans benefits and NOAservices) 805 Exp.

Readjustment benefits 803 NOAExp.

Veterans insurance and indemni- NOAties 805

Permanent, indefinite, special NOAfund. Exp.

Grants to the Republic of the NOAPhilippines 804 Exp.

Construction of hospital and domi- NOAciliary facilities 804

Exp.

Construction—Corregidor-Bataan NOAMemorial 805 Exp.

Public enterprise funds:Canteen service revolving fund Exp.

805

Direct loan to veterans and re-serves (authorization to expendfrom debt receipts): 803

Permanent NOACurrent NOA

Exp.

Loan guaranty revolving fund_803 Exp.

Sale of participations in mortgage Exp.pools (proposedlegislation).803


56,86956,869

95,80095,600

32,000

68233.987

350301

77,000

65.752

-751

200,000

-86,187

-22,922

61,03460,000

67,00064,600

30,200

80028,600

310310

76,796A 5,00074,500

A500

A1,500A 150

167

150,000

-69,000

10,000

63,35263,000

39,60043.600

13,700

80021,700

310310

1 102,000

80,500A 4.500

A500

304

150,000-150,000-171,000

-63,000

A-100,000

2,3183.000

-27,400-21,000

-16,500

-6,900

20,204

| 10,000

-1,500350

137

1-150,000

-102,000

-73,000

-100,000

Increase includes tort claims and burial flags (previously programedunder "General operating expenses") and subsistence allowance todisabled peacetime ex-servicemen undergoing vocational rehabilita-tion.

Reduced requirements result primarily from the phasing out of Koreanconflict readjustment trainees by Jan. 31, 1965, as provided by law.

Decreases result principally from phaseout of indemnities paid to sur-vivors of veterans and servicemen deceased during the Korean conflict.Permanent NOA is premium receipts on policies issued to certain dis-abled veterans of World War II.

Estimate is for medical care and treatment of daily average of 180Philippine Commonwealth Army veterans.

Supplemental in 1964 is for alterations of existing hospitals to provide2,000 nursing home beds. Proposal for 1965 is the fifth-year incre-ment of a 15-year $1,200 million modernization program. Includes$6.4 million for construction and planning research facilities.

Supplemental in 1964 is for construction of a recently authorized me-morial on Corregidor to those who fought in the Pacific area in WorldWar II.

(Receipts of $49 million from canteen sales to hospital patients andstaff approximately offset expenses.)

Loans decrease as World War II veterans entitlement runs out. Saleof loans and other unobligated balances eliminate need for borrow-ings from the Treasury. Permanent NOA of $150 million whichwould otherwise become available for 1965 is proposed for cancellation.

(Receipts, primarily from planned sale of mortgage notes, are expectedto more than offset expenditures.)

(Legislation is proposed to authorize the sale of participations in pooledmortgage loans.)

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ooCD


ANALYSIS OF NEW


OBLIGATIONAL

code1963

AUTHORITY

1964

AND

1965

EXPENDITURES

Increase or

( - )



to

Public enterprise funds—ContinuedRental, maintenance and repair of Exp.

quarters 805

Service-disabled veterans insur-ance fund 805

Soldiers' and sailors' civil relief_803

Veterans special term insurancefund _ _ _ 805

Vocational rehabilitation revolvingfund 805

Supply fund 805

Total, Veterans Administra-tion.

Exp.

Exp.

Exp.

Exp.

Exp.

NOA

Exp.

VETERANS

2

-102

23

-19.840

- 8

-1.784

5,533,700

5,172,823

-34

37

-15.739

2

-815

5,535,528A 17,079

5,338,303A 10.515

ADMINISTRATION—Continued

27

16

-25,406

-901

15,443,771

5,160,626A-94,286

61

-21

-9,667

- 2

- 8 6

-108,836

j-282,478

(Receipts from rental housing offset maintenance costs.)

(Receipts from premiums and the insurance and indemnities appropria-tion approximately cover expenditures of $9.3 million, mainly deathclaims.)

(A small volume of claims will be partly offset by repayments.)

(Increased net receipts result primarily from the completion of paymentin 1964 of the special dividend authorized by Public Law 87—223.)

(Repayment of loans to trainees are expected to cover new loans.)

(Fund is estimated to net near zero on a volume of $183.7 million.)

OTHER INDEPENDENT AGENCIES

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ADVISORY COMMISSION ONINTERGOVERNMENTAL RELATIONS


Exp.375412

385380

395393

1013

This Commission brings together representatives of Federal, State, andlocal Governments for studies of intergovernmental cooperation.


ALASKA INTERNATIONAL RAIL ANDHIGHWAY COMMISSION

Salaries an d expenses 506 Exp.

AMERICAN BATTLE MONUMENTSCOMMISSION


Construction of memorials and Exp.cemeteries 805

Total, American Battle Mon- NOAuments Commission. Exp.

CENTRAL INTELLIGENCE AGENCY

Construction 905 Exp.

CIVIL AERONAUTICS BOARD


Payments to air carriers:Contract authorization (perma- NOA

nent, indefinite) 501Liquidation of contract authori-

zation.Exp.

Total, Civil Aeronautics NOABoard. Exp.


- 1

1,5801,473

353

1,5801,826

1,722

9,425

9,374

82,740

(82,864)

81,857

92,16591,231

1,8001,817

183

1,8002,000

922

10,2409,522

87,656

(79,000)(A 5,000)

80,478A 5,000

97,89690,000

A 5,000

1,8001,900

1,8001,900

10,800

10,000

84,024

1 (82,824)

| 82,824

94,824| 92,824

83

-183

-100

-922

560

478

-3,632

(-U76)

-2,654

-3,072-2,176

(The Commission made its final report to the Congress in 1961.)

Level of maintenance is expected to remain at about the 1964 level.

(Account is available only to pay old obligations.)

(Construction will be completed with use of unexpended balances.)

Increases are primarily to strengthen the aircraft accident investigationprogram.

Airline subsidy obligations are expected to decline in 1965.

(Supplemental in 1964 is for funds to meet additional authorized con-tractual payments. Appropriation for 1965 liquidates that part ofsubsidy contract obligations for which payments are due during theyear.)

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ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued toCOto



OTHER INDEPENDENT AGENCIES—Continued

CIVIL SERVICE COMMISSION


Exp.

Investigation of United States NOAcitizens for employment by in- Exp.ternational organizations. _ _908

Annuities under special acts. _906 NOAExp.

Government payment for annui- NOAtants, employees health benefits Exp.fund 906

Trust fund:Limitation on administrative ex-

penses, employees health bene-fits fund.

General and special funds:Government contribution, retired NOA

employees health benefits fund906

Reappropriation NOAExp.

22,14122,071

600459

2,0001,862

5,1666,789

(1,099)

8,000

5,20013,200

21,80522,784

600579

1,8001,837

9,5009,500

(1.125)

14,800

14,800

22,18721,992

634633

1,7001,714

10,66410,664

(1.151)

14,840

14,840

382-792

3454

-100-123

1,1641,164

(26)

40

40

Mandatory salary reform costs are partly offset by decreases resultingfrom productivity improvement. Provision is also made for purchaseof a computer in lieu of rental.

Increase in 1965 results from expanded workload and mandatory salaryreform costs.

Panama Canal construction annuitants are estimated to drop from1,518 to 1,347; Lighthouse Service widows from 425 to 423.

On June 30, 1963, 116 thousand eligibles were enrolled; increases to 157thousand in 1964 and to 201 thousand in 1965 are expected.

(Increase will provide for additional eligibility determinations and man-datory salary reform costs.)

Increase includes amount to pay mandatory contributions unpaid in1964.

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penses, retired employees healthbenefits fund.

General and special funds:Payment to civil service retirement NOA

and disability fund 906Exp.


penses, employees life insurancefund.

Intragovernmental funds:Investigations (revolving fund) Exp.

906

Total, Civil Service Commis- NOAsion.

Exp.

COMMISSION OF FINE ARTS


Exp.

COMMISSION ON CIVIL RIGHTS


A Proposed for separate transmittal.° Includes $555 thousand to carry out legislation pending in Congress.

(388)

30,000

30,000

(264)

-699

73,107

73,683

8382

9601,046

(392)

62,000

62,000

(270)

632

110,505

112,132

9191

985970

(348)

65,000A -65,000

65,000A -65,000

(277)

-343

115,025A -65,000

114,500A -65,000

161161

°985965

(-44)

1-62,000

1-62,000

(7)

-975

1-60,480

1-62,632

7070

- 5

(Administrative expense will decrease with drop in number of estimatedparticipants from 236 to 232 thousand.)

Estimate is to pay costs of additional benefits granted in 1963. Pendinglegislation to provide permanent financing would eliminate the needfor an appropriation in 1965.

(Increased participation under regular insurance program is partlyoffset by decrease in beneficial association members.)

(Decrease in expenditures reflects decreases in investigations in processthat will rot be completed by the end of 1965.)

Estimate provides for mandatory salary reform costs, increased travelcosts, consultant services, and equipment.

Estimate will continue program at about 1964 level.


ANALYSIS OF NEW


OBLIGATIONAL

code1963

AUTHORITY

1964

AND

1965

EXPENDITURES

(-)


Explanation of NOA requestso


COMMISSION ON INTERNATIONALRULES OF JUDICIAL PROCEDURE


Exp.

EXPORT-IMPORT BANK OFWASHINGTON

Public enterprise funds:Export-Import Bank of Washing-

ton fund 152.Limitation on operating ex-

penses.Limitation on administrative

expenses. Exp.

Liquidation of certain Reconstruc-tion Finance Corporation assets Exp.

152

Total, Export-Import Bank of Exp.Washington.

FARM CREDIT ADMINISTRATION

General and special funds:Administrative expenses (perma- NOA

nent, indefinite, specialfund) 352

Limitation on administrative ex-penses. Exp.

103

(1,295,000)

(3,123)-391,547

- 3

-391,550

2,564

(2,632)2,567

7

(1,314,366)

(3,500)-648,981

-1,250

-650,231

2,785

(2,785)2,785

(3,825)-855,914

-855,914

2,876

(2,876)2,876

- 7

(-1,314,366)

(325)-206,933

1,250

-205,683

91

(91)91

(This Commission expired on Dec. 31, 1963.)

(Disbursements will be exceeded by loan repayments, sales of certificatesand individual loan maturities with recourse, and other receipts.)

(Completion of liquidation is anticipated in 1964.)

Activity is financed by assessments collected from the banks in the farmcredit system. No significant change in administrative services iscontemplated. The increase in 1965 is for mandatory salary reformcosts.

GO


Public enterprise funds:Short-term credit investment fund

352Exp.

Banks for cooperatives investment Exp.fund 352

Total, Farm Credit Admin- NOAistration. Exp.

FEDERAL COAL MINE SAFETYBOARD OF REVIEW


Exp.

FEDERAL COMMUNICATIONSCOMMISSION


FEDERAL HOME LOAN BANK BOARD

Public enterprise funds:Federal Home Loan Bank Board

revolving fund - 551Limitation on administrative

and nonadministrative ex- Exp.penses.

Federal Savings and Loan Insur-ance Corporation fund 551

Limitation on administrative ex-penses. Exp. —

13,310

-11,980

2,5643,898

7059

14,95114,088

(13,619)-119

(1.161)-263,543

9,920

-13,927

2,785-1,222

6565

15,58416,000

(15,230)-67

(1,315)-250,151

9,900

-11,750

2,8761,026

7070

16,61016,400

(17,333)-28

(225)-348,838

-20

2,177

912,248

55

1,026400

(2,103)39

(-1,090)-98,687

(Expenditures represent Government investment in Federal intermediatecredit banks and production credit associations.)

(Negative expenditures represent a return of capital previously investedin banks for cooperatives.)


Increase provides for more intensive enforcement activities in the fieldand regulation of common carriers in greater depth.

(Expenses are paid from fees, charges, and assessments—primarily bymember institutions and the Federal home loan banks. Limitationincreases in 1965 primarily because of mandatory salary reform costsand transfer of certain functions from the Corporation.)

(Premiums and other receipts will continue to increase, while acquisitionof assets from insured institutions will decrease, causing a rise in netrevenues. Administrative expenses decrease because of transfer ofcertain functions to Federal Home Loan Bank Board revolving fund.)

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FEDERAL HOME LOAN BANK BOARD—Continued

Public enterprise funds—ContinuedHome Owners' Loan Corporation Exp.

fund 551

Total, Federal Home Loan Exp.Bank Board.

FEDERAL MARITIME COMMISSION


Exp.

FEDERAL MEDIATION ANDCONCILIATION SERVICE


Exp.

FEDERAL POWER COMMISSION


1

-263,661

2,2672,142

5,1895,052

11,00710,653

1

-250,217

2,5752,586

5,6875,650

11,85012,171

1

-348,865

3,3003,100

6,1006,050

13,33513,310

-98,648

725514

413400

1,4851,139

(Only expenditures are for interest on matured bonds.)

Increase is to provide for expanding caseload and for development ofeconomic data for evaluating shipping rates and practices.

Increase will permit greater efforts to avoid disputes through pre-ventive mediation.

Backlog of natural gas producer rate cases will be reduced as first arearate case is completed. Regulation of interstate electric power rateswill be strengthened.

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COO5


Payments to States under Federal NOAPower Act (permanent, indefi- Exp.nite, special fund) 401

Total, Federal Power Com- NOAmission. Exp.

FEDERAL TRADE COMMISSION


FOREIGN CLAIMS SETTLEMENTCOMMISSION


Payment of Philippine war dam- NOAage claims 151 Exp.

Total, Foreign Claims Settle- NOAment Commission. Exp.

GENERAL ACCOUNTING OFFICE


HISTORICAL AND MEMORIALCOMMISSIONS

Civil War Centennial Commis- NOAsion 910 Exp.

Corregidor-Bataan Memorial NOACommission 805 Exp.


9858

11,10510,712

11,47211,515

738514

73,000290

73,738804

43,89842,294

10097

8998

11,93912,269

12,21511,900

1,4141,468

21,832

1,41423,300

45,69146,294

100103

MlMl

8989

13,42413,399

13,27012,900

1,7001,728

17,505

1,70019,233

47,20047,035

100100

2525

-9

1,4851,130

1,0551,000

286260

-4,327

286-4,067

1,509741

-3

1414

States receive 37.5% of license receipts from hydroelectric projects innational forests and public lands.

Increase provides for compliance investigations, expanded enforcementactivity under textile and fur statutes, greater emphasis on industryguidance, and mandatory salary reform costs.

Increase results from rise in General War Claims workload from 3 thou-sand in 1964 to 8.5 thousand in 1965.

Transfer of $20 million of unobligated balance will be made for thePhilippine education program in 1965. Expenditures in 1965 willcomplete the claims program.

Increase is primarily for mandatory salary reform costs and extendedaudit coverage.

(Expenditure activity will decline slightly.)

Supplemental in 1964 is for planning for the memorial1965 will continue the work of the Commission.

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a

Estimate inO

CO



toCO00Account and functional code

1963enacted

1964 1965decrease Explanation of NOA requests

HISTORICAL AND MEMORIALCOMMISSIONS—Continued

General and special funds—ContinuedFranklin Delano Roosevelt Me- NOA

morial Commission. 910 Exp.

James Madison Memorial Com- Exp.mission 910

United States Territorial Expan- Exp.sion Memorial Commission. _910

Woodrow Wilson Memorial Com- NOAmission __ 910 Exp.

Total, historical and memorial NOAcommissions.

Exp.

INDIAN CLAIMS COMMISSION


INTERSTATE COMMERCECOMMISSION

Salaries and expenses __508 NOAExp.

OTHER INDEPENDENT

252

1

10135

100

297269

23,50023,519

.25

4

10

100M l142

All

297290

24,66924,000

\ 125

i r2!

313305

25,85025,000

AGENCIES—Continued

-25

- 4

-10

14

- 2 8

1615

1,1811,000

(The Commission is expected to complete its work under the 1963NOA.)

(No activity is expected in 1965.)

(The Commission is concerned with the Jefferson National ExpansionMemorial, St. Louis, Mo.)

(The Commission is expected to complete its work under the 1963authorization.)


Increases are for additional workload arising from growth of the regu-lated motor carrier industry.

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NATIONAL CAPITAL HOUSINGAUTHORITY

Operation and maintenance of NOAproperties 555 Exp.

NATIONAL CAPITAL PLANNINGCOMMISSION


Land acquisition, National Capital NOApark, parkway, and playground Exp.system 555

Total, National Capital Plan- NOAning Commission. Exp.

NATIONAL CAPITAL TRANSPORTA-TION AGENCY


Land acquisition and construe- NOAtion 555 Exp.

Total, National Capital NOATransportation Agency. Exp.

NATIONAL LABOR RELATIONSBOARD



4040

632586

1001,296

7321,882

2,8932,290

40033

3,2932,323

20,96620,945

4343

650725

1,615

6502,340

1,000900

1,000900

22,42222,435

3737

774774

500

7741,274

500500

500500

25,25024,962

-6-6

12449

-1.115

124-1,066

-500-400

-500-400

2,8282,527

Decrease results from demolition in 1964 of 23 existing low-renthousing units. Receipts ($39 thousand in 1965) are deposited in thegeneral fund.

Estimate provides for staff to deal with increased workload, publicationof comprehensive plans, increased travel and communication costs,and mandatory salary reform costs.

Employment will be reduced pending enactment of legislation providingfor rapid transit for the National Capital region.

(Funds have been appropriated for advance acquisition of rights-of-wayfor rapid transit facilities.)

Estimate reflects continuing increases in unfair labor practices caseloadand in representation petitions.

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NATIONAL MEDIATION BOARD


Exp.

NATIONAL SCIENCE FOUNDATION


International Geophysical Year_ _7fi3

Intragovernmental funds:Advances and reimbursements_703

Total, National Science Foun-dation.

NOAExp.

Exp.

Exp.

NOAExp.

OUTDOOR RECREATION RESOURCESREVIEW COMMISSION

General and special funds:Salaries and expenses 405 Exp.

PARTICIPATION IN INTERSTATE-FEDERAL COMMISSIONS

Delaware River Basin Commission:Salaries and expenses 401 NOA

Exp.

1,9391,812

322,476206,858

- 5

-480

322,476206,372

88

3430

1,9501,948

353,000259,953

47

353,000260,000

13

3838

1,9701,968

487,700301,700

487,700301,700

3939

13441

13441

2020

,700,747

-47

,700,700

-13

11


Includes increase to emphasize science education (by 32%), institu-tional development and improvement (by 88%), and basic research(by 18%).

(Expenditures under prior obligations will be complete in 1964.)

(The Commission's work has been completed.)

This appropriation provides for the expenses of the U.S. Commissioner,his alternate, and their staff.

d

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I


Contribution to the Delaware NOARiver Basin Commission _ 401 Exp.

Total, Delaware River NOABasin Commission. Exp.

Interstate Commission on the Po- NOAtomac River Basin: Contribu- Exp.tion 555

Total, participation in inter- NOAstate-Federal commissions. Exp.

PRESIDENT'S ADVISORY COMMITTEEON LABOR-MANAGEMENT POLICY

President's Advisory Committee NOAon Labor-Management Policy Exp.

652

RAILROAD RETIREMENT BOARD

Payment for military service NOAcredits 655 Exp.

Payment to railroad unemploy- Exp.ment insurance account 652

Trust fund:Limitation on salaries and ex-

penses.

RENEGOTIATION BOARD


Exp.

80100

114130

55

119135

300120

-601

(9,906)

2,4462,325

117117

155155

55

160160

200120

(11,065)

2,5502,500

92 I92

131131

55

136136

200120

13,83413.834

(10.560)

2,6002.625

-25-25

-24-24

-24-24

13,83413.834

(-505)

50125

The amount recommended is the Federal share (24.2%) of the net an-nual expense budget as adopted for 1965 by the Commission.

The United States contributes $5 thousand annually for the Commis-sion's efforts to reduce pollution.

No change in the level of activities is anticipated.

Estimate is first of proposed 10 annual installments to pay amount duethe account for military service of railroad workers.

(Program of temporary extended benefits has expired.)

(Claims from railroad workers and numbers of beneficiaries are ex-pected to increase. Increases in productivity and decline in thenumber of industry workers result in a decrease.)

Provides for mandatory salary reform costs. The Renegotiation Actexpires on June 30, 1964, but this will have no effect on the work ofthe Board until later years. Legislation to extend will be proposed.

3

8


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands cf dollars)—Continued GOoto




ST. LAWRENCE SEAWAYDEVELOPMENT CORPORATION

Public enterprise funds:St. Lawrence Seaway Develop-

ment Corporation fund 502Limitation on administrative

expenses. Exp.

SECURITIES AND EXCHANGECOMMISSION


Exp.

SELECTIVE SERVICE SYSTEM


Exp.

SMALL BUSINESS ADMINISTRATION


Limitation to be derived fromrevolving fund.

(424)1.437

13,21913,207

37,56934,489

5,879

(27,500)

(429)1,000

13,93314,200

37,70537,230

6,972

(27,800)

(450)1,500

15,22515,100

43,02042,350

7,476

(29,193)

(21)500

1,292900

5,3155,120

504

(1,393)

(Operating costs, interest, and some additional construction will befinanced from revenues of $4.5 million and borrowing of $1.5 millionfrom the Treasury.)

Increases emphasis on investigations and enforcement; provides morefrequent inspections of investment companies and investment ad-visers; and includes mandatory salary reform costs.

Increase reflects mandatory salary reform costs and higher workloads.Registrations will increase 38% from 1,526 to 2,110 thousand.

Increase provides for mandatory salary reform cost and for full-year costof personnel added during 1964.

(Increase provides for mandatory salary reform cost and for full yearcost of personnel added during 1964.)

W

O

55O


Limitation to be derived fromtrade adjustment loan assist- Exp.ance.

Trade adjustment loan assist- NOAance 506 Exp.

Grants for research and manage- Exp.ment counseling 506

Public enterprise funds:Revolving fund 506 NOA

Exp.

Reconstruction Finance Corpora- Exp.tion liquidation fund 506


Total, Small Business Admin- NOAistration. Exp.

SMITHSONIAN INSTITUTION


Exp.

Remodeling of Civil Service Com- NOAmission Building 704 Exp.

Construction and improvements, NOANational Zoological Park___704 Exp.


4.849

161

300,000137,368

40

-11

305,879142,407

11,000

10,509

169

1,27590

(30)7.144

1,50025

341

90,000133,649

98,472141,159

13,124A 112

13.035A110

5,4651.404

1,2751.500

(100)7,313

500

133,676

7,476141,489

1 14,794

14,501A2

1,0002.246

1,7762.200

(70)169

-1,500475

-341

-90,00027

-90,996330

1,558

1 1,358

-4,465842

501700

(Administrative costs of trade adjustment loan program rise as programactivity grows.)

Program will be funded from available balances of 1964 appropriation.

(Old obligations are expected to be fully liquidated in 1964.)

Higher program level in 1965 will be financed entirely by repayments,sales, and available balances.

(Balance has been transferred to preceding fund.)

Supplemental in 1964 is for wage board pay increases. Estimate in1965 provides for mandatory salary reform costs, staffing of the newMuseum of History and Technology and the east wing of the NaturalHistory Building, and broadened scientific effort.

Provides for remodeling of the building as an art gallery.

Provides for replacement of exhibits, additional parking, extension ofutilities, modernization of sewage system, and planning.

3Oo

i

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3

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SMITHSONIAN INSTITUTION—Con.


National Air Museum 704 NOAExp.

Salaries and expenses, National NOAGallery of Art 704

Exp.

Additions to the Natural History Exp.Building 704

Museum of History and Technol- Exp.ogy 704


Smithsonian Institution 704

Total, Smithsonian Institu- NOAtion.

Exp.

SUBVERSIVE ACTIVITIES CONTROLBOARD


Exp.

2,114

2,006

1,949

5,509

-27

14,389

20,204

395338

511425

2,138A38

2,140A 38

3,358

4,108

41

22,513A 150

26,011A 148

425444

1,364

1.411

1 2,147

1 2,284

5,085

324

41

| 21,081

28,092A2

475475

853986

- 2 9

106

1,727

-3,784

-1,582

| 1,935

5031

The Institution will complete planning for a National Air Museum Build-ing.

The estimate provides for workload increases, maintenance of buildingand equipment, and mandatory salary reform costs. Repairs to glassroof, from prior years' NOA, will be completed in 1965.

(Construction of the east wing was completed in 1963. Construction ofthe west wing, with balances of prior NOA, is scheduled for 1964.)

(The building will be completed in 1964.)

3W

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ot 1

CD

Ox



TARIFF COMMISSION

Salaries and expenses. _ 151 NOAExp.

TAX COURT OF THEUNITED STATES


TENNESSEE VALLEY AUTHORITY

Public enterprise funds:Tennessee Valley Authority fund:

Power proceeds and borrow- Exp.ings 401

Appropriations and nonpower NOAproceeds 401 Exp.

Total, Tennessee Valley NOAAuthority. Exp.

UNITED STATES ARMS CONTROLAND DISARMAMENT AGENCY

General and special funds:Arms control and disarmament NOA

activities 151 Exp.


2,9502.767

1,8031.770

14.943

35,07138,506

35,07153,449

6,5002.333

3,1453,104

1,8901,870

10,000

47,14247,000

47,14257,000

7,5007,410

3,3243.310

1,9602.004

17,500

50,91550.000

50,91567.500

11,0009.200

179206

70134

7.500

3,7733.000

3,77310.500

3,5001,790

Increase anticipates larger number of public investigations, and work onSummaries of Tariff Information.


(Power revenues of $295 million, together with $75 million from revenuebonds will be used to finance power operations and a $137 millioninvestment in power system facilities, including construction ona 900,000-kilowatt power unit. Payment to the general fund willinclude $10 million for reduction of investment and a dividend of$42.2 million. Returns to the general fund and revenue bondproceeds do not effect net expenditures.)

An appropriation of $50.9 million and $25.0 million of other receipts willfinance all operating costs except power operations and provide$36.0 million for construction of navigation, chemical, and other non-power facilities. Increases are principally for added capital outlay,including second year construction on Nickajack dam and lock.

Increase will provide for additional contractual research.

uft)>

i

8


ANALYSIS OF NEW


OBLIGATIONAL

code1963

AUTHORITY

1964

AND

1965

EXPENDITURES

Increase or

( - )




UNITED STATES INFORMATIONAGENCY


Exp.

Salaries and expenses (special for- NOAeign currency program) 153 Exp.

Special international exhibitions NOA153 Exp.

Special international exhibitions NOA(special foreign currency pro- Exp.

gram 153

Acquisition and construction of NOAradio facilities 153 Exp.

Public enterprise funds:Informational media guarantee NOA

fund 153 Exp.

Total, United States Informa- NOAtion Agency. Exp.

123,090121,465

8,50010,099

7,6006,770

375524

16,15014,756

1,0001,850

156,715155,463

133,882125,500

11,75011,000

7,2007,332

450518

12,07014,150

7501,781

166,102160,281

143,800136,800

8,20011,200

7,2006,715

450485

15,11615,250

1,0001,077

175,766171,527

9,91811,300

-3,550200

-617

-33

3,0461,100

250-704

9,66411,246

Increase will provide $4.9 million for expansion of oversea programsand $3.1 million for support of worldwide television, motion picture,radio, press and publications, and information center activities.

Currencies excess to U.S. needs supplement the appropriation immedi-ately above and are used to pay local expenses.

Estimate covers exhibits at international fairs, trade missions to promoteAmercian exports, labor missions, and special exhibits in the SovietUnion, East Europe, Sao Paulo, and Venice.

Currencies excess to U.S. needs supplement the appropriation immedi-ately above and are used to pay local expenses.

Estimate for 1965 is largely to complete new transmitting facility inGreece.

Estimate will maintain the program at about the 1964 level of guarantees.

O

ioEd

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o

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U.S. STUDY COMMISSION-SOUTHEAST RIVER BASINS

General and special funds:Salaries and expenses. _ __401 NOA

Exp.

U.S. STUDY COMMISSION—TEXAS

Salaries and expenses: Reappro- NOApriation __401 Exp.

Total, other independent NOAagencies.

Exp.

552669

237106

1,285,054

293,322

167

7

1,115,485A 161

187,670A5J59

1,207,2711A -65,000|

— 19,6901A—64,998]

-167

-7

26,625

-277,517

(Final report was submitted to the President on Sept. 24, 1963. TheCommission ceased to exist on Dec. 23, 1963.)

(Final report was submitted to the President on May 28, 1962. TheCommission ceased to exist on Aug. 28, 1962.)

DISTRICT OF COLUMBIA

3

H

a

General and special funds:Federal payment to District of NOA

Columbia (proposed legislation)555 Exp.

Loans to District of Columbia for NOAcapital outlay, general fund_555 Exp.

Loans to District of Columbia for NOAcapital outlay, highway fund Exp.

Loans to District of Columbia for NOAcapital outlay, water fund. _555 Exp.

A Proposed for separate trans mittal.

32,899

32,899

18,700

1,6007,500

850

40,368

40,368

11,30015,000

1,938

3,900

53,220A 4,80053,220

M,800

8,60015,000

8006,000

3,000

1 17,652

1 17,652

-2 ,700

8004,062

-900

Amount of $50 million is to help defray expenses of the government ofthe District and $3.2 million is for water and sewer services to theFederal Government. Supplemental in 1965 will be authorized bylegislation to base the payment on a formula reflecting impact of theFederal Government on the District.

Loans are 30-year-interest-bearing, to assist in constructing facilities.

Loans are 30-year-interest-bearing, to assist highway construction.

Loans are 30-year-interest-bearing, to assist water system construction.No new loans are contemplated in 1965. 00

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ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—ContinuedCOo00Account and functional code

1963 1964 1965Explanation of NOA requests

DISTRICT OF COLUMBIA—Continued

General and special funds—ContinuedLoans to District of Columbia for NOA

capital outlay, sanitary sewage Exp.works fund 555

Federal contributions and loans to NOAthe Metropolitan area sanitary Exp.sewage works fund 555

Repayable advances to the District NOAof Columbia general fund (per- Exp.manent, indefinite) 555

Advances to stadium sinking fund, NOAArmory Board (permanent, in- Exp.definite authorization to expendfrom debt receipts) 555

Total, District of Columbia.. NOA

Exp.

3,2422,400

2,80014,500

10,0007,000

416416

69,657

65,565

8,0009,000

6,000

-10,000

656-176

60,324

66,030

5,0003,500

3,550

-656

67,620A4,80083,614

A 4,800

3,0005,500

-2 ,450

10,000

- 6 5 6- 4 8 0

12,096

22,384

Loans are 30-year-interest-bearing, to assist construction of separatestorm drainage and sanitary sewers.

No appropriation is requested in 1965. Previously authorized contri-bution ($3 million) and loans ($25 million) will complete work in 1964.

Temporary advances are made to avoid sale of investments, with laterrepayments. No advance is contemplated in 1965.

Advances are made to meet interest payments on bonds which cannotbe met from receipts.

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SPECIAL ALLOWANCES

Allowance for attack on poverty NOAExp.

Allowance for civilian pay compara- NOAbility. Exp.

A500,000A 250,000

A 544,000A 544,000

500,000250,000

544,000544,000

Legislation will be proposed to launch a coordinated Federal, State,and local attack on poverty by providing funds to supplement ex-isting and initiate new activities, under comprehensive local com-munity programs.

Proposed legislation would provide for civilian pay scales more nearlycomparable with those in private employment.


Allowance for contingencies.

Total allowances.

NOAExp.

NOAExp.

A400,000A 250,000

A400,000A 250,000

A500,000A 300,000

A 1,544.000A 1,094,000

100,00050,000

1,144,000844,000

The allowance for contingencies is to cover unforeseen needs and smalleritems of proposed legislation. Specific supplemental estimates willbe transmitted as the need arises.

GRAND TOTALS—ADMINISTRATIVE BUDGET

Total new obligational authority _

Expenditures:Subtotal

I nterfund transactions

Total expenditures

102,283,356

93,155,196

-513,397

92,641,799

98,316,970A 3,296,472

B 866,080c 74,086

97,301,169A 909,051B 849,692

c 29,472

-684,565

98,404,819

100,918,572A 2,870,013

97,261,645A 1,198,086

B 19,603c 20,450

-599,519

97,900,265

11,234,977

-589,600

85,046

-504,554

>t-1

5TRUST FUNDS

LEGISLATIVE BRANCH

Library of Congress: Gift and trustfund income accounts 704

THE JUDICIARY

Judicial survivors annuity fund __ 654

NOAExp.

NOAExp.

11

,630,723

658416

1,6271,707

680440

1,6671,789

690440

4082

10

Income of the gift fund and other gifts and receipts are devoted to ad-vancing the work of the Library.

Pays annuities to dependents of deceased judges, refunds to formerjudges and claims of survivors in certain cases.

A Proposed for separate transmittal.B Proposed for separate transmittal, Uniformed Services Pay Act of 1963.c 1964 appropriation pending in Congress.

COoCO


ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—ContinuedCO

©Account and functional code1963 1964 1965 Increase or


TRUST FUNDS-Continued

FUNDS APPROPRIATED TO THEPRESIDENT

Agency for International Develop- NOAment trust funds 152 Exp.

Peace Corps gifts and donations. 152 NOAExp.

Total, funds appropriated to NOAthe President. Exp.


Miscellaneous contributed funds. 351 Exp.

354 NOAExp.

355 NOAExp.

Farmers Home Administration (trust Exp.revolving fund) 352

Forest Service: Cooperative work__ NOA402 Exp.

Total, Department of Agri- NOAculture. Exp.

3,6241.015

12770

3,7511,085

479533

24,91924,226

-518

25,63521,016

51,03545.258

3,0003,120

153206

3,1533,326

45

636591

26,96726,831

1,056

27,17523,200

54,77851,723

3,0003,110

215210

3,2153,320

700660

27,20727,280

577

26,91023,000

54,81751,517

-10

624

62-6

-45

6469

240449

-479

-265-200

39-206

These funds are advances by foreign governments to pay for local costsof development grant and other mutually agreed upon programs.The activity level is expected to remain about the same as in 1964.

Gifts and advances from foreign governments are used in the program.

(Receipts, mostly from States and local organizations, are used in workunder cooperative agreements with ASCS.)

Receipts, mostly from States and local organizations, are used in workunder cooperative agreements with SCS.

Fees are used for inspection and grading services of AMS and ARS.Other receipts are used under cooperative agreements.

(Funds, of 39 States are administered in insured loan programs withinthose States.)

Advances from others are used in cooperative work, such as reforestation,in forests and on land adjacent to forests.

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DEPARTMENT OF COMMERCE

Bureau of Public Roads highwaytrust fund: 503

Contract authorization NOACurrent appropriation NOAReceipts to liquidate contract au-

thorization and finance cur-rent appropriation:

(Excise taxes)(Interest on investments)

Exp.

Bureau of Public Roads internationaltrust funds: 152


thorization and finance current Exp.appropriation.

Miscellaneous trust funds, Bureau ofPublic Roads: 503


thorization and finance current Exp.appropriation.

Other miscellaneous trust funds.506 NOAExp.

502 NOAExp.

Total, Department of Com- NOAmerce. Exp.

3,580,0192,000

(3,278,698)(14.268)

3.016.701

5,639282

(4.714)4,802

1,630331

(1.567)2,021

3,5343,713

17,78915.322

3,611,2243.042.560

3,705,000500

(3,478,000)(6,000)

3,551,000

9,561

(6,040)7,534

(1.360)2,776

4,2404,196

21,71415,512

3,741,0153,581,018

3,805,000

(3,553,000)(6,000)

3,650,000

4,958630

(7,078)5.394

1,200

1,200

3,8713,9061,349

12,564

3,817,0083,673,064

100,000-500

(75,000)

99,000

-4,603630

(1.038)- 2 J 4 0

1,200(-1.360)-1,576

-369-290

-20,365-2,948

75,99392,046

Contract authorization granted by Congress is explained in non-addentry under Administrative Budget items for Commerce above.Receipts of the fund liquidate portions of the contract authorization.Proposed legislation will shift aviation and motorboat gas taxrevenues to General Fund. Expenditures are mainly in the formof grants to States, but also include outlays for administration andresearch ($48.8 million in 1965).

Advances from other countries are used for cooperative work andtechnical assistance.

Advances from other Federal agencies, States, local governments, andnongovernmental interests are used for special services requested bythose who pay.

Gifts, donations, advances from individuals and firms, proceeds fromsale of documents, and bond sale receipts held in escrow are used tofinance projects and activities to which the receipts are dedicated.

W

CO


ANALYSIS OF NEW


OBLIGATIONAL

code1963

AUTHORITY AND EXPENDITURES





00to

DEPARTMENT OF D E F E N S E -MILITARY

Miscellaneous trust funds 051 NOAExp.

Military assistance advances 051Contract authorization NOAReceipts to liquidate contract

authorization. Exp.

Total, Department of De- NOAfense—Military. Exp.

DEPARTMENT OF DEFENSE—CIVIL

Corps of Engineers advances and NOAcontributed funds 401 Exp.

U.S. Soldiers Home, receipts appro-priated:

Current appropriation 805 NOAPermanent appropriation NOA

Exp.

5,5495,116

886,187(838,306)673,736

891,736678,852

27,56622,171

6,2723

6,990

5,0915,131

1,682,300(990,500)860,000

1,687,391865,131

20,95634,000

6,7423

7,505

5,0905,081

1,324,800(1,290,000)1,225,000

1,329,8901,230,081

18,84419,975

6,8883

6,853

- 1- 5 0

-357,500(299,500)365,000

-357,501364,950

-2,112-14,025

146

-652

Receipts include gifts, donations and bequests used for specified pur-poses. Funds also include ships' stores profits used for benefit ofnaval personnel, and the USS Arizona memorial fund.

Contract authorizations based on agreements with foreign governmentsfor the sale of military materiel are lower in 1965 because of con-clusion in 1964 of agreements with certain countries covering 2 years'sales.

Advances and contributions from local interests are used in constructionand maintenance work. Unused balances are returned.

Receipts include fines, forfeitures and pay stoppages of Army and AirForce enlisted personnel. Current appropriations are for mainte-nance and capital outlay. Receipts unappropriated are (in thou-sands): 1963, $3,880; 1964, $3,180; 1965, $3,034. Refunds arepermanently authorized.

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V.S. Soldiers Home, trust revolving Exp.fund 805

Total, Department of De- NOAfense—Civil. Exp.

DEPARTMENT OF HEALTH,EDUCATION, AND WELFARE

Federal old-age and survivors insur- NOAance trust fund 654

Receipts appropriated:(Employment taxes)(Deposits by States)(Interest on investments)(Payments for military service

credits.)(Other)

Expenditures: Exp.(Benefit payments)(Administrative expenses and

construction.)(Payment to Railroad Retire-

ment Board.)

Disability insurance trust fund_ 654 NOAReceipts appropriated:

(Employment taxes)(Deposits by States)(Interest on investments)(Payment for military service

credits.)Expenditures Exp.

(Benefit payments)(Administrative expenses)(Payment to Railroad Retire-

ment Account.)A Proposed for separate transmittal.

(13,842,660)

12,338,191989,571514,822

10

33,84129,171

(15,873,553)

14,242,0001,100,000531,476

76(14,529,710)13,844,584

262,603

422,523

(1,146,256)

994,76381,85869,635

(1,259,214)1,170,678

68,92719,609

27,70141,505

76(15,358,634)14,629,000

306,634

423,000

(1,198,387)

1,050,00081,00067,387

(1,345,179),255,00070,17920,000

25,73526,828

(16,271,163)

14,531,0001,128,000

556,085A 56,000

77(16,090,671)15,376,000

296,171

418,500

(1,227,622)

1,076,00083,00064,622

A4,000

(1,427,794)1,324,000

85,29418,500

- 1 , 9 6 6-14,677

(397,610)

289,00028,00024,60956,000

1(732,037)747,000

-10,463

-4,500

(29,235)

26,0002,000

-2,7654,000

(82,615)69,00015,115

-1 ,500

(Fund finances certain supply inventories of the Home.)

The Social Security program provides insurance against the loss of in-come due to death, retirement, or disability. Receipts are primarilyfrom taxes on employers, employees, and self-employed. Receiptsnot immediately needed are invested at interest in U.S. securitiesuntil payments exceed receipts. In addition to receipts shown in1963, $28,000 thousand received in taxes were unappropriated atyear end, but required no congressional action.

The number receiving monthly benefits at the end of each fiscal yearare as follows (in thousands):

1963 1964 1965actual estimate estimate

Retired individuals! 12,600 13,372 13,991Disabled dependents 151 172 * 192Survivors2 4,475 4,744 4,966

1 Includes wives under retirement age who have children intheir care.

2 Includes children of retired workers.

The disability insurance provisions of the Social Security Act are ad-ministered largely under this separate fund. Receipts are mainlyfrom taxes on employment. Funds not immediately needed are in-vested in U.S. securities until required.

The number receiving monthly benefits at the end of each fiscal year isas follows (in thousands):

1963 1964 1965

Disabled, and their dependents.actual1,404 1,564 1,729

oo

3


ANALYSIS OF NEW


OBLIGATIONAL

code1963



(-)

TRUST FUNDS^-Continued



CO

DEPARTMENT OF HEALTH, EDUCA-TION, AND WELFARE—Continued


655 Exp.

Total, Department of Health, NOAEducation, and Welfare.

Exp.


Indian tribal funds . _409 NOAExp.


403 NOAExp.

404 NOAExp.

405 NOAExp.

541556

14,989,458

15,789,473

69,71166,871

2,1062,179

1,617,245

,360,310

1,211,986

872748

17,072,812

16,704,561

50,91169,250

1,7651,798

1,3741,300

1,4291,470

1,0112,143

228447

17,439,013A 60,000

17,518,912

44,29354,183

1,4501,576

1,3861.300

1,4741,470

511855

-644-301

I 396,966}

814,351

-6,618-15,067

-315-222

12

45

-500-1,288

Gifts and contributions are expended for specified purposes, or are usedto further the work of the Public Health Service.

Certain funds of Indian tribes are maintained in trust and administeredby the Secretary for their benefit.

Non-Federal advances are deposited for shared land managementactivities and for construction of power and reclamation facilities.

States, counties, municipalities and private sources contribute fundsfor minerals and mining research.

Contributions and receipts are used for fishery products inspection, sealamprey control and other work of the Fish and Wildlife Service.

Donations are mainly used for specified purposes of the National ParkService.

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409 NOAExp.

Total, Department of the NOAInterior. Exp.

DEPARTMENT OF JUSTICE

Alien property trust revolving funds Exp.151

Federal prison system trust revolv- Exp.ing fund 908

Total, Department of Justice. Exp.

DEPARTMENT OF LABOR

Unemployment Trust Fund 654 NOAReceipts appropriated:

(Deposits by States) 654(Federal unemployment taxes):

652654

(Railroad unemployment in-surance taxes) 654

(Railroad unemployment in-surance—other) 654

(Advance from revolving fund)652

(Interest on investments) . _652(Advances for temporary un-

employment compensation)654


4,6434,831

80,64878,419

31,688

18

31,706

(4,260,542)

3,008,934

945,242

149,798

44,982

-81,912

191,1072,392

4,5874,686

61,07780,647

51,867

51,867

(4,191,829)

2,901,090

896,482

147,000

31,000

216,257

4,7844,801

53,89864,185

22,290

22,290

(3,932,809)

2,825,000

537,000170,000153,800

18,200

228,809

197115

-7,179-16,462

-29,577

-29,577

(-259,020)

76,090

-359,482170,0006,800

-12,800

12,552

Certain revenues from Indian reservations, agencies, and schools are usedfor support of schools and agency functions.

(Seized property of enemy nations of World War II or their nationalsis being liquidated and used for payment of claims and settlements.)

(Profits from sales of sundries in prison commissaries are used for thebenefit of prison inmates.)

The fund combines financial activities of the Federal-State and railroadunemployment systems. Payroll taxes of employers are the principalsource of receipts. States and the Railroad Retirement Board drawupon the funds to pay weekly benefits to unemployed eligibles. Re-cently enacted legislation will increase employer contributions forrailroad unemployment to fully fund requirements, and other pro-posed legislation will improve benefits under the Federal-Statesystem. In addition to receipts shown, $126 thousand were un-appropriated at year end, but required no congressional action. Re-ceipts in 1963 and 1964 included repayments of advances to Statesfor temporary extended unemployment benefits. Decrease in 1965receipts reflects the completion of repayments in 1964.

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ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—ContinuedCo





DEPARTMENT OF LABOR—Continued

Unemployment Trust Fund—ContinuedExpend itures: Exp.

(Withdrawals by States) _ _ .654(Railroad unemployment bene-

fits) 654(Federal extended benefits) _ 654(Administrative expenses):

652654

(Temporary extended unem-ployment compensation bene-fits) 654

(Repayment of advances fortemporary extended benefits)

654(Repayment of adyances for

temporary unemploymentcompensation) 654

(Other) 654

Bureau of Employees' Compensation NOAtrust funds 906 Exp.

Miscellaneous trust funds 652 Exp.

Total, Department of Labor. NOAExp.

(3,815,459)2,812,637

166,744

347,9728,840

-14,873

466,327

27,812

39160

4,260,5813,815,624

(3,555,408)2,550,000

152,210

422,4009,300

302,500

93,381

25,617

39121

4,191,8683,555,535

(3,442,561)2,450,000

150,000

A 170,000

452,0008,600

190,000

21,961

3998

10

3,932,8483,272,6691A170,000]

(-112,847)-100,000-2,210

170,000

29,600-700

-302,500

96,619

-3,656

-23

4

-259,020-112,866

(The average rate of insured unemployment during 1963 was 4.4 percent;the estimate for 1964 is 3.8 percent, and for 1965, 3.7 percent.)

Receipts are from employers on the deaths of employees without eligiblesurvivors, and from fines and penalties. Payments include certainpermanent disability cases and rehabilitation maintenance benefits.

(Includes advances from others for labor statistics.)

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DEPARTMENT OF STATE

Foreign Service retirement and dis- NOAability fund____ 654

Receipts appropriated:(Employing agency contribu-

tion.)(Deduction from salaries)(Interest on investments)

Miscellaneous trust funds 151

153

152

Total, Department of State. _

NOA

NOANOAExp.

NOAExp.

NOAExp.

NOAExp.

NOAExp.

TREASURY DEPARTMENT

National defense conditional gift NOAfund 059 Exp.

Foreign claims fund 151 NOAExp.

Coast Guard general gift fund, __502 NOAExp.

Miscellaneous trust fund___, 904 NOAExp.

Total, Treasury Department, NOAExp.


(8,232)

3,136

3,6351,4617.085

78

31

100184

8,3427.278

45

616,445

63

16,24416.224 .

16,31522,677

(8,550)

3,370

3,6301,5507,580

4440

108

198250

8,8027,878

7,6001,053

3035

16,83617,752

24,46618,840

(8,903)

3,519

3,7841,6008,413

211

109

189300

9,1048,733

1,9001,205

66

17,53317,603

19,43918,814

(353)

149

15450833

-42-29

1

- 950

302855

-5,700152

-24-29

697-149

-5,027-26

A retirement and disability system for Foreign Service officers and mostForeign Service staff officers and employees is maintained. Employ-ing agencies match employee payments of 6%% of basic salaries.Approximately 1,261 annuitants will be receiving benefits at the endof 1965. Fund balances are invested in interest-bearing U.S. securi-ties.

Ford Foundation contribution increases 1964 receipts above normallevel.

These funds, mainly from gifts, are for educational exchange.

Advances from foreign governments for training and other services willcontinue in 1965 at about the 1964 level.

Decrease represents change in receipts for Polish claims fund from$7,600 thousand in 1964 to $1,900 thousand in 1965.

Decrease results from nonrecurring expenditure for a swimming poolgiven to the Coast Guard Yard, Curtis Bay, Md.

Increase is principally estimated work volume and increased salary costsfor Customs activities in Puerto Rico and the Virgin1 Islands.



00


decreas)

Explanation of N0A requests

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Advances for non-Federal projects. _ NOA058 Exp.


Miscellaneous trust funds. __ 501 NOAExp.

GENERAL SERVICES ADMINISTRATION

National Archives trust revolving Exp.fund 905

Miscellaneous trust funds 905 NOALiquidation of contract authori-

zation ___ _ Exp.

Total, General Services Ad- NOAministration. Exp.

274125

419

4

259(1.742)2,168

2592,173

2,0742,223

36

- 6 9

30(254)431

30362

1,3281,328

- 6 0

30

77

3017

- 7 4 6- 8 9 5

- 3 6

9

(-254)

-345

Advances from the Washington Public Power Supply System are forwork related to construction of electric facilities at Richland, Wash.

(State, local, and private advances for air navigation facilities, in prioryears, are used as intended.)

(Microfilm and reproduction service and admission fees to 3 Presidentiallibraries are used for operations.)

Receipts from the FDIC liquidate authority for GSA to construct a $7million building in Washington. The substantially completed build-ing was occupied in May 1963. Grants from foundations are usedfor historical research.


HOUSING AND HOME FINANCEAGENCY

Federal National Mortgage Associa- NOAtion, secondary market opera- Exp.tions, trust revolving fund(authorization to expend cor-porate debt receipts) 551

NATIONAL AERONAUTICS ANDSPACE ADMINISTRATION

I nternational cooperation 251 NOAExp.

Gifts and donations 251 NOAExp.

Total, National Aeronautics NOAand Space Administration. Exp.

VETERANS ADMINISTRATION

Life insurance funds 805 NOAReceipts appropriated:

(Premiums and other operating NOAreceipts.)

(Payments from general and NOAspecial funds.)

(Interest on investments) NOAExp.


Total, Veterans Administra- NOAtion. Exp.

207,840-730,222

1

1

(709,548)

493,659

5,753

210,136826,226

1,8891,661

711,438827,887

100,00029,872

2,000500

1

2,001500

(717,169)

501,236

7,089

208,844632,701

1,8951,703

719,064634,404

147,000138,000

1,500

1

11,500

(711,983)

498,754

5,838

207,391486,819

1,9051,715

713,888488,534

47,000108,128

-2,0001,000

-2,0001,000

(-5,186)

-2,482

-1,251

-1,453-145,882

1012

-5,176-145,870

Mortgage purchases of $490 million will include $40 million acquired inexchange for U.S. securities; receipts will include sales of $150 million(par) of mortgages. Private equity of $128 million will exceed Gov-ernment equity of $106.8 million at year end, primarily because oftrust fund purchase of Treasury preferred stock in 1964.

No new receipts are expected,equipment purchases.

No increase is expected.

NOA in 1964 is advance from Italy for

The National Service (World War II) and U.S. Government (WorldWar I) Life Insurance funds will cover 5,072,000 policies, $32.5billion of insurance in force at end of 1965. Premium receipts andinterest earned thereon are available for the payment of liabilities.The decrease in expenditures results from the acceleration of divi-dends into 1963 and 1964. Fund balances are in U.S. securities;assets exceeded actuarial liabilities by $79 million at June 30, 1963.

Gifts and other receipts are used for welfare of veterans at homes andhospitals.

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ANALYSIS OF NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES BY AGENCY (in thousands of dollars)—Continued CO

SAccount and functional code

1963 1964 1965stimate

Increase ordecreas Explanation of NOA requests


OTHER INDEPENDENT AGENCIES

American Battle Monuments Com-mission contributed fund 805

Civil Service Commission: Civilservice retirement and disabilityfund 654

Receipts appropriated:(Employing agency contribu-

tions.)(Deductions from salaries)(Voluntary contributions, etc.)(Interest on investments)

NOAExp.

NOA

NOA

NOANOANOAExp.

Exp.Employees health benefits fund(trust revolving fund).

Employees life insurance fund Exp.(trust revolving fund).

Retired employees health benefits Exp.fund (trust revolving fund).

Federal Communications Commis- Exp.sion trust revolving fund 508

Foreign Claims Settlement Commis- NOAsion war claims fund 151 Exp.

75

(2,247,055)

920,853

920,75243,191362,259

1,175,887

-12,326

-32,239

-143

10

24,250128

46

(2,382,000)

945,000

945,00075,000

417,0001,336,582

-14,665

-50,265

166

47,50022,000

33

(2,391,000)

958,000

958,00013,000

462,0001,490,220

-2,728

-52,088

-187

118,75066,000

- 1- 3

(9,000)

13,000

13,000-62,00045,000153,638

11,937

-1,823

-353

71,25044,000

Contributions for flowers and for repair of non-Federal war memorialsare used as intended.

Most civilian workers are covered by this fund. Employees and em-ploying agencies each pay 6}i% of basic salaries. About 725 thousandpersons are expected to be on annuity rolls by June 1965. Fundbalances are invested in U.S. securities. Receipts under Contribu-tions include $30 million in 1963 and $62 million in 1964 from generalfunds under Public Law 87-793. Pending legislation would eliminatethe need for an appropriation of $65 million in 1965.

(Employees health benefits fund will have 2,100,000 participants; em-ployees life insurance fund 2,525,000, and retired employees healthbenefits fund, 231,600.)

(Fund is used as clearinghouse for settlements with foreign govern-ments on radiotelephone and radiotelegraph messages.)

Alien property fund receipts are appropriated for claims under theGeneral War Damage Claims Act.

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ox


General Accounting Office trust fund NOA904 Exp.

Historical and Memorial Commis-sions:

Civil War Centennial Commis- Exp.sion, donations 910

Battle of Lake Erie Sesquicen- NOAtennial Celebration Commis- Exp.sion, donations 910

National Capital Housing Authority Exp.trust revolving fund 555

National Capital Planning Commis- NOAsion contributed fund 555 Exp.

National Science Foundation dona- NOAtions 703 Exp.

Railroad Retirement Board: Rail- NOAroad retirement account 654

Receipts appropriated:(Employment taxes) NOA(Interest on investments) NOA(Payment from OASI trust NOA

fund.)(Payment from Federal dis- NOA

ability insurance trust fund.)(Payment for military service NOA

credits.)(Other) NOA

Expenditures: Exp.(Benefit payments) Exp.(Administrative expenses) Exp.(Advances for unemployment Exp.

insurance.)

45

-2,437

75202

22

(1,115,341)

559,049105,214422,523

19,609

8,946(1.111.533)1,064,001

9,83337,699

68

11

1,459

602804

22

(1,218,324)

633,724131,900423,000

20,000

9,700(1,128,950)1,100,000

10,95018,000

66

1

856

22

(1,279,134)

682,000133,700418,500

18,500

13,834

12,600(1,143,500)1,125,000

10,5008,000

-2

1

-1-1

-603

-602-804

(60,810)

48,2761,800

-4,500

-1,500

13,834

2,900(14,550)25,000-450

-10,000

6 Estates are held in trust for legal claimants.

(Donations are used under the terms received.)

Donations are used under the terms received.

(Activity of $18.6 million involves 11,000 housing units.)

One-half the cost of land for the George Washington Memorial Parkwayis contributed by Maryland and Virginia.

Donations received are used in furtherance of general purposes of theFoundation.

The Railroad Retirement system serves as a combined social insuranceand staff retirement system for workers in the railroad industry.Recent legislation, increasing contributions by railroad employees andemployers, results in an increase in receipts. Funds are recommendedto fulfill the Government's obligation for time spent in militaryservice. Trust fund balances are invested in interest-bearing U.S.securities. The number receiving monthly benefits at the end of eachfiscal year is as follows (in thousands):

1963 1964 1965actual estimate estimate

Retired individuals. _ 489 504 517Disabled, and their dependents 101 101 102Survivors 277 286 294

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00

3ANALYSIS OF NEW


OBLIGATIONAL

code1963






OTHER INDEPENDENT AGENCIES-Continued

Smithsonian Institution trust fund.. NOA704 Exp.

Tax Court of the United States trust NOAfund 904 Exp.

United States Information Agency NOAtrust funds 153 Exp.

Total, other independent NOAagencies. Exp.

DISTRICT OF COLUMBIA

District of Columbia receipts appro-priated:

Current appropriations 555 NOAPermanent appropriations 55 5 NOA

Exp.

DEPOSIT FUNDS

Federal agencies Exp.

1010

264

266

3,386,7962,240,648

344,1841,646

333,546

145,667

1919

2612

4658

3,648,5302,425,137

346,7971,608

395,613

-115,855

1516

2612

5054

3,788,9862,645,667

416,9511,598

417,055

-16,892

- 4- 3

4- 4

140,456220,530

1 70,144

} 21,443

98,963

Donations, subscriptions, and fees are used for part of cost of the CanalZone Biological Area.

Judges pay 3% (currently $6 thousand) and the Government pays theremainder ($20 thousand) to finance survivors annuity system.

Business concerns contribute toward exhibits. Donations are receivedto acquire and ship books abroad. Sale of films is also financed here.

Funds of the municipal government are accounted for through U.S.Treasury as trust funds. Congressional appropriations of municipalfunds are required currently for most municipal activities.

(Net change in suspense account balance is reported here.)

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GOVERNMENT-SPONSOREDENTERPRISES

Farm Credit Administration:Banks for Cooperatives 352 Exp.

Federal Intermediate Credit Exp.Banks 352

Federal Land Banks 352 Exp.

Federal Home Loan Bank Board:Home loan banks 551 Exp.

Federal Deposit Insurance Corpora- Exp.tion 506

Total, Government-sponsored Exp.enterprises.


Expenditures:

Subtotal

Interfund transactions

Total expendituresA Proposed for separate transmittal.

29,289

276,889

176,418

363,215

-160,546

685,266

40,000

226,645

180,000

1,200,000

-180,000

1,466,645

40,000

233,000

140,000

-100,000

-202,000

111,000

6,355

-40,000

-1,300,000

-22,000

-1,355,645

(Bank operations are financed by $80.9 million of Government capitaland $80.1 million of private capital as of June 1963.)

(Bank operations are financed by $115.0 million of Government capitaland $49.9 million of private capital as of June 1963.)

(Bank operations are wholly privately owned enterprise.)

(Bank operations are wholly privately owned enterprise.)

(Premium receipts and interest on investments in U.S. securities exceedcurrent claims and expenses; corporation has no capital stock.)

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4

GRAND TOTALS—TRUST FUNDS

28,601,661

27.050,078

-504,847

26,545,231

31,695,474

29,803,115

-487,960

29,315,155

31,757,106A 60,000

29,678,851A170,000-476,949

29,371,902

121,632

-45,736

11,011

-56,747

CO

IS


CO

ANALYSIS OF NEW


OBLIGATIONAL

code1963

AUTHORITY AND EXPENDITURES BY


(-)

MEMORANDUM—ANNEXED BUDGETS

AGENCY (in

Explanat

thousands of dollars) —Cont inued

ion of NAO requests

Department of Agriculture:Milk Marketing Administration:

Not included above Exp.Treasury Department:

Comptroller of the Currency:Included under "Deposit funds" Exp.

above.*Exchange Stabilization Fund:

Included under "Deposit funds" Exp.above.

Operating expenditures Exp.Other Independent Agencies:

Board of Governors of Federal Re-serve System:

Not included above* Exp.

Farm Credit Administration:Banks for Cooperatives:

Included under Government- Exp.sponsored enterprises above.

Included under "Deposit Exp.funds" above.

Not included above Exp.

Total. Exp.

-41

-1 .267

-3 .706

(3,068)

5

29,289

304

-27.190

2.403

- 6

-506

(2.990)

-112

40.000

150

16.725

56,875

-500

(2,997)

152

40,000

-16,150

23,850

6

6

(7)

264

-150

-32,875

-33,025

(Operations are financed by assessments on regulated milk handlers.)

(Operations are financed primarily by assessments from national banks.)

(The fund is financed by $200 million of Government capital and byearnings. Operating expenditures for 1964 and 1965 have beenestimated by the Bureau of the Budget.)

(Operations are financed by levies upon the Federal Reserve Banks, inproportion to their capital and surplus.)

(Loan program is estimated to continue at slightly over $1 billion ayear. Repayments of loans and other income will be supplementedby borrowing from the public of $56.7 million in 1964 and $23.8million in 1965. Government capital is being retired by nearly $12million in each of these 2 years. See further explanation underGovernment-sponsored enterprises, above.)

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to


Federal intermediate creditbanks:


Included under "Deposit Exp.funds" above.

Not included above Exp,

Total

Federal Deposit Insurance Cor-poration:


Included under "Deposit funds" Exp.above.

Total

Total:Included under Government- Exp.

sponsored enterprises above.Included under "Deposit funds" Exp.

above.Not included above Exp.

Total, annexed budgets Exp.

276,889

-1,218

-7,950

267,720

-160,546

1,615

-158,931

145,632

-4,272

-35,176

106,183

226,645

-1,382

10,550

235,813

-180,000

1,000

-179,000

86,645

-738

27,157

113,064

233,000

-1,950

231,050

-202,000

-1,000

-203,000

71,000

-3.450

-15,998

51,552

6,355

-568

-10,550

-4,763

-22,000

-2,000

-24,000

-15,645

-2,712

-43,155

-61,512

(Loan program is estimated at $5 billion for 1965, which is approxi-mately $300 million more than the estimated loans for 1964. Repay-ments of loans and other income will be supplemented by borrowingfrom the public of $237 million in 1964 and $235 million in 1965.Government ownership of capital stock is being increased by $9million in 1964 and $8.4 million in 1965. See further explanationunder Government-sponsored enterprises, above.)

(Approximately $179 billion of deposits in 13,455 banks were insured asof Dec. 31, 1962, and this amount continues to grow with expansionof the population and the economy. The cumulative net income,which is being retained as a reserve, is estimated to be approximately$2.8 billion by June 1964 and $3.0 billion by June 1965. The principalrevenues are from insurance assessments (approximately $100 millionfor 1964 and $117 million for 1965) and interest on investments ($97million and $103 million for the same 2 years). The estimates forthese years are the Bureau of the Budget's. See further explanationunder Government-sponsored enterprises, above.)

3

: Amounts reported are on a calendar year basis.

GO

Or


PART 6

SPECIAL ANALYSES

327


SPECIAL A N A L Y S I S A

THREE MEASURES OF FEDERAL FINANCIAL TRANSACTIONS

Data on Government financial transactions are used for manypurposes. No single set of accounts can serve all purposes equallywell. As a result, various budget concepts and forms have been de-veloped to meet different needs. The three measures of Federalreceipts and expenditures most commonly used are: (1) the adminis-trative budget, (2) the consolidated cash statement of Federal transac-tions, and (3) the Federal sector of the national income accounts.A reconciliation of these three measures is presented in table A-l.

ADMINISTRATIVE BUDGET

The administrative budget covers receipts and expenditures offunds owned by the Federal Government—the general fund, specialfunds, public enterprise funds, and intragovernmental revolving andmanagement funds. Although budget documents placed before theCongress have regularly included both federally owned funds andfunds held in trust by the Government, only the former have beentraditionally used to calculate budget totals.

For many years, the administrative budget served as the principalfinancial plan for conducting the affairs of Government. It repre-sented a focal point for management and decisionmaking with respectto Government activities. As long as almost all Federal financialtransactions were carried out with federally owned funds, the ad-ministrative budget provided adequate coverage.

In recent years, however, trust fund operations have grown rapidly.Several major parts of the Government's program are now carriedout through trust funds, particularly those for labor, welfare, andhighway activities. This means that the flow of financial transactionsbetween the Federal Government and the public is considerablylarger than is indicated by the administrative budget.

CONSOLIDATED CASH STATEMENT

The consolidated cash statement of Federal receipts and paymentsis designed to show the total flow of financial transactions (excludingborrowing) between the Federal Government and the public. It ismore comprehensive and complete than the administrative budgetin that it includes the receipts and expenditures of trust funds aswell as funds wholly owned by the Federal Government. Since theconsolidated cash statement measures the Government's flow ofcash to and from the public, intragovernmental transactions (trans-actions between budget and trust fund accounts) are excluded andpayments are put on a checks-paid basis. The consolidated cashstatement is useful for determining Government financing and netborrowing requirements and for analyzing the financial impact of theGovernment's overall activities.

328


SPECIAL ANALYSES 329

Table A-1. RELATION OF FEDERAL RECEIPTS AND EXPENDITURES INTHE ADMINISTRATIVE BUDGET, CONSOLIDATED CASH STATEMENT,AND NATIONAL INCOME ACCOUNTS, 1963-65

[In billions of dollars]

1963actual

1964estimate

1965estimate

RECEIPTS

Administrative budget receiptsPlus: Trust fund receiptsLess: Intragovernmental transactions

Receipts from exercise of monetary authorityEquals: Federal receipts from the public

Adjustments for agency coverage:Less: District of Columbia revenues

Adjustments for netting and consolidation:Plus: Contributions to Federal employees' retirement

funds, etcLess: Interest, dividends, and other earnings

Adjustments for timing:Plus: Excess of corporate tax accruals over collections,

personal taxes, social insurance contributions,etc

Adjustments for capital transactions:Less: Realization upon loans and investments, sale of

Government property, etcEquals: Receipts—national-income accounts

EXPENDITURES

Administrative budget expendituresPlus: Trust fund expenditures (including Government-

sponsored enterprise expenditures, net)Less: Intragovernmental transactions

Debt issuance in lieu of checks and other adjust-ments

Equals: Federal payments to the publicAdjustments for agency coverage:

Less: District of Columbia expendituresAdjustments for netting and consolidation:

Plus: Contributions to Federal employees' retirementfunds, etc

Less: Interest received and proceeds of Government sales_Adjustments for timing:

Plus: Excess of interest accruals over interest payments..Excess of deliveries over expenditures and other

itemsLess: Commodity Credit Corporation foreign currency

exchangesAdjustments for capital transactions:

Less: Loans—Federal National Mortgage Associationsecondary market mortgage purchases, redemp-tion of International Monetary Fund notes, etc_.

Trust funds (including Government-sponsored en-terprise expenditures, net) and deposit fund items

Purchase of land and existing assets and otheritems

Equals: Expenditures—national-income accounts

86.427.74.3

*

109.7

.3

1.91.1

.6

1.5109.3

92.6

26.54.3

1.1113.8

.3

1.9.6

.9

.3

.7

1.9

.1112.6

88.430.24.1

.1114.4

.4

1.91.2

1.1113.6

98.4

29.34.1

.9122.7

.4

1.9.6

- . 4

.3

1.1

3.4

.1119.1

93.030.94.1

.1119.7

.4

1.91.3

- . 2

1.0118.8

97.9

29.44.1

.5122.7

.4

1.9.9

.6

.6

.1

.2

2.6

.1121.5

*Less than $50 million.



FEDERAL SECTOR OF THE NATIONAL INCOME ACCOUNTS

The Federal sector of the national income and product accounts isdesigned to provide a measure of the direct impact of Federal fiscalactivity on the Nation's current flow of income and output.

Like the consolidated cash statement, the Federal sector account ismore comprehensive than the administrative budget in that it in-cludes most trust fund transactions. However, in contrast both tothe consolidated cash statement and the administrative budget, onlythose receipts and expenditures which directly affect the current flowof income and output are recorded. Therefore, the Federal sector ofthe income and product accounts excludes transactions involvingpurely financial claims and exchanges of secondhand or existingassets; such transactions represent neither the production of currentoutput nor incomes earned in production, even though they have in-direct effects on the level or composition of economic activity.

Further, both the administrative budget and consolidated cashstatement count business tax receipts, like other receipts, as theyare collected. In contrast, the Federal sector account records somebusiness tax receipts, particularly corporate income taxes, as theyaccrue, on the grounds that the main economic impact of these taxesis more closely associated with the accrual of liabilities than withactual cash collections. Also, the Federal sector records most pur-chases of goods and services when delivery is made, while the admin-istrative budget and consolidated cash statement count expendituresat the time of payment.

RELATIONSHIP OF CONSOLIDATED CASH STATEMENT TO THEADMINISTRATIVE BUDGET

Certain adjustments are needed to derive the consolidated cashstatement from administrative budget totals, as summarized intable A-l.

1. Trust funds.—In addition to administrative budget receipts andexpenditures, the consolidated cash statement covers the financialtransactions of Federal trust funds (including Government-sponsoredenterprises). Accordingly, excise taxes that support the highway trustfund, employment taxes, deposits by States for unemployment insur-ance, veterans life insurance premiums, and other trust fund receiptsare included along with the corresponding trust fund disbursements.

2. Intragovernmental transactions.—Administrative budget receiptsinclude amounts paid into the Treasury by trust funds. (Theseamounts are also reported as trust fund expenditures.) Similarly,there are trust fund receipts, such as interest on trust fund holdingsof U.S. securities, which are also reported as administrative budgetexpenditures. In consolidating the transactions of budget and trustfunds, these intragovernmental transactions are eliminated from thecombined receipts and expenditures since no exchange of cash withthe public is involved in these operations.



Table A-2. INTRAGOVERNMENTAL TRANSACTIONS EXCLUDED FROMTHE CONSOLIDATED CASH STATEMENT

[In millions of dollars]

Description

Administrative budget receipts which are trust fund expendi-tures:

Franchise taxes from Government-sponsored enterprises._ ___Dividends, interest, etc., from Federal National Mortgage

AssociationReimbursements for expenses and servicesRepayment of advances from unemployment trust fund and

other _ .

Total, administrative budget receipt items

Trust fund receipts which are administrative budget expendi-tures:

Interest on trust fundsContributions for military service creditsPayments to District of Columbia (including Federal grants-

in-aid)Employing agencies' payments to employees' retirement funds. _Awards to Indian tribal fundsAdvances to unemployment trust fundContributions to veterans' life insurance funds._ _Other

Total, trust fund receipt itemsDeductions from employees' salaries for retirement

Total, intragovernmental transactions _

1963actual

5

2762

816

909

1,477

88947

15- 8 0

61

2,454917

4,281

1964estimate

5

3165

403

504

1,589

951,003

7

71

2,702941

4,147

1965estimate

5

2167

190

282

1,66974

134953

3

61

2,839954

4,075

3. Exercise oj monetary authority.—These receipts are now mostlyfrom seigniorage; that is, they represent the difference between thecost of the metal and minting of coins, on the one hand, and the actualvalue of the coins as money on the other. Seigniorage is included inadministrative budget receipts, but is not a cash receipt from thepublic.

4. Debt issuance in lieu oj checks.—In a few cases, Governmentexpenditures are made by issuing bonds or notes, or increasing thevalue of bonds outstanding in lieu of issuing checks. Such transac-tions are recorded in the administrative budget as expenditureswhen the debt is thus increased, even though no cash outflow takesplace until the debt instrument is redeemed.

For example, the administrative budget records interest on savingsbonds when it accrues (and is added to the redemption value currentlypayable) rather than when it is actually paid. In computing cashpayments to the public, interest payments are included only when thebonds are cashed. Therefore, an adjustment is made for the differencebetween the amount of interest accrued and the amount paid.



Table A-3. DEBT ISSUANCE IN LIEU OF CHECKS, NET (in millions of dollars)

Description1963

actual1964 1965

estimateEnd 1965outstand-

ing

Accrued interest added to value of debt (savings bonds,etc.)

Treasury notes issued for:International Monetary FundInternational Development AssociationInter-American Development Bank

Armed Forces leave bonds issued l

Adjusted-service bonds issuedExcess profits tax refund bonds issued 2

Total, debt issuance in lieu of checks, net

696

2551470

- 1*

772 603

1425

- 1*

- 5 2

*

11,891

2,92291

150611

1,033 810 550 15,062

*Less than one-half million dollars.1 Negative figures represent net redemption.2 Reported as refunds of receipts.

A second example involves transactions in special notes used to paycertain U.S. Government obligations. The Government has paid aportion of its subscriptions to the International Monetary Fund, theInternational Development Association, and the Inter-American De-velopment Bank in non-interest-bearing notes. The notes are con-sidered administrative budget expenditures and become part of thepublic debt when they are issued. However, they are not counted asa payment to the public until they are redeemed for cash, at whichtime they cease to be part of the public debt. Conversely, when theinstitutions return cash to the Treasury in exchange for notes, pay-ments to the public are reduced by the amount of the cash receiptsand a corresponding increase in the public debt takes place.

5. Changes in outstanding checks.—Administrative budget and trustfund expenditures are recorded at the time checks are issued. Toreflect more accurately the point in time at which cash is actually inthe hands of the public, an adjustment is made to place expenditureson a checks-paid basis.

FEDERAL SECTOR ACCOUNTS—DEFINITIONS AND RELATIONSHIP TOOTHER MEASURES

The national income accounts, as developed and prepared by theDepartment of Commerce's Office of Business Economics, is a dual-entry accounting system for making estimates of the current pro-ductive activity of U.S. residents.1 The term "residents" is definedto include the Federal Government as well as State and local govern-ments, corporations incorporated under U.S. laws (but not theirforeign branches or subsidiaries) ? individuals employed in the UnitedStates proper, and U.S. citizens employed by the Federal Govern-ment abroad (civilian as well as military). "Nonresidents" includegovernments, individuals (other than employees of the Federal Gov-ernment), and businesses in foreign countries, as well as in PuertoRico, the Virgin Islands, and other U.S. possessions.

1 The accounts are discussed in detail in the Department of Commerce's National Income, 1954edition, pp. 143-149, and U.S. Income and Output, 1958 edition, pp. 53-57, and 99-101. Each is a"Supplement to the Survey of Current Business." Current estimates on a quarterly and an annualbasis are provided in the Survey of Current Business and in the Economic Indicators.


SPECIAL ANALYSES 3 3 3

The output side of the national income accounts depicts the totalmarket value of the currently produced output of goods and services,classified by type of expenditures: consumer expenditures; grossprivate domestic investment in new construction, equipment, andinventories; Federal, State, and local government purchases of goodsand services; and net exports. The total, obtained by summing theseitems, is called the gross national product (GNP).

The total value of the gross national product is balanced by an equalamount of gross income earned in producing the output.2 The incomeside of the accounts portrays this total, classified by type of income; forexample, wages and salaries, proprietors' income, corporate profits,rent, and net interest and certain other costs of production, such asdepreciation and indirect business taxes. The income accounts alsoprovide additional data showing various transfers of income from onesector to another, such as business gifts to nonprofit institutions andsocial security benefits from the Government.

It should be pointed out that national income data, although basedon accounting statements of economic units, are statistical aggregatesrather than accounting totals in the ordinary sense.

Federal receipts.—Federal receipts on a national income basis areclassified into the following four categories: (1) personal tax and nontaxreceipts, (2) corporate profits tax accruals, (3) indirect business taxand nontax accruals, and (4) receipts from contributions for socialinsurance. Personal tax and nontax receipts consist mostly of indi-vidual income taxes, estate and gift taxes, fines, penalties, and chargesfor Government services. Corporate profits tax accruals representthe Federal tax liability incurred and accrued by resident corporationson their corporate earnings during the specified year or period.Federal corporation income tax collections do not necessarily concidewith—and usually lag—accruals. Indirect business tax and nontaxaccruals consist primarily of excise taxes, customs duties, Federalreceipts from rent and royalties, and other charges to business.Receipts from contributions for social insurance are composed chieflyof employment taxes, contributions to the retirement funds forGovernment employees, and deposits by the States to the unemploy-ment trust fund.

Federal expenditures.—Federal expenditures on a national incomebasis are classified in the following categories: (1) Purchases of goodsand services, (2) transfer payments, (3) grants-in-aid to State andlocal governments, (4) net interest paid, and (5) subsidies less currentsurplus of Government enterprises. The definitions of the categorieshave been developed by the Department of Commerce consistentwith the framework of accounts covering the Nation's total economicactivity.

1. Purchase of goods and services.—These purchases represent thevalue of the Nation's currently produced output bought directly bythe Federal Government. They are reported in the national incomeaccounts net of Government sales.

Purchases include the pay of active military and civilian employeesof the Federal Government, employer contributions to retirement,insurance and other benefits for Federal employees, outlays on new

2 "Gross income" includes capital consumption allowances and certain charges against production.



equipment and supplies for defense and other programs, new construc-tion, research and development contracts with corporations organizedfor profit, expenditures for the purchase of commodities (even if thecommodities are then donated or transferred, domestically or abroad),and generally, the administrative expenses of Government programs.

2. Transfer payments.—Transfer payments consist of expendituresby the Federal Government for which no current output or serviceshave been rendered; in other words, they are payments to certainrecipients for which no contribution to national production is madeduring the time period under consideration. There are two importantcriteria which must be met by an expenditure classified as a transferpayment: (a) the recipient must be an individual, an institution notorganized for profitmaking purposes (a "not-for-profit" institution)or a nonresident (for example, a foreign government), and (b) theexpenditure must also be in monetary form and not in commodities.

Examples of transfer payments are: veterans compensation, pen-sions, and benefits; retired pay to Federal civilian or military per-sonnel; unemployment benefits; and old-age, survivors, and disabilityinsurance; cash gifts and contributions to nonresidents; nonrepayableoutlays for scholarships and fellowships; and research and develop-ment expenditures for contracts let to private individuals. Althoughsuch transfer payments do not directly enter GNP calculations, theydo enter into the income stream and have an impact on national out-put; they are reflected in the GNP in another sector of the accountswhen respent by the recipients.

For national income purposes, net interest paid to nonresidents isconsidered a transfer payment. All other transactions involving in-terest expenditures and receipts (that is, to and from residents) arereported in the net interest paid category.

3. Grants-in-aid to State and local governments.—Grants, for pur-poses of the national income accounts, are Federal payments to Stateand local governments (other than for interest on the public debt),including State and local educational institutions. Included in grantsare almost all of the grants-in-aid and the shared revenues in SpecialAnalysis I of the budget, except (a) outlays to nonprofit and privatelyowned hospitals, (b) outlays-in-kind such as commodities distributedto State and local governments, and (c) payments to Puerto Rico, theVirgin Islands, and other possessions. In addition, the national in-come accounts record as grants research and development outlays forcontracts to public educational institutions. Like transfer paymentsand net interest paid, Federal grants-in-aid are counted in the GNPwhen respent by recipients—in this case, as purchases by State andlocal governments.

4. Net interest paid.—Net interest paid consists of the interestoutlays to residents minus the interest received from this source.

5. Subsidies less current surplus of Government enterprises.—Thiscategory consists of two elements which are consolidated for analyticaland statistical reasons: (a) subsidy payments to (resident) businesses,and (b) the "current surplus" (or deficit as the case may be) of Govern-ment enterprises.

(a) In principle a Government expenditure becomes a subsidy whenit enables a producer to sell goods and services below the cost-price



relationship determined by market forces or when it is a paymentmade to curtail production. By definition, therefore, subsidies aremade only to businesses organized for profitmaking purposes (in-cluding farms). Examples of subsidies are Government paymentsto farmers for land retirement, certain outlays for the export of surplusagricultural commodities by business, payments to air carriers, andthe operating differential subsidy of the Maritime Administration.

(b) Government enterprise is the term applied to those functionsof the Government (usually appearing in the budget as public enter-prise revolving funds) whose operating costs are to a great extentcovered by the sale of goods and services to the public, as opposedto being financed by tax receipts. In short, Government enterprisesconduct operations which are of a commercial nature. Because ofthis, part of their operations are reported in the business sector ofthe national income accounts and part in the Federal sector. TheFederal sector covers the difference between sales and operatingcosts, interest expenses, and capital formation.

Relationship to the consolidated cash statement.—There area number of important differences between the Federal sector accountand the consolidated cash statement. These are set forth in table A-l.

1. Coverage.—With respect to coverage, the Federal Governmentpart of the income and product accounts excludes the revenues andexpenditures of the District of Columbia, which are classified by theDepartment of Commerce in the State and local government sector.

2. Netting and consolidation.—The Federal sector account recordsboth interest paid by the Government and Government purchases ona net basis. Accordingly, interest received by the Government isexcluded from receipts and subtracted from Federal interest pay-ments. Similarly, receipts from sales of Government products aresubtracted from Government purchases. Neither adjustment influ-ences the surplus or deficit, for in effect, both receipts and expendituresare decreased by the same amount.

Adjustments for consolidation are needed to reflect in the incomeand product account a few transactions such as employer and em-ployee contributions to Federal employees' retirement funds. Al-though these contributions are considered to be part of the totalcompensation of Government employees in the national incomeaccounts, they are excluded from the consolidated cash statement asan intragovernmental transaction. Again, the deficit or surplus isunaffected by the adjustment, since total receipts and expendituresare both increased by the same amount.

3. Timing.—Business taxes are recorded in the national incomeaccounts as they are accrued by the private sector, rather than whenthey are collected by the Government. The principal timing adjust-ments for expenditures are: (a) The Federal sector account recordsFederal purchases in terms of the delivery of goods and services to theGovernment, whereas cash payments for these deliveries may precedeor follow; (b) the account also records as purchases guarantees ofnonrecourse loans by the Commodity Credit Corporation at the timethe guarantees are made, rather than when the collateral is sur-rendered; (c) interest on savings bonds and Treasury bills is treatedas an expenditure in' the Federal sector account when the interest is



accrued, rather than when it is actually paid out in cash; and (d) cer-tain foreign currency activities of the Commodity Credit Corporationalso require an adjustment—the Corporation facilitates exports ofsurplus agricultural commodities by paying dollars to exporters, inexchange for foreign currencies received for the exports. Expendi-tures in the Federal sector account are recorded only at the time theseforeign currencies are subsequently used for Government programs.The consolidated cash statement, on the other hand, includes thedollar payments to exporters but excludes both the receipt and thesubsequent expenditure of a large part of these foreign currencies.

4. Capital transactions.—Many capital or financial transactionswhich are included in the consolidated cash statement are excludedfrom the Federal sector account. These items consist primarily ofloans, mortgages, and other financial claims. Also excluded are pur-chases and sales of existing assets, such as land and secondhandproperty.

USES AND LIMITATIONS

Each of the three measures—the administrative budget, consoli-dated cash statement, and the Federal sector of the income andproduct accounts—is useful for specific kinds of analysis, and theselection of which to use should be determined by the problem at hand.

The administrative budget provides a useful measure of theGovernment's operations which are financed by the Government'sown funds.

The Federal sector account is especially suited for an analysis offiscal policy. It was specifically designed to complement the data onprivate expenditures and incomes contained in the national incomeaccounts.

The national income accounts, however, exclude a substantialvolume of financial transactions through which the Federal Govern-ment significantly affects the capital and credit markets. Moreover,in financial markets, the flow of cash payments to the Governmentmay be more significant than the accrual of tax liabilities. As a re-sult, for purposes of analysis of the Federal impact on money andcredit, the consolidated cash statement is generally more useful thanthe national income accounts.

For certain types of problems, no overall measure of receipts andexpenditures will serve adequately. Since the various receipt andexpenditure transactions have different economic effects, a givenaggregate will have an economic impact which depends importantlyon the composition of the total.

In addition, many Government transactions besides receipts andexpenditures affect the economy. For example, a rapid expansion innew appropriations and in Government orders could stimulate a risein business activity well before either the delivery of goods, the per-formance of services, or the payment for them. The management ofpublic debt is a further factor which has a significant impact in themoney and credit markets of the economy. Consequently, in eval-uating the economic impact of Federal Government activities, thereis no substitute for complete and detailed analysis of the Governmentprogram in all its aspects.


SPECIAL ANALYSIS B

PUBLIC ENTERPRISES, TRUST FUNDS, AND GROSS EXPENDITURES OFTHE GOVERNMENT

This analysis presents selected information on the public enterprisefunds and the trust funds with special reference to financing. It alsocovers certain receipts and reimbursements from outside the Treasuryto general fund appropriations and other accounts which are nettedin the administrative budget expenditures, and it indicates the magni-tude of total expenditures if such netting did not occur. Additionaltables in this special analysis relating to borrowing and investmentsin U.S. securities are an integral part of the computation of thechanges in public debt in table 11 of part 2 of the budget.

PUBLIC ENTERPRISE FUNDS

The public enterprise funds are federally owned funds which carryon a cycle of operations, primarily with the public, organized usuallyon a business-type basis. Some of them are incorporated enterprises;others are unincorporated. Their expenditures have been included,on a net basis, in the administrative budget for many years. Thegeneral fund usually supplies them with capital; the provision of suchcapital, its return, and any dividends given to the general fund arenot counted in the budget totals as expenditures or receipts.

Expenditures and receipts.—Expenditures of public enterprise fundsare estimated to be $21.5 billion in 1965, and their receipts will be$19.9 billion (table B-l) , resulting in net expenditures of $1.6 billionwhich are included in the administrative budget totals. The Com-modity Credit Corporation and the postal fund together account forsomewhat more than half of the transactions. The figures for both1964 and 1965 take account of the legislative proposal to put theRural Electrification Administration loan program on a public enter-prise fund basis.

The expenditures in table B-l include certain interfund paymentsto the general fund, principally for interest (see note at end of table14). The receipts shown in table B-l are generally from the public;but they include some transactions from within the Government—notably, the sales of Commodity Credit Corporation inventoriesand services to appropriations for special activities, accountingfor $2 billion of the Commodity Credit Corporation receipts shown for1965. The sales of Tennessee Valley Authority power to Governmentagencies, payments by all agencies to the Post Office for postal services,and interest paid to certain funds on their investments are otherexamples of such intragovernmental receipts included in table B-l .

337

700-000 O—64



Table B-1. GROSS EXPENDITURES AND APPLICABLE RECEIPTS OFPUBLIC ENTERPRISE FUNDS (in millions of dollars)

Description

Gross expenditures

1963actual

1964 1965

Applicable receipts

1963actual

1964 1965

Funds appropriated to the President:Foreign assistance—EconomicOther

Department of Agriculture:Commodity Credit CorporationRural Electrification Administration

(proposed legislation)Other

Department of CommerceDepartment of Defense:

MilitaryCivil (Panama Canal Company)

Department of Health, Education, andWelfare .

Department of the InteriorDepartment of LaborPost Office DepartmentTreasury DepartmentGeneral Services AdministrationHousing and Home Finance Agency:

College housing loansUrban renewal fundFederal National Mortgage Association..Federal Housing AdministrationPublic Housing AdministrationOther

Veterans AdministrationOther independent offices:

Export-Import Bank of WashingtonFederal Savings and Loan Insurance

CorporationSmall Business AdministrationTennessee Valley AuthorityOther

89534

10,418

62446

16112

4148176

4,6401*

339336868611567

69618

548

34034837

963168

9,574

37767696

15117

170259

4,8991

34240259875559498

581

708

6036336735

1,0997

7,995

383862124

4115

138262

5,058

2291

17,371

340527

1,014779628131487

739

- 138638839

54013

12104

549

2623,870

4*

56162

1,308476388

17748

939

27120329533

27

42

12 7,298

1695772011

112

752

2684,353

2*

119151

1,176698446

31656

1,358

31023031036

Total. 21,802 22,227 21,512 17,237 18,460

36

45

i 7,008

178807243

116860265

4,5831*

132198

1,60295240548846

1,595

34825232138

19,869

Receipts from the publicReceipts from other accounts.

(14,209)(3,028)

(15,737)(2,723)

(16,468)(3,401)

*Less than one-half million dollars.1 Includes advances from foreign assistance programs of $2,091 million in 1963, $1,879 million in

1964. and $2,377 million in 1965.2 Excludes adjustment of $2 million for "Cropland conversion program."

Treasury financing.—Capital requirements of the public enterprisefunds are usually supplied through new obligational authority (eitherappropriations or some other form of NOA) from the general fund.While most public enterprise funds are operated to be self-sustainingover a period of years, the largest—the Commodity Credit Corpora-tion—has incurred substantial losses in most years. Appropriationshave been made regularly to make up for the loss in this fund, thepostal deficit, and other losses in a few smaller funds. Contractauthorizations have also been provided for the Commodity CreditCorporation and for the Urban Renewal Fund of the Housing andHome Finance Agency.



Table B-2 reflects all such new obligational authority, except forthe authority to borrow directly from the public. The latter countsas new obligational authority, but is reflected in table B-10 instead ofhere.

Writeoffs shown here are primarily the return of capital or transferof dividends to the general fund of the Treasury; they include a fewcases of transfers to other accounts or lapses of obligational authority.

Table B-2. NEW OBLIGATIONAL AUTHORITY AND WRITEOFFS OFPUBLIC ENTERPRISE FUNDS (in millions of dollars)

Description

New obligationalauthority l

1963actual

1964estimate

1965

Writeoffs (includingcapital transfers) 1

1963actual

1964 1965estimate

Funds appropriated to the President: For-eign assistance—Economic


(proposed legislation)Other

Department of CommerceDepartment of Defense—MilitaryDepartment of Health, Education, and

WelfareDepartment of the InteriorDepartment of LaborPost Office DepartmentTreasury DepartmentGeneral Services AdministrationHousing and Home Finance Agency:

College housing loansUrban renewal fundFederal National Mortgage Association _Public Housing AdministrationOther


Export-Import Bank of WashingtonSmall Business AdministrationTennessee Valley AuthorityOther

429

180

16121

1,062

2,475

M957

137

1,390

1,205

81112170

43 21

150 68

29•102

119)103

8401

654

78

551

74 226

46

1M1011

300 3001,400

300

19595

200

212106150

23187

30035

1

9047

151

2554

2221

351

49*

175*6

187

51

185*3

150

50

50*

52

Total. 6,832 7,240 4,255 563 685 532

*Less than one-half million dollars.1 Excludes NOA in form of indefinite authorization for Federal Housing Administration to expend

from corporate debt receipts of $162 million in 1963, and $142 million in 1964, and reductions in suchborrowings of $44 million in 1965.

2 Excludes transfers received upon initiation of new funds: For Rural Electrification Administra-tion, Department of Agriculture, $1,062 million in 1964; for Food and Drug Administration, Depart-ment of Health, Education, and Welfare, $1 million in 1964.

3 Represents balances transferred to "Family housing, Defense."4 Unobligated balance transferred to "Salaries and expenses, Mexican farm program."

Balances available.—The balances of public enterprise funds areshown in table B-3. They are there divided between the balanceswhich are accounted for as assets of the funds (cash in banks, fundbalances with the Treasury, and U.S. securities), and the undrawnauthorizations to obtain capital from the Treasury, to borrow, or(in two cases) to contract in excess of their cash availability.



Table B-3. BALANCES OF PUBLIC ENTERPRISE FUNDS (in millions of dollars)

Description

Funds appropriated to the President:Foreign assistance—EconomicOther


(proposed legislation)Other :

Department of CommerceDepartment of Defense—MilitaryDepartment of Defense—Civil (Panama

Canal Company)Department of Health, Education, and

WelfareDepartment of the InteriorDepartment of LaborPost Office DepartmentTreasury DepartmentGeneral Services AdministrationHousing and Home Finance Agency:

College housing loansUrban renewal fundFederal National Mortgage Association..Federal Housing AdministrationPublic Housing AdministrationOther


Export-Import Bank of WashingtonSmall Business AdministrationTennessee Valley AuthorityLoans to Federal Deposit Insurance

CorporationLoans to Federal home loan banksFederal Savings and Loan Insurance

CorporationOther

Total _

Cash balances in Treasuryand U.S. securities as of

June 30

1963actual

2,72819

36

28410621

160294420*

694209784264166609

539324

868116

7,653

1964

2,8122

28

19315917

352302519

6627338928103234677

34939

1,118120

8,036

1965

3,11834

22

24922916

7

257304595*

7320830

1,057111271

1,036

21545

1,467122

9,268

Undrawn authorizationsas of June 30

1963actual

199177

12,298

1300

10

16

250

7432 3,656

4,310

1,4751,037

281

4,524

3,0001,000

75024

24,050

1964

19969

12,504

*300

10

250

8232 4,951

4,772

1,5001,002

249

5,127

3,0001,000

75023

26,536

1965estimate

199

74

12,727

1,008300

10

250

90824,686

5,183

1,50096799

5,933

3,0001,000

75021

28,616

*Less than one-half million dollars.1 Includes unfunded balance of contract authority of $1,402 million in 1963, $1,087 million in

1964, and $487 million in 1965.2 Includes unfunded balance of contract authority of $3,016 million in 1963, $4,311 million in

1964, and $3,045 million in 1965.3 Excludes undrawn corporate debt authority of $555 million in 1963, $480 million in 1964, and

$405 million in 1965.

In most cases, a large part of the balances are obligated or re-served—to pay loan commitments, purchase and construction con-tracts, or other obligations entered into but on which the other partyhas not yet required or earned the money. The balances includeinactive "standby" authority for loans to the Federal Deposit Insur-ance Corporation, the home loan banks, and the Federal Savingsand Loan Insurance Corporation. Also included is an unused balancefor the never-activated Federal Flood Indemnity Administration(HHFA).



TRUST FUNDS

The trust funds are administered in a fiduciary capacity by theGovernment. They are not included in the administrative budgettotals, and transactions between the general fund and the trust fundsare conducted "at arm's length"—that is, payments between them arereported as expenditures and receipts of the funds involved.

Expenditures and receipts.—Trust fund expenditures are estimatedto be $29.4 billion in 1965, with receipts of $30.9 billion, as shown intable B-4. The transactions of the Federal old-age and survivorsinsurance fund are slightly more than half of the totals.

Table B-4. EXPENDITURES AND RECEIPTS OF TRUST FUNDS(In millions of dollars)

Description

Federal old-age and survivors insurancetrust fund_

Federal disability insurance trust fundUnemployment trust fundRailroad retirement accountFederal employees' funds __ _ _ _Highway trust fund _Veterans life insurance fundsFederal National Mortgage Association

trust fundsOther trust funds _ _ _Deposit fundsInterfund transactions (table 14, note)

SubtotalGovernment-sponsored enterprises.

Total

Expenditures

1963actual

14,5301,2593,8151,1121,1383,017

826

-7301,252

146-505

25,860685

26,545

1964

15,3591,3453,5551,1291,2793,551

633

301,571-116-488

27,8491,467

29,315

1965

16,0911,4283,4431,1441,4443,650

487

1381,932- 1 7

-Ml

29,261111

29,372

Receipts

1963

13,8561,1454,2611,1282,2553,293

710

1,546

-505

27,689

27,689

1964

15,8461,1984,1911,2022,3913,484

717

1,623

-488

30,163

30,163

1965

16,2711,2283,9331,2792,4003,510

712

2,017

-477

30,872

30,872

The trust funds include a small group of trust revolving funds (seetable B-5) which, like the public enterprise funds, are stated on a netexpenditure basis in figures used elsewhere in the budget.

Table B-5. TRANSACTIONS OF TRUST REVOLVING FUNDS (in millions of dollars)

Description

Civil Service Commission (Employees' lifeinsurance and health benefits) _ _ _

Federal National Mortgage AssociationAll other trust revolving funds. _ __

Total, trust revolving funds

Receipts from the publicReceipts from other accounts

Gross expenditures

1963actual

50139362

956

1964estimate

520479100

1,099

1965estimate

581595159

1,335

Applicable receipts

1963actual

5461,124

33

1,703

(1,489)(214)

1964estimate

58544945

1,079

(857)(222)

1965estimate

636457135

1,228

(998)(230)



Treasury financing.—The principal financing provided by thegeneral fund to the trust funds is interest paid on public debt invest-ments of the trust funds. The Government also contributes, asemployer, to the employee retirement funds.

Balances available.—Trust fund balances with the Treasury andU.S. securities are shown in table B-6. These balances are reserved tocarry out the purposes of the trust.

Table B-6. TRUST FUND BALANCES (in millions of dollars)

Description

Federal old-age and survivors insurance trust fund___Federal disability insurance trust fundUnemployment trust fundRailroad retirement accountFederal employees' fundsHighway trust fundVeterans life insurance fundsFederal National Mortgage Association trust fund___All other trust fundsDeposit funds

Total

As of June 30

1962actual

19,6412,5085,8323,789

12,524471

6,843104842

1,913

54,467

1963

18,9672,3946,2773,805

13,641747

6,726237

1,1361,767

55,698

1964

19,4542,2476,9123,878

14,752680

6,81125

1,1881,883

57,830

1965stimate

19,6342,0477,4024,01415,708

5407,036

221,2731,900

59,577

Note.— Excludes Government-sponsored enterprises.The figures shown above differ somewhat from those on an authorization basis shown in table 10.

The reconciliation is as follows:As of June 30

1962 1963 1964 1965Balances available on an authorization basis

(table 10) 64,136 66,341 69,774 71,827Unappropriated receipts:

Available as needed on an indefinite basis 51 76 25 25Available for appropriation by Congress:

District of Columbia - 1 1 4 - 1 1 4 - 9 6 - 8 9U.S. Soldiers* Home 98 102 105 108Highway trust fund 106 148 382 242

Unfinanced contract authorization - 8 , 9 2 9 - 9 , 1 6 7 -10 ,290 - 1 0 , 4 5 3Undrawn authorizations to borrow —882 —1,687 —2,071 —2,083

Balances available on a cash basis 54,467 55,698 57,830 59,577

GOVERNMENT-SPONSORED ENTERPRISES AND ANNEXED BUDGETS

This budget continues the practice adopted a year ago of includingwith the trust fund expenditures certain transactions of five Govern-ment-sponsored enterprises, stated on a net basis. The transactionsthus reported relate to investments in U.S. securities and debt issuancefor which the Treasury acts as fiscal agent; amounts equal to the netdebt issuance or net disinvestments of such enterprises are used asan estimate of net expenditures.

The budget appendix includes for the first time this year detailedbudget statements with respect to seven self-supporting activities,including three of the Government-sponsored enterprises just men-tioned, and four other activities. (In the case of one of the latter,the Exchange stabilization fund, estimates for the years 1964 and1965 are incomplete.)

Table B-7 summarizes the expenditures and receipts of the annexedbudgets.



Table B-7. EXPENDITURES AND APPLICABLE RECEIPTS OF ACTIVITIESCOVERED BY ANNEXED BUDGETS (in millions of dollars)

Description

Milk Marketing Administration __Comptroller of the Currency. _ _ _Exchange Stabilization FundBoard of Governors of Federal Reserve

SystemBanks for Cooperatives _Federal Intermediate Credit Banks. __ _Federal Deposit Insurance Corporation. __

Total

Gross expenditures

1963actual

12144

71,0704,595

6

5,708

1964estimate

1316

0)8

1,1324,881

20

6,070

1965estimate

1318

P)8

1,1295,201

19

6,388

Applicable receipts

1963actual

12158

71,0674,327

165

5,602

1964estimate

1317

0)8

1,0754,645

199

5,957

1965estimate

1318

81,1054,970

222

6,336

1 Not available.

OTHER EXCLUSIONS FROM ADMINISTRATIVE BUDGET RECEIPTS

The law permits certain collections to be credited as reimbursementsto general fund appropriations. Such collections from outside the ad-ministrative budget accounts are identified in the detailed schedulesof the budget appendix as reimbursements from "non-Federal sources,"distinguishing them from reimbursements within the administrativebudget sector. The intragovernmental revolving and managementfunds also have some receipts from outside the Government. TableB-8 reflects the estimated amount of such collections which arecredited to appropriations or to intragovernmental funds.

Table B-8. REIMBURSEMENTS FROM NON-FEDERAL SOURCES TOAPPROPRIATIONS AND INTRAGOVERNMENTAL FUNDS (in millions of dollars)

Description 1963 1964 1965

Funds appropriated to the PresidentDepartment of AgricultureDepartment of CommerceDepartment of Defense:

MilitaryCivil

Department of Health, Education, and Welfare..Department of the InteriorDepartment of JusticeDepartment of LaborDepartment of StateTreasury DepartmentAtomic Energy CommissionFederal Aviation AgencyNational Aeronautics and Space Administration.Veterans AdministrationOther independent agencies

*134

1,9892

32383*7

12572

*145

1,9492

33643*2

13522*

144

,8872

34783*1

1475

3*1*

Total. 2,162 2,142 2,118

From trust funds.From the public.

(694)(1,468)

(880)(1.262)

(1.244)(874)




GROSS EXPENDITURES OF THE GOVERNMENT

Table B-9 gives gross expenditures, on a checks-issued basis forall Government-administered funds, except deposit funds; the latterare excluded since they are for the most part suspense accounts.

Table B-9. GROSS EXPENDITURES OF GOVERNMENT-ADMINISTEREDFUNDS (in millions of dollars)

Function 1963actual

1964estimate

1965estimate

National defenseInternational affairs and financeSpace research and technologyAgriculture and agricultural resources.Natural resourcesCommerce and transportationHousing and community development.Health, labor, and welfareEducationVeterans benefits and servicesInterestGeneral governmentUndistributed—special allowances

54,9023,5642,55218,2682,7169,4323,105

25,3551,2766,7158,3082,010

57,2093,8884,40118,0642,91210,9353,33326,9081,4296,6018,8922,268

250

Total. 138,205 147,090

56,0004,0704,992

16,5903,035

11,0274,040

28,3281,7816,3649,1992,2641,094

148,785

The total is derived as follows:Administrative budget expenditures (table 14)Trust fund expenditures (table 14 and B-4) :

Total of such transactionsElimination of deposit funds included in total

Intragovernmental transactions (table A-2) :Total of such transactionsEmployees' contributions included in totalOther adjustments included in total

Receipts from the public netted in conventional totals:Receipts of public enterprise funds (table B-1)Receipts of trust revolving funds (table B-5)Reimbursements to administrative budget funds (table B-8) _ _

Substitution of annexed budgets:Gross expenditures of annexed budgets (table B-7)Elimination of net expenditures of Government-sponsored

enterprises (included in table B-4)

92,642

26,545-146

-4 ,281917340

14,2091,4891,468

5,708

-685

98,405

29,315116

-4,147941

15,737857

1,262

6,070

-1,467TotaL 138,205 147,090

97,900

29,372U

-4,075954

16,468998874

6,388

-111

148,785

BORROWING OTHER THAN FROM THE GENERAL FUND

The Tennessee Valley Authority has authority to borrow $750million from the public. The Federal Housing Administration hasan indefinite authorization to issue short-term debentures in connec-tion with its settlements. The Federal National Mortgage Associa-tion trust revolving fund has authority to issue its own debt instru-ments in an amount equal to 10 times the aggregate of its capitaland retained earnings. The District of Columbia Armory Boardwas authorized to issue bonds for the financing of the stadium com-pleted in 1961. A few funds in liquidation are retiring earlier debt is-



suances. Government-sponsored enterprises also have their ownborrowing authority. Some Government enterprise debt is guaran-teed by the Treasury; some is not formally guaranteed. Borrowingand repayments pursuant to these authorities are shown in table B-10.

A small portion of such borrowing is from other funds; the largerpart is from the public and in effect reduces the Treasury borrowingfrom the public (see table 11 of part 2).

Table B-10. DEBT ISSUANCES BY GOVERNMENT ENTERPRISES (OTHER

THAN BORROWING FROM THE GENERAL FUND) (in millions of dollars)

Description

Borrowing from the public:By public enterprise funds:

Federal Housing Administration __Federal National Mortgage Association _ _Federal Farm Mortgage Corporation _ _ _ _ _Home Owners Loan Corporation _Tennessee Valley Authority

By trust funds:D.C. Armory BoardFederal National Mortgage Association

By Government-sponsored enterprises:Banks for cooperatives _ _ _ _Federal intermediate credit banks _ __ _ _ _Federal land banksFederal home loan banks _ __ _ _ __

Total, borrowing from the public. __

Borrowing from other funds:By public enterprise funds:

Federal Housing Administration _ _ _By Government-sponsored enterprise funds:

Banks for cooperatives _ _Federal intermediate credit banksFederal land banks _ _ _Federal home loan banks _

Total, borrowing from other funds. _ __ __

Total, debt issuances by Government enter-prises

1963

164***

- 5 9 7

29243176946

961

- 1

135

- 129

61

1,022

1964

189

**

75

- 1 8 3

40261180

1,225

1,787

- 4 6

- 3 4

- 2 5

- 1 0 6

1,681

1965

-87

**

75

135

40235140

538

44

44

581

End 1965,estimate

out-standing

522

**

295

201,913

5372,5943,0433,967

12,892

163

21*

4

170

13,063

Note.— Negative figures represent net retirement of debt.*Less than one-half million dollars.

INVESTMENTS IN U.S. SECURITIES

A few public enterprise funds, a substantial number of trust funds,and the Government-sponsored enterprises may purchase Treasurybonds or notes for investments. In addition, the Federal NationalMortgage Association acquires some of the debentures issued by theFederal Housing Administration, and the Federal Housing Adminis-tration acquires some of its own debentures as investments. Theseinvestment transactions in securities issued by the Government or itsagencies are shown in table B- l l .



The public debt bought by the various funds enters into the com-putation of the debt as shown in table 11 of part 2.

Table B-11. INVESTMENTS IN U.S. SECURITIES BY GOVERNMENT-ADMINISTERED FUNDS (in millions of dollars)

Description

Investments in Treasury issuances (public debt):By public enterprise funds:

Federal Housing AdministrationFederal Savings and Loan Insurance Corporation.Tennessee Valley AuthorityVeterans' AdministrationMaritime Administration

By trust funds:Federal old-age and survivors insurance trust

fundFederal disability insurance trust fundUnemployment trust fundRailroad retirement accountFederal employees' funds.Federal National Mortgage AssociationHighway trust fundVeterans life insurance fundsDistrict of Columbia municipal government

fundsAll other

By Government-sponsored enterprises:Federal Deposit Insurance CorporationBanks for cooperativesFederal intermediate credit banksFederal land banksFederal home loan banks

By Exchange stabilization fund

Total, investments in Treasury issuances

Investments in issuances of other funds:By public enterprise funds:

Federal Housing AdministrationFederal National Mortgage Association

By trust funds:Federal National Mortgage Association. _"District of Columbia municipal government

funds _ _ _

Total, investments in issuances of other funds.

Total, investments in U.S. securities

Transactions

1963U

- 5269

- 1 0137

-821-129

4561

1,14492

242-114

58

161*

1- 261281

2.007

41- 2 7

44

3

61

2,069

1964

57250

16- 3

487-147

62985

1,095- 9 2- 6 8

83

- 2 64

180

2,552

26- 5 9

- 7 3

-106

2,446

1965

75349

254

125-204

475136940

-140226

- 9- 1 2

202

2

100

2,294

52- 8

44

2,338

End 1965.estimate

out-stand-

ing

8521,460

1428

18,2251,9277,3493,918

15,569

4707,025

2419

3,13643

113102

2,044M53

62,580

12627

10

8

170

62,751

Note.— Negative figures represent net reduction of investments.

"'Less than one-half million dollars.1 As of end of fiscal year 1963; estimates for 1964 and 1965 are not available.


SPECIAL ANALYSIS C

CIVILIAN EMPLOYMENT IN THE EXECUTIVE BRANCH

This analysis summarizes actual and estimated employment in theexecutive branch for fiscal years 1963, 1964, and 1965.

EMPLOYMENT TOTALS

The 1965 budget projects a decrease of 1,200 in civilian employmentin the executive branch—it is the first budget to call for a reductionin total civilian employment since the practice of making total em-ployment estimates for the budget proposals began 9 years ago.Regular employees will total 2,511,200 at the end of fiscal 1965, as.compared with 2,512,400 at the same time in 1964.

Table C-l SUMMARY OF CIVILIAN EMPLOYMENT IN THE EXECUTIVEBRANCH

As of June

1963actual

1964estimate

1965

Estimate Percent

Department of Defense—Military and militaryassistance 1

Post Office DepartmentVeterans AdministrationDepartment of AgricultureDepartment of Health, Education, and Welfare. _Treasury DepartmentAll others

Total

1,017,117587,161172,864112,48881,06286,579

433,017

1,007,000593,100173,021116,80086,00088,433

448,046

989,920597,900173,754115,37690,73090,427

453,093

39.423.86.94.63.63.6

18.0

22,490,288 2,512,400 2,511,200 100.0

1 Consists of civilian employment for military functions and military assistance.2 Excludes 7,411 project employees for the public works acceleration program.

About 70% of all Federal civilian employees work in three agencies,the Department of Defense, Post Office, and the Veterans Adminis-tration. The Departments of Agriculture, Health, Education, andWelfare, and Treasury account for another 12%. AH the remaining50-odd agencies of the Government account for only 18% of theemployment. The totals for the major agencies are shown on table 12in part 2.

TYPES OF POSITIONS

Employees appointed to four major types of positions make up theFederal work force. They are designated "permanent," "temporary,""part-time," and "intermittent," respectively.

Most employees occupy positions called "permanent," though thesepositions can usually be abolished by the head of the employing agencyif he decides to discontinue a function or to reorganize staffing arrange-ments so as to improve efficiency, or if funds are not available to

347



support the agency*s full authorized strength. Most of these em-ployees are not office workers, but are to be found on postal routes,in hospitals, shipyards and research laboratories, in national forestsand parks, as teachers in Indian schools, airway control experts,highway construction engineers, border patrol inspectors, and inmany other places and jobs.

Most short-term fluctuations in total Federal employment reflectchanges in the number of "temporary," "part-time," and "inter-mittent" employees in service. "Temporary" positions are predomi-nantly of a seasonal character and usually vary in number by at least30,000 between peak employment during the summer months and themidwinter nadir. "Part-time" employees are found principally inthe Post Office and the Veterans Administration, and are used to meetworkloads that regularly require less than a full week's work. "Inter-

Table C-2. EMPLOYMENT BY TYPE OF POSITION OCCUPIED(As of June 1963)

Description

Executive Office of the President. __Department of AgricultureDepartment of CommerceDepartment of Defense:

Military and military assistance l.Civil2

Department of Health, Education,and Welfare

Department of the InteriorDepartment of JusticeDepartment of LaborPost Office DepartmentDepartment of State

Agency for International De-velopment

Peace CorpsTreasury DepartmentAtomic Energy CommissionFederal Aviation AgencyGeneral Services AdministrationHousing and Home Finance Agency _National Aeronautics and Space

AdministrationVeterans AdministrationOther:

Civil Service CommissionSelective Service SystemSmall Business Administration. __Tennessee Valley AuthorityThe Panama CanalUnited States Information

Agency '_.Miscellaneous independent

agencies and other

Total*

Full-timepermanent

1,32478,89828,466

998,58530,019

77,15554,69631,4219,193

449,66623,880

16,491872

82,5766,97745,21331,65613,927

27,904150,871

3,9855,1303,32811,38213,990

11,485

22,429

2,231,519

Full-timetemporary

18416,7622,250

14,6482,322

2,2999,514323

78377

221183

3,3825517661651

1,9053,120

25

596,298315

29

545

65,737

Part-time

143,182442

1,62615

5005033751

72,540205

1916

5411512127340

105,428

201,276

216341

276

90

87,797

Inter-mittent

13813,6461,180

2,258292

1,1084,845300323

64,87757

51398073

803105142

11513,445

5551021320

3

449

105,235

Total

1,660112,48832,338

1.017,11732,648

81,06269,55832,0819,567

587,16124,519

16,7821,110

86,5797,12046,31332,65014,160

29,934172,864

4,0856,9163,38717,91714,966

11,793

23,513

2,490,288

1 Consists of civilian employment for military functions and military assistance.2 Employment of the Panama Canal and the United States Soldiers Home is included under

"Other" below.8 Excludes 7,411 project employees for the public works acceleration program.



mittent employees" include leave replacements for rural mail carriers,consultants, members of advisory committees, and others who maywork for the Government for as little as 1 day a month, and in somemonths not at all.

As the fiscal year ends on June 30, the end-of-year employmentfigure includes most of the seasonal employees likely to be on boardat any one time of the year and is, therefore, higher than the averagenumber of employees for the year. Table C-2 shows the compositionof Federal employment by type of position and major agency at theend of fiscal 1963.

EMPLOYMENT CHANGES IN PARTICULAR AGENCIES

The President has directed each agency to institute programs toimprove management and employee productivity, and to continuouslyreassess its employment needs in the light of advances made throughthese efforts. Many agencies have achieved outstanding results, ofwhich the following are a few recent examples:

• The Department of Defense, the Government's largest employer,has identified economies which will allow a drop of 10,000 in em-ployment in 1964, and a further reduction of 17,000 in 1965.

• The Post Office Department, despite an uncontrollable workloadand the necessity to extend service to rapidly growing suburbanareas, has held staff increases to 1.8% between 1963 and 1965, ascompared with an increase of 6.4% in mail volume.

• The Agency for International Development has made manage-ment improvements in Washington and in its foreign posts which,together with program adjustments, will result in a decrease inoverall employment of about 800 in 1965.

• The Department of Agriculture will employ about 1,400 fewerpeople at the end of 1965 than at the same time in 1964, due princi-pally to improvements in management and organization, as wellas elimination of lower priority projects.

Savings achieved through economies of management and operationscontribute to the Government's ability to meet new and growingneeds. Employment growth in such agencies as the Department ofHealth, Education, and Welfare corresponds to the initiation of newprograms, usually requiring new legislation, to accomplish objectivesurgent to the national interest such as the eradication of poverty.Increases in such agencies as the Treasury Department and the Gen-eral Services Administration reflect the necessity of coping withexpanding workloads which require more people with even the mostefficient procedures. In 1965, savings accomplished through improvedmanagement will more than offset both of these kinds of increases,however.



EMPLOYMENT COMPARED WITH OTHER FACTORS

Federal employment has grown more slowly than population orother types of employment.

Between 1955 and 1965, the U.S. population will have risen at anaverage annual rate of 1.7%. The average yearly growth of Federalemployment over the same period has been 0.6%. Though notevery agency's workload is directly affected by population increases,most of them are, and have been further increased by changes in thenature and composition of the population, (e.g., increases in thenumbers of very old and very young persons). Despite this, how-ever, Federal employment has grown more slowly than the popu-lation—in 1955, each Federal employee in the executive branch served70 Americans; it is expected that in 1965 each employee will beserving 77 Americans (see table C-3). There are now approximately13 U.S. workers serving each 1,000 of the population, of which 5 areemployed by Defense, 3 by the Post Office, 1 by the Veterans Admin-istration, and 4 by all the rest of the Government.

Federal employment has also grown less than non-Federal, nonagri-cultural employment over the same period of time, as indicated intable C-3. In 1955, there were 20 non-Federal, nonagriculturalemployees for each Federal employee; but in 1965, there are ex-pected to be 24.

Table C-3. EXECUTIVE BRANCH EMPLOYMENT, POPULATION,AND OTHER EMPLOYMENT

194219451948195019511952195319541955195619571958195919601961196219631964(estimated)_1965 (estimated).

Executivebranch

employ-ment asof June(thou-sands)

2,2723,7872.044

11,9342,4562,5742,5322,3822,3712,3722,3912,3552,355

12,3712,4072,485

2 2,4902,5122,511

U.S. population

Number(thou-sands)

135 ,'361140,468147,208152,271154,878157,553160,184163,026165,931168,903171,984174,882177,830180,676183,742186,591189,278

Numberper

executivebranch

employee

60377279636163687071727476767675767677

Non-Federalnonagricultural

employment

Number(thou-sands)

37,91237,58643,02843,29445,54746,40547,92746,83448,48850,19950,68749,23251.17152,10051,94553,50154,807

Numberper

executivebranch

employee

17102122191819202021212122222222222324

State and localgovernmentemployment

Number(thou-sands)

3.3103,1043,7764,0784,0314,1344,2824,5524,7285,0645,3875,6815,9076,2336,5206,8237,141

Numberper

executivebranch

employee

1.5.8

1.82.11.61.6

1.92.02.12.32.42.52.62.72.72.93.03.1

1 Includes piece-rate census workers employed for the decennial census.3 Excludes 7,411 project employees for the public works acceleration program.3 Not available.



State and local government employment will have increased by64% since 1955 while Federal civilian employment will rise less than6%.

It is also important to note that personnel compensation is a rela-tively small portion of the Federal budget. In the administrativebudget for 1965 these costs amount to only 12.5%, and they are onlyslightly more than 10% of consolidated cash expenditures. The ade-quacy of pay rates have significant monetary effects throughout thebudget, however, as they affect the quality of personnel charged withmaximizing efficiency and economy.


SPECIAL ANALYSIS D

INVESTMENT, OPERATING, AND OTHER EXPENDITURES

This analysis is designed to contribute to a greater understanding ofGovernment activities by dividing Federal administrative budget andtrust fund expenditures into several categories: (1) additions toFederal assets; (2) additions to State, local, and private assets; (3)developmental expenditures; (4) current expenses for aids and specialservices; (5) retirement and social insurance benefits (trust fundsonly); (6) other services and current operating expenses; and (7) un-classified (trust fund expenditures which do not properly belong in anyof the other categories). In each category where applicable, nationaldefense expenditures are reported separately from those for all other(civil) programs.

Basically, this analysis distinguishes between two types of expendi-tures: Those yielding benefits primarily in the future and those pro-viding benefits largely in the year in which they are made. Theformer are essentially outlays of an investment nature while the latterare principally current expenses for aids, special services, and socialinsurance benefits. Expenditures yielding benefits over a period ofyears are shown in the first three classes, while outlays providingmainly current benefits are grouped in the remaining categories.

Expenditures from administrative budget funds are shown sepa-rately from trust funds in tables D-l and D-2. The sum of the budgetand trust fund totals is greater than the total of cash payments tothe public primarily because there are intragovernmental transactions.

1. Additions to Federal assets.—This category includes administra-tive budget expenditures for direct loans, such as loans to financeprivate housing construction and encourage home ownership, to helpsmall businesses, to finance college dormitory construction, to aid farmownership and operation, to finance rural electric and telephonesystems, and to promote economic development abroad. (Most ofthese programs are included in the budget total on a net basis; that is,gross disbursements less receipts.) It also includes financial invest-ments in certain international organizations and mixed-ownershipenterprises, and expenditures for public works, for changes in majorcommodity inventories, for major equipment (including militaryequipment), and for the acquisition and improvement of real propertyand other physical assets.

Trust fund expenditures in this category consist primarily of mort-gage purchases (net of sales) by the Federal National MortgageAssociation in support of its secondary mortgage market operations,and net loans by two Government-sponsored enterprises—banks forcooperatives and the Federal intermediate credit banks.

2. Additions to State, local, and private assets.—Federal outlaysunder this heading add to State, local, and private assets. Grant-

352



Table D-l. SUMMARY OF INVESTMENT, OPERATING, AND OTHEREXPENDITURES (in millions of dollars)

Description

Additions to Federal assets:CivilNational defense

Additions to State, local, and privateassets:

CivilNational defense

Developmental expenditures:CivilNational defense __

Subtotal, investment and develop-mental type expenditures:


Current expenses for aids and specialservices:


Retirement and social insurance benefits—civil

Other services and current operating ex-penses:

Civil:InterestOther

National defenseDistrict of Columbia, deposit funds, and

other unclassified itemsAllowances and contingenciesInterfund transactions

Grand total

Administrative 1funds

1963

5,06017,947

1,31228

4,7727,886

11,14425,861

16,1091,751

9,9803,167

25,142

-513

92,642

1964

3,55518,734

1,68628

6,8408,597

12,08227,359

17,3111,617

10,7013,449

26,323

250-685

98,405

>udget

1965

3,09017,239

1,68322

7,8378,252

12,61025,513

16,3541,265

11,1013,360

27,201

1,094-600

97,900

Trust funds

1963

-250

3,481*

54

3,285*

661674

20,814

1515

1,461

-505

26,545

1964

362

4,8332

68

5,2632

816860

21,409

1535

1,294

-488

29,315

1965estimate

576

3,5821

74

4,2321

7921,225

22,330

1045

1,160

-477

29,372


in-aid expenditures which augment the physical assets of State andlocal governments are primarily for the construction of highways(mainly through the Highway trust fund), hospitals, airports, waste-treatment works, watershed protection projects, schools in federallyaffected areas, and public facilities under the area redevelopmentprogram and the temporary accelerated public works program.Federal expenditures which increase the value of privately ownedassets are largely for the conservation and improvement of privatefarm land and water, for grants to States for the building of privatehospitals and other health facilities, and for construction subsidies tothe merchant fleet. Trust fund expenditures in this category, inaddition to the highway program, include the net loans made by theFederal land banks and the Federal home loan banks (Government-sponsored enterprises in which the Federal Government no longerholds any capital stock); these loans strengthen lending institutionswhich promote farming and individual home ownership.

700-000(


3 5 4 THE BUDGET FOR TISCAL YEAR 196 5

3. Developmental expenditures.—Federal expenditures of this typeinclude outlays principally for research and development, educationand health, and other programs which increase the Nation's fund ofknowledge and technical skills and improve the physical vigor of thepopulation. The total of Federal spending shown in this categorydoes not fully reflect the Government's contribution to the produc-tivity of the economy, since it excludes additions to physical assets, aswell as certain other programs which further this end. The latterare classified in accordance with their principal purpose; thus, veteranseducational benefits are listed as veterans aids rather than as develop-mental outlays. Similarly, the training of military personnel or otherGovernment personnel is treated as an operating expense and not aspart of the Government's education and training programs.

4. Current expenses jor aids and special services.—Expendituresclassified under this heading provide aids or special services to certaingroups—mainly in the year in which the outlays are made. In addi-tion to such items as realized losses of the Commodity Credit Corpora-tion on its farm programs, maritime operating subsidies, veteranspensions, and grants to foreign nations for economic and militaryassistance, this category includes (a) administrative and other operat-ing expenses attributable to investment-type programs which benefitspecific groups, and (b) the costs of maintaining the physical assetsrelated to those programs.

Only part of the Federal Government's aid to special groups isreflected in this classification, which is limited by definition to currentexpenses. For example, subsidies for the construction of privatemerchant ships are classified as additions to private assets. Similarly,outlays for which the Federal Government receives assets or collateral(as the acquisition of farm commodities by the Commodity CreditCorporation) are treated as additions to Federal assets. Manyindirect Government aids are excluded from this classification eitherbecause they are not reflected in expenditures or cannot be readilymeasured. Examples of such indirect benefits include low interestrates on some loans and certain preferential tax treatments.

Although expenditures in this category essentially provide a directaid or special service yielding immediate benefits, some of the outlaysincluded contribute indirectly to the Nation's future development.Among these are grants for slum clearance and urban renewal.

5. Retirement and social insurance benefits.—This category appliesonly to trust funds. It covers benefit programs which (a) are fi-nanced from special taxes or contributions and (b) provide insuranceagainst the loss of income due to unemployment, retirement, disability,or death. It does not include Government employees' health andlife insurance expenditures, which are in the form of subscription andpremium payments to approved private companies. It also excludessuch noncontributory programs as public assistance grants, militaryretired pay, and veterans disability and death compensation andpensions which are financed through the administrative budget.

6. Other services and current operating expenses.—The outlays re-ported under this heading support a wide range of activities. They



consist mainly of current expenditures for: Pay and subsistence ofmilitary personnel; repair, maintenance, and operation of physicalassets of the national military establishment and general purposepublic buildings; conduct of foreign affairs; tax collection; payment ofinterest on the national debt; and operation and administration ofother direct Federal programs not elsewhere classified.

7. Unclassified.—Certain trust fund expenditures represent finan-cial transfers to other trust or budget accounts and cannot be properlyclassified into any of the categories described above. Advances andrepayments between the Railroad retirement account and the Unem-ployment trust fund (for railroad unemployment benefits) areexamples of such transactions. This grouping also includes theexpenditures of the District of Columbia which are for the most partlocally financed, but are accounted for as a Federal trust fund.Deposit fund transactions (net) are also included here.

Recoverability of expenditures.—In general, Government expendi-tures for assets are not expected to be recovered by specific revenues.However, most loans, investment in commodity inventories, the con-struction of powerplants, and outlays for range and forest improve-ments on public domain and national forest lands are offset in wholeor in part by receipts to the Treasury through repayments and sales,specific charges, or recoveries. Where such activities are carried onthrough revolving funds, as in most loan programs, receipts arecredited directly against the expenditures and only the difference isincluded in the expenditure total in the budget and in this analysis.In other cases, the returns are included as miscellaneous receipts to theTreasury rather than as offsets to expenditures.

Whether recovered by specific revenues or not, investment anddevelopmental expenditures in both physical and human capital addto the wealth and income of the Nation and, by helping to expand thetax base, augment the Government's potential future revenues.However, this analysis does not attempt to measure the degree ofrecoverability of these outlays, the potential gain in public revenueswhich will be forthcoming from them, nor the duration of futurebenefits and their discounted present value.

Comparison with capital accounting, budgeting, and funding.—Thepurpose of this analysis is to provide a broad framework for under-standing Federal expenditures, recognizing not only outlays to increasephysical capital and financial assets, but also developmental expendi-tures which represent an investment in human capital. It does notdistinguish precisely between capital and current items, although itdoes provide useful general magnitudes. Moreover, it does not makeany allowance for depreciation and obsolescence on existing physicalassets, anticipated losses on loan programs, or profit or loss on sales ofassets at figures different from their book value. Agencies record suchallowances only for transactions where the data will serve programand management needs, as in the case of the public enterprise funds.As a result, it is not possible to determine directly from this analysisthe net addition to the value of federally owned assets.



This analysis is not a capital budget in the sense of a long-rangeprogram for the acquisition of assets, or a plan for separate financingof capital expenditures. Some foreign governments and some Stateand local governments fund a portion of their capital expenditures byseparate borrowing and exclude most or all such expenditures fromtheir computation of budget totals, except for annual charges toamortize these capital outlays over a number of years. The U.S.budget, on the other hand, treats outlays for investment items andfor other purposes alike in computing the budget surplus or deficit.

Table D-2. INVESTMENT, OPERATING, AND OTHER EXPENDITURES(in millions of dollars)

Description

Administrative Budget Funds

ADDITIONS TO FEDERAL ASSETSLoans:

Civil:To domestic private borrowers:

Department of Agriculture:Commodity Credit Corporation: Price support and

grain storage loansRural Electrification AdministrationFarmers Home Administration ._ __ _

Department of Commerce:Area redevelopment fund and other

Department of Health, Education, and Welfare: Defenseeducational activities and other _

Housing and Home Finance Agency:Federal National Mortgage Association _ _College housing loansHousing for the elderly -Federal Housing Administration_ __Other

Veterans Administration:Housing loans:

Veterans direct loans _ _ _ _Loan guarantee revolving fund

UtnerFederal Home Loan Bank BoardSmall Business AdministrationOther agencies _ _ _

Total, to domestic private borrowers, civil

To State and local governments:Housing and Home Finance Agency:

College housing loansPublic facility loansLow rent public housingOther

District of Columbia __ _Other agencies

Total, to State and local governments, civil

1963actual

433332289

20

93

-44017318

- 9 8*

-65-106

L2

1271

781

11530

- 3- 93219

184

1964

-25218263

62

131

-45915433

-100- 2

-5813

44124

8

405

7434

- 5 6212643

141

1965

-420218106

85

152

-59114551

-191- 1

-157-136

i

- 7123*

-623

6831*

223051

203

"Less than one-half million dollars.



Table D-2. INVESTMENT, OPERATING, AND OTHER EXPENDITURES(in millions of dollars)—Continued

Description

Administrative Budget Funds—Continued

ADDITIONS TO FEDERAL ASSETS—Continued

Loans—ContinuedCivil—Continued

To foreign borrowers:Funds appropriated to the President: Foreign assistance—

economicDepartment of State: Loan to the United NationsExport-Import Bank of Washington _ _ _ _ _ _ _

Total, to foreign borrowers, civil

Total, loans, civil

National defense:To domestic private borrowers:

Funds appropriated to the President: Expansion of defenseproduction

Other agencies

Total, to domestic private borrowers, national defense.._

To foreign borrowers: Department of Defense—Militaryassistance . .

Total, loans, national defense

Total, loans _ _ _

Other financial investments:Civil:

Investments in quasi-public institutions, trust funds and in-ternational institutions:

Funds appropriated to the President:Foreign assistance—economic,Inter-American Development Bank _International Development Association

Department of Labor: Advances to unemployment trustfund

Housing and Home Finance Agency: Federal NationalMortgage Association _

Other agencies. _

Total, investment in quasi-public institutions, trustfunds and international financial institutions

Public works—sites and direct construction:Civil:

Legislative branchFunds appropriated to the President: Public works accelera-

tion _.Department of Agriculture:

Forest ServiceOther

Department of Commerce:National Bureau of StandardsOther

Department of Defense—Civil:Corps of EngineersThe Panama CanalOther

1963actual

1,02011

-111

820

1,785

-684

-64

-46

-110

1,675

496062

- 8 5

1

87

24

47

626

143

853161

1964estimate

1,0574

-522

539

1,085

- 45

1

-75

-751,010

1005062

- 8

-101- 5

98

23

104

925

2713

852151

1965estimate

1,133

-732

401

-19

- 42

- 2

-78

-80-98

120

62

- 4

- 2

176

33

2

895

224

902101




Description


ADDITIONS TO FEDERAL ASSETS-Continued

Public works—sites and direct construction—ContinuedCivil—Continued

Department of Health, Education, and Welfare:Public health service _ .Other

Department of the Interior:Bureau of ReclamationBureau of Indian AffairsNational Park Service _ _Bonneville Power Administration _ __Other

Post Office Department _ . _Department of State _ _ _ _Treasury Department _Federal Aviation AgencyGeneral Services Administration: Public buildingsNational Aeronautics and Space AdministrationVeterans Administration: Hospitals and otherTennessee Valley AuthorityOther agencies ___

Total, public works, civil

National defense:Department of Defense—Military:

Military construction (excluding infrastructure)Family housing. _ ,Other

Atomic Energy CommissionOther agencies _

Total, public works, national defense _

Total, public works, sites and direct construction

Major commodity inventories:Civil:

Department of Agriculture: Commodity Credit Corporation:Agricultural commodities

Other agencies

Total, major commodity inventories, civil

National defense:Funds appropriated to the President: Expansion of defense

productionDepartment of Defense—Military: Civil defense.._ _Department of Health, Education, and Welfare: Emergency

health activities _ _ _ _

Total, major commodity inventories, national defense

Total, major commodity inventories

1963

915

2706559152534135

12915622566

13540

2,289

1,1248

2491

1,383

3,672

2514

256

126

20

37

293

1964

2414

25557592528331817

10718547575

17245

2,720

1,092185

2431

1.522

4,242

-91836

-882

-2130

13

22

-861

1965

2916

2396561332746353199

21752086

17211

2,815

1,046190

8260

1

1,504

4,319

-32842

-286

-3010

15

- 5

-291



Table D-2. INVESTMENT, OPERATING, AND OTHER EXPENDITURES(in millions of dollars) —Continued

Description 1963 1964 1965


ADDITIONS TO FEDERAL ASSETS—Continued

Major equipment:Civil:

Department of CommercePost Office DepartmentTreasury Department: Coast GuardOther agencies

Total, major equipment, civil

National defense:Department of Defense—MilitaryAtomic Energy Commission

Total, major equipment, national defense

Total, major equipment

Other physical assets—acquisition and improvement:Civil:

Department of AgricultureDepartment of the InteriorHousing and Home Finance Agency—Federal Housing Ad-

ministration and otherVeterans AdministrationOther agencies . . 1

Total, other physcial assets, civil

National defense:Department of Defense—Military

Atomic Energy Commission

Total, other physical assets, national defense

Total, other physical assets—acquisition and improvement-


ADDITIONS TO STATE, LOCAL, AND PRIVATEASSETS

State and local assets:Civil:

Funds appropriated to the President: Public works accelera-tion

Department of Agriculture: Flood prevention and water-shed protection

Department of Commerce:Area Redevelopment AdministrationBureau of Public Roads—Forest highways and other

Department of Health, Education, and Welfare:School construction in federally affected areasHospital construction activitiesWaste treatment works construction _Other .

Federal Aviation Agency: Grants-in-aid for airportsHousing and Home Finance Agency

•Leas than one-half million dollars.

33393020

122

15,147157

15,303

15,426

2230

3995613

521

1571,177

1,334

1,855

23,007

45522132

150

15,895192

16,087

16,236

2444

345-37

9

385

1601,017

1,177

1,562

22,288

48522915

145

14,538\75

14,713

14,858

2844

222-5015

259

165942

1,107

1,366

20,330

14

57

339

536952351*

111

57

1042

4976755759

214

60

1140

527975307624




Description


ADDITIONS TO STATE, LOCAL, AND PRIVATEASSETS—Continued

State and local assets—ContinuedCivil—Continued

District of ColumbiaOther agencies___ _

Total, State and local assets, civil

National defense: Department of Defense—Military.

Total, State and local assets

Private assets—civil:Funds appropriated to the President:

Public works accelerationDepartment of Agriculture:

Agricultural stabilization and conservationSoil conservationOther _

Department of Commerce: Merchant shipsDepartment of Health, Education, and Welfare:

Private hospital constructionHealth research facilitiesOther -

National Science FoundationOther agencies

Total, private assets—

Total, additions to State, local, and private assets.

DEVELOPMENTAL EXPENDITURES

Education, training, and health:Civil:

Department of Agriculture: Extension ServiceDepartment of Health, Education, and Welfare:

Office of Education:Payments to school districtsDefense educational activitiesVocational educationProposed education legislationOther

Vocational rehabilitation administrationPublic Health Service:

Indian health activitiesNational Institutes of HealthCommunity healthEnvironmental health.Other _

Welfare Administration:Grants, maternal and child welfareOther

Other . . . . .Department of the Interior: Bureau of Indian Affairs:

Education and welfare _

1963actual

529

376

28

404

1

523112

9103

113344

361

936

1,340

75

27710234

4285

55175693211

761311

69

1964estimate

1224

662

28

690

34

5731171

94

1143810402

1,024

1,714

80

29011951349106

572161113316

991512

75

1965estimate

3026

715

22.

737

30

4771191

1194237532

968

,706

78

33513510410669106

592091133816

1221513

82




Description


DEVELOPMENTAL EXPENDITURES—Continued

Education, training, and health—ContinuedCivil—Continued

Department of Labor:Youth employment opportunities

OtherNational Science Foundation.Other agencies

Total, education, training, and health, civil _

National defense: Atomic Energy Commission

Total, education, training, and health _

Research and development:Civil:

Department of Agriculture:Agricultural Research ServiceCooperative State Experiment Station Service.Forest ServiceOther .

Department of Commerce:National Bureau of StandardsOther . _

Department of Health, Education, and Welfare:Public Health Service:

National Institutes of HealthOther _ _

Office of Education and otherDepartment of the Interior:

Geological SurveyBureau of MinesFish and Wildlife ServiceOther

Federal Aviation AgencyNational Aeronautics and Space AdministrationVeterans AdministrationNational Science Foundation . .Other agencies

Total, research and development, civil


Military personnel: Research and developmentProcurement: Test and evaluation support _ _Research, development, test, and evaluationOperation and maintenanceOther

Atomic Energy CommissionOther agencies.

Total, research and development, national defense

Total, research and development

1963actual

rD

6419

1,214

15

1,229

86382218

2323

5114029

2729111063

2,32730

10037

3,439

23990

6,3767215

1,0783

7,871

11,310

1964estimate

10cD

8522

1,453

16

1,469

97423720

2525

5638742

3030291869

3,92534

12753

5,253

24885

6,9434820

1,237

8,581

13,834

1965estimate

65cJ

9824

1,790

19

1,809

102422619

2932

5868851

33313319

1094,470

3614357

5,906

25990

6,5804220

1,242

8,233

14,140

"Less than one-half million dollars.




Description


DEVELOPMENTAL EXPENDITURES—Continued

Engineering and natural resource surveys—civil:Department of the Interior:

Geological surveyOther

Other agencies

Total, engineering and natural resource surveys

Total, developmental expenditures

CURRENT EXPENSES FOR AIDS AND SPECIALSERVICES

Agriculture—civil :Department of Agriculture:

Agricultural Marketing Service:Removal of surplus agricultural commodities __Other _ _

Agricultural Stabilization and Conservation Service:ExpensesSugar Act - - -Other

Commodity Credit Corporation and special export pro-grams:

Sales for foreign currencies _International Wheat AgreementTransfer to supplemental stockpileNational Wool Act -Price support, supply, and related programsLosses on long-term sales contracts

Agricultural Research Service. _Other

Other agencies

Total, agriculture

Business:Civil:

Department of Commerce:Patent OfficeMaritime Administration: Ship operating subsidies and

other ' _____ -_Other -__

Department of Defense—Civil:Corps of Engineers: Operation and maintenanceOther __

Post Office DepartmentTreasury Department: Coast Guard: Navigation aidsFederal Aviation AcencvCivil Aeronautics Board: Payments to air carriersOther agencies

Total, business, civil-

National defense: Funds appropriated to the President: Expansion of Defense production . _

Total, business

1963actual

302564

119

12,658

1127

887711

1,48374

10063

2,4337959«?7

4,675

26

22651

11;

6912104318222

1,845

_

1,84

1964stimate

313072

134

15,436

2715

11693

1,6091018679

2,75722359£08

5,488

28

22658

127__(

452257472

8528

1,722

15

1,87

1965stimate

343078

141

16,090

1747

11488

1,081*

8155

2,357295949221

4,458

30

21469

126-113682674948328

1,668

- 3

1,664

'Less than one-half million dollars.




Description


CURRENT EXPENSES FOR AIDS AND SPECIALSERVICES—Continued

Labor—civil:Department of Labor:

Manpower development and training activitiesOther. . __

Other agencies

Total, labor

Homeowners and tenants—civil:Housing and Home Finance Agency:

Urban renewalFederal Housing AdministrationPublic HousingOther_

Federal Home Loan Bank BoardOther agencies __

Total, homeowners and tenants

Veterans—civil:Department of Health, Education, and Welfare: Military

service creditsVeterans Administration:

HosDitals and medical careCondensation and DensionsReadjustment benefitsDirect housing loans: Operating expensesLoan guarantee revolving fund: Operating expensesGeneral operating expenses and other

Other agencies

Total, veterans

International aids:Civil:

Funds appropriated to the President:Foreign assistance—economicPeace Corps - -

Department of Agriculture: Commodity Credit Corporationand special export programs: Emergency famine relief tofriendly peoples -- --

Export-Import Bank of WashingtonOther agencies

Total, international aids, civil

National defense: Department of Defense—Military assistance.

Total, international aids _ _ _ . _

Other aids and special services—civil:Funds appropriated to the President: Disaster reliefDepartment of Agriculture:

School lunch programSpecial milk programFood stamp plan _ __.

1963actual

50196

75

186-167

18211

-266*

-53

1,0473,871

96- 2 3

2916910

5,200

96742

216-120

21

1,126

1,754

2,880

31

1709420

1964estimate

133196

158

234-189

205- 6

-294*

-50

1,1293,929

65- 1 1

3517311

5,331

93473

246-127

28

1.1.54

1,466

2,620

35

1829845

1965estimate

322207

347

312-204

22318

-3421

7

60

1,1233,960

44-15

2415026

5,373

88590

244-124

30

1,123

1,268

2,391

23

19310051






1964 1965


CURRENT EXPENSES FOR AIDS AND SPECIALSERVICES-Continued

Other aids and special services—civil—ContinuedDepartment of Health, Education, and Welfare:

Hospitals and medical care _Public assistanceAssistance for Cuban refugees _._Other

Department of the Interior: Bureau of Indian AffairsOther agencies _ __

Total, other aids and special services

Total, current expenses for aids and special services

OTHER SERVICES AND CURRENT OPERATINGEXPENSES

Repair, maintenance, and operation of physical assets (excludingspecial services):

Civil:Department of Agriculture: Forest ServiceDepartment of Defense—Civil: Corps of EngineersDepartment of the Interior:

Bureau of Land ManagementNational Park Service ___Bureau of ReclamationOther. _

General Services Administration: Real property activities. _Tennessee Valley AuthorityOther agencies __ __

Total, repair, maintenance, and operation, civil


Operation and maintenanceFamily housing

Atomic Energy CommissionOther agencies

Total, repair, maintenance, and operation, national de-fense _

Total, repair, maintenance, and operation of physical assets.

Regulation and control:The JudiciaryDepartment of Agriculture:

Agricultural Research ServiceAgricultural Marketing ServiceAgricultural Stabilization and Conservation Service

Department of Health, Education, and Welfare

50,730

42305124

3,241

17,861

13348

25444414

226-100

41

477

11,8029582

- 1

11,978

12,455

63

2629

125

502,948

39385124

3,508

18,929

13549

25464716

243-137

45

469

11,82217595

- 1

12,091

12,560

67

2731

134

512,816

33355125

3,378

17,618

12554

26495316

254-128

53

502

12,23614597

- 1

12,477

12,979

71

- 2 9171

38




Description


OTHER SERVICES AND CURRENT OPERATINGEXPENSES—Continued

Regulation and control—ContinuedDepartment of Justice:

Legal activities and general administrationFederal Bureau of InvestigationImmigration and Naturalization ServiceFederal prison system

Department of LaborTreasury Department:

Bureau of CustomsOther . . .

Federal Aviation AgencyInterstate Commerce Commission _ _National Labor Relations Board. _Other agencies

Total, regulation and control

Other operation and administration:Civil:

International activities:Department of State:

Foreign affairs administration _International organizations and conferences _ _Educational exchange ____Other ___ _. _

United States Information AgencyOther agencies __ _ __ _ _ _ _ _ _ _ _ _ _ _ _

Total, international activities _ _ _ _

Federal financial activities:Treasury Department:

Bureau of AccountsBureau of the Public DebtInternal Revenue Service _ _ _ _Other

General Accounting OfficeOther agencies __

Total, Federal financial activities __

Other direct Federal programs:Legislative branch _ _Department of Commerce:

Weather BureauOther

Department of Defense—CivilTreasury Department: Claims, judgments, and private

relief actsGeneral Services Administration _ _Other agencies.__ _ __

Total, other direct Federal programs

1963actual

58136664824

673133242177

730

1649938

1403

445

3249

49726424

651

110

61- 137

265260

345

1964estimate

60143674828

743536242285

781

16610568

l14511

512

3449

56429464

726

127

632

41

1310467

417

1965estimate

64149705029

763736252590

750

1789450

'yl

15623

503

3349

59226475

751

127

672

44

57765

387




Description



Other operation and administration—ContinuedCivil—Continued

Retirement, unemployment, and accident compensationfor Federal employees:

Department of Labor:Unemployment compensation for Federal employeesEmployees' compensation claims and expenses

Treasury Department: Coast Guard retired pay andSecret Service annuities

Civil Service Commission: Special payments and an-nuities -- -

Other agencies _

Total, retirement, unemployment, and accident com-pensation for Federal employees

Shared revenues and grants-in-aid:Department of Agriculture: Forest Service._.Department of the Interior:

Bureau of Land ManagementQther

Treasury Department —District of Columbia: Federal paymentOther agencies __. _

Total, shared revenues and grants-in-aid

Total, other operation and administration, civil


Military personnel (excluding'research and development).Family housingCivil defense --Other __

Selective Service System _Other agencies - --

Total, other operation and administration, national defense-

Total, other operation and administration

Interest:On the public debt -

Other interest:On refunds: Treasury DepartmentOn uninvested funds: Treasury Department

Total, other interest

Total, interest _

Total, other services and current operating expenses

1963actual

15365

32

525

307

28

643A

452517

214

1,960

12,761166187

-103426

13,164

15,124

9,895

7411

85

9,980

38,289

1964estimate

14059

35

885

327

31

64

452518

216

2,199

13,93216097

-153720

14,232

16,430

10,600

9011

101

10,701

40,473

1965estimate

11653

38

276

240

32

68VI472516

226

2,108

14.401160110

-144225

14,724

16,832

11,000

9012

101

11,101

41,663




Description


Allowance for attack on povertyAllowance for civilian pay comparabilityAllowance for contingencies

SubtotalInterfund transactions

Total, administrative budget funds

Trust Funds

(Includes deposit funds and Government-sponsored enterprises)

ADDITIONS TO FEDERAL ASSETS

Loans—civil:To domestic private borrowers:

Housing and Home Finance Agency: Federal NationalMortgage Association: Secondary market operations

Veterans Administration: Life insurance fundsFarm Credit Administration:

Banks for cooperativesFederal intermediate credit banks

Other agencies

Total, loans to domestic private borrowers, civil

Public works—sites and direct construction—civil:Department of Defense—Civil: Corps of Engineers and other_Other agencies

Total, public works, sites and direct construction

Major equipment—civil _.

Other physical assets—acquisition and improvement—civil


ADDITIONS TO STATE, LOCAL, AND PRIVATEASSETS

State and local'assets—civil:Department of Commerce: Highway trust fund and other

Private assets:Civil:

Farm Credit Administration: Federal land banksFederal home loan banks

Total, private assets, civil

1963

93,155-513

92,642

-702113

29111- 1

-283

239

32

*

-250

2,941

176363

540

1964

250

99,089-685

98,405

- 7 3123

40111

1

317

359

43

*

1

362

3,453

1801,200

1,380

1965

250544300

98,500-600

97,900

156120

40233

1

550

205

25

2

576

3,541

140-100

40

*Less thai one-half million dollars.




Description

Trust Funds—Continued

ADDITIONS TO STATE, LOCAL, AND PRIVATEASSETS—Continued

Private assets—ContinuedNational Defense: Atomic Energy Commission

Total, private assets

Total, additions to State, local, and private assets ._

DEVELOPMENTAL EXPENDITURES

Research and development—civil:Department of Commerce: Bureau of Public Roads and other.Other agencies _

Total, research and development ._

Total, developmental expenditures

CURRENT EXPENSES FOR AIDS AND SPECIALSERVICES

Business—civil:Department of Commerce:

Bureau of Public RoadsOther

Federal Deposit Insurance Corporation

Total, business. _

Labor—civil:Department of Labor: Unemployment trust fund: Grants for

administration and other

Homeowners and tenants—civil:Housing and Home Finance Agency: Federal National Mort-

gage Association: Secondary market operationsNational Capital Housing Authority 4

Total, homeowners and tenants

Veterans—civil

International aids:Civil 1National defense: Department of Defense—Military assistance

advances

Total, international aids

1963

540

3,481

485

53

54

2919

-161

-112

375

- 2 9- 2

-31

14

6

674

680

1964

2

1,382

4,835

626

68

68

3920

-180

-121

450

21

4

16

11

860

871

1965

1

41

3,583

686

74

74

4216

-202

-144

483

- 1 81

-17

14

9

1,225

1,234

•Less than one-half million dollars.




Description


CURRENT EXPENSES FOR AIDS AND SPECIALSERVICES—Continued

Other aids and special services—civil:Department of Health, Education, and Welfare:

Federal old-age and survivors insurance: Operating expenses.Federal disability insurance: Operating expenses

Department of the Interior:Indian tribal fundsOther . . _ .

Other agencies __ _

Total, other aids and special services

Total, current expenses for aids and special services

RETIREMENT AND SOCIAL INSURANCE BENEFITS

Social security benefits—civil:Department of Health, Education, and Welfare:

Federal old-age and survivors insuranceFederal disability insurance

Total, social security benefits 1 _

Unemployment benefits—civil: Department of Labor: Unem-ployment trust fund

Other retirement and social insurance benefits—civil:Veterans Administration:

National service life insuranceU.S. Government life insurance

Civil Service Commission: Civil Service retirement and dis-ability __- _--

Railroad Retirement Board: Railroad retirement accountOther agencies

Total, other retirement and social insurance benefits

Total, retirement and social insurance benefits

OTHER SERVICES AND CURRENT OPERATINGEXPENSES

Repair, maintenance, and operation of physical assets—civil

Regulation and control:Department of Agriculture: Inspection, grading, and other—Other agencies

Total, regulation and control

1963actual

26169

673

10

410

1,335

13,8451.171

15,015

2,965

64266

1,0551,064

8

2,834

20,814

20

243

27

1964

30470

693

11

457

1,676

14,6291,255

15,884

2,702

44756

1,2121,100

8

2,822

21,409

22

264

29

1965

29585

543

11

447

2,017

15,3761,324

16,700

2,770

31447

1,3651,125

9

2,860

22,330

22

174

31

700-000 O — m 2)4




Description



Other operation and administration:Civil:

International activities:Department of Justice:

Alien property fund, World War II

Foreign Claims Settlement Commission: War claims fund.Other agencies

Total, international activities

Federal financial activities

Other direct Federal programs:Civil Service Commission:

Civil Service retirement and disability fund: RefundsHealth benefits and life insurance

Other agencies

Total, other direct Federal programs

Shared revenues and grant-in-aid

Total, other operation and administration, civil

National defense: Department of Defense —Military

Total, other operation and administration

Total, other services and current operating expenses

UNCLASSIFIED

Payments to other trust funds:Federal old-age and survivors insuranceFederal disability insuranceAlien property fund - -Railroad retirement account __

Payments to general fund: Unemployment trust fundDistrict of Columbia _ __Federal National Mortgage Association—secondary market

operationsDeposit funds. _ .

Total, unclassified

SubtotalInter fund transactions

Total, trust funds . _

1963actual

5i

*

6

13

*

121- 4 5

2

78

13

104

5

109

156~

423202638

476334

146

1,461

27,050-505

26,545

1964

1i

221

25

1

125- 6 5

2

62

14

102

5

107

158

423205018

403396

101-116

1,294

29,803-488

29,315

1965

-103

661

-35

125- 5 5

2

72

14

51

5

56

109

41818

1258

190417

-17

1,160

29,849-477

29,372



SPECIAL ANALYSIS E

FEDERAL CREDIT PROGRAMS

INTRODUCTION

Federal credit aids help achieve basic objectives of Governmentprograms in six major areas. Most important are the loan, loaninsurance, and loan guarantee programs for: (a) improvement of pri-vate housing and encouragement 01 home ownership; (b) developmentof agricultural and other natural resources; and (c) promotion ofeconomic development abroad. In addition, Federal credit programsprovide significant assistance for: (d) domestic business, e.g., smallbusiness generally, transportation, and commercial fisheries; (e)community development and public housing; and (f) higher education.

Federal Credit ProgramsNew Commitments

These programs are intended to supplement, rather than to sub-stitute for private credit. In some cases, they fill gaps by providingor stimulating a type of credit not otherwise generally available toimportant groups of borrowers. Often they assume or share in riskswhich private lenders, at least initially, cannot reasonably be expectedto undertake. Similarly, the terms on which the assistance is providedoften are more liberal, with longer maturities, smaller downpayments,

371



or lower interest rates than are generally available otherwise. Inseveral programs the loans are part of a package of Federal assistance,which may include, for example, research grants to help identifypromising new industries for depressed areas, or technical aids to helpunderdeveloped countries plan and construct basic transportationsystems.

Unlike almost all other Government programs, the initial expendi-tures involved for credit programs are largely or wholly repayable,so that the ultimate net cost is normally low. Some programs arefully self-supporting; in most others, the income from interest pay-ments or insurance and guarantee fees covers most of the currentexpenses and/or provides reserves for future losses. Customarily,administrative expenses are paid from income, but occasionallyseparate appropriations are made to finance them. Thus, theseprograms are mainly methods of helping borrowers to help themselves.

REPORT OF COMMITTEE ON FEDERAL CREDIT PROGRAMS

In February 1963, President Kennedy released the report of theCommittee on Federal Credit Programs.1 The Committee, chairedby the Secretary of the Treasury, reviewed legislation and administra-tive policies governing present Federal credit programs and theireffectiveness in helping to meet national goals. It recommended a setof guidelines to serve as "a framework for the further evolution ofthese programs to meet the changing requirements of an expandingAmerican economy."

In transmitting the report to the departments and other agenciesadministering the various credit programs, the President suggestedthat they be "guided by the principles outlined in the report in ad-ministering their present programs and especially in proposing anynew or expanded credit authority." Specific assignments were alsomade to the Director of the Bureau of the Budget, the Chairman of theCouncil of Economic Advisers and the Secretary of the Treasury totake the lead in assuring effective and equitable application of theseguidelines, in reviewing special economic problems and in assuringthat borrowing arrangements are consistent with overall monetaryand debt management policy.

COVERAGE OF SPECIAL ANALYSIS

The number of types of assistance and the overall level of activityin Federal credit programs have been gradually rising—as new pro-grams are authorized by the Congress and existing programs broad-ened. At the same time, important changes in emphasis are occurring,and programs established for temporary reasons in earlier years areliquidating their operations as outstanding loans are repaid or privatelyrefinanced.

The analysis this year presents separate information on major creditprograms administered by seven cabinet departments and five otheragencies. Separate information is presented for the first time on themilitary assistance credits of the Department of Defense. In addi-tion, the 1965 estimates reflect: (a) enactment of legislation broad-ening credit aids for education by the Department of Health, Educa-

1 Report of the Committee on Federal Credit Programs to the President of the United States (Washington:1963).



tion, and Welfare and authorizing two new types of credit extensionby the Department of the Interior; (b) proposed legislation to author-ize Federal insurance or guarantees of private credit to aid ruralhousing, urban mass transportation, college students, and hospitalmodernization; and (c) proposed legislation to authorize sales ofparticipations in pools of housing loans by the Housing and HomeFinance Agency and the Veterans Administration.

The analysis includes (in tables E-2 and E-3) the total amounts,but no detailed information, on outstanding loans and guaranteesand on net expenditures for numerous smaller or relatively inactivecredit programs administered by seven departments and five otheragencies; these account for about 0.4% of outstanding direct and guar-anteed loans. Loan programs of important quasi-public agencies areexcluded from tables E-l to E-5, but their outstanding loans areshown in table E-6. The analysis excludes borrowing from theTreasury by other Federal agencies, whether for loans or otherprograms.2

NEW COMMITMENTS

New commitments are the best single measure of the trends in mostFederal credit programs. They also give the best advance indicationof trends in the economic impact of these programs, since changes inthe level of new commitments usually precede corresponding changesin the volume of loans disbursed by either public agencies or privatelenders and in the purchase of goods and services by the ultimateborrowers.

In this analysis, commitments are defined as approvals by Federalagencies of direct loans or of insurance or guarantees of private loans.They are shown on a gross basis, including administrative reserva7tions or other commitments which do not later result in actual creditextensions, as well as the unguaranteed portions of loans partiallycovered by Federal guarantees.

Direct loans.—New commitments of $7.9 billion estimated fordirect loans in 1965 are $1.1 billion higher than the actual commit-ments made in 1963. The largest increases expected are for loans toforeign borrowers by the Export-Import Bank and for mortgagepurchases by the Federal National Mortgage Association. Thenewly enacted legislation for college academic facility loans and otherincreased educational loans by the Department of Health, Education,and Welfare will cause commitments for these programs to more thantriple the actual 1963 level. The two most active international lend-ing programs, the Export-Import Bank and the Agency for Inter-national Development, together will account for almost 40% of newdirect loan commitments in 1965.

Guarantees and insurance.—New commitments for guarantees andinsurance of private loans will continue to rise to an estimated $21.4billion in 1965. About two-thirds of the total new commitmentsand of the rise during the 2-year period will be in housing loansinsured by the Federal Housing Administration. The largest other in-creases are expected in guarantees of loans to foreign borrowers by

2 Supplementary material containing brief summaries of each of the major programs (includingthe major quasi-public credit programs) with emphasis on current developments is available onrequest from the Bureau of the Budget.



Table E-l. NEW COMMITMENTS FOR MAJOR FEDERAL CREDIT PRO-GRAMS CLASSIFIED BY TYPE OF ASSISTANCE, MAJOR AGENCY ORPROGRAM (in millions of dollars)

Agency or program

1963 actual

Directloans

Guar-anteed

andinsuredloans

1964 estimate

Directloans

Guar-anteed

andinsuredloans

1965 estimate

Directloans

Guar-anteed

andinsuredloans

Department of Agriculture:Commodity Credit CorporationRural Electrification AdministrationFarmers Home Administration

Department of Commerce:Area Redevelopment AdministrationMaritime Administration

Department of Defense:Defense production guaranteesMilitary assistance credits

Department of Health, Education, andWelfare: Office of Education

Department of the InteriorDepartment of State:

Loans to United NationsAgency for International Development..

Treasury Department: Loans to Districtof Columbia

Housing and Home Finance Agency:Office of the AdministratorCommunity Facilities Administration__Urban Renewal AdministrationFederal National Mortgage Association.Federal Housing AdministrationPublic Housing Administration

Veterans AdministrationExport-Import Bank of WashingtonInterstate Commerce CommissionSmall Business Administration

572427592

22512

2,497

" 2 6 6

56

8712

1001,780

36

43

37

524390562

2437

2,285

208

436385456

282

1,908

516

99

19

95

22105

13312

138

30613

25

,740

20

110 1,889

14

225

702124177292131417680

280

325

11,930648

2,8798505357

668170400247110427

1,119

565

324

12,511804

2,6661,010

1846

742200710222120371

1,228

75

678

13,206852

2,4501,324

368 56

Total by type of assistance.

Grand total

6,747 19,475 7,201 20,341 7,8 21,432

26,222I

27,542 29,312

the Export-Import Bank and of loans to finance the expanding urbanrenewal program, and in insured loans by the Farmers Home Admin-istration, largely because of the proposed new program to help financerural housing.

Overlapping commitments.—The total estimated commitments of$29.3 billion include several cases where two or more types of Federalassistance are provided for the same borrower, or on the same prop-erty a different stages in the financing process. For example,all of tne $0.7 billion of commitments for mortgage purchases by theFederal National Mortgage Association are for mortgages coveredby insurance or guarantees made by other Federal agencies. Com-mitments by the Public Housing Administration are likewise madeat more than one stage of the financing of local low-rent publichousing.



OUTSTANDING DIRECT AND GUARANTEED LOANS

The best index of the level of Federal credit programs over a periodof years is provided by the total outstanding direct and guaranteedloans. By the close of 1965, these will total $121.7 billion for majorprograms, and with numerous smaller programs, $122.1 billion.

Table E-2. OUTSTANDING DIRECT LOANS, AND GUARANTEED AND IN-SURED LOANS FOR MAJOR FEDERAL CREDIT PROGRAMS CLASSI-FIED BY AGENCY OR PROGRAM (in millions of dollars)

Agency or program

Department of Agriculture:Commodity Credit CorporationRural Electrification AdministrationFarmers Home Administration._ _ __



Department of Health, Education, andWelfare: Office of Education______ _ __

Department of the Interior: Reclamationloans

Department of State:Loans to United Nations _ _Agency for International Develop-

ment _ _ _ _ _ _ _ _Treasury Department:

Loans to District of ColumbiaForeign loans

Housing and Home Finance Agency:Community Facilities AdministrationUrban Renewal AdministrationFederal National Mortgage AssociationFederal Housing Administration _ __Public Housing Administration _ _ _ _

Veterans AdministrationExport-Import Bank of Washington _ _ _Interstate Commerce Commission.Small Business Administration.

Total by type of assistance:Major agencies or programsOther agencies or programs

All agencies __

1963 actual

Direct

1,7683,6941,551

25126

12185

296

67

113

6,121

1053,873

1,680129

2,88363394

1,6303,296

15817

29,113346

29,459

Guar-

insuredloans

834

474

419

139

56

1,038

42,4474,387

30,0551,336

16189

81,43526

81,461

1964 estimate

Direct

1,7303,9111,775

100108

16214

419

81

112

7,469

1303,784

1,974147

2,42163437

1,5832,773

15941

30,374400

30,774

Guar-

insuredloans

905

653

484

128

166

1,287

45,7544,828

28,0002,245

169106

84,72528

84,753

1965 estimate

Direct

1,3094,1291,833

20190

18272

563

96

107

8,944

1593,694

2,270165

1,82954038

1,2882,042

151,064

30,666407

31,073

Guar-anteed

andinsuredloans

1,062

1,114

558

107

25

381

1,632

49,6245,299

27,6003,339

170130

91,04142

91,083

Outstanding direct loans will rise by more than $1.3 billionduring 1964 and another $0.3 billion during 1965. Loans to foreignborrowers held by the Agency for International Development, theTreasury Department and the Export-Import Bank, estimated at



$14.7 billion on June 30, 1965, will account for 45% of all direct loansof Federal agencies at that time. While the Treasury Departmentand the Bank will reduce their portfolios during the 2-year period by$1.4 billion, AID expects to have a $2.8 billion increase.

During the same 2 years increases in outstanding loans by theRural Electrification Administration and the Farmers Home Ad-ministration will be partly offset by the anticipated $459 millionreduction in the Commodity Credit Corporation portfolio. Forall other credit programs, the net reduction of $1.5 billion in loansheld by the Federal National Mortgage Association, the VeteransAdministration and the Federal Housing Administration—primarilyresulting from increased sales to private lenders—will roughly balancethe continuing expansion in the outstanding loans of the CommunityFacilities Administration, the Department of Health, Education, andWelfare, the Small Business Administration, the Area RedevelopmentAdministration and other credit programs.

Guaranteed and insured loans outstanding are expected to go upby $9.6 billion over the 2-year period. Mortgage and propertyimprovement loans insured by the Federal Housing Administrationwill account for more than half of the total in 1965 and for two-ithirdsof the net; increase during the period. Other substantial increasesare estimated for the Export-Import Bank, the Agency for Interna-tional Development, the Public Housing Administration, the UrbanRenewal Administration and the Farmers Home Administration. Out-standing guaranteed loans of the Veterans Administration will declineby $2.5 billion, as more loans mature, or are prepaid, and fewer newloans are made as veterans exhaust their eligibility for this type ofcredit assistance.

The amounts shown include both the guaranteed and unguaranteedportion of outstanding loans in order to give a clearer picture of theeconomic impact of these programs and to tie in better with banking-statistics. Thus, they do not indicate the estimated contingentliability of the Federal Government. The major program for whichthe contingent liability differs materially from the principal amountof the loans is the veterans loan guarantee program; by the end of1965, the Government's liability will be about $12.5 billion lower thanthe outstanding amount of such guaranteed loans.

DISBURSEMENTS AND REPAYMENTS

Direct loans can have a major budgetary impact, since the differencebetween disbursements and repayments represents net expendituresor receipts. Federal guarantees and insurance of private loans, onthe other hand, ordinarily have only a minor effect on Federal expendi-tures, since they result primarily in expenditures by private financialinstitutions. Net expenditures for Federal credit assistance, there-fore, give only a partial picture of the economic impact of most ofthese programs.

Net expenditures of all Government lending programs (with theexception of loans from trust funds or by quasi-public agencies) areincluded in the administrative budget totals. In most currentlyactive loan programs, collections are offset directly against expendi-tures. In the case of the Rural Electrification Administration,collections on loans are deposited to miscellaneous receipts, but



legislation is proposed to put this program on a revolving fund basisbeginning in 1964. In the case of foreign loans, disbursements andrepayments in foreign currencies are included in the analysis, thoughthey are not included in budget expenditures and receipts. Alsoincluded is sales credit extended to buyers of federally owned assets,even when no budget expenditures are involved.

Table E-3. DISBURSEMENTS AND REPAYMENTS FOR MAJOR FEDERALCREDIT PROGRAMS CLASSIFIED BY AGENCY OR PROGRAM


Agency or program

1963 actual

Dis-burse-ments

Repay-ments

1964 estimate

Dis-burse-ments

Repay-ments

1965 estimate

Dis-burse-ments

Repay-ments




Department of Health, Education, andWelfare: Office of Education

Department of the Interio rDepartment of State:

Loans to United NationsAgency for International Development-

Treasury Department:Loans to District of ColumbiaForeign loans

Housing and Home Finance Agency:Community Facilities AdministrationUrban Renewal AdministrationFederal National Mortgage Association.Federal Housing AdministrationPublic Housing Administration

Veterans AdministrationExport-Import Bank of WashingtonSmall Business Administration

Total.

Net addition to loans:Major agencies or programsOther agencies or programs

Adjustment for repayments going directlyinto miscellaneous receipts

Adjustment for net extensions of salescredit, deduct

Adjustment for net expenditures in foreigncurrencies, deduct-

Total administrative budget ex-penditures l

3,137332760

2412

1556

9114

721,438

36

369143137292379405508293

2,704162495

15

1152

2482

384

28156576187382576780166

2,738377762

767

14105

12315

41,507

36

387161125247384434668310

2,764160533

225

977

1*

2159

12

94143584197441479

1,191186

2,187383826

107

3138

14415

1,600

31

412207305222399377720326

2,607165761

618

79

1*

2125

291

114189896271399670,452203

8,513 6,862 ,480 7,147 8,404 8,052

1,651-68

623

280

251

1,33360

259

262

380

352

4

200

264

390

1,675 1,010

"'Less than one-half million dollars.1 See special analysis D, p. 359.



Gross loan disbursements of major credit programs are expectedto decline slightly from the 1963 level in both 1964 and 1965. How-ever, repayments will rise sharply in both years from $6.9 billion in1963 to an estimated $8.1 billion in 1965. As a result, the net ex-penditures of over $1.6 billion in 1963 will be reduced to less than$0.4 billion in 1965. After adding in net expenditures for othercredit programs and adjusting for repayments going directly tomiscellaneous receipts, for loans in foreign currencies and for salescredit extensions involving no budget expenditures, receipts willexceed budget expenditures for loans in 1965 by an estimated $98million.

The sharply reduced net impact on the budget anticipated in 1965arises mainly from the considerable fall now expected in disbursementson Commodity Credit Corporation loans from the unusually high1963 levels, together with increased substitution of private for publiccredit, primarily by the Export-Import Bank, the Federal NationalMortgage Association and the Farmers Home Administration.

PRIVATE PARTICIPATION IN CREDIT PROGRAMS

The relative importance of public and private credit varies greatly,for different types of credit. Direct loans outstanding to domesticprivate borrowers amounted to 2.2% of the estimated private debtof $716 billion outstanding on June 30, 1963. Private loans partlyor wholly guaranteed by Federal agencies comprised 11.2% of thetotal private debt on that date. Federal participation was muchhigher in agricultural and housing credit; on the other hand, direct orguaranteed loans provided only a fraction of 1% of the total creditotherwise used by private businesses.

As a general rule, Federal credit programs endeavor to maximizeprivate participation. Federal guarantees and insurance of privatecredit account for almost three-quarters of all new commitments ofFederal credit programs and for about the same proportion of out-standing Federal credit assistance. Excluding loans to foreignborrowers, the predominance of guaranteed and insured loans is evengreater.

Emphasis upon private participation is reflected both in the basicstatutes and in the administrative policies of the major credit pro-grams. Often direct loans are prohibited except when the borrowercannot otherwise obtain the funds from other sources on reasonableterms. In two major programs (the Public Housing Administrationand the Urban Renewal Administration) the direct loans made arecustomarily refinanced in whole or in part by private loans guaranteedby the Federal agency. In four other programs (college housing andpublic facility loans made by the Community Facilities Administra-tion, business loans by the Small Business Administration, and foreignloans by the Export-Import Bank), administrative policies emphasizejoint participations between private lenders and the Governmentlending agencies. In the first two programs, the borrowers are re-quired to advertise all offerings of their obligations publicly and theCommunity Facilities Administration purchases only those whichprivate lenders are unwilling to buy at predetermined interest rates.



Table E-4. SALES OF LOANS TO NONFEDERAL BUYERS AND OTHERREPAYMENTS FOR MAJOR FEDERAL CREDIT PROGRAMS CLASSI-FIED BY AGENCY OR PROGRAM (in millions of dollars)

Agency or program

Housing and Home Finance Agency:Community Facilities Administration:

College housing loans _Public facility loansOther

Federal National Mortgage Association:Special assistance functionsManagement and liquidating func-

tionsProposed pool participations

Federal Housing AdministrationPublic Housing Administration

Veterans Administration:Direct loansLoan guarantee revolving fundProposed pool participations

Export-Import Bank of WashingtonSmall Business AdministrationAll other major credit programs ^

Total

1963 actual

2

293

14

32

181279

3365

1,142

Other

merits

1817

129

141

155382

8035

444161

4,167

5,720

1964 estimate

5010

348

50

53

150222

7037

1,593

Other

merits

221

10

67

119

197388

7037

488179

3,976

5,554

1965 estimate

5025

348

167200

200263100909

12

2,274

Other

ments

262

10

62

119

271399

6740

543191

4,048

5,778

In the past year, a Government-wide effort has been made to sellexisting loans from the portfolios of Federal agencies to privatelenders and to encourage private refinancing. During fiscal 1963over $1.1 billion of such sales were consummated, considerably abovesales in any previous year. In 1964 and 1965, these sales are esti-mated to increase to $1.6 billion and $2.3 billion respectively. Thesefigures exclude not only regular amortization and prepayments ofprincipal, but also sales made as part of the usual process of guaran-teeing or insuring loans and sales from one Government agency toanother agency.

The salable portions of the loan portfolios are concentratedmainly in the Export-Import Bank and in the various mortgage andother housing loans. Most of the loans held by other Federal creditprograms have interest rates, maturities, or other terms which makethem currently unattractive to private lenders except at sacrificeprices. Legislation is being proposed to authorize sales of certificatesof participations in pools of loans owned by the Federal NationalMortgage Association and the Veterans Administration.



INTEREST RATES AND MATURITIES

Two of the major ways in which Federal credit programs helpachieve program objectives are by providing more favorable interestrates or maturities than many borrowers can obtain from othersources. Table E-5 summarizes the current range of interest ratescharged by the various major credit programs on direct loans (or pre-vailing on insured or guaranteed loans) and the customary maturitiesfor both direct and insured and guaranteed loans. These terms areon newly committed loans by currently active programs, and do notnecessarily correspond to those on previously outstanding loans, or onloans covered by commitments made in earlier years.

Table E-5. INTEREST RATES AND MATURITIES FOR MAJOR ACTIVECREDIT PROGRAMS CLASSIFIED BY AGENCY OR PROGRAM,DECEMBER 1963

Agency or program




Department of Health, Education, and Welfare: Office ofEducation

Department of the Interior: Bureau of ReclamationDepartment of State:

Loans to United NationsAgency for International Development

Treasury Department: Loans to District of ColumbiaHousing and Home Finance Agency:

Community Facilities AdministrationUrban Renewal AdministrationFederal National Mortgage. AssociationFederal Housing AdministrationPublic Housing Administration _.

Veterans AdministrationExport-Import Bank of WashingtonInterstate Commerce CommissionSmall Business Administration

Direct

Interestrate

(percent)

/ 2 23-5

3/8-46

0-4

3-4H0-4

2

4

0-3/8

3/8-6

4

5/!-6

3-5/

loans

Maturity(years)

/2-45-351-50

10-4017-20

3-10

2 11-5020-50

253-40

30

1-50Demand

10-4030-35

4301/2-20

3-25

insured

Interest

(percent)

4.15-5

6

W2-W4

33/ 8 -62-3.2

5M5 /2 -^/ 2 5-8 2

loans

Maturity(years)

33-50

17-20

/2-2

/2-36

1 35-40/4-40

30/2-51-153-25

1 When commodity loan is repaid by forfeiting collateral, no interest is charged.2 On student loans, maturities begin when student leaves school and exclude periods of military

or Peace Corps service.3 In addition, property improvement loans are insured for $4 to $5 discount per year (equivalent

to over 8% simple interest), and with maturities of 6 months to 7 years.



Interest rates charged on direct loans vary greatly both amongthe various Federal credit agencies and sometimes among the varioustypes of loans made by a single agency. Many of the differences inrates reflect mainly differences in the cost of providing the loan,including the cost of borrowing the necessary funds, of administeringthe varying types of loans and of incurring the varying degrees ofrisk of probable loss. In many cases, the rate charged is governedby statutory limits or formulas. These sometimes are intended toassure loans at rates below those prevailing in the private market orbelow the cost to the Government, in order to provide special assist-ance to particular groups of borrowers as a method of accomplishingFederal program objectives. In some cases, the rates charged reflectmainly Government borrowing costs in earlier periods, rather thancurrent market yields of Government obligations.

Interest rates charged on insured and guaranteed loans tend tocorrespond more closely to market rates of interest on comparableloans by private lenders—allowing for the reduction or removal ofthe normal private credit risk. In a few cases, interest rates on insuredloans are deliberately set below the market rate and a secondarymarket provided to assure the willingness of the private lender tomake the initial loans; for example, the Federal Housing Adminis-tration was authorized in the Housing Act of 1961 to insure certaintypes of loans to finance moderate-income housing at rates well belowthose prevailing in the private market and the Federal NationalMortgage Association purchases all of such mortgages.

Maturities, both on direct and on insured or guaranteed loans, oftenare substantially more liberal than on private loans of similar types.Private lenders are often limited by law or supervisory policy toshorter maturities. When a Federal agency insures or guarantees theloans, however, these limitations customarily do not apply. Whenborrowers are acquiring assets yielding income or tangible benefits overa long period of years, long-term loans reduce periodic installmentsand make it possible for borrowers to undertake such acquisitions withreasonable assurance of repayment.

QUASI-PUBLIC CREDIT PROGRAMS

The Federal Government also has certain responsibilities for thecredit programs of mixed-ownership corporations and other publicagencies operating in whole or in part with private funds. Table E-6summarizes the outstanding loans for eight institutions or groups ofinstitutions of this type which have important lending operations.

Outstanding loans of the five groups of mixed-ownership enterprisesand trust funds for which estimates of future fiscal years as well asactual data on the past years are available will increase from a totalof $5.7 billion in 1963 to an estimated $6.4 billion by the end of thefiscal year 1965. Most of the anticipated increase is in the operationsof the Federal intermediate credit banks.



Table E-6. OUTSTANDING LOANS FOR MAJOR QUASI-PUBLIC CREDITPROGRAMS CLASSIFIED BY AGENCY AND PROGRAM (in millions of dollars)

Agency

Mixed ownership enterprises and trust funds:Farm Credit Administration:

Banks for cooperatives _Federal intermediate credit banks __ __

Housing and Home Finance Agency: Federal NationalMortgage Association (Secondary market operationstrust fund)

Veterans Administration:National service life insurance fund. _U.S. Government life insurance fund __

Subtotal, mixed ownership and trust funds

Other quasi-public credit programs:Farm Credit Administration: Federal land banksFederal Home Loan Bank Board: Federal home loan banks.Federal Reserve, Board of Governors: Federal Reserve

banks

Subtotal, other quasi-public credit programs

Total

1962actual

6921,998

2,871

418102

6,081

2,9682,767

136

5,871

11,952

g

1963actual

7012,293

2,138

46398

5,693

3,1983,270

139

6,607

12,300

d f fi

1964esti-mate

7612,300

2,058

50894

5,721

0)4,500

0)

1965esti-mate

7902,800

2,213

54891

6,442

0)4,400

0)

i Estimates are not available (or 1964 and 1965.

The three other groups of institutions, which are privately owned,increased their outstanding loans from $5.9 billion at the end of 1962to $6.6 billion on June 30, 1963, primarily because of the $0.5 billionincrease in advances by the Federal home loan banks during 1963.This increase has accelerated during 1964, but is not expected tocontinue in 1965. No data are available on the expected trends inloans by the Federal land banks or in discounts and advances by theFederal Reserve banks.


SPECIAL ANALYSIS F

FEDERAL ACTIVITIES IN PUBLIC WORKS

Many types of public works are needed by the Federal Governmentto carry out its program responsibilities. In some cases the structuresare built by the Federal Government, usually under contract withprivate enterprise; in other cases, Federal financial assistance in theform of grants or loans is provided to State and local authorities forpublic facilities needed in the national interest.

Construction undertaken directly by the Federal agencies involve?facilities ranging from large water resources developments, spac(facilities, office buildings, and defense installations to small recrea-tional facilities, warehouses, and border facilities. Federal grants orloans are provided for highways, hospitals, waste treatment works,educational facilities, sewage systems, and many other types ofcommunity facilities.

Direct Federal construction currently constitutes about 22% ofthe total public construction in the United States. State and localpublic works benefiting from Federal grants represent another 24%,two-thirds of which is financed from Federal funds. Federal cost-sharing, which depends upon program objectives and provisions oflaw, varies substantially among the grant programs.

In 1965, Federal expenditures for public works are estimated toreach $8.7 billion, an increase of $228 million over the 1964 level.This total is more than double the level of 10 years ago. Partof this dollar increase results from increased construction costs,which are now about 15% above 1956. The increase in public works

Table F-1. FEDERAL EXPENDITURES FOR PUBLIC WORKS,FISCAL YEARS 1956-65 (in millions of dollars)

From budget accounts and trust funds

Year

195619571958195919601961196219631964 estimate1965 estimate

Total,civil anddefensepublicworks

4,1034,4925,0706,6846,8466,8236,9387,1968,5078,735

Civil public works

Total

1,7842,2433,1064,5355,0114,9255,3105,7906,9627,213

Federalconstruc-

tion

8691,0761,2541,5211,6431,8782,0852,3212,7642,840

Grants

8891,1031,7352,8713,2112,8973,0183,2804,0664,188

Loans(net)

2665

117143156149207190133186

Nationaldefensepublicworks

2,3192,249

,9642,1501,8351,8981,6271,4051,5451,521

Note.—In this and the following tables, nonconstruction costs are excluded; proposed legislationis included for the years 1964 and 1965. Details may not add because of rounding.

383



expenditures, however, results mainly from the needs of a growingpopulation and the investments required for economic growth. Inmany cases, these Federal public works will stimulate related privateand State and local developments.

Table F-2. EXPENDITURES AND 1965 NEW AUTHORIZATIONS FOR CIVILPUBLIC WORKS, BY AGENCY (in millions of dollars)


Federal construction:Legislative branchPublic works acceleration-Forest ServiceCorps of Engineers—CivilBureau of Reclamation _ _ _ _Bureau of Indian Affairs _ _National Park Service _ _Post Office Department .__ _._ _ _Federal Aviation Agency _General Services AdministrationNational Aeronautics and Space AdministrationVeterans Administration _ _Tennessee Valley AuthorityOther

Total, Federal construction

Grants to State and local governments:Public works acceleration- _Soil Conservation ServiceArea Redevelopment Administration. _ _ _Bureau of Public RoadsOffice of Education. _ _ _ _ _ __Public Health ServiceFederal Aviation Agency „Housing and Home Finance AgencyDistrict of ColumbiaOther

Total, grants.

Loans to State and local governments, net:Area Redevelopment AdministrationBureau of ReclamationHousing and Home Finance AgencyDistrict of ColumbiaOther

Total, loans _ _ _

Civil public works:Budget accounts __ _-Trustfunds

Total, civil public works

I

1963actual

244764

875271

656134

129158225

66135165

2,321

14203

2,98053

12451

529

3,280

314

14625

2

190

2,8172,973

5,790

Expenditure*

1964

2310494

886256576133

107185475

75172233

2,764

2271910

3,49450

15475

1224

4,066

1115543617

133

3,4663,496

6,962

1965

332

91922239

65624699

21752086

172286

2,840

2141811

3,581

n15876103018

4,188

1614

1033121

186

3,6473,566

7,213

Newauthori-zations

1965

47

10793424569591074

25828110235

334

2,556

46935

3,725350279

75753022

4,665

3413

14714

117

326

3,8293,718

7,547



Approximately four-fifths of the $8.7 billion to be spent in 1965 willbe for civil public works; the remainder will be for military publicworks and atomic energy facilities.

Direct Federal public works activities, which are scattered through-out the States and territories, are roughly estimated to provide 457,000man-years of employment, onsite and offsite, in 1965. Constructionaided by Federal grants, including the State or local share of thecosts, will provide an estimated additional 653,000 man-years of labor.

The Federal Government also provides financial assistance for non-profit and private capital facilities through loans, loan guarantees,tax concessions and lease contracts, and indirectly supports throughprocurement contracts the provision of some private facilities whichproduce only materials to meet Government requirements, such asmissiles, space components, and helium conservation. These activi-ties, however, are not within the scope of this analysis.

CIVIL PUBLIC WOKKS

Civil public works expenditures of $7.2 billion in 1965 are estimatedto be $251 million above the 1964 estimate. Expenditures for directFederal public works in 1965, estimated at $2.8 billion, make up39% of this total. The largest increases in direct Federal construc-tion for 1965 include $45 million by the National Aeronautics andSpace Administration, $36 million by the Corps of Engineers—Civil,and $32 million by the General Services Administration. Under thepublic works acceleration program, initiated in 1963 to relieve unem-ployment, expenditures for direct Federal work will decrease by $103million between 1964 and 1965.

The $4.2 billion of grants for State and local public works makeup 58% of total civil works expenditures. Slightly more than $3.5billion of this total consists of grants for the Federal-aid highwayprograms financed from the Highway trust fund. Federal aid for theprimary, secondary, and urban highways is on a 50-50 matching basis ;for the National System of Interstate and Defense Highways it is 90%.

Significant amounts of local public construction receive Federalfinancial assistance through loans. The $103 million of expendituresfor loans by the Housing and Home Finance Agency make up 56% ofthe total loan expenditures. Since expenditures on the various loanprograms are included in the budget totals on a net basis (i.e., ex-penditures for new loans are generally offset by repayments of loansmade in prior years), the totals do not reflect the amount of construc-tion aid provided from loans. New loans by the Housing and HomeFinance Agency are estimated at $322 million in 1965.

New and continuing work.—About $2.6 billion of the $2.8 billion ofexpenditures for direct Federal civil public works in 1965 will be tocontinue or complete construction of projects started prior to 1965.Completion of these projects is estimated to require expenditures of$9.3 billion after 1965.

New Federal projects to be started with funds'recommended in thebudget will require an estimated $191 million of expenditures in1965, and will commit the Government to additional expenditures after1965 of an estimated $1.8 billion. In the water resources field, the

700-000 0—64 <25



Table F-3. ESTIMATED COST OF 1965 DIRECT FEDERAL CIVIL PUBLICWORKS BY CONTINUING AND NEW WORK (in millions of dollars)


*$500 thousand or less.1 Includes some sites as well as planning costs.

Agency or program

Continuing work:Corps of Engineers—Civil. _National Aeronautics and Space Administration. __Bureau of Reclamation _General Services AdministrationTennessee Valley AuthorityVeterans AdministrationForest ServiceFederal Aviation AgencyNational Park ServiceBureau of Indian Affairs..Post Office DepartmentBonneville Power AdministrationPublic Health Service _.Public works accelerationTrust fundsOther

Total, continuing work

New projects and features in 1965:Federal Aviation AgencyCorps of Engineers—CivilGovernment Printing OfficeTennessee Valley Authority _ _National Aeronautics and Space AdministrationGeneral Services AdministrationVeterans AdministrationBonneville Power Administration _Bureau of Indian AffairsBureau of ReclamationOther

Total, new projects and features

Advance planning:General Services Administration *Corps of Engineers—Civil -- -National Aeronautics and Space Administration. __Tennessee Valley Authority .Bureau of ReclamationNational Park ServiceOther

Total, advance planning

Total, direct civil public works

Totalestimated

Federalcost

13,8492,0065,041

786897347606372

1,15567616819999

15325

1,128

27,507

753784739

26658969

18843

120207

2,021

191632719352221

378

29,906

Cumula-tive to

June 30,1964

8,884903

2,866248475154514108376111

103015

151

631

15,642

8

*

3

11

792351

2794

148

15,801

1965estimatedexpendi-

tures

86649323218315478747360604511212

25179

2,572

261616141286554

79

191

2620154219

77

2,840

Requiredto com-

plete

4,099610

1,94335526811518

19171933911314263

318

9,293

493543125

25458163

18338

116125

1,819

86207

146

128

153

11,265

Corps of Engineers will start 34 new projects and the Bureau of Rec-lamation will start 7 new projects. The 1965 budget includes ap-propriations of $266 million to finance new facilities to be constructed



by the National Aeronautical and Space Administration, ranging fromresearch and plant-support facilities to large launch and test facilities.Among the other new starts are public buildings by the General ServicesAdministration, hospitals by the Veterans Administration, a U.S.mint in Philadelphia by the Treasury Department, the NationalAgricultural Library by the Department of Agriculture, and environ-mental health facilities by the Public Health Service. Table F-3shows the total costs of new Federal project starts, as well as theestimated expenditures in 1965 and later years.

In addition to the new direct Federal works to be started, severalnew programs have been authorized recently or are recommended forwhich Federal grants, and in some cases Federal loans, will be madeto State and local groups to meet the Nation's needs for higher educa-tion facilities; vocational, research, and training facilities; classroomsfor elementary and secondary schools; libraries; community healthcenters; and research facilities on mental retardation. Also, theSoil Conservation Service will aid in the construction of 36 newwatershed projects, and the Bureau of Reclamation will make loansto local groups for 3 small reclamation projects.

Public works planning and surveys.—The 1965 budget includesexpenditures of $77 million for advance planning of new Federalprojects, including acquisition of sites by the General Services Admin-istration for public buildings. To encourage preparation and mainte-nance of a current and adequate reserve of local public works and topromote economy and efficiency in building such works, the Housingand Home Finance Agency will make planning advances of $14million in 1965 to States, municipalities, and other public agencies.

Significant amounts will also be spent for preliminary surveys andgeneral investigations to assure economic design and construction ofnew Federal projects. The 1965 budget recommendations for waterresource activities continue on a coordinated basis the comprehensiveriver basin planning by the major Federal agencies concerned. Thesestudies provide long-range economic, hydrologic, and land-use projec-tions for the various river basins, and serve as a basis for planningindividual water resource projects to be undertaken in later years.Expenditures of about $8 million will be made for this purpose in1965 by the Departments of the Army, Interior, Agriculture, andHealth, Education, and Welfare. Expenditures for these activitiesare not included in the public works expenditures in this analysis.

Authorized reserve of direct Federal public works.—Table F-4 sum-marizes the $13 billion reserve of Federal projects which have beenauthorized by substantive legislation. Such projects require onlyfinancing and planning for starting. This reserve provides a basisfor a wise selection of projects for advance planning and for startingin accordance with program needs and budgetary policy.



Table F-4. RESERVE OF PRESENTLY AUTHORIZED PROJECTS ANDPROGRAMS FOR UNDERTAKING AFTER 1965 (in billions of dollars)

Agency

Cost of authorized reserve

Esti-matedtotal

Federalcost

Status of plans as ofJune 30, 1964

Con-tractcouldbe let

Inprocess

Notstarted

Status of plans as ofJune 30. 1965

Con-tractcouldbe let

In Not

Corps of Engineers—CivilBureau of ReclamationForest ServiceTennessee Valley AuthorityBureau of Land ManagementFederal Aviation AgencyGeneral Services Administration.Other agencies

Total

5.12.71.71

1.1.6.2

0)0)

()0)

2.4.7

1.4.7

0)

'.3.1

1.61.4

1.9.7.2.2

'.2.1

2.0.6

1.41.0

1.31.4

.1

.6

.1).4

13.2 2.2 5.9 5.1 3.5 5.8 3.9

i $50 million or less.

Civil public works by function.—Federal programs are classified inthe budget by major functional categories. Table F-7 groups thepublic works activities according to these functions. Some of thesefunctional areas require very large investments in public works; othersrequire few public works.

About 57% of the $7.2 billion of civil public works expenditures in1965 will be spent for public works under the commerce and trans-portation function. Major expenditures include the grants for high-ways, airports, and public works acceleration, and direct Federalexpenditures for air navigation facilities and modernization of postoffices.

The public works acceleration program was enacted in September1962 to accelerate Federal, State, and local public works, both toprovide immediate employment opportunities and to meet longstand-ing needs for such facilities. Only projects located in redevelopmentareas or in areas suffering from substantial unemployment which arecapable of substantial completion within a year after initiation areeligible for aid. Appropriations for the program are allocated bythe President upon recommendation of the Secretary of Commerce.Like the activities of the Area Kedevelopment Administration, theprogram is classified in the commerce and transportation function.However, funds are allocated, to various Federal agencies, whoseregular activities are classified in other functions. Table F-5 pro-vides information on the agencies participating in the program. Asof November 1, 1963, 7,021 projects had been approved. Theseprojects will generate an estimated 1,120,000 man-months of onsiteemployment.



Table F-5. PUBLIC WORKS ACCELERATION PROGRAM (in millions of dollars)

Agency

Estimated)bligaticns

(alloca-tions)

Expenditures

1963actual

1964 1965

Housing and Home Finance Agency (grants)Public Health Service (grants) 1

Department of AgricultureCorps of Engineers—CivilDepartment of the InteriorDepartment of CommerceDepartment of JusticePost Office DepartmentGeneral Services AdministrationOther agenciesUnallocated (1965)Lapsed appropriations

Total

481.0231.062.810.564.219.61.82.92.71.55.02.0

13.01.0

23.64.4

17.71.6

.2

.2

.3

.5

173.681.038.26.1

42.416.01.62.72.41.0

156.077.0

1.0

4.02.0

5.0

885.0 62.5 365.0 245.0

i Includes grants of $0.9, $33.8, and $29.5 million in 1963, 1964, and 1965, respectively, for non-profit private hospitals which are not classified as public works.

The largest share of the direct Federal civil construction expendi-tures in 1965 will be for development of natural resources. Of the$1.7 billion of expenditures for the natural resources programs in1965, $1.4 billion will be water resources and related power de-velopment. In addition, there will be expenditures for the construc-tion of roads, recreational facilities, facilities for fish and. wildlifeprograms, and other facilities including an estimated $40 million forconstruction of school facilities for Indian children.

Table F-6 brings together the total budget expenditures for allwater resources development, including programs carried on under theagriculture and health, labor, and welfare functions as well as thenatural resources function.

To implement the new education programs recently enacted orrecommended, the budget includes new obligational authority $146million in 1964 and $402 million in 1965 for assistance to State andlocal governments in the construction of higher education facilities(including public community colleges and technical institutes), resi-dential schools for vocational education, school classrooms, and publiclibraries. Also, new programs for health, labor, and welfare will resultin construction of additional facilities. Expenditures by the Depart-ment of Labor under proposed youth employment legislation areestimated at $31 million in 1965 for renovating existing facilities andconstructing new camps for youth in the conservation corps.



Table F-6. BUDGET EXPENDITURES FOR WATER RESOURCES ANDRELATED DEVELOPMENTS (in millions of dollars)

Type

Flood control works:Corps of Engineers—Civil

GrantsBureau of Reclamation _ _Soil Conservation Service (mostly grants)International Boundary and Water CommissionTennessee Valley Authority

Total, flood control worksBeach erosion control: Corps of Engineers—Civil

Irrigation and water conservation works:Bureau of Reclamation

Loan and grant program __ _Soil Conservation Service (mostly grants)Bureau of Indian Affairs _ _ __

Total, irrigation works __

Navigation facilities:Corps of Engineers—CivilSaint Lawrence Seaway Development CorporationTennessee Valley Authority

Total, navigation facilities

Multiple-purpose dams and reservoirs with hydroelectric powerfacilities:

Bureau of ReclamationCorps of Engineers—Civil __ __International Boundary and Water CommissionTennessee Valley Authority _

Total, multiple-purpose facilitiesSteam-electric powerplants: Tennessee Valley Authority

Power transmission facilities:Tennessee Valley AuthorityBureau of ReclamationBonneville Power AdministrationSouthwestern Power Administration

Total, power transmission facilitiesWaste treatment facilities: Public Health Service, grants

Total, water resources and related developments

1963actual

351.317.01.2

54.0.7

2.6

426.81.3

71.714.43.54.0

93.6

227.41.47.6

236.4

150.4272.9

10.313.0

446.674.8

30.247.215.21.2

93.851.7

1,425.0

1964

370.28.45.1

51.52.14.1

441.4.8

61.314.94.55.8

86.5

234.61.09.6

245.2

132.8246.8

10.57.5

397.691.9

43.456.224.74.2

128.575.0

1,466.9

1965

393.012.49.6

52.11.94.6

473.62.1

59.714.55.87.8

87.8

261.21.56.4

269.1

131.3246.0

12.89.8

399.969.0

65.138.232.75.9

141.975.0

1,518.4

NATIONAL DEFENSE PUBLIC WORKS

Department of Defense—Military.—The military public works pro-gram includes overseas and domestic construction to support Army,Navy, Air Force, Reserve, and National Guard activities. The pro-posed projects are part of the 5-year force structure and financial planto strengthen and modernize the Armed Forces of the United States.The construction projects include operational and training facilities,maintenance facilities, research and development facilities, logistic



facilities, medical facilities, troop housing and other personnel facili-ties, utilities and ground improvements, and land acquisitions.

Facilities are to be constructed for one additional hardened Minute-man squadron, and funds are included for improvements to previouslyauthorized Minuteman and Titan missile sites. Projects for thePolaris missile system will contribute to the operational readiness ofthe system and the proficiency of its crews. Relocation of a portionof the Nike-Hercules air defense missile system is proposed as well asadditional work to provide the system with protection against radia-tion fallout. About 22% of the direct military construction programis related to the general purpose or tactical forces of the Army, Navy,Marine Corps, and Air Force. Approximately 10% of the* program isto provide facilities in support of research and development.

The family housing program for 1965 proposes the construction ofan additional 12,500 units as well as numerous improvements to exist-ing units.

Atomic Energy Commission.—Public works expenditures during1965 by the Atomic Energy Commission are primarily for continua-tion of work on major production plants and on research and develop-ment installations previously authorized. New projects proposedfor 1965 include modifications and additions to existing productionplants, and additional facilities for weapons production and develop-ment, reactor development, and research in the physical and bio-medical sciences.

Table F-7. FEDERAL ACTIVITIES IN PUBLIC WORKS (in millions of dollars)

By major function and agency

CIVIL PUBLIC WORKS

International Affairs and Finance

Department of State:State Department and Foreign Service

buildings.Cultural and Technical Interchange

Center, Hawaii (grant)United States Information Agency: Radio

facilities

Total, international affairs andfinance

Space Research and Technology

National Aeronautics and Space Admin-istration:

Research and space flight facilities

NEW AUTHORI-ZATIONS

1963enacted

1.1

1.5

14.7

17.3

743.6

1964estimate

6.7

10.6

17.3

673.5

1965estimate

11.7

13.1

24.9

281.0

EXPENDITURES

1963enacted

2.3

2.7

13.7

18.7

225.3

1964estimate

4.4

1.1

12.6

18.1

475.0

1965estimate

6.0

13.2

19.2

520.0



Table F-7. FEDERAL ACTIVITIES IN PUBLIC WORKS(in millions of dollars)—Continued


CIVIL PUBLIC WORKS—Continued

Agriculture and AgriculturalResources

Department of Agriculture:Laboratories, research facilities, and

librarySoil Conservation Service: Flood pre-

vention, watershed protection, andother:

Direct work _ __Grants _Loans _

Farmers Home Administration: Ruralrenewal loans

Total, agriculture and agriculturalresources.-

Natural Resources

Department of Agriculture:Forest Service:

Roads and research, recreational andprotective facilities

Trust funds _Department of Defense—Civil:

Corps of Engineers—Civil: Flood con-trol, navigation, and multiple-purpose projects with power _

Trust fundsGrants

Department of the Interior:Office of Saline Water: Demonstration

plantsPower transmission facilities:

Bonneville Power Administration 1

Southwestern Power Administration..Bureau of Land Management: Roads

and other facilitiesBureau of Indian Affairs: Irrigation

works, roads, and schoolsBureau of Reclamation:

Irrigation and multiple-purpose proj-ects with power l _

Loans, small irrigation projectsGrants, small irrigation projects

Geological Survey: Laboratories -_Bureau of Mines:

Laboratories and other structuresAnthracite mine drainage grants

Fish and Wildlife Service: Facilities. _ _National Park Service: Parkways,

roads, buildings, and utilitiesTrust funds

NEW AUTHORI-ZATIONS

1963enacted

2.8

.8

68.54.0

76.1

102.72.0

829.227.617.0

29.47.2

9.4

69.7

. 275.912.0

_ 12.

75.

1964

.4

.871.04.7

1.0

77.9

102.12.0

873.021.08.4

.7

34.23.0

U.4

76.2

283.512.

6.6

68.4

1965

9.4

.869.36.2

1.8

87.5

105.02.0

915.418.812.4

.4

43.12.8

9.2

69.2

245.113.4(?.o

6.7

59.4

EXPENDITURES

1963

5.0

1.0

19.91.9

27.9

61.82.0

852.922.217.0

3.3

15.81.2

6.9

64.6

271.014.3

.1

.1

4.4(2)8.0

58.91.8

1964

3.9

1.018.86.1

1.0

30.7

91.82.0

852.434.08.4

1.7

25.24.2

7.0

57.5

255.814.7

j

2.3

10.6

58.82.

1965

3.9

.917.67.6

1.8

31.9

88.92.0

902.220.012.4

1.4

33.25.8

7.8

65.3

238.814.5

(2)1.0

2.4.4

7.3

61.4.4

See footnotes at end of table.



Table F-7. FEDERAL ACTIVITIES IN PUBLIC WORKS(in millions of dollars) —Continued



Natural Resources—Continued

Department of State: InternationalBoundary and Water Commission:Water resources projects

Restoration of salmon runs, Fraser Riversystem

Tennessee Valley Authority: Power, waterresources, and chemical facilities


Commerce and Transportation

Funds appropriated to the President:Public works acceleration program:

Grants ___Direct Federal work. _

Department of Commerce:Maritime Administration: Library and

other improvementsBureau of Public Roads:

Highway and other trust funds:Grants

Woodrow Wilson Bridge and otherwork

Forest and public lands highways,grants . .

Control of outdoor advertising, grants.Coast and Geodetic Survey: Observato-

ries and facilitiesWeather Bureau: Facilities. _New York World's Fair: Buildings-National Bureau of Standards: Labora-

tories _Area Redevelopment Administration:

Grants for public facilities.Loans for public facilities — _ _

Department of Defense—Civil: PanamaCanal Company: Canal and harbor im-provements and bridge

Department of the Interior: Office ofTerritories* Alaska Railroad

Post Office Department: Improvementsand alterations __ . . .

Treasury Department: Coast Guard:Lifeboat stations and other aids _.Department of Defense transfer

Federal Aviation Agency:Air traffic control, navigation and

research facilitiesWashington, D.C., and Alaska airports.Federal-aid airport program: Grants

Saint Lawrence Seaway DevelopmentCorporation

Total, commerce and transportation

NEW AUTHORI-ZATIONS

1963

11.0

24.0

1,506.5

632.0152.0

3,493.9

46.02.0

6.6

28.4

35.029.3

55.7

14.4

110.05.2

75.0

4,685.5

1964

45.8

32.2

1,580.9

26.81.0

3,600.5

39.9

.5

7.6

8.015.0

43.3

16.0

95.22.5

75.0

3,931.4

1965

14.6

35.3

1,553.9

4.5

.8

3,691.2

33.9

.6

.6

8.8

35.034.5

10.1

22.0

72.02.0

75.0

3.990,9

EXPENDITURES

1963

11.0

135.0

1,552.4

14.247.3

2,941.0

.3

38.6

.4

.52.0

13.7

2.92.5

12.6

.9

33.7

24.9-20 .0

109.320.151.5

1.4

3,297.7

1964

13.1

.1

171.8

1,614.1

227.0104.2

3,452.8

.3

39.62.0

.34.18.2

27.5

10.011.2

9.4

1.1

32.7

36.9-20 .5

93.913.375.3

1.0

4,130.2

1965

28.7

171.6

1,665.7

214.01.5

.1

3,541.2

39.9

.52.8

.6

21.6

11.015.6

5.1

.9

46.2

24.9- 5 . 0

93.35.3

75.7

1.5

4,096.7




Table F-7. FEDERAL ACTIVITIES IN PUBLIC WORKS(in millions of dollars) —Continued



Housing1 and CommunityDevelopment

Housing and Home Finance Agency:Office of the Administrator:

Urban transportation grantsPublic facility loans _ _ _Advance planning, non-Federal public

works: LoansLiquidating programs: Community

facilities: Loans _Public Housing Administration:

Low-rent public housing loans ___National Capital Transportation Agency:

Land acquisition and constructionDistrict of Columbia:

Loans for highway, sewage and watersystems and other structures

Grants for sewage worksFederal payment to District: Grant

Total, housing and community de-velopment _ _______ _ __

Health, Labor, and Welfare

Department of Health, Education, andWelfare:

Food and Drug Administration: Build-ings

Public Health Service:Federal research facilities and National

Library of MedicineIndian health facilities 1

Grants for public hospitals _ _Grants for health research facilitiesGrants for waste treatment worksGrants for mental health centersMental health facilities, Alaska

(grant) __ _____Saint Elizabeths Hospital: BuildingsSocial Security Administration: Build-

ings and district offices (trust fund)Department of Labor: Youth camps, pro-

posed legislation, _ _


NEW AUTHORI-ZATIONS

1963

12.5

12.0

.4

26.0.3

5.0

56.3

.3

33.29.6

88.050.090.0

8.1

279.2

1964

6.0

19.3

12.5

37.8

4.5

16.36.0

88.056.090.0

.6

10.0

271.4

1965

75.0

12.0

14.4

29.8

131.2

11.0

21.58.8

116.058.090.015.0

2.0

5.8

70.0

398.1

EXPENDITURES

1963

29.8

5.9

-1 .3

-3 .4

(2)

25.0.3

5.0

61.2

1.0

2.37.4

69.72.2

51.7

.31.9

1.7

138.1

1964

33.7

3.5

-1 .0

-56.3

35.8

12.5

28.3

1.9

14.210.576.03.0

75.0

.22.1

2.8

185.6

1965s e

9.631.1

5.2

- 1 . 4

.2

31.0

29.8

105.6

4.2

20.68.8

79.03.0

75.01.5

4.7

1.7

31.0

229.5






Function, organization unit, and program


Education

Department of Health, Education, andWelfare: Office of Education:

Schools in federally affected areas:At Federal installationsGrants

Higher education facilities:LoansGrants

Residential vocational schools (grants)Proposed education legislation:

Libraries and classrooms (grants)Housing and Home Finance Agency: Col-

lege housing loansMational Science Foundation: Research

facilitiesSmithsonian Institution: Museums.

Total, education. _

Veterans Benefits and Services

Department of Defense—Civil:Army: Cemeteries __ _ _United States Soldiers' Home (trust

fund)Veterans Administration:

Hospital and domiciliary facilitiesCorregidor-Bataan memorial

American Battle Monuments Commis-sion: Memorials and cemeteries...

Total, veterans benefits and services.

General Government

Legislative branch:Architect of the Capitol: Buildings and

libraryBotanic Garden: GreenhousesGovernment Printing Office: Annex

Department of Defense—Civil:Army: Power and water systems in the

Ryukyu Islands: LoansCanal Zone Government: Improvements.

Department of the Interior:Office of Territories: Public facilities in

Samoa, Guam, and the PacificTrust Islands:

GrantsLoans

Alaska public works: GrantsVirgin Islands Corporation: Water and

power facilitiesDepartment of Justice:

Federal Prison System: Prison facilities. _Immigration and Naturalization Serv-

ice: Border facilities

NEW

1963

10.452.5

135.0

8.11.7

207.6

.7

77.0

77.7

18.0

6.4

2.6

14.6

.5

3.5

.2

f AUTHORI-SATIONS

1964

7.552.0

6.0140.0

135.0

9.87.7

358.1

.4

81.81.5

83.7

4.8

- 6 . 4

6.0

17.85.9

9.5

.3

1965

7.550.1

102.0140.025.0

135.0

135.0

7.54.6

606.6

2.0

102.0

104.0

46.7

4.1

10.06.5

21.2

.5

EXPENDITURES

1963

12.253.2

115.0

6.38.3

195.1

1.2

.6

65.8

.468.0

23.8

3.9

9.3

.4

8.0

.2

1964

10.049.2

.3

.3

74.0

8.011.3

153.1

.6

.7

75.0.2

.2

76.6

22.8

7.95.3

14.32.0

.5

10.8

.2

1965

7.551.7

6.613.11.2

7.0

68.3

7.811.6

174.8

.6

85.0.5

86.1

16.2

16.5

2.24.5

4.82.9

8.4

.6






Function, organization unit, and program


General Government—Continued

Treasury Department:Bureau of Customs: Border facilitiesBureau of the Mint: U.S. mintBureau of Engraving and Printing: Air-

conditioning __General Services Administration:

Construction of public buildings, sitesand planning

Trust fundsCentral Intelligence Agency: Headquarters.


Total, civil public works

Budget accountsTrust funds

NATIONAL DEFENSE PUBLICWORKS

Department of Defense—Military:Interservice activities:

Construction, defense agenciesLoran stationsFamily housing _

Civil Defense:Grants for shelterEmergency centers and shelters

Army:ConstructionConstruction, Army ReserveConstruction, Army National Guard

(grants) _Navy:

Construction. __ _Construction, Naval Reserve

Air Force:ConstructionConstruction, Air Force ReserveConstruction, Air National Guard

Total, Department of Defense—Military

Atomic Energy Commission: Facilities.__General Services Administration: N.I.R.

facility __

Total, national defense public works:Budget accountsTrust funds

Total, civil and defense public works

NEW AUTHORI-ZATIONS

1963

.2

.3

256.7

303.1

,952.9

,428.1,524.9

149.820.0

148.7

7.0

151.48.0

7.0

161.47.0

780.15.0

14.0

1,359.3262.7

1.2

1,623.3

9,576.3

1964

.2

.5

243.3

281.9

,313.9

,689.1,624.8

24.020.5

138.6

10.0

200.64.5

5.7

198.96.0

468.34.0

16.0

1,097.1245.3

1.5

1,343.9

8,657.8

1965

.216.0

5.8

258.3

369.4

,547.4

,829.1,718.3

34.05.0

224.0

10.020.0

408.05.0

6.0

278.07.0

406.05.0

14.0

1,422.0180.2

.7

1,602.9

9,150.4

EXPENDITURES

1963

.2

156.42.11.7

206.1

,790.4

,817.2,973.2

2o!o8.3

3.0

145.114.0

19.2

190.25.6

715.44.6

21.9

1,154.9249.5

1.1

1,405.5

7,195.9

1964

.2

.5

.3

184.7.3.9

250.7

,962.5

,466.4,496.1

39.020.5

185.0

8.0

175.010.5

15.0

202.08.0

614.06.0

17.0

1,300.0243.3

1.2

1,544.5

8,507.0

1965

.28.0

2.5

217.2

284.0

,213.5

,647.3,566.2

130.05.0

190.0

7.07.5

251.08.0

10.0

225.07.0

500.05.0

15.0

1,260.5260.0

.6

1,521.1

8,734.6

1 Includes small amounts from trust funds.3 $50 thousand or less.


SPECIAL ANALYSIS G

FEDERAL HEALTH PROGRAMS

This is the first comprehensive analysis of Federal health activitiesto be included in the budget document. It presents information on allthe medical and health-related activities of the Federal Government,regardless of where they may otherwise be classified in the budget.

On this broad basis, the Government will spend an estimated$5.4 billion in 1965 for all health activities—for hospital care andmedical treatment in Federal and non-Federal facilities, for construc-tion of health facilities, for health research and training, and for amultitude of preventive and community health and health-relatedprograms. Almost all of these health expenditures will be fromadministrative budget funds—more than 5% of the administrativebudget total. In addition, trust fund expenditures of $469 millionwill be made, mainly for health benefits for Federal employees, butthis will be nearly entirely offset by receipts from contributions byemployees and Federal agencies.

Compared to the total net expenditures of $5.4 billion from budgetaccounts, new obligational authority in 1965 will be $6.0 billion.

The development oj Federal health-related expenditures.—Healthprograms are among the oldest activities of the Federal Government.The origins of the Army Medical Service predate the Constitution,and the Public Health Service was established in 1798 to providehospital care for merchant seamen. Medical and hospital care wasprovided for veterans residing in the National Homes for DisabledVolunteer Soldiers established after the Civil War. Such care forall service-disabled veterans was provided by an amendment to theWar Risk Insurance Act of 1917, and in 1923 and 1924 inpatientbenefits were authorized for non-service-connected disability. Experi-ments in 1900 by Walter Reed, an Army doctor, proving thatmosquitoes carry yellow fever, indicate the longstanding Federalinterest in health research. In the last 15 or 20 years, many newhealth programs have been enacted, particularly programs whichauthorize grants to State-local agencies and to private organizationsand individuals for health research, training, facilities, and for supportof health activities and services.

Although historical figures on the comprehensive basis used in thisanalysis are not available, the directly operated hospital and medicalactivities of the Veterans Administration and the agencies now com-prising the Department of Defense were by far the largest Federalhealth programs in the decade following World War II. In recentyears, however, expenditures for care of military personnel have beenfairly level while outlays for the care of veterans have increased at asteady pace. In contrast, programs of other agencies, notably of theDepartment of Health, Education, and Welfare, with its manygrants for nonfederally operated health activities, have expandedrapidly. This can be roughly illustrated by a comparison of the pro-

397



posed appropriations for 1965 with the figures for obligations for 1958which were published in 1961 on a reasonably comparable basis inSenate Report No. 142, 87th Congress, 1st session, prepared by asubcommittee of the Senate Committee on Government Operations.

Health programs in 1958, according to this report, totaled about$3 billion compared to the proposed new obligational authorizations of$6.0 billion for 1965. While the total doubles during this 8-yearperiod, Department of Defense programs rise from less than $1billion to over $1.1 billion and Veterans Administration programsrise from $0.9 billion to $1.3 billion, an increase of about two-fifths.The programs of the Department of Health, Education, and Welfare,however, increase almost fourfold, rising from $0.8 billion to $3billion. Funds for all other agencies combined rise from about $0.3billion in 1958 to $0.6 billion in 1965.

Distribution of Federal health programs by agency.—Seven Cabinetdepartments and more than a dozen other agencies conduct or supporthealth programs, in addition to those for Federal employees whichare financed by every agency. Many of the health activities of theseagencies are not classified in the "health, labor, and welfare" functionbut are carried on as part of broader programs and are classified inthe functional categories according to the basic purpose served,such as "national defense," "veterans benefits and services," etc.Because these activities contribute to advancing the Nation's health,they are included in this analysis. Thus while the regular functionalclassification shows expenditures of $1.7 billion in 1965 for "healthservices and research"—all by the Department of Health, Education,and Welfare—the amounts included in this analysis are more thanthree times as large and cover many agencies. Table G-l shows theexpenditures for each agency.

Of the $5.4 billion in budget and trust fund expenditures estimatedfor health in 1965 on this broad basis, $4.8 billion, or 89%, will bemade by three agencies, including 46% by the Department of Health,Education, and Welfare, 23% by the Veterans Administration, and20% by the Department of Defense. The bulk of the health expendi-tures by the Department of Defense and the Veterans Administrationare for the provision of direct care and treatment, most of which isprovided in their own hospitals and clinics. These two agencies alsohave sizable expenditures for health facilities, for training, and forsupport of health research.

The Department of Health, Education, and Welfare, on the otherhand, spends only a comparatively small portion of its health funds fordirect medical care, principally for merchant seamen and Indians inPublic Health Service hospitals. The bulk of the Department's healthcare outlays is for medical research and training and for grants toStates and localities to cover medical expenses of public assistancerecipients and medical care of the aged. The Department also spendssubstantial amounts through the Public Health Service for grants forconstruction of health facilities, for support of local and State com-munity health, and for environmental health activities.

The remaining 11%, or $0.6 billion, of the estimated expendituresin 1965 will be made by more than 15 other departments and agencies.Among these are the Agency for International Development and theDepartment of State which support health activities in other coun-



Table G-1. FEDERAL EXPENDITURES FOR MEDICAL AND HEALTH-

RELATED PROGRAMS BY AGENCY (in millions of dollars)

Agency 1963 1964 1965

ADMINISTRATIVE BUDGET

Department of Health, Education, and Welfare:Public Health Service:

National Institutes of HealthOther

Welfare AdministrationOther

Total, Department of Health, Education, and Welfare. __

Veterans AdministrationDepartment of Defense:

ArmyNavyAir ForceOther


Agency for International DevelopmentAtomic Energy CommissionDepartment of AgricultureNational Aeronautics and Space AdministrationNational Science FoundationHousing and Home Finance AgencyCivil Service CommissionDepartment of StateDepartment of LaborDepartment of JusticePanama CanalDepartment of the InteriorPeace CorpsSmall Business AdministrationGeneral Services AdministrationUnited States Information AgencyContributions by Federal agencies to Federal employees' health

benefits fund not included above

Total net budget expenditures for health

TRUST FUNDS

Civil Service Commission

United States Soldiers' Home

Total trust fund expenditures for health

Total budget and trust fund expenditures for health

723.6540.2678.585.7

2,028.0

1,144.9

440.6190.6340.6

15.6

987.3

76.577.392.815.626.528.620.013.315.63.46.91.82.02.8.1

120.0

4,663.5

-12.57.0

- 5 . 5

4,658.0

825.0655.3765.7103.7

2,349.6

1,239.9

469.3196.6356.7

9.6

1,032.3

98.686.497.444.431.030.524.316.016.28.87.72.64.22.81.5

.1

120.3

5,214.7

-14.57.5

- 7 . 0

5,207.7

850.0708.5803.0107.8

2,469.3

1,245.5

486.1211.6380.4

18.9

1,097.0

107.593.159.754.035.029.225.517.216.812.46.55.44.82.82.0

124.5

5,408.3

- 2 . 96.9

4.0

5,412.3

tries, the Atomic Energy Commission with its substantial biomedicalresearch activities in the radiological field, the National Aeronauticsand Space Administration with its rapidly growing research activitiesin space medicine, the Housing and Home Finance Agency whichmakes advances and loans for water and sewer facilities, and the Na-tional Science Foundation which underwrites basic research inbiosciences.



Federal health programs are developing on many fronts. Of theestimated increase of $754 million in total expenditures from 1963 to1965 more than half, $441 million, is in the Department of Health,Education, and Welfare—a growth of about 22% in 2 years for thatagency. The Department of Defense and the Veterans Adminis-tration each increase by more than $100 million, with increases of11% and 9%, respectively. All other agencies show a net growthof $103 million or 21%, with the largest increases in the NationalAeronautics and Space Administration, and the Agency for Inter-national Development. The decrease which occurs in Departmentof Agriculture expenditures results because legislation is proposed tofinance meat and poultry inspections on a self-supporting fee basis.There will be no reduction in the amount of service.

Distribution oj Federal health expenditures by category and by bene-ficiary group.—Table G-2 shows the distribution of the total Federalmedical and health-related expenditures for the 3 fiscal years, 1963-65,by six categories. The accompanying chart on estimated expendi-tures for 1965 depicts the distribution of the outlays in each categorybetween the Department of Health, Education, and Welfare and allother agencies.

Table G-2. FEDERAL EXPENDITURES FOR MEDICAL AND HEALTH-RELATED ACTIVITIES BY CATEGORY (in millions of dollars)

Category 1963 1964 1965stimate

1. Hospital and medical care in Federal facilities2. Federal grants and payments for hospital and health care in

non-Federal facilities3. Medical research, total

(a) Conduct of research(b) Research facilities

4. Training, including training research5. Preventive and community services6. Construction of hospitals and health facilities

Total health expenditures from administrative budgetand trust accounts

1,877.3

905.7892.1

(832.8)(59.3)256.5346.1380.3

1,982.3

991.81,047.2(966.6)(80.6)324.4396.0466.1

2,006.5

1,029.41,124.8

(1,031.3)(93.4)332.9390.2528.5

4,658.0 5,207.7 5,412.3

Of the total expenditures of $5.4 billion in 1965 for medical andhealth-related purposes, $3.0 billion or about 56% will be for provisionof health care either directly in Federal facilities or financed by Federalgrants or payments for services by non-Federal facilities. This is anincrease of $253 million from 1963.

The direct care expenditures amount to just over $2 billion, or37%, of total expenditures. Most of this service is provided in hos-pitals of the Department of Defense, Veterans' Administration, andthe Department of Health, Education, and Welfare, which, in all,comprise almost 10% of all hospital beds in the United States.

Table G-3 shows the number of hospital beds and the average dailynumber of patients during the 3 years 1963-65. The number ofindividual patients during any year is, of course, many times the dailycensus because hospital stays average 7 to 75 days for most agencies.



Federal Expenditures for Medical and Health-Related Activities by Category

In addition to this large number of inpatients, several million individ-uals each year receive outpatient care or treatment in the Federalfacilities.

Approximately one-sixth of the population in the United States isactually or potentially eligible for direct hospital care or medicaltreatment in Federal facilities based on estimates available at the endof calendar year 1963. Approximately 22.1 million living war vet-erans, including some 3 million with service-connected disabilities,comprise the largest single group of eligibles, although for ailmentsnot related to service hospital care is provided only to the extent thatVeterans Administration hospital facilities are available. Under thebasic policy of limiting its hospital system to 125,000 beds, the Vet-erans Administration meets approximately half of the hospital carerequirements of veterans with non-service-connected ailments.Active duty and retired uniformed service personnel numbering 3.1million and their 4 million dependents are also covered. Approxi-mately 2.5 million Federal employees are entitled to treatment forin-line-of-duty disabilities, although such injuries are comparativelyinfrequent. Other eligible groups include 385,000 American Indiansand natives of Alaska, 120,000 American seamen, some 73,000 civiliansin the Panama Canal Zone, an estimated 60,000 narcotic addicts,24,000 inmates of Federal prisons, and 1,500 patients with leprosy.With allowance for duplications in the above categories, an estimated30 million Americans are eligible for all or part of their health carefrom Federal facilities.

The third largest category of expenditures—$1 billion or 19% ofthe total—is for grants and payments for hospital and health care innon-Federal facilities. Grants for public assistance and for medicalcare for the aged by the Department of Health, Education, and Wel-fare account for three-fourths of this total. During 1965, nearly 3million individuals are estimated to receive such aid. The CivilService Commission provides health benefits to about 81% of the 2.5million Federal civilian employees and an estimated 4.1 million oftheir dependents under the Federal Employees' Health Benefits Act.

700-000 0—64 26



Table G-3. FEDERAL HOSPITALS,

By agency

Number of hospitals:DefenseHealth, Education, and WelfareVeterans AdministrationOther

Total

Number of operating beds:DefenseHealth, Education, and WelfareVeterans Administration _ __ _Other _

Total.._.

Average daily patient load:DefenseHealth, Education, and WelfareVeterans AdministrationOther

Total

OPERATING BEDS, AND

1963

ac a

23567

16936

507

43,19016,857

120,3043,245

183,596

30,62414,080

110,1942,152

157,050

PATIENT

1964

23467

16836

505

43,00016,654

120,3713,261

183,286

30,41313,954

110,2692,191

156,827

LOADS

1965

23267

16836

503

43,40016,654

120,2493,294

183,597

30,75413,772

110,3182,254

157,098

A similar program provides benefits for 241,000 retired Federalemployees and their dependents. These payments are made fromtrust revolving funds into which are deposited both agency and em-ployee contributions. Since the health benefits funds are revolvingfunds, with receipts offsetting expenditures, only the net effect ofthese transactions in the trust funds is included in the expendituresfor this category. The Government's contributions amounting to$151 million in 1963, $156 -million in 1964, and $161 million in 1965,are included in the administrative budget figures and are mostly classi-fied in this category. The bulk of the remainder represents paymentsfor care of Federal beneficiaries, principally by the Veterans Admin-istration and the Department of Defense in those cases where Fed-eral facilities are not available.

Every citizen is benefited in one way or another by the healthresearch, training, preventive and community services, and hospitalconstruction activities of the Federal Government. Expendituresfor these activities will total $2.4 billion in 1965, an increase of $501million from 1963. These categories comprise only 44% of the totalhealth expenditures, but they account for 66% of the increase over1963 in health outlays. The amount of increase over 1963 is greatestfor health research and facilities ($233 million and 26%), but thehighest rates of increase will be for construction of health facilities($148 million and 39%) and training ($76 million and 30%). Pre-ventive and community service activities show the largest dollar andpercentage increases ($44 million and 13%). Legislation passed in1963 provides for increased Federal efforts for air pollution control,for assista$ce to schools and to students in medicine and dentistry,



and for programs to combat mental retardation and promote mentalhealth. Other expanding areas include activities relating t6 waterpollution, pesticides, community health, and food and drugs. Thenext several paragraphs discuss the four categories separately.

About two-thirds of the $1.1 billion in Federal expenditures forhealth related research and research facilities are by the Departmentof Health, Education, and Welfare, particularly the National Insti-tutes of Health, which alone account for $631 million. The Depart-ment of Defense, the Atomic Energy Commission, the NationalScience Foundation, and the National Aeronautics and Space Admin-istration also make sizable outlays for health research.

Training, including training for research, accounts for $333 millionin 1965 expenditures. Again, the Public Health Service, and espe-cially the National Institutes of Health, are the major sources,although the Department of Defense also spends significant amounts.

Of the $390 million for preventive and community health services,$269 million will be spent by the Public Health Service, the Food andDrug Administration, and the Welfare Administration. The FederalGovernment's programs of assistance to underdeveloped countries arealso responsible for about $75 million of the outlays and the Depart-ment of Agriculture programs account for most of the remainder.

The Hill-Burton hospital construction program accounts for $204million out of $528 million to be spent in 1965 for construction offacilities other than for research. The Veterans Administration'sexpenditures of $82 million represent the fifth year of that agency's15-year hospital replacement and modernization program. TheDepartment of Defense will also spend $58 million for construction.

Proposed legislation.—Significant health legislation is proposed inthe 1965 budget. New obligational authority of $270 million isrequested to extend the Hill-Burton health facilities constructionprogram, with increased emphasis on modernization of urban hospitals,construction of long-term care facilities for the aged, and improvedplanning of community health facilities. It is expected that $5million of this will be spent in 1965. The 1965 budget includes$11 million of expenditures for extension and improvement of nurseeducation activities. Proposed legislation in the Department ofAgriculture to place meat and poultry inspection on a self-supportingfee basis will reduce Federal expenditures nearly $44 million in 1965,although inspections are expected to increase. Because of this latteritem, expenditures under proposed legislation for 1965 will show a netreduction of $28 million. Proposed appropriations of $295 millionunder new legislation are offset in part by the $47 million reductionin appropriation for the Agriculture program.

Other health proposals, which are covered by the general allowancefor contingencies because the costs would not be large, would extendand broaden the public health training programs, authorize grouppractice facility loans and provide grants for sanitation facilities formigrant agricultural laborers. A proposal to provide hospital insur-ance for persons over 65 through the social security system is alsopending in Congress, but this does not affect the 1965 budget sincethe program will not begin until January 1, 1966.



Table G-4. FEDERAL EXPENDITURES FOR MEDICAL AND HEALTH-RELATED PROGRAMS (in millions of dollars)

FAgency and program t


National defense:Department of Defense:

Hospital and medical care of military personnel andtheir dependents, retired personnel and their fami-lies on a space available basis, and civilian employeesand their dependents overseas

Research in preventive medicine, improved methodsof caring for and rehabilitating the sick and injured,and studies relating to medical problems of militaryscience _ _ _

Professional and technical training of personnelProcurement, distribution, and installation of medical

supplies in civil defense shelters _.-Construction of civil defense shelters in medical fa-

cilities _Department of Health, Education, and Welfare: Stock-

piling of medical supplies - --Atomic Energy Commission: Research on the effects

and use of radiation


International affairs and finance:Peace Corps: Assistance to underdeveloped countries

particularly for nursing and malaria eradicationprojects - - -

United States Information Agency: Medical care ofForeign Service officers who become ill abroad

Agency for International Development:Alliance for Progress: Grants and loans for community

health services and construction of health facilities..Contributions to international organizations __Grants, loans, and other assistance to underdeveloped

countries in meeting their most pressing healthproblems . .

Department of State:Contributions to international organizations, con-

ferences, and medical and hospital care of ForeignService personnel and their dependents

Assistance to refugees from Communist countries, ex-cept Cuba

Mutual educational and cultural exchange activities..

Total, international affairs and finance

Space research and technology:National Aeronautics and Space Administration: Re-

search on health factors and human capabilities inadvanced aerospace systems - - -

Agriculture and agricultural resources:Department of Agriculture:

Plant and animal research; meat and poultry inspec-tions -

Proposed legislation: Finance meat and poultryinspection on a self-supporting fee basis

Total, agriculture and agricultural resources..-

'unc-ionalcode

051

051051

051

051

059

058

152

153

152152

152

151

152153

25

35

V\

1963actual

832.2

101.244.0

10.0

20.0

77.3

1,084.7

2.0

.1

20.812.5

43.2

11.6

.8

.9

91.9

15.6

92.8

92.8

1964estimate

867.1

115.447.7

2.1

13.0

86.4

1,131.6

4.2

.1

36.112.5

50.0

14.1

.81.1

119.0

44.4

97.

97.

1965stimate

911.0

125.149.5

3.0

8.4

15.0

93.1

1,205.1

4.8

.1

34.312.5

60.7

15.7

.41.1

129.6

54.0

103.2

—43.6

59.7



Table G-4. FEDERAL EXPENDITURES FOR MEDICAL AND HEALTH-RELATED PROGRAMS (in millions of dollars)—Continued

Agency and programunconal:od

1963 1964 1965

Natural resources:Department of Interior:

Research on toxicological effects of pesticides on fishand wildlife ___ _

Care of 600 Aleut Indians in Pribilof Islands, Alaska..


404404

Commerce and transportation:Small Business Administration: Loans for construction

and operation of nursing homes and other health-related facilities

Housing and community development:Housing and Home Finance Agency: Advances and

loans to local communities for construction of sewer,water, and other health-related facilities

Health, labor, and welfare:Department of Health, Education, and Welfare:

Freedmen's Hospital: Operation of a communityteaching hospital serving Howard University Med-ical School _

Saint Elizabeths Hospital: Hospital care for thementally ill in the District of Columbia

Public Health Service:Health services for Indians -Medical care of merchant seamen, narcotic addicts,

and other Public Health Service beneficiariesQuarantine activities _Grants and loans for construction of hospital and

health facilities -Proposed legislation: Hill-Burton amendments...

Education and training for public health. _Proposed legislation: Nursing education and

training . -Accident and disease prevention and controlScientific activities overseasConstruction of health facilities (other than re-

search) _Environmental health activitiesNational Institutes of Health (research) _

Welfare Administration:Grants for maternal and child welfareAssistance to Cuban refugees and repatriated U.S.

nationals -Public assistance grants for hospital and health care.

Vocational Rehabilitation Administration: Rehabili-tation grants and research and training in problemsof handicapped individuals.

Food and Drug Administration: Enforcement of thepure food and drug laws

Department of Labor: Accident prevention and voca-tional rehabilitation for disabled longshoremen

Department of Interior: Health research related to mineoperations

506

553

651

651

651

651651

651

651

651651

651651651

651

653653

655

651

652

652

1.2.1

1.3

2.8

28.6

3.7

7.5

62.5

50.06.3

240.9

")V.9

85.01.6

2.259.8

723.6

50.5

3.0625.0

39.0

29.2

2.0

.5

2.2

2.2

2.8

30.5

3.8

10.9

66.9

50.15.7

275.6

133.13.9

14.071.5

825.0

62.5

3.2700.0

47.2

35.1

2.2

.4

5.1.1

5.1

2.8

29.2

3.8

13.1

67.8

51.66.0

278.95.0

28.8

11.0133.0

4.5

18.588.5

850.0

85.0

3.0715.0

41.0

42.8

2.2

.3

Total, health, labor, and welfare. 2,004.2 2,332.5 2,449.7



Table G-4. FEDERAL EXPENDITURES FOR MEDICAL AND HEALTH-RELATED PROGRAMS (in millions of dollars)—Continued

Agency and program

Education:Department of Health, Education, and Welfare:

Practical nurse trainingDefense educational activities _ _

National Science Foundation: Support of basic re-search in health-related fields. _

Total, education

Veterans benefits and services:Veterans Administration: Hospital, domiciliary, and out-

patient care of veterans including medical research andconstruction and modernization of facilities

General government:Department of Labor: Hospital and medical care for

Federal employees injured in line of duty. _Department of Justice: Medical care of prisonersCivil Service Commission:

Government contribution to Federal employees'health benefit funds for retired employees and an-nuitants - -

General Services Administration: Matching grant for ahospital in Southeast Washington, D.C

Panama Canal: Medical and hospital care for civilianand military personnel, sanitation and quarantine


Contributions by Federal agencies to employees' healthbenefits fund not included above ___

Total net administrative budget expenditures forhealth

TRUST FUNDS

Civil Service Commission:Expenditures for employee health benefitsReceipts from employee and Government contributions

Net expenditures from trusts revolving funds.United States Soldiers Home: Hospital and domiciliary

care of retired and disabled enlisted personnel of theRegular Army and Air Force

Total net trust fund expenditures for health

Total budget and trust fund expenditures for health.

7unc-tionalcode

704702

703

804

906908

%6

905

910

654

805

1963actual

4.71.6

26.5

32.8

1,144.9

13.63.4

20.0

.1

6.9

43.9

120.0

4,663.5

385.1-397.6

-12.5

7.0

- 5 . 5

4,658.0

1964estimate

4.91.8

31.0

37.7

1,239.9

14.08.8

24.3

1.5

7.7

56.4

120.3

5,214.7

403.4-417.9

-14 .5

7.5

- 7 . 0

5,207.7

1965estimate

5.02.1

35.0

42.1

1,245.5

14.612.4

25.5

2.0

6.5

61.1

124.5

5,408.3

461.8-464.7

- 2 . 9

6.9

4.0

5,412.3


SPECIAL ANALYSIS H

FEDERAL RESEARCH, DEVELOPMENT, AND RELATED PROGRAMS

This analysis summarizes Federal administrative budget expendi-tures for research and development.1 The chart below illustrateshow most of the growth in recent years has resulted from the decisionsto undertake a vigorous space program and to maintain a strongnational defense which utilizes the latest products of science andtechnology. In other areas of research and development there hasbeen a slower but steady growth since 1954. Total Federal expendi-tures for research and development will increase from $14.9 billion in1964 to $15.3 billion in 1965, a rise of 3% as compared with 24%between 1963 and 1964. (See table H-l.) The 1965 increase isprimarily attributable to the space programs of NASA.

Estimated Administrative Budget Expenditures for Research and Development

407



Table H-l. BUDGET EXPENDITURES FOR RESEARCH AND DEVELOP-MENT, 1954-65 (in millions of dollars)

Fiscal year

195419551956195719581959I96019611962 _._196319641965

Depart-ment of

Defense1

2.4872,6302.6393,3713,6644,1835,6546,6186,8126,8497,4507,107

NASA 2

9074717689

145401744

1,2572,5524,4004,990

AEC

383385474657804877986

1,1111,2831,3351,5431,557

D/HEW

637086

144180253324374512621754796

NSF

49

153133515811

105142175204

Other

121140161183220293315356409483561633

Total

3,1483,3083,4464,4624,9905,8037,7389,278

10,37311,98314,88315,287

Note.— Totals in text tables may not add due to rounding.1 Includes civil functions.2 National Advisory Committee for Aeronautics prior to 1958.

This year, for the first time, a summary is included showing sepa-rately the totals for research and development (table H-2) and forbasic research (table H-3). These tables illustrate the relativelysmall proportion of funds—less than 30%—spent for research com-pared with the amounts for development, consisting primarily ofengineering and fabrication of launch vehicles and spacecraft forspace exploration and of military hardware for test and evaluation.Decreases in expenditures for development in the Department ofDefense explain the marked slowdown in the growth of Federal fundsfor research and development.

Since science and technology represent such a large proportion oftotal Federal expenditures, it is important to understand the widerange of research and development activities conducted in the ad-vancement of agency missions. Explanations of the contents andtrends of the programs of the agencies with major research and de-velopment activities are provided in the following sections of thisanalysis.

There are also included at the end of this analysis summary databy agency on total Federal support for several selected scientific andtechnical activities of the Federal Government—such as oceanographyand meteorology—which, because of their broad national importance,are coordinated on a governmentwide basis. These activities illus-trate the fact that many agencies need to undertake research in thesame general area if they are to utilize science and technology effec-tively in the achievement of their basic missions. Research on theuse and control of water, as an example, is particularly important tothe missions of the Departments of Agriculture; Commerce; Health,Education, and Welfare; and Interior. No one agency can be expectedto understand or provide for the research required to meet the needs—often the urgent operational demands—of all interested agencies.



Table H-2. EXPENDITURES FOR RESEARCH, DEVELOPMENT, AND

FACILITIES (in millions of dollars)

Purpose

Conduct of research:Department of DefenseNational Aeronautics and Space Administration. __Atomic Energy CommissionDepartment of Health, Education, and WelfareNational Science FoundationOther

Subtotal, conduct of research

Conduct of development:Department of DefenseNational Aeronautics and Space Administration _ _ _ _Atomic Energy Commission __ __ _ _Department of Health, Education, and WelfareOther

Subtotal, conduct of development ___ __.

Research and development facilities:Department of DefenseNational Aeronautics and Space AdministrationAtomic Energy CommissionDepartment of Health, Education, and WelfareNational Science Foundation. _ _ _ _Other

Subtotal, research and development facilities__ .__

Total

1963actual

1,491.6739.8247.9577.599.6

322.6

3,479.0

5,302.01,587.3

829.83.6

110.4

7,833.3

55.2225.3257.640.142.550.4

671.1

11,983.4

1964

1,621.01,054.2

268.7691.5126.8368.6

4,130.9

5,727.02,870.8

968.04.1

122.9

9,692.9

101.8475.0306.458.048.369.7

1,059.2

14,883.0

-1965

1,635.11,142.4

302.0723.6143.0391.9

4,338.0

5,360.73,327.6

940.14.4

168.5

9,801.3

111.3520.0314.867.961.072.8

1,147.8

15,287.1

Table H-3. EXPENDITURES FOR CONDUCT OF BASIC RESEARCH


Agency 1963actual

1964estimate

1965estimate

Department of DefenseNational Aeronautics and Space AdministrationAtomic Energy CommissionDepartment of Health, Education, and Welfare.National Science FoundationOther

Total

193.0525.1218.9195.199.6

118.2

204.5727.0238.9223.1126.8136.5

1,349.9 1,656.8

219.9790.2268.3237.2143.0150.2

1,808.8

Note.— Basic research is directed toward increase of knowledge in science where the primaryaim is fuller understanding of a subject rather than practical application.

1 Amounts are included in conduct of research, table H-2.



In these formally coordinated research programs, as well as manyother scientific activities of the Federal Government, steps are beingtaken to improve coordination among the agencies concerned so thatthe research efforts of the scientific community are mutually rein-forcing. The growth of research and development activities in recentyears has created a tremendous problem of communicating scientificresults among scientists and to the agencies which wish to use theresults in some applied form. A major effort is underway to improvesuch communications and to strengthen the means of handling anddisseminating scientific information.

Through its many research and development programs the FederalGovernment now supports more than two-thirds of the total nationalexpenditures for this purpose. Almost two-thirds of Federal fundsfor research and development are expended through contracts withprivate industry. A little over 20 percent are expended for directresearch and development by Federal scientists and engineers inagency laboratories. Only about 13 percent of Federal funds arespent through contracts with and grants to universities and othernonprofit institutions.

In connection with that portion of research and development con-ducted in universities, it is important to recognize the dual impactof research carried out by faculty members assisted by graduatestudents. The interaction of education and research in the universityenvironment contributes materially not only to the advancement ofresearch but also to the training of the scientific and technical man-power needed for the future.

DEPARTMENT OF DEFENSE—MILITARY

The research and development programs of the Department ofDefense include basic and applied research; exploratory, advanced,and engineering development of new components and systems withpossible military applications; and development of weapons systemsapproved for introduction into the operational forces. The principalamounts for these purposes and for the operation of research andtesting facilities of the Department are carried in the budget in theresearch, development, test, and evaluation appropriations. As indi-cated in table H-4, certain supporting amounts are provided in themilitary personnel, procurement, operations and maintenance, andmilitary construction appropriations. Research and developmentrelated to civil defense and military assistance are financed underthose headings.

Of the totals shown in table H-4 for 1965, 3% is for basic scientificresearch with about 23% providing for all research including experi-ments with extensive equipment requirements. Approximately 77%is for development, test, and evaluation of new military weapons andequipments.



Table H-4. EXPENDITURES OF THE DEPARTMENT OF DEFENSE-MILITARY—RESEARCH AND DEVELOPMENT (in millions of dollars)

Purpose and budget title 1963actual

1964estimate

1965estimate

Conduct of research and development:Research, development, test, and evaluationMilitary personnelProcurementOperations and maintenanceCivil DefenseMilitary assistance _-

Total, expenditures for the conduct of researchand development

Research and development facilities: Military construction-

Total, expenditures for research and development--

6,375.6238.890.072.01.4

13.2

6,943.0248.485.048.010.09.6

6,580.0259.490.042.010.010.0

6,791.055.2

7,344.0101.8

6,991.4111.3

6,846.2 7,445.8 7,102.7

Research and development activities decline slightly in 1965, asdevelopment of several major strategic systems nears completion.This reduction is shown in table H-4 above in terms of expenditures.Obligations for research and development activities will also beslightly lower in 1965 than in 1964 as indicated in table H-5 whichalso shows the composition of the programs of the Department bymajor fields of effort.

Amounts for basic and applied research increase slightly in 1965.Development of components, subsystems and weapons includingweapons for conventional and limited war is also expected to increaseas major strategic weapon system development programs like Atlas,Titan, Polaris, and Minuteman decline.

The new tactical fighter aircraft for use by both the Navy and theAir Force as well as smaller aircraft to increase the mobility of theground forces will continue development in 1965. Missile develop-ments include the Army's project for an improved antiballistic missileknown as Nike-X, the Navy's Polaris program, and the Air Forceprograms for an improved version of Minuteman and a new mobilemidrange ballistic missile.

Included in military astronautics are such spacecraft programs asthe manned orbiting laboratory (MOL) as well as basic engine andvehicle development efforts, such as the Titan III multipurposespace booster program. Totals for the military space program aregiven in table H-14. The research and development totals also in-clude substantial and increased effort in the various aspects of anti-submarine warfare research and development and in the developmentof improved combat vehicles for use by our land forces. Provisionis also made for support of Government-owned laboratories and testinstallations such as the Atlantic and Pacific missile ranges.



Table H-5. OBLIGATIONS OF THE DEPARTMENT OF D E F E N S E -MILITARY—RESEARCH AND DEVELOPMENT (in millions of dollars)

Purpose and budget title 1963actual

1964estimate

1965estimate

Conduct of research and development:Research, development, test, and evaluation:

Military sciencesAircraft and related equipmentMissiles and related equipmentMilitary astronautics and related equipmentShips, small craft, and related equipmentOrdnance, combat vehicles, and related equipment. _Other equipmentProgramwide management and supportEmergency fund

Total, direct obligations, research, development,test, and evaluation

Military personnelProcurementOperations and maintenanceCivil defenseMilitary assistance

Total, direct obligations for the conduct of researchand development

Research and development facilities: Military construc-tion

Total, direct obligations, for research and develop-ment

925.7724.1

2,525.41,234.8

223.9249.0513.7490.2

,886.8238.872.773.311.0

.1

7,282.7

87.2

7,369.9

888.2967.9

,140.0,263.9265.1329.3638.1536.5101.0

7,130.0248.487.344.910.01.2

7,521.8

133.6

7,655.4

971.3959.8

1,883.31,037.5

302.4348.4606.5533.8150.0

6,793.0259.4108.142.715.0

7,218.2

118.4

7,336.6

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

All the activities of the National Aeronautics and Space Adminis-tration are classified as research and development for purposes of thisspecial analysis. The National Aeronautics and Space Administra-tion is responsible for the development, test, and operation of space-craft and vehicles for manned and unmanned exploration of space andother nonmilitary applications, and for conducting the broad programsof supporting research and development required for these purposes.In addition, NASA is responsible for conducting research to advanceaircraft technology in support of both military and civilian interests.

The nature and estimated composition of the research and develop-ment programs of NASA are shown on table H-6. The increases in1965 in almost all categories result primarily from the successive largeincreases in NASA appropriations provided in 1963 and 1964 to carryout the expanded space program, principally to provide the facilitiesand initiate the vast new development programs required for the toppriority program to achieve a manned lunar landing by the end of thedecade. A further substantial increase in total NASA appropriationsis not required in 1965, so expenditures are not expected to continueto increase in future years at the high rate shown in 1965 and preced-ing years.

The programs of scientific research in space include unmanned in-vestigations in space with sounding rockets, satellites, and deep space



Table H—6. EXPENDITURES OF THE NATIONAL AERONAUTICS AND

SPACE ADMINISTRATION FOR RESEARCH AND DEVELOPMENT


Program and type of activity

Conduct of research:Basic scientific research in space:

Development and fabrication of spacecraft andinstruments

Procurement of launch vehicles and launching costs __Conduct of experiments, data reduction, and sup-

porting costsDevelopment of launch vehicles and equipment for

research purposes _Other basic research in space science and technology

Subtotal, basic researchOther research:

Space technologyAircraft technology

Total, conduct of research..

Conduct of development:Manned space flight and supporting developmentSpace applications developmentOther space technology development

Total, conduct of development

Research and development facilities:Basic scientific research in spaceOther basic research . . _Other research:

Space technologyAircraft technology _ . . .

Development and support:Manned space flight and supporting developmentAll other .

Total, research and development facilities

Total, National Aeronautics and Space Adminis-tration __

1963actual

199.775.2

106.6

88.055.6

525.1

177.737r0

739.8

1,383.187.8

116.4

1,587.3

33.010.0

12.6

163.76.0

225.3

2,552.3

1964

267.690.6

174.9

110.983.0

727.0

282.444.8

1,054.2

2,608.2106.0156.6

2,870.8

55.915.0

43.7.4

343.316.7

475.0

4,400.0

1965

257.4127.9

202.8

109.392.8

790.2

302.449.8

1,142.4

3,052.592.8

182.3

3,327.6

43.715.0

22.21.1

418.919.1

520.0

4,990.0

probes. Major emphasis in 1965 will be on the investigations to beconducted with the large orbiting solar, geophysical, and astronomicalobservatories and on the investigation of Mars with Mariner space-craft. NASA also supports basic research in space sciences at uni-versities and both basic and applied research in fields applicable tospace and aircraft technology at NASA research centers and throughgrants and contracts with universities and industry. NASA's activi-ties classified as development are currently devoted primarily to thedevelopment of spacecraft and launch vehicles required for the mannedlunar landing program. Development is also continuing of satellitesand technology for communications, meteorology, and other spaceapplications, and of nuclear propulsion and other engineering develop-ments to advance space technology.




The Atomic Energy Commission's program in research and develop-ment accounts for more than half of AEC's annual expenditures.

Research programs, which in 1965 constitute approximately 25%of the total conduct of research and development, are conducted in thephysical and biomedical sciences to secure a better understanding ofnuclear structure, nuclear processes, and the effects of nuclear radia-tion on living organisms and systems. Of the total funds programedfor research, about 90% is considered to be basic or fundamentalresearch. The development programs include efforts to improve theprocesses used in the production of special nuclear materials, to de-velop improved types of nuclear weapons, and to improve the meansof obtaining useful power from nuclear reactions.

These programs are carried on in AEC's contractor-operatedlaboratories, in universities, in other private research institutions, andby private industry. In support of its activities for the conduct ofresearch and development, AEC provides laboratory facilities, re-search equipment, and large research machines, such as nuclearreactors and particle accelerators. In 1965 more than one-third ofAEC's expenditures of this sort will be in support of research in con-trast to development.

Table H-7. EXPENDITURES OF THE ATOMIC ENERGY COMMISSION FORRESEARCH AND DEVELOPMENT (in millions of dollars)

Program

Conduct of researchand development

1963actual

1964 1965

Research and develop-ment facilities

1963actual

1964 1965estimate

Special nuclear materials and weaponsReactor developmentPhysical researchBiology and medicineOther research and development

Total, Atomic Energy Commission.

351.7462.4182.865.115.7

437.9508.3197.371.321.9

420.9497.9222.080.021.3

54.6107.585.5

7.92.1

83.6120.589.79.53.1

70.3126.9106.7

8.62.4

1,077.8 1,236.7 1,242.1 257.6 306.4 314.8

AEC's reactor development program includes efforts to developeconomic nuclear power reactors, to develop nuclear propulsion forrockets (Project Rover), to develop compact nuclear electric powersources for space and other remote applications, to develop militarypower and propulsion reactors, and to broaden the base of reactortechnology. In 1965 particular emphasis will be given to "breeder"power reactors, which would produce more fissionable material thanthey consume, and to the area of nuclear safety.

The physical research program, which increases in 1965, comprisesresearch in high and low energy physics and in those aspects ofchemistry, materials, and mathematics of particular importance tonuclear science and technology. In addition, there is a continuingprogram to achieve a controlled thermonuclear reaction for possiblegeneration of power. Of special interest in 1965 is AEC's plan toconstruct in the Midwest the world's finest nuclear research reactor.



In addition, AEC conducts programs for research in the biomedicalsciences and for the peaceful uses of isotopes and nuclear explosives.

DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE

The expenditures for research and development by the Departmentwill increase $42.3 million* in 1965 over an estimated $753.6 millionin 1964. This increase is primarily to strengthen the programs of thePublic Health Service and reflects the additional emphasis being placedon prevention and treatment of mental illness and mental retardation.

In addition to the $38 million spent in 1964, $6 million is includedto expand environmental health activities, primarily to study the long-term effects of pollution on human health.

Expenditures for the National Institutes of Health include in-creases for the new Institutes of Child Health and Human Develop-ment and the Institute of General Medical Sciences.

The Office of Education is expanding its support for research toimprove course materials, strengthen teacher training programs, im-prove teaching of the arts, to help smaller universities and collegesdevelop educational research programs, and to demonstrate researchfindings to school personnel. Expenditures for these programs willtotal $23.8 million in 1965, an increase of $5.6 million over 1964.

NATIONAL SCIENCE FOUNDATION

The total expenditures of the National Science Foundation forresearch and research facilities are estimated at $204.0 million in 1965as compared with $175.1 million in 1964 and $142.1 million in 1963.

The 1965 budget will provide increased support for basic researchproject grants; for the Antarctic research program; and for ProjectMohole, a program of research in the geology and geophysics of thedeeper layers of the earth. Support will be continued for U.S. par-ticipation in the Indian Ocean Expedition and in the InternationalYear of the Quiet Sun. Additional funds are estimated in 1965 foruniversity nuclear research facilities, university computing facilities,and specialized biological facilities. Support of the National Centerfor Atmospheric Research and of two astronomy observatories willcontinue, with provision in 1965 for the start of construction of a 150-inch optical telescope at Kitt Peak, Ariz. In addition, the Founda-tion is planning a substantial increase in its program of matchinggrants for facilities related to research and science training.


Expenditures of the Department for the conduct of research anddevelopment are estimated at $187.2 million in 1965 as compared with$181.4 million in 1964 and $162.4 million in 1963. The net increase of$5.8 million in expenditures is composed of a number of expandedresearch activities partly offset by the closing of several low priorityresearch locations. Funds will be available for staffing and operatingsoil and water, entomology, poultry, and other laboratories recentlyauthorized by Congress. Research will be expanded on biologicalcontrols, on nonchemical control methods, on the effects of pesticideson animals, on pesticide residues in soils, on forest tree genetics, andon other measures to avoid or minimize pesticide hazards.



Additional funds will be available to continue the forest surveyand research on forest land management, including watershed studies.Wood products research will be expanded and an addition to theForest Products Laboratory in Madison, Wis., will be started. Stepswill be taken to implement the Department's program in food andnutrition research. Construction funds will be available to modernizeand rehabilitate portions of the National Agricultural Research Centerat Beltsville, Md., and to construct a new facility at Fort Collins,Colo., to replace temporary buildings; $1.4 million additional will beavailable for institutional-type grants to the agricultural experimentstations at the land-grant universities.

Funds are being requested for the construction of the NationalAgricultural Library at Beltsville, Md. Planning money was madeavailable in 1964.

Research projects overseas financed in excess currency countriesunder Public Law 480 will be expanded to include basic studies ofvalue to agriculture.


Expenditures of the Department of the Interior for research anddevelopment are estimated at $130.8 million, compared with $116.1million in 1964 and $100.4 million in 1963. About 22% of the 1965amount will be spent on development programs including the con-struction of research facilities; 47% on applied research; and theremainder on basic research. Programs of the Bureau of Mines,Fish and Wildlife Service, Geological Survey, Office of Coal Research,and the Office of Saline Water make a significant contribution to theresearch and development activities of the Department.

The 1965 budget provides for continuing research directed primarilyat improving the conservation and use of water, parks and monu-ments, fish and wildlife, minerals, and other natural resources. In-creased emphasis will be given to the study of the toxicological effectsof pesticides on fish and wildlife; and to the biological aspects of thenational oceanographic program. Geophysical and geochemicalstudies of the upper mantle of the earth's crust that may ultimatelyimprove the technology of locating deep-lying mineral deposits arescheduled for major expansion. Programs to increase the use of andexpand the markets'for coal and coal products will increase. Basicstudies and investigations of groundwater and groundwater character-istics will be expanded; major efforts to discover low cost means ofconverting saline to fresh water will be continued.

DEPARTMENT OF COMMERCE

Total expenditures for research and development are estimated at$95 million in 1965, an increase of $9.3 million over 1964 and $28.5million over 1963. Expenditures for research facilities decrease by$1.7 million since construction of the new National Bureau of Stand-ards laboratory complex will be substantially completed by the end ofthe year. The $11 million net expenditure increase for the conductof research will provide modest strengthening of various programs fortransportation, business, and industry. Among these programs are



weather prediction and forecasting, experimental nuclear ship opera-tions, textile research, analysis of business conditions, and researchinto transportation planning problems. Improvements are also fore-cast in oceanography and geodesy, Federal research report distribu-tion and reference services, patent classification and search, and sta-tistical measurement of economic and social characteristics.

Two new programs will be undertaken by the National Bureau ofStandards. Approximately half of the $4.2 million expenditure in-crease for these programs will be associated with contractual orcollaborative work. The National Standard Reference Data Systemwill constitute a comprehensive system for the identification, collec-tion and verification of data on the properties and behavior of physicalmaterials. A program of engineering measurements and standards,of principal benefit to consumer-oriented industry, will provide a basisfor collaboration with standardizing bodies and societies in the devel-opment of codes, standards, and methodologies of testing. Expansionis planned particularly for the development of criteria for evaluatingthe performance of industrial products and processes.


The Federal Aviation Agency will continue its efforts to developimproved devices for air navigation and air traffic control. In addi-tion funds were appropriated in 1964 to finance a design competitionfor the construction of a civil supersonic transport aircraft.

SELECTED SCIENTIFIC AND TECHNICAL ACTIVITIES OF THE FEDERALGOVERNMENT

The following section presents six scientific and technical activitiesof the Federal Government on a Government-wide basis. In thesefields, and in many other fields, the Office of Science and Technologyin cooperation with the President's Science Advisory Committee andthe Federal Council for Science and Technology is active in improvingthe planning, coordination, and review of Federal research and devel-opment programs. Expenditures for these scientific and technicalactivities are included in the agency expenditures shown elsewhere inthis analysis.

MEDICAL RESEARCH

Federal expenditures for medical and health-related researchactivities are estimated at $1.3 billion in 1965. Nearly two-thirds ofthis amount is expended by the National Institutes of Health, acomponent of the Public Health Service, Department of Health,Education, and Welfare. The seven disease-centered instituteswere augumented in 1963 by two new institutes more oriented towardbasic research and the total human life cycle. The increases in 1965support growth for these two institutes and provide for training ofadditional research personnel, particularly in mental health. Over$30 million of NIH funds will go to industrial firms for testing andevaluation of new chemicals and drugs for the treatment of cancer,cardiovascular diseases and mental illness. Other bureaus of theDepartment of Health, Education, and Welfare are also expanding

700-000 0—64 27



Table H-«. OBLIGATIONS OF FEDERAL AGENCIES FOR MEDICAL ANDHEALTH RELATED RESEARCH (in millions of dollars)

Agency 1963actual

1964estimate

1965estimate

Department of Health, Education, and Welfare:Public Health Service.

(National Institutes of Health)Other

Total, Department of Health, Education, andWelfare

Department of DefenseAtomic Energy CommissionNational Aeronautics and Space AdministrationVeterans AdministrationDepartment of AgricultureNational Science Foundation _Other

Total, medical and health related researchTotal, conduct of research....Total, research facilities

686.6(623.9)

19.9

825.6(727.8)

29.4

905.7

706.592.577.934.734.025.128.86.0

855.0107.882.850.338.024.629.2

7.6

943.1108.894.966.247.125.532.27.6

1,005.5923.482.1

1,195.41,084.7

110.7

1,325.51,185.4

140.1

Note.—Figures include obligations for research with other than medical or health objectives butrelated to health in terms of substance or probable applications as follows in millions of dollars:1963, $169.8; 1964. $198.3; 1965, $225.9.

their programs. The Food and Drug Administration is strengtheningits program of testing and evaluating new drugs, food and coloradditives, and pesticides.

The National Library of Medicine will expand its Medical LiteratureAnalysis and Retrieval System (MEDLARS), which began operationsin 1963. This system will speed production of Index Medicus, themonthly bibliography of medical research papers published through-out the world. It is also intended to make special bibliographic com-pilations.

The Atomic Energy Commission conducts and supports medicalresearch related to the effects of radiation and its beneficial applica-tion. Medical research supported by the Department of Defense isfocused on preventive medicine and the medical problems of militaryoperations. Over one-third of the National Science Foundation ex-penditures in this area, and all of the increases in 1965, are for researchfacilities.

METEOROLOGICAL ACTIVITIES

The atmospheric science and weather service programs of Federalagencies include both operational and research and developmentactivities.

Comprehensive arrangements have been established to coordinateatmospheric science and weather programs. Operational activitiesand research and development directed toward improvement ofoperational weather services (other than the development of meteoro-logical satellites and activities involving special military securityconsiderations) are coordinated by the Department of Commerce.



That Department has also recently been made responsible for de-veloping a plan to achieve the maximum integration of both weatherservices and supporting research, consistent with the effective andeconomical accomplishment of agency mission requirements. Inaddition, the Federal Council for Science and Technology, throughits Interdepartmental Committee for Atmospheric Sciences, reviewsand evaluates all research and development in the field of atmosphericsciences, including research supporting weather systems. Furtheradvice regarding these research and development activities is obtainedfrom a panel on atmospheric sciences of the President's ScienceAdvisory Committee.

The introduction of computers, radar, rockets, and satellites havegreatly enhanced capabilities for observing the atmosphere. Prob-lems associated with air pollution, fallout of atomic debris, super-sonic and space flight, and the possibility of weather control havecaused increasing emphasis to be given to the atmospheric sciences.In 1965, funds programed for research and development in this broadfield (which includes studies of the upper atmosphere and the atmos-pheres of other planets as well as more conventional weather phe-nomena) are estimated to total $227 million, an increase of $26 millionover 1963. Of this total, $119 million is for aeronomy—the scienceof the upper atmosphere. Meteorological programs, which are con-cerned with the behavior of the lower atmosphere (generally within100 kilometers of the earth's surface) are described in detail below.

Table H-9. OBLIGATIONS FOR FEDERAL PROGRAMS IN METEOROLOGY


Summary Table

Agency

Department of AgricultureAtomic Energy Commission _Department of Commerce:

Bureau of StandardsWeather Bureau 1

Department of Defense:Army __NavyAir Force

Federal Aviation AgencyDepartment of Health, Education, and

WelfareDepartment of the InteriorNational Aeronautics and Space Admin-

istration. _ __ ______ __ _National Science FoundationTreasury Department: Coast Guard

Total

Operations

1963

72.2

3.429.788.916.9

.3

211.4

1964

mate

105.3

3.729.085.318.2

5.0

246.5

1965

mate

106.8

3.828.184.518.4

5.1

246.7

Research anddevelopment

1963

1.24.0

.611.5

11.24.9

11.34.3

1.42.2

55.59.4

117.5

1964

mate

1.34.3

.911.2

10.45.7

11.51.4

1.62.5

66.410.2

127.4

1965

mate

1.36.3

1.114.4

11.25.8

12.41.5

1.92.9

39.010.2

108.0

1965Total

1.36.3

1.1121.2

15.033.996.919.9

1.92.9

39.010.25.1

354.7

1 Includes $11.6 million in 1963, $38.4 million in 1964, and $35.3 million in 1965 for operationalsatellite program.



The increase in obligations in 1964 over 1963 for both operationsand research results chiefly from acceleration of meteorological satelliteactivities. In 1965 Weather Bureau obligations for satellite operationswill decrease $3.1 million and NASA obligations for development ofmeteorological satellites by $27 million as its work on the TIROS andNIMBUS spacecraft approaches completion. Exclusive of thesechanges, civil programs show modest growth. Funds for militarymeteorology remain at about $146 million through 1965.

Table H-10. OBLIGATIONS FOR FEDERAL METEOROLOGICAL OPERA-

TIONS, 1965 (in millions of dollars)

Agency

Department of Commerce,Weather Bureau

Department of Defense:ArmyNavy _ _ __Air Force

Federal Aviation AgencyTreasury Department: Coast

Guard

Total

73.0

2.714.929.9

.9

4.7

126.1

23.6

.27.2

33.4.4

.2

65.1

Com muni-

6.8

.35.9

18.317.1

.1

48.5

Climatology

3.4

.6( i )

2.80

0

6.9

Total

106.8

3.828.184.518.4

5.1

246.7

1 Less than $50 thousand.

Weather service operations.—The Weather Bureau will place princi-pal emphasis in 1965 on increasing its production of centrally preparedcomputer products to provide field forecast and service units amaximum amount of reliable guidance material on which to baseadvisory services to specific user groups. Concurrently with theexpansion of central data processing facilities there will be a smallreduction in the number of local forecast and briefing outlets main-tained by the Weather Bureau and the Federal Aviation Agency.

The military weather services utilize products of the nationalmeteorological system in order to provide direct support to field forcesthroughout the world. The Air Force and the Navy also performaircraft weather reconnaissance at a cost of approximately $14 millionannually. The amounts reported include the estimated costs ofmaintaining military personnel performing weather activities andfunds for procurement of equipment, estimated to increase slightlyin 1965.

The weather service activities of the Coast Guard and FederalAviation Agency support the national meteorological system. TheCoast Guard finances the operation of multipurpose ocean stationvessels. About 25% of this cost is ascribed to meteorology. TheFederal Aviation Agency provides teletype communications for bothWeather Bureau and military use. In 1965, it will achieve a $0.5million reduction in these costs by leasing teletype lines through jointprocurement contracts with the Department of Defense.

A significant development in the usefulness of satellite observationsresults from the procurement of equipment capable of receiving cloudcover TV pictures directly from an overflying spacecraft. These



equipments both reduce the need for expensive ground communica-tions and speed up receipt of data. In excess of 20 such equipmentsare now operating in the United States; an additional 20 sets havebeen obtained by the military services for use overseas; and 8 morehave been purchased or constructed by foreign governments.

Table H I 1. OBLIGATIONS FOR FEDERAL METEOROLOGICAL RESEARCHAND DEVELOPMENT PROGRAMS, 1965 (in millions of dollars)

Department of AgricultureAtomic Energy CommissionDepartment of Commerce:

Bureau of StandardsWeather Bureau

Department of Defense:ArmyNavyAir Force

Federal Aviation AgencyDepartment of Health, Educa-

tion, and WelfareDepartment of the InteriorNational Aeronautics and Space

AdministrationNational Science Foundation

Total. _

Physicsof the

phere

2.9

1.11.9

1.22.95.0

.7

.2

3.9

19.8

Motionsand

1.33.4

5.3

3.9.9

2.0

1.11.4

5.4

24.7

Weatherservice

opment

4.7

1.5.5

3.91.5

.7

12.8

Clima-

.7

.4

.1

.5

.2

.4

2.2

Satelliteand

other

mentdevel-

.8

1.41.41.1

.1

.5

39.0

Facili-ties,net-

andsupport

1.0

2.7.1

.5

«

1.36.3

1.114.4

11.25.8

12.41.5

1.92.9

39.010.2

108.0

Research and development.—Activities reported in the table aboveare directed to increasing understanding of the physical and chemicalproperties, composition, behavior and processes of the lower atmos-phere and to improving the weather service system. Expendituresfor a number of closely related activities concerned with the effects ofthe atmosphere on plants and animals are excluded, as are engineeringprojects to apply meteorological science to specific problems such asballistics and the control of air pollution.1

A $2 million expansion of the atomic energy program is planned in1965 in order to improve understanding of transport and fallout ofradioactive materials. The $3.2 million increase projected in theWeather Bureau research and development program will be directedprincipally to operations research designed to improve the efficiencyof that Bureau's operations. In addition, the Weather Bureau plansto participate in international efforts to improve the observation andexchange of weather data.

In 1964 financing will be completed for the initial constructionplanned at the National Center for Atmospheric Research, financedby the National Science Foundation. The Center's program will be

1 Re-examination of the HEW program in reference to this definition has caused a large pro-portion of amounts previously reported by this agency to be excluded from its 1965 report ofmeteorological research and development obligations.



expanded in 1965 to provide more funds for study of basic atmosphericproblems and to provide facilities not elsewhere available for use bythe scientific community.

OCEANOGRAPHY

The National Oceanographic Program of the Federal Governmentfor 1965 will total $138.1 million. This program is reviewed and co-ordinated on a Government-wide basis by the Interagency Committeeon Oceanography of the Federal Council for Science and Technology.This committee appraises various agency programs to direct efforttoward long-range goals, avoid overlapping work, and support newand priority projects.

Table H-12. OBLIGATIONS OF FEDERAL AGENCIES FOR OCEANOGRAPHY(In millions of dollars)

Agency 1963actual

1964estimate

1965estimate

Departments of:CommerceDefense _Health, Education, and WelfareInterior •____Treasury r__

Atomic Energy CommissionNational Science FoundationSmithsonian Institution

Total

23.755.54.1

16.1.5

3.519.7

.6

23.754.62.9

16.51.24.2

20.2.6

20.566.63.3

19.71.84.7

20.6.9

123.7 123.9 138.1

The 1965 effort in oceanography is $14 million larger than the 1964program with continued growth in research partially offset by areduced level of ship construction. Research in the ocean environ-ment is particularly important to provide the United States a scientificand technological base for future exploitation of the oceans for fishprotein and minerals and to provide needed environmental informationfor weather prediction, assessment of ocean pollution, and antisub-marine warfare.

Table H-13. OBLIGATIONS FOR OCEANOGRAPHY BY FUNCTIONAL AREA(In millions of dollars)

Ship construction __Surveys and data collection in support of research and agency

missionsResearch, instrumentation, and facilities (Navy)Research, instrumentation, and facilities (Civil)

Total- -

1963

37.3

18.726.741.0

123.7

1964

27.4

22.931.941.7

123.9

1965

e»t ate

21.4

26.141.249.4

138.1



As shown in table H-13 the oceanographic program includes re-search, development of instrumentation-and facilities (66%), oceansurveys and data collection (19%) and ship construction (15%). Theresearch program is directed to the description and understanding ofthe physical and chemical properties of the "world ocean"; the effectof the interrelationship of the ocean and the atmosphere; the dis-tribution of marine organisms; the present structure of the ocean floorand its history; and the modification of the ocean by human activities.The survey program provides basic data to support the researchprogram.

SPACE PROGRAMS

As shown on table H-14, expenditures for the total Federal spaceprograms are estimated at $6.7 billion in 1965, a $555 million increaseover 1964. New obligational authority decreases $97 million from thehigh level of $7 billion reached in 1964. Virtually all of the amountsfor the space programs are classified as research and development andare included in the totals in this special analysis.

Table H-14. NEW OBLIGATIONAL AUTHORITY AND EXPENDITURES FORFEDERAL SPACE PROGRAMS (in millions of dollars)

Agency

National Aeronautics andSpace Administration 1

Department of DefenseAtomic Energy Commission.Department of Commerce:

Weather BureauNational Science Foundation-

Total


1963

3,626.01,579.3

213.9

43.21.5

5,463.9

1964

5,189.51,615.8

227.6

2.72.4

7,038.0

1965

5,230.81,474.1

212.7

20.82.9

6,941.3

EXPENDITURES

1963

2,515.31,367.5

181.0

12.2. 1.1

4,077.1

1964

4,354.81,583.0

217.7

19.01.5

6,176.0

1965

4,939.11,548.0

220.4

21.71.8

6,731.0

1 Excludes aircraft technology.

The amounts shown for the National Aeronautics and Space Admin-istration coyer all activities of that agency except those specificallyidentified with aircraft technology. The estimates for the Depart-ment of Defense include the projects in the Department's astronauticsbudget activity and certain amounts in other budget programs whichcontribute to the space effort, such as missile development, rangeoperations, and various other supporting research, development, andoperating costs. The decrease in the Defense new obligational au-thority request in 1965 is largely due to the cancellation of Dynasoarand the lower funding for the development of Titan III, which willbe nearing completion at the end of 1965. For the Atomic EnergyCommission, the table includes the amounts associated with thedevelopment of nuclear rocket propulsion and nuclear power sources



for space applications and amounts for aerospace safety and reactorresearch. The Weather Bureau amounts are primarily those relatedto the establishment of an operational meteorological satellite systemwhich, therefore, are not included in the totals for research and devel-opment in this special analysis. The amounts for the National ScienceFoundation are for research in astronomy using rockets and satellite-borne observation instruments.

WATER RESEARCH

The Federal program for water resources research will total anestimated $73 million in 1965.

TableH-15. OBLIGATIONS OF FEDERAL AGENCIES FOR WATERRESEARCH AND SURVEYS (in millions of dollars)

Agency

Departments of:Agriculture.CommerceDefenseHealth, Education, and WelfareInterior

Atomic Energy CommissionNational Science FoundationTennessee Valley Authority.. __

Total _ __._

1963actual

12.11.72.4

18.224.53.91.9.8

65.5

1964

11.72.03.4

16.631.03.32.0

.9

70.9

1965

12.82.63.4

M2.136.03.02.21.0

73.1

1 Reduction reflects nonrecurring construction costs of research laboratory facilities.

The Committee on Water Resources Research of the Federal Councilfor Science and Technology coordinates the activities of the eightmajor Federal agencies whose missions require the conduct of researchrelating to water. The Committee was organized in September 1963and provided a broad review of proposed agency programs for 1965to assure that they were mutually complementary and to avoidunwarranted duplication. r

The major portion of the increase in the Department of the Interioris for water quality research related to pesticides and ground waterresearch. The Department of Agriculture is expanding its programof research in water and land management.

The decrease for the Department of Health, Education, and Wel-fare reflects the completion of construction of new laboratory facilities.Other agency programs include modest increases in the conduct ofwater resources research to meet growing national needs.



SCIENCE INFORMATION

Under the impetus of the Committee on Scientific Information of theFederal Council for Science and Technology, individual agencies areimproving their scientific and technical information programs. Ex-amples of such activity include the recent reorganization of the ArmedServices Technical Information Agency, redesignated the DefenseDocumentation Center, to cope with the increasing demands for itsservices; the establishment by the National Library of Medicine ofMEDLARS, a computerized system designed to speed the access tomedical research literature; the standardization of microforms forGovernment research and development documents; and the establish-ment of a standard descriptive cataloging system for the FederalGovernment. Further, the agencies continue their efforts to obtainmore reliable cost data on science information activities to assist themin formulating more comprehensive program objectives and in de-veloping measures for management improvement.

The budgetary data available for 1965 reflect a recognition thatthe timely flow of scientific and technical information is essentialto the prudent management of the Nation's research and developmentprograms. Increased research and development is planned for scien-tific communication and documentation particularly in the area ofadvanced mechanization techniques. Increases are also programedfor the publication and distribution of documents to coincide with theanticipated growth of published scientific materials and for biblio-graphic and reference services to reflect agency expansion of theseservices and the establishment of new specialized information andevaluation centers. Also reflected in the 1965 budget are certainrecent Federal policy decisions designed to improve the handling ofscientific and technical information. These include the establishmentof a National Standard Reference Data System at the NationalBureau of Standards to provide scientists and engineers with criticallyevaluated numerical data in the physical and engineering sciencesnecessary for the research and development process and the transferto the National Science Foundation of fiscal and managerial responsi-bility for the Science Information Exchange. Budgetary increasesare also programed for the SIE to permit continuation of its expandedcoverage of the physical sciences and for the Office of TechnicalServices of the Department of Commerce to reflect its growing clear-inghouse function for Government research and developmentdocuments.



Table H-16. ADMINISTRATIVE BUDGET EXPENDITURES FOR FEDERALRESEARCH AND DEVELOPMENT PROGRAMS (in millions of dollars)

Based on existing and proposed legislation

Description

Department of Agriculture:Agricultural Research Service _ _Cooperative State Research ServiceEconomic Research ServiceAgricultural Marketing ServiceForest ServiceOther _

Total, Department of Agriculture..

Department of Commerce:Civilian industrial technology.National Bureau of StandardsWeather BureauMaritime AdministrationTransportation researchOther .

Total, Department of Commerce. __

Department of Defense:Military wCivil : _.


Department of Health, Education, andWelfare:

Food and Drug Administration _Office of Education LOffice of Vocational RehabilitationPublic Health ServiceWelfare Administration

Total, Department of Health, Edu-cation, and Welfare

Department of the Interior:Geological SurveyBureau of MinesOffice of Coal ResearchFish and Wildlife ServiceOffice of Saline Water . . .Other _

Total, Department of the Interior. _

Atomic Energy CommissionFederal Aviation AgencyNational Aeronautics and Space Admin-

istrationNational Science FoundationVeterans AdministrationOther

Total, research and development . . .

Conduct of research anddevelopment

1963actual

85.938.09.74.5

22.31.9

162.4

23.39.28.0

5.4

45.9

6.791.02.7

6.793.6

3.611.512.1

550.63.3

581.1

26.728.91.5

26.85.43.2

92.5

1,077.863.3

2,327.199.629.939.1

11,312.3

1964

mate

97.041.69.85.7

24.82.5

181.4

.125.29.58.01.06.7

50.5

7,344.04.1

7,348.1

4.418.216.8

649.96.2

695.6

29.830.44.4

28.89.34.1

106.3

1,236.769.1

3,925.0126.834.349.4

13.823.8

1965

mate

102.242.59.54.6

25.92.5

187.2

.829.512.29.01.58.5

61.5

6,991.44.4

6,995.8

5.223.818.5

673.46.9

728.0

32.731.54.8

32.610.63.9

116.1

1,242.1109.3

4,470.0143.035.950.4

14.139.3

Research

1963

5.0

3.4

8.4

19.01.6

20.6

55.2

55.2

.7

39.5

40.1

.1

.4

2.53.31.6

7.9

257.69.2

225.342.53.21.1

671.1

and developmentFacilities

1964

mate

3.4

.5

.4

4.2

35.2

35.2

101.8

101.8

1.1

56.8

58.0

.2

.5

6.41.7.5

9.3

306.416.3

475.048.33.11.6

1.059.2

1965

mate

3.5

2.6.3

6.4

33.5

33.5

111.3

111.3

.7

.5

66.8

67.9

1.0.4

9.21.42.7

14.7

314.812.4

520.061.03.02.8

1.147.8


SPECIAL ANALYSIS I

FEDERAL AID TO STATE AND LOCAL GOVERNMENTS

Federal aid to State and local governments in recent decades hasbecome a major factor in the cooperative financing of essential gov-ernment functions. The rudiments of the present system date backabout 100 years to the enactment in 1862 of the Morrill Act, whichestablished land-grant colleges and instituted certain federally re-quired minimum standards characteristic of the present grant-in-aidsystem. Federal aid was later initiated for agriculture, highways,vocational education and rehabilitation, forestry, and public health.In the depression years, Federal aid was extended to meet economicsecurity and other social welfare needs.

In 1965 Federal financial assistance to State and local governmentsunder existing or proposed programs will total an estimated $10.6billion, including net expenditures of $6.5 billion from regular budgetaccounts and $4 billion from the Highway and Unemployment trustfunds. The total includes $188 million under proposed legislation,of which $70 million is for education, $55 million is for youth employ-ment programs, and the remaining $63 million is for community work-training, increased contributions to the District of Columbia, urbantransportation assistance, recreation planning and land acquisition,and hospital construction.

Federal Aid to State and Local GovernmentsBudget and Trust Fund Expenditures



The growth of Federal aid programs.—In 10 years, total Federal aidto State and local governments will have more than tripled, risingfrom $3.1 billion in 1955 to an estimated $10.6 billion in 1965. In thesame period, expenditures by State and local governments fromtheir own funds will have more than doubled. Although the numberand variety of Federal aid programs have increased markedly in thelast several decades, more than 60% of total expenditures in 1965 forassistance to State and local governments will be for highway con-struction and public assistance grants. In the decade ending in1965, highway construction grants will have increased more thansixfold, rising from $586 million in 1955 to an estimated $3.6 billionin 1965, the largest increase in Federal aid for any purpose during thisperiod. Grants for public assistance will have doubled since 1955,increasing from $1.4 billion to an estimated $2.8 billion in 1965.

Increasing population and rapid urbanization have led to greaterresponsibility, particularly at the State and local level, for providingessential public services in education, health, housing, urban renewal,highways and public transportation. Continuing economic changehas stimulated programs for safeguarding the economic security ofindividuals. While the major burden of such public services restswith the approximately 90,000 State and local governmental jurisdic-tions, the Federal Government plays a vital role, both through directoperation of programs and by providing financial assistance to Stateand local governments.

The provision of public services can be facilitated through improvedintergovernmental cooperation and coordination concerning revenuesources and expenditure programs. The Advisory Commission onIntergovernmental Relations, established in 1959 for this and otherpurposes, is continuing to make valuable contributions in identifyingareas in which interlevel action could improve the efficiency of theseveral levels of government in our Federal system.

Major program changes for 1965.—For 1965, the total of budgetand trust fund expenditures under existing and proposed programsfor financial assistance to other levels of government is expected to be$391 million more than in 1964 and $1.8 billion more than the actualtotal for 1963. This change reflects both significant increases anddecreases in several of the grant-in-aid programs. The major in-creases over the 1964 estimate are expected to be in the educationalassistance programs which are estimated to rise by $213 million to atotal of $798 million reflecting recently enacted higher and vocationaleducation bills and proposed new legislation; in the housing andcommunity development programs which will rise by $190 million to atotal of $705 million; and in total Federal aid to highway constructionwhich is estimated to increase by $94 million to $3.6 billion. Smallerincreases will occur in other programs including employment service,school lunch, environmental health, and maternal and child welfareprograms.

Significant decreases in 1965 are expected to occur (1) in the distri-bution of surplus food commodities which will decline by $75 million(2) in accelerated public works which will decline by $17 million and(3) in public assistance, where a decline in expenditures of $132million will be offset by a drawing down of cash balances held by theStates, so that obligations in 1965 will continue to increase. Smaller



decreases occur in national defense, disaster relief, and communityhealth programs, and in special grants to Alaska.

New legislation proposed for 1965.—Federal aid to State and localgovernments will be affected by several of the recommendations forlegislative change which are provided for in the 1965 budget. Alarge part of the $718 million in total new obligational authorityrequested for education legislation will be for aid to State and localgovernments. Because expenditures lag behind authorizations, how-ever, it is expected that there will be only $70 million in expendituresfor grants-in-aid in 1965. Grants under the Youth EmploymentAct, pending in Congress, are estimated to be $55 million in 1965.

Among the other recommendations for legislative change for whichspecific amounts are included in this analysis are: (1) recreationplanning and land acquisition, $9 million; (2) urban transportationassistance grants, $10 million; (3) increased Federal payments to theDistrict of Columbia, $5 million; (4) hospital construction activities,$5 million; and (5) community work-training programs, $35 million.

Federal aid programs by Junction and agency.—In 1965, Federal aidfor health, labor, and welfare activities will amount to $4.2 billion,40% of the total. Of this amount $3.4 billion, including $2.8 billionfor public assistance grants, will be for programs administered by theDepartment of Health, Education, and Welfare. About 38% oftotal Federal aid, or $4 billion, will be spent for commerce and trans-portation activities of which highway construction under the De-partment of Commerce will account for $3.6 billion. Most of theremaining 22% will be distributed among education (8%), housingand community development (7%), and agriculture and agriculturalresources (5%). The detailed table at the end of this analysis liststhe various programs of Federal aid to State and local governmentsby function, type of aid, agency, and major program groups.

Table 1-1. FEDERAL-AID BUDGET AND TRUST FUND EXPENDITURESBY AGENCY (in millions of dollars)

Agency 1963actual

1964estimate

1965estimate

Executive Office of the PresidentFunds appropriated to the PresidentDepartment of AgricultureDepartment of CommerceDepartment of Defense—MilitaryDepartment of Defense—CivilDepartment of Health, Education, and Welfare-Department of the InteriorDepartment of Labor .Department of StateTreasury DepartmentFederal Aviation AgencyGeneral Services AdministrationHousing and Home Finance AgencyVeterans AdministrationOther independent officesDistrict of Columbia 1

48.7848.3

3,028.340.518.6

3,628.9138.8330.4

7.358.151.5

.1502.6

8.27.7

62.7

.4298.3979.0

3,570.442.518.0

3,967.0145.8408.5

5.658.775.3

1.5525.7

8.38.6

63.2

1.5266.0916.2

3,668.137.016.5

4,086.7154.0487.0

5.661.075.72.0

688.57.98.9

85.2

Total, budget and trust fund expenditures for Federal aid_ 8,780.7 10,177.0 10,567.7

1 Represents Federal payments, contributions, and loans to the District of Columbia for operationsand capital improvements.



In 1965, Federal-aid budget and trust fund expenditures will beincurred primarily under programs administered by the Departmentof Health, Education, and Welfare (39%) and the Department ofCommerce (35%). Federal-aid expenditures by other agencieswill make up the remaining 26% of the total, with the largest amountsby the Department of Agriculture, 9%; the Housing and HomeFinance Agency, 7%; and the Department of Labor, 5%.

Federal aid in relation to total Federal and State-local outlays.—Estimated Federal aid in 1965 to State and local governments frombudget accounts alone of $6.5 billion will represent approximately7% of total Federal budget expenditures. Total financial aid frombudget and trust accounts of $10.6 billion will represent about 9% ofestimated total Federal cash payments to the public. As a source ofState and local revenue, Federal-aid payments from both trust fundand budget accounts in 1963 was about one-seventh of all generalrevenue available to/ these jurisdictions.

Table 1-2. FEDERAL-AID E X P E N D I T U R E S IN RELATION TO TOTAL

FEDERAL E X P E N D I T U R E S A N D TO STATE-LOCAL REVENUE

1954 __. - . . .19551956 . . . . . .19571958 . . .19591960 __ .19611962 _ _ _ _ .19631964 estimate1965 estimate _ _

Net budget expenditures-» ^faf« on/]

local governments

Amount(millions)

$2,6573,1243,7533,1593,5764,0124,2594,3264,9665,4536,2526,520

As a per-cent of total

Federaladministra-tive budgetexpenditures

456555656667

Total expenditures for aid to State

trust accounts

Amount(millions)

$2,6573,1243,7534.1115,0726,8137,1747,2838,1678,781

10,17710,568

As a per-cent of total

cash pay-ments to

the public

445567878889

As a per-cent ofState-local

revenue l

10111211121514131414

(2)

1 Based on compilations published by Governments Division, Bureau of the Census. ExcludesState-local revenue from publicly operated utilities, liquor stores, and insurance trust systems.

3 Not available.

Types of Federal aid.—Federal financial assistance to State and localgovernments takes the form of direct grants-in-aid, shared revenue,and net loans and repayable advances. Grants to States and localitiesare the most significant type of Federal aid. In 1965, it is estimatedthat $10.2 billion or 96% of total expenditures for all three types ofaid will take the form of grants-in-aid. Shared revenue will accountfor $183 million, or 1.7%, and net loans and repayable advances,$203 million, or 1.9% of the grand total. Apart from these types ofFederal aid, many other Federal expenditures which are not includedin this analysis, such as contractual payments or grants to publicinstitutions for research and training in special fields, affect thefinances of State and local governments.



Table 1-3. FEDERAL AID TO STATE AND LOCAL GOVERNMENTS(In millions of dollars)

Agency and programFunc-

code

1963 1964 1965stimate

BUDGET ACCOUNTS *

Grants-in-aidNational defense:

Executive Office of the President:Office of Emergency Planning: Federal contributions

and State and local planningDepartment of Defense—Military: Civil defense shelters

and financial assistanceConstruction of Army National Guard centers

059

051051

Total, national defense.

International affairs and finance:Department of State: East-West Cultural and Tech-

nical Interchange Center


Commodity Credit Corporation and AgriculturalMarketing Service: Removal of surplus agriculturalcommodities and value of commodities donated

Watershed protection, flood prevention, and resourceconservation and development

Cooperative agricultural extension workAgricultural experiment stationsPayments to States, territories, and possessions, Agri-

cultural Marketing Service

Total, agriculture and agricultural resources.

Natural resources:Department of Agriculture: Forest protection and util-

izationDepartment of Defense-Civil: Corps of Engineers:

Payment to California, flood control__Department of the Interior:

Bureau of Reclamation: Disposal of Boulder City andCoulee Dam communities

Bureau of Indian Affairs: Resources managementDrainage of anthracite minesFederal aid for fish and wildlife restoration ,..Proposed legislation: Land and water conservation

fund: Recreation planning and land acquisition

Total, natural resources.

Commerce and transportation:Funds appropriated to the President: Public works

accelerationDepartment of Commerce:

State marine schoolsForest and public lands highwaysControl of outdoor advertisingArea redevelopment assistance

Federal Aviation Agency: Federal-aid airport program.

See footnotes at end of âble, p. 435.

153

351

354355355

355

402

401

401401403404

405

507

502503503507501

21.319.2

40.4

7.3

353.5

57.572.037.0

1.4

521.4

16.0

17.0

.1

.7

20.0

53.9

15.1

.438.6

2.951.5

.4

27.515.0

42.9

5.6

416.2

57.477.440.2

1.5

592.7

28.5

8.4

.2

.8

.217.2

55.2

260.8

.439.62.0

10.075.3

1.5

27.010.0

38.5

5.6

340.8

59.675.141.2

1.4

518.2

17.6

12.4

.8

.4

20.0

8.8

60.0

243.5

.439.9

11.075.7



Table 1-3. FEDERAL AID TO STATE AND LOCAL GOVERNMENTS(In millions of dollars)—Continued

Agency and programcode

1963 1964 1965

BUDGET ACCOUNTS i—Continued

Grants-in-aid—Continued

Commerce and transportation—ContinuedSmall Business Administration: Research and manage-

ment counseling -. 506 .2

Total, commerce and transportation. 108.6

Housing and community development:Housing and Home Finance Agency:

Low-income housing demonstration programLow-rent public housing programUrban renewal and planningProposed legislation: Urban transportation assist-

Open space program _National Capital Planning Commission: Acquisition of

lands in MarylandDistrict of Columbia:

Federal payment and contributionProposed legislation: Increased payments

551552553

553553

555

555555

.1170.3199.3

.2

30.3

Total, housing and community development.

Health, labor, and welfare:Funds appropriated to the President: Disaster reliefDepartment of Agriculture: School lunch, special milk,

and food stamp programsDepartment of Health, Education, and Welfare:

Hospital construction activities.Proposed legislation: Hospital construction activities.Portion to private, nonprofit institutions 2

Construction of waste treatment facilitiesCommunity health activitiesEnvironmental health grantsNational Institutes of Health:

Operating grantsMental health facilities

Maternal and child welfareMental health facilities, AlaskaHospital and medical care, HawaiiIndian health facilities. *Public assistance __Proposed legislation for community work-trainingVocational rehabilitation

Department of Labor: Proposed legislation for youth em-ployment opportunities

655

655

651651

400.2

30.5

281.1

182.5

651651651651

651651

(113.0)51.734.55.8

18.7

651651651651653653

73.4.3

1.5.3

2,729.6

.3

388.4

2.0191.0252.0

8.7

37.5

491.3

34.5

320.1

190.1

(114.0)75.050.26.3

10.0

94.0.2

1.2

370.5

3.0208.2331.6

9.614.6

50.04.8

621.9

22.4

339.2

192.05.0

(119.0)75.041.413.0

10.03.0

116.0

1.2

655

652

73.2

2,947.6

""89~5

5.0

2,781.035.093.2

55.0

Total, health, labor, and welfare. 3,483.0 3,823.5 3,782.5

Education:Department of Health, Education, and Welfare:

Assistance to schools in federally affected areasDefense educational activities:

Assistance for elementary and secondary education.Other aid to education _

701

701704

330.0

48.114.9

339.1

60.616.9

386.6

74.817.0





Agency and programcode

1963 1964 1965


Grant s-in-aid— Cont in ue d

Education—ContinuedDepartment of Health, Education, and Welfare—Con.

Higher education constructionAssistance to land-grant collegesVocational educationGrants for library services. _Teaching of the blindTraining teachers of the handicappedEducational television facilitiesProposed education legislation

Department of the Interior: Bureau of Indian Affairs:Education and welfare services

Total, education-

Veterans benefits and services:Veterans Administration:

Aid to State homes _State supervision of schools and training establishments-

Total, veterans benefits and services

General government:Funds appropriated to the President: Transitional grants

to Alaska . ._ .Department of the Interior: Grants to territories and

Alaska public worksGeneral Services Administration: Hospital facilities in

the District of Columbia. _

Total, general government-

Total, grants-in-aid

Shared revenueNatural resources:

Department of Agriculture: National forest and grass-land funds, payments to States and counties

Department of Defense—Civil: Corps of Engineers:Flood Control Act of 1954 payments. _

Department of the Interior:Payments to States and counties from grazing receipts,

sales of public lands and proceeds, and nationalgrasslands

Boulder Canyon project, payments to Arizona andNevada

Oregon and California land-grant fund paymentsPayments to Coos and Douglas Counties, OregonMineral Leasing Act paymentsPayments to counties, Migratory Bird Conservation

Act and national grasslands, and payments toAlaska, Alaska Game Law and Pribilof Islands fund.


702704704704704704700

704

14.541.57*3.7.5

7.7

465.2

804805

7.4.9

8.2

910

910

905

3.1

22.3

.1

25.5

5,113.8

402

401

401

401402402403

404

27.8

1.6

.7

.615.4.7

47.1

1.3

2.014.557.17.5.7.91.91.5

8.6

511.3

7.5.8

8.3—

3.0

29.3

1.5

33.8

5,953.0

30.7

1.7

1.0

.615.0.3

47.6

1.2

26.114.5108.47.5.8

3.84.869.9

9.1

723.3

7.5.5

7.9

18.4

2.0

20.5

6,148.9

31.8

1.8

1.1

.618.0

49.3

2.2

700-000 O—64 28




Agency and program

BUDGET ACCOUNTS '—Continued

Shared revenue—Continued

Natural resources—ContinuedTennessee Valley Authority: Payments in lieu of taxes. _Miscellaneous shared revenue


General government:Department of the Interior: Internal revenue collections,

Virgin IslandsTreasury Department: Tax collections for Puerto Rico..


Total, shared revenue

Loans and repayable advances (net)


Rural renewalWatershed protection, flood prevention and resource

conservation and development

Total, agriculture and agricultural resources

Natural resources:Department of the Interior: Irrigation projects

Commerce and transportation:Department of Commerce: Area redevelopment

Housing and community development:Housing and Home Finance Agency:

Liquidating programs: Community facilities loansLow rent public housing programPublic facilitiesPublic works planningUrban renewal fund

District of Columbia: Capital outlays and operations

Total, housing and community development

Education:Housing and Home Finance Agency: College housing. _.Department of Health, Education, and Welfare:

Higher education construction __ __

Total, education ._.

runc-

code

401400

910910

V>7

354

401

507

551552553553

555

702

700

1963

7.3.1

102.7

7.744.8

52.5

155.2

1.9

1.9

14.3

2.5

- 1 . 3- 3 . 429.85.9

-13 .232.4

50.1

115.0

115.0

1964

8.2.1

106.5

7.045.1

52.1

158.6

1.0

6.1

7.0

14.7

11.2

- 1 . 0-56 .3

33.73.5

18.025.7

23.6

74.0

.3

74.3

1965

8.8.1

113.7

8.047.0

55.0

168.7

1.8

7.6

9.4

14.5

15.6

- 1 . 4.2

31.1-5.2

18.030.4

83.5

68.3

6.6

74.9

See footi nd of table, p. 435.





Loans and repayable advances (net)—Continued

General government:Department of Defense—Civil: Corps of Engineers: Con-

struction of power systems, Ryukyu Islands _Department of the Interior: Alaska public works


Total, loans and repayable advances

Total, net budget expenditures _ __

TRUST FUNDS

Grants-in-aid

Commerce and transportation:Department of Commerce: Highway trust fund: Fed-

eral-aid highway programHealth, labor and welfare:

Department of Labor: Unemployment trust fund: Ad-ministration of employment security programs

Total, grants-in-aid

Shared revenue

General government:Treasury Department: Bureau of Customs: refunds,

transfers, and expenses of operation, Puerto Rico andthe Virgin Islands _ _ _

Total, shared revenue

Total trust fund

Total, budget and trust fund expenditures for Fed-eral aid 3

Func-tionalcode

910910

503

652

904

1963actual

184.0

5,453.0

2.984.0

330.4

3,314.4

13.3

13.3

3.327.7

8,780.6

1964estimate

7.92.0

9.9

140.8

6,252.4

3,507.2

403.5

3,910.7

13.6

13.6

3,924.3

10,176.7

1965estimate

2.22.9

5.1

202.9

6,520.5

3,601.2

432.0

4,033.2

14.0

14.0

4.047.2

10,567.7

Note.— Detail will not necessarily add to totals because of rounding.

* Less than $0.05 million.1 Many expenditures listed under budget accounts and trust funds are part of larger appropriation

ounts.l f

accounts or trust accounts.2 In 1965 $3.0 million of this amount is contained under proposed legislation above.3 The amount in 1963 for grants-in-aid and shared revenue from budget and trust accounts in

this analysis is identical with the $8,596.7 million distributed by States in the 1963 Annual Reportof the Secretary of the Treasury, table 95, part A, "Federal Aid Payments to State and Local Units."


SPECIAL ANALYSIS J

PRINCIPAL FEDERAL STATISTICAL PROGRAMS

This analysis summarizes the principal statistical programs of theFederal Government in the 1965 budget which provide general-purposestatistical information for the use of the Government and the public.The programs are presented in two categories: current and periodic.Fiscal 1965 recommendations for current programs, reflecting con-tinuing year-to-year statistical activity in the various agencies, pro-vide for a total of $94.3 million, an increase of $9.1 million over theamount available for 1964. Recommendations for periodic pro-grams—the large scale census-type surveys characteristically takenonce or twice a decade—amount to $26.5 million in obligationsfor 1965.

The continuing objectives of the Federal statistical system are toprovide accurate, comprehensive, and timely data needed for theoperations of the Government, to furnish the public with informationabout the functioning of the economy and the welfare of the people, andto insure efficient utilization of Government resources and minimumburden on respondents. The attainment of these objectives requirescontinuous evaluation of the needs for statistical information. Theprograms included in this budget reflect the most urgent of the specificneeds for data identified by Government agencies and emphasizedin appraisals of the adequacy of existing economic and social statisticsby the Joint Economic Committee of the Congress, the Subcommitteeon Census and Government Statistics of the House Committee onPost Office and Civil Service, the President's Committee To AppraiseEmployment and Unemployment Statistics and other groups repre-senting business, labor, and research organizations.

The functions of collection, processing, and analysis of current gen-eral-purpose statistical information are often closely related to otheragency objectives. To indicate the interrelationships of the statisticalprograms carried out by different agencies and to aid in evaluating theGovernment's overall statistical system, the significant components ofcurrent Federal statistical activity are brought together and classifiedby broad subject areas in this special analysis. These areas and theamounts involved are summarized in table J - l .

The current statistical programs included in this analysis representthe entire programs of some agencies but only that portion of theprograms of other agencies constituting general purpose statisticalactivity. Some statistical activity is not included.

The periodic statistical programs for which funds are provided in1965 to the Bureau of the Census include the 1963 economic censuses,the 1964 Census of Agriculture, initial phases of the national housinginventory and preparatory work on the 1970 censuses. In addition,modest provision is made for the Census Bureau's program to developand modernize automatic data handling equipment.

The agencies and amounts involved in botn the current and periodicstatistical programs included in this analysis are shown in table J-2.

436



Table J-l. OBLIGATIONS FOR PRINCIPAL CURRENT STATISTICALPROGRAMS, BY BROAD SUBJECT AREAS (in millions of dollars)

Program

Labor statistics (Departments of Agriculture, Interior, andLabor; National Science Foundation) _

Demographic and social statistics (Departments of Agriculture,Commerce, and HEW; National Science Foundation)

Prices and price indexes (Departments of Agriculture, Commerce,and Labor)

Production and distribution statistics (Departments of Agricul-ture, Commerce, Defense, and Interior; Civil AeronauticsBoard; Interstate Commerce Commission)

Construction and housing statistics (Department of Commerce;Federal Home Loan Bank Board, Housing and Home FinanceAgency) __

National income and business financial accounts (Departmentsof Agriculture, Commerce, and Treasury; Securities and Ex-change Commission, Federal Trade Commission)

Total, principal current programs _

1963actual

17.8

14.3

4.6

29.5

2.3

7.5

76.0

1964estimate

21.1

16.5

5.1

31.6

2.7

8.2

85.2

1965estimate

23.8

18.3

5.7

33.7

4.0

8.8

94.3

CURRENT PROGRAMS

Labor statistics.—Expansion of statistical investigation in the fieldof manpower and employment statistics was started last year inresponse to the recommendations of the President's Committee ToAppraise Employment and Unemployment Statistics. In 1965, pro-vision is made to expand the work on sharpening labor force conceptsinitiated in 1964 with the establishment of a special sample of house-holds; to study factors affecting labor force participation; to investigatemethods of strengthening State and area manpower estimates; and toexpand statistics on hours and earnings by industry and area. Fundsare also provided for enlarging and improving the sample for thenational professional, administrative and technical salary survey.

An increase for the National Science Foundation will allow addi-tional scientific manpower studies to be undertaken, with particularemphasis on estimating the demand for scientists of various types.

Demographic and social statistics.—Increases are recommended inthis area to enable the Bureau of the Census to expand its programof current population estimates for metropolitan areas started lastyear and to conduct basic work on the methodology of populationestimates. Funds are provided for the National Center for HealthStatistics to enable the agency to continue its development of healthrecord surveys and to initiate improvements in the collection of vitalstatistics. Funds are also recommended to permit a substantial im-provement of the basic statistical program of the Office of Educationincluding provision for pilot projects to develop a system for obtaininguniform or compatible basic records from local areas to allow directcomputer processing and for strengthening the staff for planning,research, and training.



Table J-2. OBLIGATIONS FOR PRINCIPAL STATISTICAL PROGRAMS, BYAGENCY (in millions of dollars)

Agency 1963actual

1964estimate

1965estimate

CURRENT PROGRAMS

Department of Agriculture:Economic Research Service.Statistical Reporting Service

Department of Commerce:Bureau of the CensusOffice of Business Economics

Department of Defense: Corps of Engineers: Commercial sta-tistics

Department of Health, Education, and Welfare:Office of Education: Educational statisticsNational Center for Health StatisticsSocial Security Administration: Statistical and research activ-

itiesWelfare Administration: Statistical and research activities

Department of the Interior: Bureau of Mines: Mineral statistics.Department of Labor:

Bureau of Employment Security: Statistical activitiesBureau of Labor StatisticsOffice of Manpower, Automation and Training: Statistical

activitiesTreasury Department: Internal Revenue Service: Statistical

reportingCivil Aeronautics Board: Statistical and research activitiesFederal Home Loan Bank Board: Statistical activitiesFederal Trade Commission: Financial statisticsHousing and Home Finance Agency: Urban studies and housing

researchInterstate Commerce Commission: Transport economics and

statisticsNational Science Foundation: Statistics and researchSecurities and Exchange Commission: Operational and business

statistics-. _

Total, current programs ,_ _ __

PERIODIC PROGRAMS

Department of Commerce: Bureau of the Census:Eighteenth Decennial Census _1962 Census of Governments1963 economic censuses1964 Census of AgriculturePreparation for Nineteenth Decennial CensusModernization of data processing equipmentNational Housing Inventory

Department of Labor: Bureau of Labor Statistics: Revision ofConsumer Price Index

Total, periodic programs

Total, principal statistical programs _

8.89.3

12.82.0

.9

1.35.1

4.11.02.2

1.714.6

2.2

4.3.4.4.3

.4

1.32.6

.3

76.0

2.8.8

2.9.5

4.0

1.4

12.3

8.3

9.210.6

13.72.1

1.0

1.55.9

4.51.62.4

1.716.4

3.8

4.5.5.4.3

.4

1.42.9

.4

85.2

.88.71.6.7

4.5

1.4

U.7

102.9

9.511.4

15.32.6

1.0

2.06.2

4.61.72.4

2.518.5

3.8

4.6.5.4.3

1.5

1.53.5

.5

94.3

7.016.51.1.2

1.7

26.5

120.8

Prices and price indexes.—Additional funds for this area are re-quested to provide for collection of data on prices paid by consumersfor an improved sample of items and to extend the Consumer Price



Index to the remaining 6 of the 22 Standard Metropolitan StatisticalAreas with 1960 population over a million persons. Funds are alsoprovided for the construction of wholesale price indexes for selectedindustries on a basis comparable with that on which other majoreconomic measures are presented.

Production and distribution statistics,—A substantial part of theincrease for this activity supports the program to improve the cropand livestock estimates initiated in 1961, and for continuation of theprogram of expanded cattle-on-feed statistics started in 1964. In-creases are provided to the Bureau of the Census to update the sampleof stores reporting retail trade statistics, to initiate a series on retailinventories, and to improve export statistics.

Construction and housing statistics.—Most of the increase recom-mended in this area is for the Housing and Home Finance Agency tostrengthen and expand its statistical and research programs, primarilyin the field of basic housing market data. Additional funds areprovided for the Census Bureau to permit direct measurement ofconstruction projects in the western States.

National income and business financial accounts.—A major part ofthe increase in this area is for the Department of Commerce to extendand improve the basic information and estimates of the nationaleconomic accounts. Particular emphasis is placed on the need tomeet an intensified demand for new information on the U.S. balanceof payments. Projects include the strengthening of the data andanalysis on international investments and transactions, improved esti-mates for the trade and service industries, extension of the detail forincome size distributions, and improvement in statistical techniquesfor analysis of economic trends. Funds are also provided to theInternal Revenue Service to permit greater utilization in tax admin-istration and other uses of statistics developed from tax returns andto the Securities and Exchange Commission for improvement of sta-tistics on securities markets operations.

PERIODIC PROGRAMS

Major censuses for which funds are included in this budget are the1963 economic censuses and the 1964 Census of Agriculture. In 1965,work on the economic censuses covering manufacturing and mineralindustries, retail, wholesale and service trades, and selected areas oftransportation activity will consist primarily of the tabulation andpreparation of data for publication. The field enumeration of theCensus of Agriculture, which will occur in the fall of 1964 after com-pletion of the 1964 harvest, represents the major portion of theexpenditure in the taking of this census. Provision is also made forthe initial phases of a National Housing Inventory to be taken in fiscal1966 and on continuation of preparatory work on procedures for use intaking the 1970 population and housing censuses. In addition, fundsare recommended to carry on the Census Bureau's program to developand modernize automatic data handling equipment.


SPECIAL A N A L Y S I S K

FOREIGN CURRENCY AVAILABILITIES AND USES

Many agencies of the Government are engaged in activities through-out the world which involve payments in foreign currencies. Fromsome governmental activities, particularly the sale on concessionalterms of surplus agricultural commodities, foreign currencies accrueto the Government without purchase with dollars. This analysispresents in summary form data on foreign currency availabilities anduses.

Most currencies accrue to the credit of the United States becauseof past or current international agreements authorized under severallaws. In most cases, these international agreements deal (1) withsales arrangements, wherein commodities (usually surplus agri-cultural commodities) are sold to foreign purchasers for local curren-cies, or (2) with loans, wherein dollars or foreign currencies themselvesare lent to foreign borrowers and may be repaid in the currency ofthe borrower. Currencies also become available in much smalleramounts under other kinds of international agreements and from thenormal operations of the U.S. Government abroad.

Table K-l. CASH AVAILABILITY OF FOREIGN CURRENCIES(In millions of dollar equivalents)

For U.S. uses:Excess currenciesNonexcess currencies:

Restricted.. _ _ _ _Unrestricted

Subtotal, for U.S. usesFor country uses

Total

1963actual

1,142

237203

1,5822,658

4,240

1964estimate

1,315

175i 339

1,7282,742

4,470

1965estimate

1,520

38306

1,8642,758

4,622

1 Reflects transfer of $112 million of currencies previously restricted by administrative actionwhich became available for unrestricted use pursuant to Public Law 88-257.

Foreign currency availabilities are divided in table K-l betweenthose available for U.S. uses and those available for country uses. Inboth cases the currencies belong to this Government and are kept inTreasury accounts or those of other Government agencies. Thecountry use currencies, however, are committed by the terms of theinternational agreements under which they are received to be usedon a loan or grant basis for mutually beneficial purposes in the countryby agreement with its government. U.S. use currencies, on the otherhand, are available for the purposes of U.S. agencies.

440



U.S. use currencies are further divided between those which areexcess and those which are nonexcess. The excess currencies arethose of which the Treasury has found (after reviewing the amountsof currency on hand, prospective receipts for U.S. uses, and pro-spective requirements) the supply to be great enough to more thancover the demand for the next 2 or 3 years. For 1965, a prospectiveexcess condition is anticipated in Burma, India, Israel, Pakistan,Poland, United Arab Republic (Egypt), and Yugoslavia. In additionto these countries, Indonesia and Syria were designated as excesscurrency countries during 1963, and Indonesia during 1964.

Some nonexcess U.S. use currencies are restricted by conditionswhich have been placed on their use by international agreement.Although the policy in recent years has been to avoid such restrictions,some restricted currencies under old agreements are still on hand.

Up until December 31, 1963, some U.S. use currencies on hand werealso restricted by administrative action, authorized by law, reservingcurrencies for use by specific programs. Section 508 of Public Law88-257 authorizes the Treasury to maintain currencies reserved byadministrative action in "unfunded accounts." The equivalent ofapproximately $112 million of previously reserved currencies wasmade available for current unrestricted use, to be replaced whenneeded for the purpose for which they were reserved. Estimatesfor 1965 assume that this provision will be continued.

Limits on uses of foreign currencies.—International agreements, andin many cases the nature of the economy on which they are a claim,still restrict the use of the greater part of currencies accruing to thecredit of the United States.

First, sales of agricultural commodities, through which most of thecurrencies are acquired, are often largely concessional. In thesetransactions the international financial position of the purchasingcountry is usually such that it must minimize the real cost of the salesto itself in terms of export of its resources. As a result, large amountsof currencies acquired by the United States from the sale of farmcommodities are restricted by the sales agreement so they can onlybe loaned or granted back to the buying country.

Second, virtually all of the> currencies are inconvertible under thelaws and regulations of the purchasing countries. This means theycannot be freely used to buy goods in third countries. Neither canthey be exchanged for another currency which we may be able to use.

Need for foreign currencies.—Many agencies of the U.S. Govern-ment carry on activities overseas in which foreign currencies areneeded. As indicated in table K-2, the need for foreign currenciesin U.S. operations often does not correspond to their availability ona country-by-country basis. A strong effort is made at the time thatcommodity sales agreements are negotiated to obtain the maximumamount for U.S. uses to which the other government will agree, inthose countries in which we have an insufficient supply of currencies.Despite this, in the normal course of its worldwide operations theGovernment must purchase large amounts of the currencies of manycountries while at the same time it is accumulating large inconvertiblebalances of others.



Procedure for use of foreign currencies.—Normally, when an agencyrequires foreign currencies to carry out its activities, the disbursingofficer must, by Treasury regulation, use currencies owned by theU.S. Government if they are available. If the particular foreigncurrencies required are not available, they must be purchased throughbanking channels. Expenditures of U.S. owned currencies areordinarily charged to appropriations at the rate at which currenciescould be obtained for official U.S. disbursements. Thus foreigncurrency expenditures are reported on a comparable basis whetherthey are owned by the United States or obtained from commercialsources.

U.S. use currencies expended for agency programs are generallyreflected in Treasury and agency accounts and in the budget as dollarexpenditures as they are used, with a corresponding credit to mis-cellaneous receipts or to the fund (e.g., Commodity Credit Corpora-tion) which financed the transaction from which the currency derived.

Table K-2. FOREIGN CURRENCIES AVAILABLE TO MEET U.S.REQUIREMENTS, 1965 (in millions of dollar equivalents)

Country

Excess currencies:Burma _IndiaIsraelPakistan . .Poland _.United Arab Republic (Egypt)Yugoslavia

Total excess currencies

Nonexcess currencies:CanadaFranceGermany, Federal Republic ofItalyiwuy _ __-Japan..j f*

Korea _PhilippinesSpainUnited Kingdom _ _ _Other countries

Total nonexcess currencies

Total

Supply

1453253

175523108115

1.520

13

11124

143

1510

271

344

1,864

Requirements(expenditures)

Otherthan

programs

26581*5

26

110179

1,06847

25256336591

299

2,200

2,226~

Special

11555572

39

1*1**

113

7

46

Amountsavailablefor use

after 1965

1151143

162518101108

1,455

*181

4151

165

1,620

Require-ments

for com-mercial

purchasein 1965

109177

1,05844

25042305186

181

2,028

2,028




U.S. uses of foreign currencies.—Table K-3 summarizes foreigncurrency transactions of U.S. use currencies as they are reflected inthe budget.

Table K-3. SUMMARY OF FOREIGN CURRENCY TRANSACTIONS, U.S. USES(In millions of dollar equivalents)

Cash balances brought forward:Excess currencies ___Nonexcess currencies:

RestrictedNonrestricted

Subtotal, cash balances brought forward _

Collections:Public Law 480 sales „__Foreign assistance programsOther nonloan collections:

Sale of military supplies and equipment. _Contributions for support of U.S. forces abroadSurplus property and lend-lease _Informational media guaranteesInterest on public depositsMiscellaneous

Loan repayments (principal and interest):Public Law 480 loansForeign assistance loans (including Development Loan

Fund)

Subtotal, collections _Transfer of U.S. use currencies to country use _

Total availabilities __ _

Expenditures:Without dollar controlWith dollar credits to^-

Miscellaneous receipts of the general fundCommodity Credit Corporation, AgricultureInformational media guarantee fund, USIAForeign buildings program, State.Military assistance program, Defense.__

Subtotal, expenditures _ _ _Adjustments due to changes in exchange rates

Cash balances carried forward _ _ _

1963actual

871

11479

1,064

21318

3310143

2537

66

97

518

1,582

8

90159

33

32

295- 4 0

1,246

1964estimate

1,036

16347

1,246

19216

132

103

2427

70

128

485- 3

1,728

10

109226

3

12

359

1,369

1965estimate

1,234

25110

1,369

1638

293

2527

89

169

495

1,864

6

82153

2

244

1,620



Recommendations for special uses, 1965.—Most U.S. uses of foreigncurrencies are covered by unrestricted dollar appropriations. Forthose situations where currencies are available in the Treasury inexcess of amounts needed for regular appropriations, separate appro-priations are proposed for special foreign currency programs. Theseappropriations are summarized in table K-4.

Table K-4. SPECIAL FOREIGN CURRENCY PROGRAM APPROPRIATIONS-NEW OBLIGATIONAL AUTHORITY (in thousands of dollar equivalents)

Library of Congress: Collection and distribution of librarymaterials.-.

Funds appropriated to the President: Agency for Inter-national Development: American schools and hospitalsabroad _ __

Department of Agriculture:Agricultural Research Service: Salaries and expensesForeign Agricultural Service: Salaries and expenses

Department of Commerce:National Bureau of Standards: Research and technical

servicesWeather Bureau: Research and development

Department of Health, Education, and Welfare:Office of Education: Educational researchOffice of Vocational Rehabilitation: Research and train-

ingPublic Health Service: Scientific activities overseas

Department of Interior: Bureau of Commercial Fisheries:Management and investigations of resources

Department of State:Acquisition, operation, and maintenance of buildings

abroadPreservation of ancient Nubian monuments

United States Information Agency:Salaries and expensesSpecial international exhibitions

Total

1963

630

2.800

5,2654,000

500

400

2,0002,800

300

2,205

8,500375

29,775

1964

898

4,700

1,250

500250

500

2,0004,000

300

2,75012,000

11,750450

41,348

1965

1,717

5,000

500500

500

2,0001,000

300

6,143

8,200450

26,310

U.S. uses without dollar controls.—Unexpended balances remain forDefense family housing and for exports to third countries from alloca-tions given to agencies prior to 1961, when these uses were generallymade subject to appropriation requirements. A new authorization,with the appropriation requirement waived, was made in 1963 to theAgency for International Development, to permit the use of Indianrupees in Nepal. These uses are summarized in table K-5.



Table K-5. SUMMARY OF U.S. USES WITHOUT DOLLAR CONTROLS

(In thousands of dollar equivalents)

New authorizations to expend foreign currency receipts:Agency for International DevelopmentDepartment of State

Total authorizations _

Expenditures:Agency for I nternational DevelopmentDepartment of Defense _ _Department of State __ _United States Information Agency. _____ _ _

Total expenditures

1963actual

15,013488

15,501

5,7602,184

3855

8,334

1964estimate

4,7004,810

9,510

1965estimate

3,0003,115

6,115

Country uses.—A far- larger amount of foreign currencies are usedoutside of the appropriations process for loans and grants in the hostcountry. These are country use currencies which are committed bythe terms of the sales agreements of surplus agricultural commoditiesto be used for programs of mutual benefit in agreement with the hostcountry. These purposes include the common defense, economicdevelopment, and loans to American and certain foreign privateenterprise. These uses are summarized in table K-6.

Table K-6, SUMMARY OF FOREIGN CURRENCY T R A N S A C T I O N S -

COUNTRY USES (in millions of dollar equivalents)

Cash balances brought forward

Collections:Public Law 480 sales.__ . .Foreign assistance program _ __ _ ___ ___

Subtotal, collectionsTransfer of currencies from U.S. uses _

Total availabilities

Expenditures:Public Law 480 country loans and grantsPublic Law 480 loans to private enterpriseOther foreign assistance programs _ _ _ _ _ _ _

Subtotal, expendituresAdjustments due to changes in exchange rates.

Cash balances carried forward _ _

1963actual

1,655

98913

1,003

2,658

7792058

, 858-148

1,652

1964estimate

1,652

1,0825

1,0873

2,742

8102638

875

1,867

1965estimate

1,867

8873

890

2,758

8313223

886

1,872


SPECIAL ANALYSIS L

INTERNATIONAL TRANSACTIONS OF THE FEDERAL GOVERNMENT

As part of a wide range of efforts to reduce the continuing deficits inthe U.S. balance of international payments, the Federal Governmenthas instituted a special program to minimize the adverse effects of itsactivities on the balance of payments. Starting in August 1962, theBureau of the Budget established a system to review periodically theinternational transactions of Federal agencies. Under this system,agencies with substantial receipts or payments abroad prepare statis-tical estimates of their international transactions twice each year.These estimates are evaluated to determine whether all possibleactions are being taken to reduce payments and increase receipts.

Since emphasis is placed on using this system as a management tool,forward estimates do not merely project current trends or programs,but rather reflect all possible efforts, consistent .with the nationalinterest, to minimize payments and to maximize receipts from othercountries.

This special analysis presents a summary of the international trans-actions of the Federal Government for 1963-65 based on estimatesmade in September 1963 revised where necessary for comparabilitywith the 1965 budget.

Major trends.—Estimated Federal payments abroad are expectedto decline from the 1963 level of about $5 billion to $4.4 billion in1965.

Receipts from abroad from regular transactions are expected toremain at about the 1963 level of $2.2 billion in 1964, but to increase to$2.4 billion in 1965. (These receipts figures do not include specialtransactions—prepayments of loans, certain sales of securities andadvances for military sales.)

These payments and receipts produce an estimated decline in thenet Federal payments abroad of about $800 million between 1963 and1965, excluding special transactions.

Table L-1. SUMMARY OF INTERNATIONAL TRANSACTIONS OF THEFEDERAL GOVERNMENT (in millions of dollars)

1963estimate

1964estimate

1965estimate

PaymentsReceipts

Excess of payments

446

4,9972,171

4,713*2,109

4,4282,414

-2,826 -2,604 -2,014



Trends by agency.—Table L-2 provides a breakdown of total cur-rent receipts and payments figures, identifying separately thoseagencies which account for the bulk of the Federal Government'sinternational transactions.

Table L-2. INTERNATIONAL TRANSACTIONS OF THE FEDERALGOVERNMENT—BY MAJOR AGENCY (in millions of dollars)

Description 1963 1964 1965stimate

Payments:Department of DefenseAgency for International DevelopmentTreasury DepartmentDepartment of StateAtomic Energy CommissionDepartment of Health, Education, and WelfareVeterans AdministrationOther

Total

Receipts:Department of DefenseTreasury DepartmentExport-Import BankAgency for International DevelopmentDepartment of AgricultureOther

Total

Receipts from special transactions (not included in receiptsabove):

Advances on military exports (Department of Defense)Sales of medium-term, nonmarketable securities and participa-

tion certificatesNonscheduled receipts on loans

Total

2,76378855528024512369174

2,70859559524713513271

230

2,5065006692259114867222

4,997 4,713 4,428

98935444616890124

75037054121495139

95028766227795143

2,171 2,109 2,414

345

J806672

250 50

1,823

1 These sales are distributed as follows: Treasury Department securities, $787 million; Export-Import Bank certificates, $19 million.

2 Not available. Forward estimates are not made for receipts from nonscheduled loan paymentsand sales of medium-term, nonmarketable securities.

Payments.—The largest reductions in payments over the 2-yearperiod are estimated for the Department of Defense, the Agency forInternational Development, and the Atomic Energy Commission.

The Department of Defense estimates reflect the Department'sefforts to achieve savings—without reductions in our military capabili-ties overseas—through a broad range of measures including: (1) avoluntary savings program for personnel overseas; (2) a program in-creasingly to replace procurement overseas with procurement in theUnited States; (3) reductions in overseas construction programs andcontractual services; (4) reduction in employment of foreign nationalsat overseas installations; and (5) reduction in the number of supplyinstallations in Western Europe.


4 4 8 THE BUDGET FOH FISCAL YEAR 1965

The Department of Defense will also continue its intensive world-wide effort to encourage other countries to purchase a portion of theirmilitary equipment in the United States to help offset our defenseexpenditures abroad.

The reduction in payments estimated for the Agency for Inter-national Development results from the Agency's efforts to insure that,wherever possible, funds loaned or granted abroad are tied directly toprocurement in the United States. Except for limited procurementin developing countries, it is now the Agency's general policy to pro-hibit the purchase abroad of any goods with foreign economic as-sistance funds.

The major reason for the estimated decline in Atomic EnergyCommission payments is a drop in overseas procurement of uraniumconcentrates.

A substantial decrease is also estimated for the Department ofState, primarily reflecting decreased purchases of U.N. bonds. Vet-erans Administration payments abroad, mostly for compensation andpensions, are expected to decline slightly.

Both the Treasury Department and the Department of Health,Education, and Welfare are estimated to make increased paymentsoverseas between 1963 and 1965. In both cases, these anticipatedincreases result from obligations not readily subject to administrativecontrols. Estimated increases for the Department of Health, Edu-cation, and Welfare, for example, result from increased social securitybenefit payments being made to recipients residing overseas. In thecase of the Treasury, the increases are largely accounted for by interestpayments on the public debt and encashments of non-interest-bearingnotes representing parts of past contributions to international lendingorganizations. (Contributions to these organizations often consistof non-interest-bearing notes which are not included as internationaltransactions until they are cashed.)

Receipts.—The estimated increase in receipts over the 1963-65period is largely accounted for by transactions of the Export-ImportBank and the Agency for International Development.

Special transactions—which are not included in the totals just dis-cussed—were the source of large additional receipts in 1963. Thesereceipts result from transactions, involving advances or loans, and gen-erally with foreign governments or official monetary authorities, whichwould not occur as part of ihe regular operations of U.S. Governmentagencies. They include: (1) advance payments by foreign govern-ments for military exports; (2) sales of nonmarketable, medium-termsecurities by the Treasury Department to foreign central banks;(3) sales of certain participation certificates by the Export-ImportBank; and (4) repayments by foreign governments of loans beforethey are due. Except for advances on military exports, they are notestimated for future years.

Geographical distribution.—Table L-3 shows a distribution ofreceipts and payments by major geographic area. Approximately17% of the decline estimated in total payments between 1963 and1965 is accounted for by transactions with Western Europe.

Receipts from Western Europe (excluding special transactions, mostof which are with Western Europe) are estimated to remain at approxi-mately the same level from 1963 to 1965.



Table L-3. DISTRIBUTION OF INTERNATIONAL TRANSACTIONS OF THEFEDERAL GOVERNMENT, BY GEOGRAPHIC AREA (in millions of dollars)

Payments:Western Europe (including international organizations located

there) _ _ _ _ _ _ _ __ _Other countries __ _Other international organizations and undistributed _ .

Total

Receipts:Western Europe (including international organizations located

there) _ _ _ __ _ _ _Other countries _ _ _ _ _ _ _ _ _Other international organizations and undistributed. _ __ _

Total

1963

2,0272,526

444

4,997

1,30881647

2.171

1964

2,0882.225

401

4.713

1,14892042

2,109

1965

1,9321.974

522

4,428

1,2971,062

55

2,414

Payments by type of transaction.—An analysis of payments bytype of transactions indicates that between 1963 and 1965 the reduc-tions in Federal payments abroad are expected to be primarily in grants,loans, and purchases of goods and services. For the most part,the procurement reductions reflect the substitution of purchases inthe United States for those overseas.

Table L-4. DISTRIBUTION OF FEDERAL PAYMENTS ABROAD BY TYPE OFTRANSACTION (in millions of dollars)

Description

1. U.S. personnel—Amount estimated to be spent abroad2. Construction3. Goods and services purchased abroad for use abroad !_4. Other purchases of goods and services.5. Grants (amounts for use abroad) 2 .6. Pensions and similar transfer payments7. Loans (amounts for use abroad) 2

8. Other

Subtotal _Less payments in excess foreign currencies 3

Total, payments affecting the balance of payments

1963

847105

2,058292598190547409

5,04750

4,997

1964

872116

1,991191544228303526

4,77158

4,713

1965

850112

1,836146407235443463

4,49365

4,428

1 Includes all Defense procurement, including military assistance.2 Excludes funds tied to procurement in the United States or which are otherwise not currently

available for use abroad.3 Excess foreign currencies are those which the United States owns in quantities excess to its

needs (see Special Analysis K). Since use of these currencies does not increase the flow of dollarsabroad, they are deducted in calculating the effect of the Federal Government on the balance ofpayments.

70O-000 O—64



Relation to the budget.—Reports on international transactionsdo not flow directly from the accounting system used for the adminis-trative budget or trust funds. They are estimated separately toshow all Government receipts or payments which enter the balanceof payments. The major differences between data on internationaltransactions and administrative budget and trust totals are:

1. Coverage.—Data on international transactions exclude all budgetand trust transactions that are within the United States; they includedebt transactions entering the balance of payments which are excludedfrom budget and trust figures. For example, the budget includesall expenditures for foreign assistance and Department of Defenseprocurement, while such payments are included as internationaltransactions only to the extent that the procurement is estimated totake place abroad.

2. Estimated basis of international transactions.—No separate de-tailed accounting system has been established for international trans-actions comparable to that which supports administrative budgetand trust fund totals. In many cases it is necessary to estimate theoverseas components of transactions, since these components are notshown directly by accounting data. For example, budget accountsprovide precise data on the gross amount of salaries paid in a givenoverseas area, but do not identify the amount actually spent overseasby employees—which is the relevant statistic for balance of paymentspurposes. Thus, for past years, international transactions are acombination of actual accounting reports and estimates.

3. Timing.—International transactions are recorded at the timewhen they are known or estimated to affect the balance of payments.The time at which a given international transaction is counted may,therefore, vary considerably from the time at which it is shown in thebudget and trust fund accounts. For example, in some cases the U.S.Government makes contributions to international organizations in theform of non-interest-bearing notes. These notes are shown as budgetexpenditures when issued, but as international payments only whenthey are cashed.

Relationship to balance of payments statistics.—Data onFederal receipts and payments abroad are also reflected in the balanceof payments statistics published by the Department of Commerce.However, as with the administrative budget, the balance of paymentsstatistics are designed for purposes which are different from those forwhich the Government agency estimates and reports on internationaltransactions have been established. Balance of payments datameet the needs of economic analysis and for the measurement ofinternational flows of real resources and money, while agency reportson international transactions serve as both a means of estimatingand a management tool for decreasing the balance of paymentscosts of Federal Government programs. Reflecting the different usesof these two bodies of data, there are the following differences betweenbalance of payments statistics and the reports on Federal transactionscovered in this analysis:

1. Classification.—The reports use classifications by agency andby types of expenditures which are quite different from the broadfunctional classifications used for the balance of payments statistics.

2. Attribution.—Transactions conducted by private businesses, inwhich the Federal Government is involved, are treated as private in



the balance of payments statistics. In order to emphasize manage-ment decisions, agency reports permit the attribution of some suchtransactions to the Federal Government. For example, military goodsmay be sold to foreign governments directly by private companies,although the sales are encouraged and sponsored by the Depart-ment of Defense. In the balance of payments, such sales wouldbe reported as private receipts for exports. However, for the pur-pose of the Defense Department's estimates on international trans-actions, some of them are considered Government receipts.

3. Other.—Further differences between the two sets of data involvethe timing of certain transactions, the reporting of foreign currencies,and minor differences in coverage of transactions which are con-sidered "foreign."

The balance of payments statistics do not include a separate identi-fiable category on total Federal receipts or payments. However,because of the recent interest in the relationship between U.S. Gov-ernment grants and loans abroad and the balance of payments, theDepartment of Commerce has included estimates indicating theamount of Government loans and grants which involve direct pay-ments to foreign accounts, as distinguished from those which involveno direct dollar outflow from the United States. Agencies reportsimilar data for their estimates on international transactions. Areconciliation between the two sets of data, shown in table L-5,illustrates the kinds of differences which exist between the agencyreports and estimates on international transactions and the Depart-ment of Commerce balance of payments statistics.

Table L-5. GOVERNMENT GRANTS AND CREDITS—RECONCILIATIONBETWEEN BALANCE OF PAYMENTS AND AGENCY ESTIMATES OFINTERNATIONAL TRANSACTIONS

[In millions of dollars]

Description 1963

Government grants and credits, as shown in agency reports on international transactions(lines 5 and 7, table L-4) .

Difference in definitions of grants and credits:Add:

Agency for International Development administrative expensesPeace Corps expendituresOther

Deduct:Certain contributions to international organizations _.Netting of certain receipts _ _Other..

Differences in coverage and reporting:Add:

Inclusion of Trust Territory paymentsForeign currency transactions (net). ___Payments to foreign flag carriers ^Payments for expenditures in the United States but entering foreign dollar accounts

in U.S. banksOther (net) _ _

Deduct other (net) _

Transactions involving direct dollar payments to foreign accounts as shown inbalance of payments statistics _ _

1,145

30118

1029023

103

17

43102

1.061


PART 7

HISTORICAL TABLES

453


Table 15. ADMINISTRATIVE BUDGET TOTALS AND PUBLIC DEBT,

1789-1965 (in millions of dollars)

Fiscal year

1789-1849.1850-1899.

19001901190219031904

19051906190719081909

19101911191219131914

19151916191719181919

19201921192219231924

19251926192719281929

1930

1931

ADMINISTRATIVE

Re-ceipts

1,16013,895

567588562562541

544595666602604

676702693714725

683762

1,1003,6305,085

6,6495,5674,0213,8493.853

3.5983,7533,9923,8723,861

4.0583,116

BUDGET

Ex-pend-itures

1,09014,932

521525485517584

567570579659694

694691690715725

746713

1,95412,66218,448

6,3575,0583,2853,1372,890

2,8812,8882.8372,9333,127

3,3203,577

Surplus( + ) ordeficit(-)

4-70-1,037

+46+63+77+45-43

-23+25+87-57-89

-18+11+3

**

-63+48

-853-9,032

-13,363

+291+509+736+713+963

+717+865

+1,155+939+734

+738-462

Publicdebt atend ofyear

631,437

,263,222,178,159,136

,132,143,147,178,148

,147,154,194,193,188

,191,225

2,97612,45525,485

24,29923,97722,96322,35021,251

20.51619,64318,51217,60416,931

16,18516,801

Fiscal year

1932....1933....1934....

1935193619371938....1939.-.

194O.._.1941....1942.-.1943

1944

19451946194719481949

195019511952.-.19531954

19551956195719581959....

I960.-.1961196219631964 est_-

1965 est___

ADMINISTRATIVEBUDGET

Re-ceipts

1,9241,9973,015

3.7063,9974,9565,5884,979

5,1377,09612,54721,94743,563

44,36239,65039,67741,37537,663

36,42247,48061,28764,67164,420

60,20967,85070,56268,55067,915

77,76377,65981,40986,37688,400

93,000

Ex-pend-itures

4,6594,5986,645

6,4978,4227,7336,7658,841

9,05513,25534,03779,36894,986

98,30360,32638,92332,95539,474

39,54443,97065,30374,12067,537

64,38966,22468,96671,36980,342

76,53981,51587,78792,64298,405

97,900

urplus+) or

deficit

-2,735-2,602-3,630

-2 ,791-4,425-2 ,777-1,177-3,862

-3,918-6 ,159

-21,490-57,420-51,423

-53,941-20,676

+754+8,419-1,811

-3,122+3,510-4 ,017-9 ,449-3 ,117

-4 ,180+1,626+1,596-2 ,819

-12,427

+1,224-3 ,856-6 ,378-6 ,266

-10,005

-4,900

Publicdebt atend ofyear

19,48722,53927,053

28,70133,77936.42537,16540,440

42,96848,96172,422136,696201,003

258,682269,422258,286252,292252,770

257,357255,222259,105266,071271,260

274,374272,751270,527276,343284,706

286,331288.971298,201305,860311,800

317,000

'"Less than one-half million dollars.

Note.—A classification of administrative budget receipts and expenditures for the period 1954 to1965, inclusive, is found in table 17 (page 456) and table 18 (page 457), respectively. The change inthe public debt from year to year is not necessarily the same as the administrative budget surplusor deficit. It reflects also changes in the Government's cash on hand, and the use of corporate debtand investment transactions by certain Government enterprises.

Certain interfund transactions are excluded from administrative budget receipts and expendituresstarting in 1932. For years prior to 1932 the amounts of such transactions are not significant.

Refunds of receipts are excluded from administrative budget receipts and expenditures startingin 1913; comparable data are not available for prior years.

454


HISTORICAL TABLES 455

Table 16. CONSOLIDATED CASH TOTALS AND FEDERAL SECTOR OFTHE NATIONAL INCOME ACCOUNTS, 1940-65 (in billions of dollars)

Fiscal year

Consolidated cash statement

Receipts PaymentsSurplus( + > ? 'deficit

Federal sector of the nationalincome accounts

Receipts Expend-itures

Surplus(+) ?r

deficit)

19401941194219431944

19451946194719481949

1950...1951195219531954

1955195619571958..1959

19601961196219631964 (estimated)

1965 (estimated)

6.99.2

15.125.147.8

50.243.543.545.441.6

40.953.468.071.571.6

67.877.182.181.981.7

95.197.2

101.9109.7114.4

119.7

9.614.034.578.994.0

95.261.736.936.540.6

43.145.868.076.871.9

70.572.580.083.594.8

94.399.5

107.7113.8122.7

122.7

-2.7-4.8

-19.4-53.8-46.1

-45.0-18.2+6.6+8.9+1.0

-2.2+7.6

*-5.3- . 2

-2 .7+4.5+2.1-1 .6

-13.1

+.8-2 .3-5.8-4.0-8.3

-2.9

7.611.919.529.643.4

43.937.342.943.740.1

42.061.765.569.965.9

67.076.380.977.885.9

94.595.2

103.6109.3113.6

118.8

9.013.533.576.791.3

97.156.631.732.340.0

42.245.366.676.274.5

68.169.576.582.890.3

92.197.8

106.4112.6119.1

121.5

-1.4-1 .6

-14.0-47.1-47.9

-53.2-19.3+11.2+11.4

+.2

- .2+16.3-1 .1-6 .3-8 .6

-1.1+6.8+4.4-4.9-4.4

+2.4-2.7-2.7-3.3-5.5

-2 .8

*Less than $50 million.Note.— For an explanation of the consolidated cash statement and Federal sector of the national

income accounts, see special analysis A (pages 328 to 336). Classifications of receipts and expendi-tures on both the consolidated cash and national income bases, for fiscal years 1954—65, are shownin table 19 (page 462). and table 20 (page 463). respectively.


Table 17. ADMINISTRATIVE BUDGET AND TRUST FUND RECEIPTS, 1954-65 (in millions of dollars)

DescriptionActual

1954 1955 1956 1957 1958 1959 1960 1961 1962 1963

Estimate

1964 1965


Individual income taxes._.Corporation income taxes.Excise taxes (net)Employment taxesEstate and gift taxesCustomsMiscellaneous receipts.Interfund transactions

29,54221,1019,945

283934542

2,309-235

28,74717,8619,131

579924585

2,562-181

32,18820,8809,929

3221,161

6823,003-315

35,62021,1679,055

3281,365

7352,760-467

34,72420,0748,612

3331,393

7823,200-567

36,71917,3098,504

3211,333

9253.160-355

40,71521,4949,137

3391,6061.1054,062-694

41,33820,9549,063

1,896982

4,080-654

45,57120,5239,585

47,58821,5799,915

47,50023,70010,221

2,0161,1423,206-633

2,1671,2054,435-513

2,3351,2754,053-685

Total administrative budget. 64,420 60,209 67,850 70,562 68,550 67,915 77,763 77,659 81,409 86,376 88,400

TRUST FUNDS

Employment taxesUnemployment tax deposits by StatesExcise taxesFederal employee and agency payments for retire-

mentInterest on trust fund investmentsVeterans life insurance premiumsMiscellaneous trust receiptsInterfund transactions

5,1001.246

5,5871,146

6,9051,330

4651,193

426685

- 1 8

4731,178

441660

- 1 6

8131,212

441918

-12

7,1921,5421,479

1,1751,324452

1,146-10

8,2331,5012,026

1,2521,350485

1,317-11

8,4461,7012,074

1,5071,323478

1,375-135

10,7282,1672.539

1.5041.337482

2,494-908

12,4042,3982,798

1,7401.414504

2,840-515

12,5612,7292,949

1,7561,433501

2,889-528

14,8623,0093,279

1,8781,477494

3,195-505

16,7772,9003,478

1,9591,589501

3.446-488

Total trust funds_ 9,097 9.470 11,607 14,301 16,153 16,769 20,342 23.582 24.290 27.689 30.163

48.50025.80010,987

2,7401.4604.113-600

93.000

16,9962,8253,504

1,9231,669499

3,934-477

30,872

"4


Note.—Figures shown in this table are net of refunds, but correspond to the net figures used in the same classifications for fiscal years 1963 to 1965 in table 13 (pages62 to 67).


050051

058059

150151152153

250251

Table 18. ADMINISTRATIVE BUDGET AND

Description


National defense:Department of Defense—Military:1

Military personnelOperation and maintenanceProcurement _ _Research, development, test, and evalua-

tionMilitary constructionFamily housingCivil defenseMilitary assistanceRevolving and management funds

Total, Department of Defense—Military.

Atomic energyDefense-related activities

Total,, national defense

International affairs and finance:Conduct of foreign affairs _ _Economic and financial programsForeign information and exchange activities. _

Total, international affairs and finance

Space research and technology:Space research and technology

1954

11,6439,162

15,957

2,1871,744

3,629-367

43,955

1,8951,136

46,986

1301,511

91

1,732

90

TRUST

1955

11.7

12

71

403931838

761715

2,292-617

37

11

40

1

2

823

857,015

,695

121,960100

181

74

EXPENDITURES

1956

11,8,

12,

7,I

582400227

101079

2,611-598

38,

1

40

1

1,

403

651669

723

129613111

853

71

1957

11,4099,487

13,488

2,4061,968

2,352-323

40,788

1,990590

43,368

1571,683

133

1,973

76

BY FUNCTION, 1954-65 (in millions of dollars)

Actual

1958

11,6119,761

14,083

2,5041,753

2,187-643

41,258

2,268709

44,234

1731,910

149

2,231

89

1959

11.1014,

71

801378409

866948

2,340-179

43

7

46

3

3

563

541379

483

237403139

780

145

I960

11,73810,22313,334

4,7101,626

1,609-416

42,824

2,623244

45,691

2171,477

137

1,832

401

1961

12,08510,61113,095

6,1311,605

1,449-300

44,676

2,713104

47,494

2162,126

158

2,500

744

1962

13,03211,59414,532

6,3191,347

901,390- 9 9

48,205

2,80692

51,103

2492,372

197

2,817

1,257

1963

13,1116

61

1- 1

49

7

52

2

2

2

000874632

144427703721401

973

75824

,755

346,041201

,588

,552

Estimate

1964

14,18011,87016,337

6,9431,107

680150

1,400-367

52,300

2,800197

55,297

3161,897

234

2,447

4,400

1965

14,1714

61

660778785

580056660150

1,200-169

51

2

53

1

2

4

200

73544

979

315,705227

,248

,990

wI—I

1wi—io



Table 18. ADMINISTRATIVE BUDGET AND TRUST EXPENDITURES BY FUNCTION, 1954-65 (in millions of dollars)—Continued

Description

ADMINISTRATIVE BUDGET F U N D S - C o n .

350 Agriculture and agricultural resources:351 Farm income stabilization and Food for

Peace 2 3

352 Financing farming and rural housing353 Financing rural electrification and rural

telephones _ __354 Agricultural land and water resources355 Research and other agricultural services

Total, agriculture and agricultural re-sources

400 Natural resources:401 Land and water resources402 Forest resources403 Mineral resources.404 Fish and wildlife resources405 Recreational resources409 General resource surveys and administration-


500 Commerce and transportation:501 Aviation502 Water transportation503 Highways505 Postal service506 Advancement of business507 Area redevelopment4

Actual

1954

1,689272

217252142

* 2,573

1,05611737383335

1,317

186370586312

-281

1955

3,486236

204290173

4,388

93511937433534

1,203

179349647356

-343

1956

3,900232

217305215

4,868

80413938454436

1,105

180420783463

5

1957

3,430248

267374227

4,546

92516362515938

1,298

21936540

518119

1958

3,284269

297315255

4,419

1,13917459606944

1,544

31539231

674170

*

1959

5,297311

315376291

6,590

1,184201

71688561

1,670

49443630

774234

I960

3,602289

330368293

4,882

1,23522065687451

1,714

56850838

525265

1961

3,800349

301397324

5.172

1,39433161739155

2.006

71656936

914271

1962

4.576234

303426341

5,881

1,56428068819460

2,147

78165433

797427

7

1963

5,517300

342404391

6,954

1,6993037194

11273

2,352

80867241

770366101

Estimate

1964

4.746279

219417409

6,070

1,72035410710412276

2,483

87570845

546426463

1965

3,750130

216423388

4.907

1,80833911311013880

2,588

91271742

475455375

ao

CO

Ox


508 Regulation of business

Total, commerce and transportation

550 Housing and community development:551 Aids to private housing552 Public housing programs553 Urban renewal and community facilities555 National Capital region

Total, housing and community develop-ment __ _

650 Health, labor, and welfare:651 Health services and research652 Labor and manpower653 Public assistance655 Other welfare services 3


700 Education:701 Assistance for elementary and secondary

education702 Assistance for higher education703 Assistance to science education and basic

research._ __704 Other aids to educationProposed education legislation 5

Total, education

800 Veterans benefits and services:801 Veterans service-connected compensation802 Veterans non-service-connected pensions803 Veterans readjustment benefits804 Veterans hospitals and medical care805 Other veterans benefits and services

Total, veterans benefits and services

45

1.219

-277-401

3714

-628

188247

1.439148

2,122

18444

691

326

1.731700789782339

4.341

38

1.225

174-116

5622

136

271321

1.428145

2.165

21543

11109

377

1.829801879727286

4,522

41

1,892

- 6 7314

23

-10

342479

1.457184

2,462

18144

2098

343

1,864884943788331

4,810

45

1,305

-254604927

-118

461397

1,558216

2,632

174110

46108

437

1,876950977801266

4,870

49

1,632

-126517826

30

540488

1,797234

3,059

189178

50124

541

2,0241,0371,025

856242

5,184

58

2,025

73297

10833

970

700924

1,969284

3,877

259225

106141

732

2,0711,152

864921280

5,287

59

1,963

-17213413030

122

815510

2,061304

3,690

327261

120156

866

2,0491,265

725961266

5,266

67

2,573

- 4 415016251

320

938809

2,170327

4,244

332286

143181

943

2,0341,532

5591,030

259

5.414

74

2.774

-149163261

74

349

1.128591

2,437382

4,538

337350

183207

1,076

2,0171,635

3881,084

279

5,403

84

2,843

-537178222

70

-67

1,354224

2,788423

4,789

392428

206219

1,244

2,1161,698- 1 3

1,145240

5,186

89

3,151

-72314631669

-191

1,638390

3,007498

5,533

411404

260269

3

1,348

2,1261,743

61,240

248

5,362

94

3,069

-1,04111141190

-317

1,733651

2,869579

5,832

471442

302359118

1.691

2,1201,777-2901.246

229

5.081

w\aiI5CO


OrCO


o

Table 18. ADMINISTRATIVE BUDGET AND TRUST EXPENDITURES BY FUNCTION, 1954-65 (in millions of dollars)—Continued

Description

ADMINISTRATIVE BUDGET FUNDS—Con.850 Interest:

851 Interest on the public debt852 Interest on refunds of receipts853 Interest on uninvested funds.

Total) interest

900 General government:901 Legislative functions902 Judicial functions __903 Executive direction and management904 Central fiscal operations905 General property and records management- _906 Central personnel management908 Protective services and alien control910 Other general government.


Allowance for attack on povertyAllowance for civilian pay comparabilityAllowance for contingencies ___ _Interfund transactions

Total, administrative budget funds

Actual

1954

6,382835

6,470

492911

44915793

186253

1,226

-235

67,537

1955

6,370625

6,438

603112

43116896

185183

1,166

-181

64,389

1956

6,787546

6,846

763812

475173304220278

1.576

-315

66,224

1957

7,244576

7,307

904012

476201602219100

1,738

-467

68,966

1958

7,607748

7,689

894419

50224584

23369

1,284

-567

71,369

1959

7.593699

7,671

1024721

566295

9525586

1,466

-355

80.342

I960

9.1807610

9,266

1094920

55837284

26388

1,542

-694

76.539

1961

8,9578310

9,050

1185222

607372140289109

1,709

-654

81,515

1962

9.1206810

9,198

1355722

653419153300136

1,875

-633

87.787

1963

9.8957411

9.980

1316321

715444142323139

1,979

-513

92,642

Estimate

1964

10,6009011

10,701

1416824

800540175338154

2,238

250-685

98,405

1965

11,0009012

11,101

1387224

838561106351148

2,238

250544300

-600

97,900

a

8

I1Ii


TRUST FUNDS

050 National defense150 International affairs and finance250 Space research and technology.350 Agriculture and agricultural resources..400 Natural resources500 Commerce and transportation550 Housing and community development.650 Health, labor, and welfare700 Education800 Veterans benefits and services90CT General governmentDeposit fundsInter fund transactions

Total, trust funds

146101

13745

-101-2966,036

1779

9-128- 1 8

6,711

16445

7361

- 9 7231

7,4231

6286

57- 1 6

8,577

143- 2 9

28879

-101461

7,9991

6068

169- 1 2

9,611

9313

42685

8661,0449,585

1608

8217

- 1 0

12,938

3441

357101

1,401- 2 9 5

12,7751

67110

- 2 9

15,325

22921

64594

2,4931,263

14,3061

65110

- 6 0-135

19,521

25648

458116

2,8311,439

16,3581

67317

- 7 8- 9 0 8

21,212

19613

416183

2,505-273

19,2361

81116

203-515

22,793

36615

398112

2,6621,524

20,3821

73320

-544-528

25,141

67944

507122

2,877- 3 6

21,8552

83519

146-505

26,545

86786*

47513b

3,3941,628

22,6692

64218

-116-488

29,315

1,23199

2442107

3,466456

23,5492

49518

- 1 7-477

29,372 i3*Less than one-half million dollars.

1 Former subfunctions 051, Department of Defense military functions, and 057, Military assistance, have been merged in this subfunction. Amounts shown foryears prior to 1964 include estimated comparability adjustments not supportable by accounting records.

2 This category was previously titled "Farm income support and production adjustment."3 The portion of the appropriation for Removal of surplus agricultural commodities. Department of Agriculture, which finances the food stamp program, has been

reclassined from 351, Farm income stabilization and Food for Peace, to 655, Other welfare services.4 Amounts shown for 1963 through 1965 include the Public works acceleration program which supplements expenditures in various other categories.5 The amounts shown for expenditures under proposed legislation will subsequently be charged to subfunctions 701, 702, and 704.

Xfl


Table 19. RECEIPTS FROM AND PAYMENTS

Description

RECEIPTS FROM THE PUBLIC

Individual income taxesCorporation income taxesExcise taxesEmployment taxesEstate and gift taxesCustoms _ _ _ _ _Deposits by States, unemployment insurance _Veterans life insurance premiumsOther budget and trust receipts

Total, receipts from the public


National defenseInternational affairs and financeSpace research and technologyAgriculture and agricultural resourcesNatural resourcesCommerce and transportationHousing and community developmentHealth, labor, and welfareEducationVeterans benefits and servicesInterestGeneral governmentDeposit funds (net)Undistributed adjustments

Total, payments to the public

Excess of receipts or payments _

TO THE PUBLIC, ]1954-65 (in millions of dollars)

Actual

1954

29.54221,1019,9455,382

934542

1,246426

2,508

71,626

47,1381.696

902,6171,3571.137

-1 ,0098,083

3275,0424,6201.235— 128- 3 4 8

71,858

-232

1955

28,74717,8619,1316,166

924585

1.146441

2.834

67.836

40.8522.044

744,3991,2601,148

3059,485

3785.1144,6641,172

57-415

70.537

-2,702

1956

32,18820,8809,9297,2281,161

6821,330

4413,249

77,087

40,8541,624

714,9771,1791,796

39610,254

3445,3285,1151,583

169-1,145

72,546

4,542

1957

35,62021,16710,5347,5201,365

7351,542

4523,171

82,105

43.4422,637

764,6271,3792,200

84212,108

4395,4485.2661,744

217-420

80,006

2,099

1958

34,72420,07410,6388,5651,393

7821,501

4853,730

81,892

44,5522,651

894,3471,6413,060-319

15,757542

5,8285,8841,292-29

-1,823

83,472

-1,580

1959

36,71917,30910,5788,7671,333

9251,701

4783.851

81.660

46,6732,398

1457,0521,7544,5452,141

18,017733

5,9105,3501.475-60

-1,382

94,752

-13,092

I960

40,71521,49411,67611,0671,6061,1052,167

4824.766

95.078

45,9151,574

4014,8771,8224,8191.440

19,107867

5,9077,2331,558-78

-1,114

94,328

750

1961

41,33820,95411,86012,4051,896

9822,398

5044,905

97,242

47,6852,153

7445,1832,1015,107-103

22,364945

6,1877,2571.724

203-2.006

99.542

-2.300

1962

45,57120,52312,53412,5612,0161,1422,729

5014,288

101,865

51,4622,4921,2575,9422,2235,4871,691

23,9751,0526,0926,9401,882-544

-2,289

107,662

-5,797

1963

47,58821,57913,19414,8622,1671,2053,009

4945,641

109,739

53,4292,2422,5527,2662,4565,777-268

25,6981,2145,9717,4271,983-194

-1,801

113,751

-4,012

Estimate

1964

47,50023,70013,69916,7772,3351,2752,900

5015,678

114,366

56,0112,4524,4006,3402,6116,6011.279

27.2651.3025.9508.1202,241-116

-1,753

122,704

-8,338

1965

48,50025,80014,49116,9962,7401,4602,825

4996,432

119,742

55,2112,3774,9925,0652,6886,588

- 4 028,595

1,6415,5258,5962,239-17

-770

122,690

-2,948

to

CO

Note.—This table shows the flow of money between the Government and the public on a cash (collections and checks paid) basis, which is explained in more detailin special analysis A, pages 328 to 336.


Table 20. FEDERAL RECEIPTS AND EXPENDITURES IN THE NATIONAL INCOME ACCOUNTS, 1954-65

(Fiscal years. In billions of dollars)

Description

RECEIPTS, NATIONAL INCOME BASIS

Personal tax and nontaxCorporate profits tax accruals _Indirect business tax and nontax accruals.Contributions for social insurance

Total receipts, national income basis

EXPENDITURES, NATIONAL INCOME BASIS

Purchases of goods and servicesTransfer paymentsGrants-in-aid to State and local governmentsNet interest paidSubsidies less current surplus of Government enter-

prises

Total expenditures, national income basis. __

Surplus ( + ) or deficit (—), national income basis..

Actual

1954

30.417.110.77.7

65.9

53.911.92.84.9

1.0

74.5

-8.6

1955

29.918.410.48.3

67.0

45.013.82.94.9

1.4

68.1

-1.1

1956

33.521.011.210.5

76.3

45.214.23.15.0

1.9

69.5

+6.8

1957

36.720.412.111.7

80.9

48.316.13.65.5

3.1

76.5

+4.4

1958

36.317.312.012.3

77.8

50.519.44.55.6

2.7

82.8

-4.9

1959

38.721.112.313.8

85.9

53.921.86.05.8

2.7

90.3

-4.4

I960

42.321.713.916.7

94.5

53.022.86.76.9

2.7

92.1

+2.4

1961

44.019.513.618.0

95.2

54.925.96.67.0

3.4

97.8

-2.7

1962

47.621.314.919.7

103.6

60.127.87.37.0

4.2

106.4

-2.7

1963

50.121.615.621.9

109.3

64.429.27.97.6

3.5

112.6

-3 .3

Estimate

1964

50.123.316.523.7

113.6

67.830.59.48.0

3.5

119.1

-5.5

1965

52 324.917.324.2

118.8

69.131.89.78.5

2.5

121.5

-2.8

3oft)

s51GO

Source.—Actual data for 1954—63 are based on the quarterly estimates published by the Department of Commerce. Data for 1964 and 1965 are based on estimatesby the Bureau of the Budget in cooperation with the Department of Commerce.


INDEX

Acceleration of public works, agency programs,table F-5, 389

Accounts, Bureau of, 269Active military forces, summary of text table, 73Administrative budget:

Expenditures:As percent of gross national product,

1942-65, chart, 9By agency, summary, table 5, 45By function, summary, table 1, 41By function, 1954-65, table 18, 457-460By function, distributed by agency, table

14, 132-139Investment, operating, and other, table

D-2, 356-370Investment, operating, and other, sum-

mary, table 6, 46Relation of, to obligational authority, sum-

mary, table 8, 48Research and development, 1954-65,

chart, 407Research and development, by agency,

table H-16, 426Explanation of, 328Grand totals, 309New obligational authority, by type and

function, summary, table 3, 43New obligational authority, summary, by

agency, table 4, 44Obligational authority, balances of, by agency

and type, summary, table 10, 51Obligations incurred, net, by agency, table 9,

50Receipts:

1954-65, table 17, 456By source, table 13, 62-66Summary, table 1, 41Text table, 57

Relation of, to consolidated cash statement,330

Relation of obligational authority to expendi-tures, 1965 budget, chart, 49

Relationship to consolidated cash statementand national income accounts, 1963-65,table A-l, 329

Totals and public debt, 1789-1965, table 15,454

Advisory Commission on IntergovernmentalRelations. 290

Aeronautics research and technology, 87Aged, health insurance for, discussion, 25Agricultural Library, National, 186Agricultural Marketing Service, 176-177Agricultural research, 95Agricultural Research Service, 173

Agricultural resources, see AgricultureAgricultural Stabilization and Conservation

Service, 178Agriculture:

Centennial, observance of, 186Department of, 173-189Department of, research expenditures analy-

sis, 415Agriculture and agricultural resources:

1954-65, chart, 93Analysis of activities, text and table (1963—

65 payments to the public and recom-mended 1965 NOA by program or agency),90-96

Discussion, 22-23NOA and expenditures, 1963-65, distributed

by agency, table 14, 132-144Aid, foreign, see Foreign aidAid to education, see EducationAid to State and local governments:

Analysis, 427-435Expenditures:

1954-65, chart, 427By agency, table 1-1,429In relation to total Federal expenditures

and to State-local revenue, 1954-64, table1-2, 430

Summary, by function, agency, and pro-gram, table 1-3, 431-435

Airlift and sealift, Defense, 76Alaska, transitional grants to, 173Alaska International Rail and Highway Com-

mission, 291Alaska Railroad, 242Alien control, 131Alliance for Progress, 21, 84American Battle Monuments Commission, 291American Printing House for the Blind, 234Annexed budgets:

Expenditures and applicable receipts, tableB-7, 343

Explanation of, 149Memorandum, 324-325

Appalachian region, development of, discussion,19

Apprenticeship and Training, Bureau of, 257Architect of the Capitol, 156-158Area redevelopment, Commerce, 103-104Area Redevelopment Administration (Com-

merce), 190Arms Control and Disarmament Agency, U.S.,

305Army—Civil, Department of the, 213-215Assets, nondefense, additions to, chart, 29Atomic energy activities, 80-81Atomic Energy Commission, 274

465

700-000 <


466 T H E B U D G E T FOR FISCAL YEAR 1 9 6 5

Atomic Energy Commission, research and de-velopment, expenditures for, table H-7, 414

Authorizations, credit commitment, see Creditprograms

Authorizations, obligational, see Obligationalauthority

Authorizations, permanent, see Permanentauthorizations

Authorization, public works, see Public worksAviation, user charges on, discussion, 15

B

Balance of payments, discussion, 28Balance of payments and agency estimates of

international transactions, reconciliation be-tween, table L-5,451

Balances:Budget, explanation, 147-148Obligation authority, by agency and type,

table 10,51Public enterprise funds, table B-3, 340Trust fund, table B-6, 342

Bonneville Power Administration, 250Borrowing by Government funds, table B—10,

345Botanic Garden, 159Budget:

Bureau of the, 165Comparison of 1964 with 1965, text table, 17Explanation of terms, 146-149Explanation of three types of accounts, 328—

336Message of the President, 7-37R6sum6of,41

Business:Advancement of, 101 -103Regulation of, 106-107Small, aid to, 102

Business and Defense Services Administration,192

Business Economics, Office of, 191

Cash statement, see Consolidated cash state-ment

Cemeterial expenses, Army—Civil, 213Census, Bureau of the, 191-192Central Intelligence Agency, 291Civil Aeronautics Board, 291Civil defense, 78, 210Civil public works, see Public worksCivil Rights, Commission of, 293Civil Service Commission, 292-293Civil War Centennial Commission, 297Civilian employment in the executive branch,

see Employment, Federal civilianCivilian pay comparability allowance, 308Coal Research, Office of, 244Coast and Geodetic Survey, 194Coast Guard, 273Commerce, Department of, 189-201Commerce, Department of, research and de-

velopment expenditures, 416

Commerce, stimulation of, discussion, 23-24Commerce and transportation:

Discussion, 23-24Expenditures, 1954-65, chart, 24NOA and expenditures, 1963-65, distributed

by agency, table 14, 134-135Program analysis, text and table (1963-65

payments to the public and recommended1965 NOA by program or agency), 100-101

Program trends, 1954-65, chart, 106Commercial Fisheries, Bureau of, 245-246Commodity Credit Corporation, foreign assist-

ance, 179Commodity Exchange Authority, 178Communication, space, 89-90Communications activities, General Services

Administration, 279-280Community action programs, discussion, 17-18Community development, see Housing and

community developmentCommunity facilities, 107-109Consolidated cash statement:

Explanation of, 328Intragovernmental transactions excluded

from, table A-2, 331Relationship to administrative budget and

national income accounts, 1963—65, tableA-1, 329

Summary, table 1, 41Totals and Federal sector of the national-

income accounts, 1940-65, table 16, 455Construction, public works, see Public worksConsumer protection, 115Continental air and missile defense forces, 75Cooperative State Research Service, 174Corps of Engineers—Civil, 213-215Corregidor-Bataan Memorial Commission, 297Cost reduction in Government, discussion,

34-35Courts:

Appeals, District courts, and other Judicialservices, 163-164

Claims, 163Customs, 163

Credit programs, Federal:Analysis, 371-382Disbursements and repayments, by agency or

program, table E-3, 377Interest rates and maturities for major pro-

grams, by agency or program, December1963, table E-5, 380

New commitments, 1954-65, chart, 371New commitments, by type of assistance,

major agency or program, table E-1, 374Outstanding direct loans, and guaranteed

and insured loans, by agency or program,table E.-2, 375

Outstanding loans for major quasi-public pro-grams, by agency and program, table E-6,

Private participation in, 378-379Sales of loans to non-Federal buyers, and other

repayments, classified by agency or pro-gram, table E-4, 379

Customs, Bureau of, 270


INDEX 467

Debt:Federal, as a percentage of the total economy,

1942-65, chart, 30Private, sec Private debtPublic, see Public debt

Debt issuances, by Government enterprises,table B-l 0,345

Debt issuances, in lieu of checks, table A-3, 332Defense:

CiviUlODepartment of:

Research and development expenditures,1954-65, table H-1, 408

Department of—Civil, 213-217Department of—Military, 201-213

Research and development expenditures,table H-4, 411

Research and development, obligationsfor, table H-5, 412

Text and table, 71-80National:

Discussion, 19-20NOA and expenditures, 1963-65, distrib-

uted by agency, table 14, 132Program analysis (1963-65 payments to

the public and recommended 1965 NOA,by program or agency), text and table,71-81

Public works, new authorizations andexpenditures, by major function, agency,and program, table F-7, 396

Defense materials activities, General ServicesAdministration, 280

Defense production, expansion of, 170Defense public works, see Defense, national,

public worksDefense-related activities, 81Deficit or surplus:

Administrative budget, 1789-1965, table 15,455

Consolidated cash statement, and nationalincome accounts, Federal sector, 1940-65,table 16, 455

Delaware River Basin Commission, 300Development loans and grants, 83Direct loans, see Credit loansDisarmament, see Arms Control and Disarma-

mentDisaster relief, 168District of Columbia, 307-308Disbursements for major credit programs, by

agency or program, table E-3, 377

Economic Advisers, Council of, 166Economic assistance, foreign, see Foreign aidEconomic assumptions as base for estimated

receipts, calendar years 1962-64, text andtable, 56

Economic development (Commerce), 190Economic and financial programs, international,

81-85Economic Research Service, Agriculture, 176

Economy, national:Effect of expenditures on, discussion, 30-31Effect of tax reduction on, discussion, 11-15Federal debt, purchases, and employment as

percentages of, 1942-65, chart, 30Economy and efficiency in public service, dis-

cussion, 33-36Education:

Analysis of activities, text, and table (1963—65 payments and recommended 1965 NOAby program or agency), 119-123

Discussion, 26-27Elementary and secondary, assistance for, 121Federal program, 119-123Higher, assistance for, 121NOA and expenditures, 1963-65, distributed

by agency, table 14, 137Education:

Office of, 218-221Program trends, 1954-65, chart, 122Science, assistance for, 122Vocational, discussion, 26

Educational exchange, 266-267Efficiency and economy in public service, dis-

cussion, 33-36Emergency Planning, Office of, 166Employees' Compensation, Bureau of, 260Employment, Federal civilian:

Analysis, 347-351By agency, summary, table 12, 53By agency and type of position occupied, as

of June 1963, table C-2, 348Compared with State and local government,

1942-65, chart, 36Costs of, in relation to Federal expenditures,

1961-65, table C-4, 351In relation to population and other employ-

ment, 1942-65, table C-3, 350In relation to the total economy, 1942-65,

chart, 30Reduction of, discussion, 33-34Summary as of June 1963-65, table C-l, 347

Employment Security, Bureau of, 259Engraving and Printing, Bureau of, 272-273Excise tax proposals, estimated effect of, on

receipts, text and table, 61Excise taxes, extension of, 14, 61Executive branch employment, see Employ-

ment, Federal civilianExecutive Mansion and Grounds, 165Executive Office of the President, 165-167Expenditures:

Administrative budget, see Administrativebudget

Aid to State and local governments:1954-65, chart, 427By agency, table 1-1,429By function, agency, and program, table

1-3, 431-435In relation to total, and to State-local

revenue, table 1-2, 430Annexed budgets, table B-7, 343By agency, for each appropriation and fund

account, analysis, 150—325By agency, summary, table 5, 45



Expenditures—ContinuedCommerce and transportation programs,

1954-65, chart, 24Comparison of 1964 with 1965, text and table,

17Contribution of, to growth and development

of national resources, discussion, 29Effect of, on balance of payments, discussion,

28Effect of, on the economy, discussion, 30-31Employment costs, in relation to 1961-65,

table C-4, 353Explanation, 147-148Government dollar, where it goes, chart, 40Gross:

Analysis of, 337-346Of Government-administered funds, table

B-9, 344Public enterprise,funds, by agency, table

B-1,338Trust revolving funds, table B-5, 341

Health and Welfare:1954-65, chart, 26By agency, table G-1, 399By category, table G-2, 400By category, fiscal year 1965, estimated,

chart, 401By functional program and agency, table

G-4, 404-406In relation to Government programs, dis-

cussion, 16-27Investment, operating, and other:

Analysis, 352-370By kind, agency, and program, table D-2,

356-370Summary, table D-1, 353Summary, table 6, 46

National income accounts, Federal sector,1940-65, table 16, 455


National income basis, summary, table 7, 47Public works:

1956-65, table F-l, 383By major function, agency, and program,

table F-7, 391-396Civil, by agency, table F-2, 384Water resources and related developments,

table F-6, 390Reconciliation of, in administrative budget,

consolidated cash statement, and Federalsector of national income accounts,1963-65, table A-1, 329

Relation of authorizations to, summary,table 8, 48

Relation of, to obligational authority, 1965administrative budget, chart, 49

Research, basic, by agency, table H-3, 409Research and development:

1954-65, table H-1. 403AEC, table H-7, 414By purpose, 1963-65, table H-2, 409Defense—Military, Department of, table

H-4,411NASA, table H-6, 413

Space programs, table H-14, 423

Expenditures—ContinuedTrust funds:

By function, 1954-65, table 18, 461By function, distributed by agency, 1963—

65, table 14, 140-144By function, summary, table 1, 41By fund, table B-4, 341

Sec also PaymentsExplanation of:

Means of financing agency activities, 146-149NOA requests for each appropriation and

fund account, by agency, 146-147Export expansion, 85Export-Import Bank, 294Export-Import Bank of Washington, 85, 294Extension Service, 175

Family housing (Defense—Military), 209Farm Credit Administration, 294-295Farm financing, 94—95Farm income stabilization, 92-94Farm programs, discussion, 22-23Farmer Cooperative Service, 175Farmers Home Administration, 183-185Federal activities, analysis by function, 70-144Federal aid to State and local governments,

see Aid to State and local government,Federal

Federal Aviation Agency, 275-276Federal Bureau of Investigation, 254Federal civilian employment, see Employment,

FederalFederal Coal Mine Safety Board of Review, 295Federal Communications Commission, 295Federal credit programs, see Credit programs,

FederalFederal Crop Insurance Corporation, 182Federal health programs, see Health programsFederal Home Loan Bank Board, 295-296Federal Housing Administration, 285Federal Maritime Commission, 296Federal Mediation and Conciliation Service, 296Federal National Mortgage Association, 284-

285Federal Power Commission, 296-297Federal Prison System, 255.Federal Radiation Council, 167Federal statistical programs, see Statistical pro-

grams, principal FederalFederal Trade Commission, 297Field Services Office (Commerce), 193Finance, international, see International affairs

and financeFinancing agency activities, explanation of

means of, 146-149Financial assistance, international, 82-85Fine Arts, Commission of, 293Fiscal operations, central, 128Fish and wildlife resources, 99Fish and Wildlife Service, 245-248Food and Drug Administration, 217-218Food for Peace, 22, 92-93Foreign affairs, conduct of, 86, 263-264Foreign Agricultural Service, 177


INDEX 469

Foreign aid:Programs, 82-84Funds appropriated to the President, 168-170Discussion, 20-21Expenditures 1963-65 and recommended

1965 NOA. text table, 72Foreign Claims Settlement Commission, 297Foreign currencies:

Availabilities and uses analysis, 440-445Available to meet U.S. requirements, table

K-2, 442Cash availability of, table K-1, 440Special program appropriations—NOA, table

K-4, 445Summary of transactions—country uses,

table K-6, 445Summary of transactions, U.S. uses, table

K-3, 443Summary of U.S. uses without dollar con-

trols, table K-5, 445Foreign currency programs, special funds ap-

propriated to the President, 173Foreign economic assistance, see Foreign aidForeign information and exchange activities,

85-86Forest resources, 99Forest Service, 187-189Franklin D. Roosevelt Memorial Commission,

298Freedmen's Hospital, 234Funds, explanation of kinds of, 146Funds, public enterprise, see Public enterprise

fundsFunds, trust, see Trust funds

Gallaudet College, 234General Accounting Office, 297General Counsel's Office, Agriculture, 185General government:

Analysis of activities, text and table (1963-65payments to the public, and 1964 NOA byprogram or agency), 128-131

NOA and expenditures, 1963-65, distributedby agency, table 14, 138-139

Program trends 1954-65, chart, 130General Services Administration, 276-281Geological Survey, 243Government-administered funds, gross expendi-

tures of, table B--9, 344Government-administered funds, investments

by, in U.S. securities, table B-11, 346Government civilian employment, Federal,

State, and local, 1942-65, chart, 36Government dollar: where it comes from;

where it goes, chart, 40Government enterprises, borrowing by, table

B-10, 345Government organization, discussion, 35Government Printing Office, 161Government programs and expenditures, 16-27Gross national product:

Administrative budget expenditures as apercent of, 1942-65, chart, 9

Gross national product—ContinuedFederal payments as a percent of, 1942-65,

chart, 6Public debt as percent of, 1942-65, chart, 31

H

Health, Education, and Welfare, Departmentof, 217-236

Health, Education, and Welfare, Departmentof, research expenditures analysis, 415

Health insurance for the aged, discussion, 25Health and welfare programs:

Analysis, 397-406Discussion, 25-26Expenditures:

1954-65, chart, 26By agency, table G-1, 399By category, table G-2, 400By category, estimated fiscal year 1965,

chart, 401By functional program and agency, table

G-4, 404-406NOA and expenditures, 1963-65, distributed


payments to the public and recommended1965 NOA by program or agency) ,111-119

Program trends 1954-65, chart, 116Public health services, 113, 115Research, obligations for, text and table

H-8,418Highways, 105Historical and memorial commissions, 297-298Hospital construction, veterans', 126Hospitals:

Freedmen's Hospital, 234Operating beds, and patient loads, Federal,

by, agency, table G-3, 402Saint Elizabeths Hospital, 231

Hospitals and medical care, veterans', 125House of Representatives, 152-155Housing:

Private, aids to, 109Public, 109Rural, 94

Housing and community development:Discussion, 24-25NOA and expenditures, 1963-65, distributed


expenditures and recommended 1965NOA, by program or agency), 107-111

Housing and Home Finance Agency, 282-286Howard University, 234-235Human resources, investment in, discussion, 29

I

Immigration and Naturalization Service, 255Income tax proposals, estimated effect of, on

receipts, text and table, 58-61Income tax revision, discussion, 13-14Indian Affairs, Bureau of, 238-239Indian Claims Commission, 298



Indians, 98Information and exchange activities, foreign,

85-86Information Agency, United States, 306Information Office, Agriculture, 185Inland Waterways Corporation, 197Inland waterways transportation, user charges

on, 15Inspector General, Office of (Agriculture), 185Insurance, unemployment, see Unemployment

insuranceInsurance, veterans life, 127Insurance and welfare, social, 117-119Inter-American Development Bank, 84Interest:

Analysis of activities, text and table (1963-65payments to the public and 1965 recom-mended NOA), 127-128

NOA and expenditures, 1963-65, distributedby agency, table 14,138

Interest rates and maturities for major creditprograms, December 1963, table E-5, 380

Interior, Department of the, 236-253Interior, Department of, research expenditures,

analysis, 416Internal Revenue Service, 271International activities (Commerce), 193International affairs and finance:

Analysis of activities, text and table (1963—65 payments to the public and 1965 recom-mended NOA by program or agency), 81-87

Discussion, 20-21NOA and expenditures, 1963-65, distributed

by agency, table 14, 132-133International Boundary and Water Commis-

sion, 265International commissions, 265-266International Development, Agency for, 82-84International Development, Agency for, pro-

gram trends, 1954-65, chart, 83International financial institutions, 171International Labor Affairs, Bureau of, 256International organizations and conferences,

264-265International Pacific Salmon Fisheries Com

mission, 266International Rules of Judicial Procedure, Com-

mission on, 294International transactions:

Analysis, 446-451By major agency, table L-2, 447Distributed by geographic areas, table L-3,

459Federal payments abroad, by type of trans-

action, table L-4, 449Reconciliation of estimates of, with balance

of payments, table L-5, 451Summary, table L-1, 446

Interstate Commerce Commission, 298Interstate Commission on the Potomac River

Basin, 301Interstate-Federal commissions, participation

in, 300-301Intragovernmental transactions excluded from

consolidated cash statement, table A-2, 331

Investment, operating, and other expenditures:Analysis, 352-370By kind, agency, and program, table D-2,

356-370Summary, table D-1, 353Summary, table 6, 46

Investments in U.S. securities by Government-administered funds, table B-11, 346

j

James Madison Memorial Commission, 298Judicial Procedure, International Rules of,

Commission on, 294Judiciary, The, 162-164Justice, Department of, 253Juvenile delinquency, 119

Labor, Department of, 256-261Labor, expenditures for, 1954-65, chart, 26Labor, see a/50 Health and welfareLabor-Management Policy, President's Ad-

visory Committee on, 301Labor-managment relations, 259Labor-Management Reports, Breau of, 259Labor-Management Services Administration,

259Labor and manpower, 116-117Labor and welfare: program analysis, text and

table (1963-65 payments to the publicand recommended 1965 NOA), by programor agency, 111-119

Labor programs, discussion, 25-26Labor Statistics, Bureau of, 256Land Management, Bureau of, 236-238Land resources, 96-98Legal activities and general administration,

Justice, 253-254Legislation, proposed:

Agricultural programs, 92Defense—Military, Department of, 79-80Estimated effect of, on receipts, text and

table, 58-61Legislative branch, 150-161Lending, Federal, see Credit programs, FederalLibrary of Congress, 159-160Loan programs, Federal, see Credit programs

M

Management improvement, discussion, 34-35Management improvement, expenses of, 171Management services office (Agriculture), 186Manned space flight, 88Manpower, Automation and Training, Office of,

256Manpower Administration (Labor), 256-259Manpower and labor, 116-117Mapping and topographic surveys, 100Maritime Administration, 197-199Maritime Commission, Federal, 296Mas* transportation, urban, discussion, 25Medical and health-related programs, see

Health and welfare programs


INDEX 471

Mental health, 114Mental illness and retardation, discussion, 25Mental retardation, 114Message, Budget, 7Meteorology, 89-90Meteorology, research and development, obli-

gations for, 1962, table H-11, 421Meteorology programs and operations, obliga-

tions for, by agency, tables H-9, H-10, 419,420

Military assistance, 78-79, 210Military construction, 208-209Military personnel, 201-203Military personnel and forces, summary of,

text and table, 73Mineral resources, 99-100, 243Minerals Exploration, Office of, 244Mines, Bureau of, 243-244Mint, Bureau of, 272Mixed-ownership enterprises, loans outstand-

ing, table E-6. 382

NNarcotics, Bureau of, 271National Aeronautics and Space Administra-

tion, 287National Aeronautics and Space Administra-

tion: Research and development, expendi-tures for, table H-6, 413

National Aeronautics and Space Council, 166National Capital Housing Authority, 299National Capital Planning Commission, 299National Capital Region, 111National Capital Transportation Agency, 299National defense, see Defense, nationalNational Gallery of Art, 304National Guard and Reserve personnel, text and

table, 76-77National income accounts:

Federal receipts and expenditures, 1954-65,table 20, 463

Federal sector:1940-65, table 16,455Definitions and relationship to consolidated

cash statement and administrativebudget, 329

Explanation of, 330Relation of, to receipts from and payments

to the public, summary, table 7, 47Receipts and expenditures in, summary,

table 7, 47Relationship to administrative budget and

consolidated cash statement, 1963-65,table A-1, 329

National Institutes of Health. 227-229National Labor Relations Board, 299National Mediation Board, 300National Park Service, 240-241National Science Foundation, 300National Science Foundation, research ex-

penditures, analysis, 415National Security Council, 166National Service Corps, discussion, 25

Natural resources:Analysis of activities, text and table (1963-65

payments to the public and 1965 NOA byprogram or agency), 96-100

Discussion, 23NOA and expenditures, 1963-65, distributed

by agency, table 14, 134New obligational authority, see Obligational

authorityNondefense assets, additions to, chart, 29Nuclear weapons, 80

O

Obligational authority:Balances of, by agency and type, table 10, 51New:

Agricultural programs, text table, 91And writeoffs of public enterprise funds, by

agency, table B-2, 339By agency, for each appropriation and fund

account, with explanation of requests,150-325

By agency, table 4, 44By function, distributed by agency,

1963-65, table 14, 132-144By type and function, summary, table 3, 43Comparison of 1964 with 1965, text table,

17Commerce and transportation, text table,

101Completeness of estimates for 1964 and

1965,149Discussion, text table, 15-16Explanation, 146-147General government, text table, 129Health programs, text table, 112Housing and community development, text

table, 108Interest, text table, 128International affairs and finance, text

table, 82National defense, 72Natural resources programs, text table, 97Space programs, by agency, table H-14,423Special foreign currency programs, table

K-4, 444Relation of, to expenditures, 1965 admini-

strative budget, chart, 49Relation of, to expenditures, table 8, 48

Obligations:Defense—Military, Department of, research

and development, table H-5, 412Incurred, explanation, 147Incurred, net, by agency, table 9, 50Medical and health-related research, by

agency, table H-8, 418Meteorological research and development,

1965, table H-11,421Meteorology programs and operations, tables

H-9, H-10, 419-420Oceanography, by agency, by functional area,

tables H-12, H-13. 422


472 T H E B U D G E T FOR FISCAL YEAR 1 9 6 5

Obligations—ContinuedStatistical programs, by broad subject areas

and by agency, tables J-1 and J-2. 437-438Water research and surveys, table H-15, 424

Oceanography, obligations for, by agency, byfunctional area, tables H-12, H-13, 422

Oil and Gas, Office of, 245Operating expenditures, see Expenditures:

Investment, operating, and otherOperation and maintenance, Defense—Military,

204-205Organization, government, discussion, 35Outdoor Recreation, Bureau of, 241Outdoor recreation, discussion, 23Outdoor Recreation Resources Review Com-

mission, 300

Panama Canal, 216Patent Office, 195Pay comparability allowance, civilian, 308Payments, Federal:

Abroad, by type of transaction, table L-4,449As a percent of gross national product,

1942-65, chart, 6Composition of, 1942-65, chart, 6Consolidated cash statement, 1940-65, table

16,455International transactions, by agency, table

L-2, 447Summary, text table, 10

Payments to the public:1954-65, table 19, 462Agricultural programs, text table, 91Commerce and transportation, text table, 101General government, text table, 129Health programs, table, 112Housing and community development, text

table, 108Interest, text table, 128International affairs and finance, text table,

82National defense, 72Natural resources programs, text table, 97Relation of Federal sector in national income

accounts to, summary, table 7, 47Summary, by function, 1963-65, table 2, 42Text table, 18

Payments, see also ExpendituresPeace Corps, 171Peaceful uses of atomic energy, 80Pensions, veterans', 125Permanent authorizations, summary, table 8,

48Permanent authorizations, summary of new

obligational authority, by type, table 3, 43Personal property activities, General Services

Administration, 278-279Personnel management, central, 131Post Office Department, 261-262Postal service, 105Poverty, attack on, discussion, 17-18Power resources, electric, 98

President of the United States:Compensation of, 165Funds appropriated to, 168-173

President's Advisory Committee on Labor-Management Policy, 301

Private debt and public debt, net, 1942-65,chart, 32

Procurement, Defense—Military, 205-207Productivity in Government, improvement of,

discussion, 33Program trends, selected, 1954-65, chart, 34Property management, Federal, 130Protective services, Department of Justice, 131Public, receipts from, see Receipts; Payments to

publicPublic assistance, 118Public debt:

As percent of gross national product, 1942-65, chart, 31

Bureau of the. 270Compared with statutory limitation, end of

year, table 11,52Discussion and text table, 31-33End of year, 1789-1965, table 15, 454Interest on, 274Net, and net private debt, 1942-65, chart, 32Summary, table 11, 52

Public enterprise funds:Analysis of, 337-346Balances, table B-3, 340Gross expenditures and applicable receipts,

by agency, table B-1, 338NOA and writeoffs by agency, table B-2, 339

Public Health Service. 221-230Public health services, 113, 115Public Housing Administration, 286Public housing programs, 109Public land management, 236-238Public Roads, Bureau of, 199-200Public works:

Acceleration program, by agency, text andtable F-5, 172, 389

Analysis of Federal activities, 383-396Civil:

Estimated cost of 1965 direct Federal, bycontinuing and new work, table F-3, 384

Expenditures and 1965 NOA for, byagency, table F-2, 386

New authorizations and expenditures, bymajor function, agency, and program,table F-7, 391-396

Defense, new authorizations and expendi-tures, by major function, agency, andprogram, table F-7, 396

Expenditures, Federal, 1956-65, table F-1,383

Reserve of presently authorized projects andprograms for undertaking after 1965,table F-4, 388

Water resources and related developments,expenditures for, table F-6, 390

Purchases, Federal, as a percentage of the totaleconomy, 1942-65, chart, 30


INDEX 473

R

Railroad Retirement Board, 301Readjustment benefits, veterans', 125Real property activities. General Services

Administration, 276-278Receipts:

Administrative budget, See Administrativebudget

Annexed budgets, table B-7, 343By source:

Analysis, 56-67Detailed list, table 13, 62-67Summary, table 1, 41

Consolidated cash statement, 1940-65, table16, 455

Estimated effect of proposed legislation on,text and table, 58-61

Federal, 1942-65, chart, 14From the public:

1954-65, table 19, 462By source, 1963-65, text table, 57Relation of Federal sector in national

income accounts to, summary, table 7,47Summary, by source, 1963-65, table 2, 42Text table, 13

Government dollar, where it comes fromchart, 40

International transactions, by major agency,table L-2, 447



National income basis, summary, table 7, 47Public enterprise funds, by agency, table

B-1,338Reconciliation of, in administrative budget,

consolidated cash statement, and Federalsector of national income, accounts, 1963—65, table A-l , 329

Summary, text table, 10Trust funds:

By fund, table B-4, 341By source, 1954-65, table 17, 456By source, detailed list, table 13, 67By source, summary, table 1,41

Trust revolving funds, table B-5, 341Trust fund, see also Trust funds

Reclamation, Bureau of, 248-250.Records activities, General Services Adminis-

tration, 279Records management, Federal, 130Recreation, outdoor, discussion, 23Recreational resources, 99Rehabilitation, 50Reimbursements from outside Government,

credited to appropriations and intragovern-mental funds, table B-8, 343

Renegotiation Board, 301Research:

Agricultural, 95

Basic, expenditures for, table H-3, 409Health, 113Medical and health-related, obligations for,

text and table H-8, 418

Research—ContinuedSpace programs, new obligational authority

and expenditures, table H-14, 423Water research and surveys, analysis of

obligations for, table H-15, 424Research and development:

Administrative budget expenditures, 1954-65,chart, 407

Agriculture, Department of, expenditures for,analysis, 19, 415

Analysis, 407-426Atomic Energy Commission expenditures

for, table H-7, 414Commerce Department expenditures analy-

sis, 416Defense—Military, Department of:

Analysis, 207-208, 410Expenditures, table H-4, 411Obligations, table H-5, 412

Expenditures:1954-65, table H-1, 4081963^5, by purpose, table H-2, 409Administrative budget, by agency, table

H-16, 426Health, Education, and Welfare, Department

of, expenditures for, analysis, 415Interior Department expenditures analysis,

416Meteorology, obligations for, 1963-65, tables

H-9, H-11,419, 421National Aeronautics and Space Administra-

tion expenditures for, table H-6, 413National Science Foundation expenditures

for, analysis, 415Oceanography, obligations for, tables H-12,

H-13, 422-423Research and technology:

Aeronautics, 87Space, 21-22, 87-89Space, 1954-65, chart, 89

Reserve and National Guard personnel, texttable, 76-77

Reserve forces, Defense, 76-77Resources, agricultural, see AgricultureResources, natural, see Natural resourcesResume, budget, table 1, 41Revenues, estimated changes in, 56-61Revolving funds, trusts, see Trust funds, re-

volvingRevolving and management funds, Defense—

Military, 211-213Rural Areas Development, Office of, 185Rural electrification, financing of, 94Rural Electrification Administration, 183Rural Electrification Administration, proposed

revolving fund, effect of, on receipts, text andtable, 6(^61

Rural housing, 94Rural telephones, financing of, 94Ryukyu Islands, Army, 215

Saint Elizabeths Hospital, 231Saint Lawrence Seaway Development Corpo-

ration, 302


474 T H E B U D G E T FOR FISCAL Y E A R 1 9 6 5

Salary reform, Federal, discussion, 35-36Saline Water, Office of, 251Saline water conversion, 96Science education, discussion, 27Science education and basic research, 122Science information activities, 425Science and Technology (Commerce), 194Science and Technology, Office of, 167Scientific activities, Federal, see Research and

developmentSealift and airlift, Defense, 76Secret Service, U.S., 271Securities and Exchange Commission, 302Securities, U.S., investments in, by Government-

administered funds, table B-11, 346Selective Service System, 302Senate, 150-152Small business, aids to, 102Small Business Administration, 302-303Smithsonian Institution, 303-304Social insurance and welfare services, 117-119Social Security Administration, 231Soil Conservation Service, 175-176Soldiers' Home, U.S., 215Solicitor, Office of (Interior), 252Solicitor, Office of (Labor), 261Southeastern Power Administration, 251Southwestern Power Administration, 251Space investigations, unmanned, 88Space flight, manned, 88Space programs, new obligational authority and

expenditures for, table H-14, 423Space research and technology:

Analysis of activities, text and table (1963-65payments to the public and recommended1965 NOA by program), 87-90

1954-65, chart, 89Discussion, 21-22NOA and expenditures, 1963-65, distributed

by agency, table 14, 133Special projects, White House Office, 165Sport Fisheries and Wildlife, Bureau of, 247-248Standards, National Bureau of, 195State, Department of, 263-267State and local governments, Federal aid to,

see Aid to State and local governmentsStatistical programs:

Analysis, 436-439Obligations for, by agency, table J-2, 438Obligations for, by broad subject areas, table

J-1,437Statistical Reporting Service, Agriculture, 176Strength and composition of Active Armed

Forces, 73Study Commissions, U.S.—Southeast River

Basins and Texas, 307Subversive Activities Control Board, 304Supreme Court of the United States, 162Surplus or deficit:

Administrative budget, 1789-1965, table 15,454

Surplus or deficit—ContinuedConsolidated cash statement, and national

income accounts, Federal sector, 1940-65,table 16, 455

T

Tariff Commission, 305Tax Court of the United States, 305Tax reduction, discussion, 11-15Technical Services Office (Commerce), 196Tennessee Valley Authority, 305Territories, Office of, 241-242Territories and possessions, 131Topographic surveys and mapping, 100Trade Adjustment Office (Commerce), 193Trade expansion, 102Trade Negotiations, Special Representative for,

167Transportation:

Commerce, 197Inland waterways, user charges on discussion,

15Mass, urban area, discussion, 25Tax and user charges on, text and table, 60-61

Transportation, see also Commerce and trans-portation

Transportation and communications activities,General Services Administration, 279-280

Transportation policies, 104Transportation programs:

Aviation, 104Discussion, 23-24Expenditures, 1954-65, chart, 24Water, 105

Travel Service, U.S. (Commerce), 193Treasurer, Office of the, 270Treasury Department, 268-274Trust funds:

Analysis of, 337-346Balances, table B-6, 342By agency, grand totals, 309-323Expenditures:

By agency, summary, table 5, 45Aid to State and local governments,

1954-65, chart, 427Aid to State and local governments, by

agency, table 1-1, 429Aid to State and local governments, by

function, agency, and program, tableH-3, 461

By function, 1954-65, table 18, 463By function, summary, table 1, 41By fund, table B-4, 341Investment, operating, and other, sum-

mary, table 6, 46Investment, operating, and other, table

D-2, 367-370Relation of, to obligational authority, sum-

mary, table 8, 49


INDEX 475

Trust funds—ContinuedNew obligational authority, by type and

function, and by agency, summary, table 3,43-44

Obligational authority, balances of, byagency and type, summary, table 10, 51

Obligations incurred, net, by agency, table 9,50

Receipts:By fund, table B-4, 341By source:

1954-65, table 17, 456Detailed list, table 13, 67Summary, table 1, 41Text table, 57

Revolving, expenditures and applicable re-ceipts, table B-5, 341

Summary, table 1, 41

U

Unemployment insurance revision, discussionof, 26

United States Arms Control and DisarmamentAgency, 305

United States Information Agency, 306United States Secret Service, 271United States Soldiers' Home, 215United States Territorial Expansion Memorial

Commission, 298United States Travel Service (Commerce), 193Urban Renewal, 24, 107-109User charges, discussion, 15User charges, proposed, estimated effect of,

on receipts, text and table, 60-61Utilization and disposal activities, General

Services Administration, 279

Veterans Administration, 288-290Veterans benefits and services:

Analysis of activities, text and table (1963-65payments to public and recommended 1965NOA by program or agency), 123-127

Discussion, 27NOA and expenditures, 1963-65, distributed

by agency, table 14, 137-138Program trends 1954-65, chart, 126

Virgin Islands Corporation, 252-253Vocational education, discussion, 26Vocational rehabilitation, 50Vocational Rehabilitation Administration, 221

W

Wage and Hour Division, 260Wage and Labor Standards, 259-260Water and power development, 248-251Water research, obligations for, by agencies text

and table H-l 5, 424Water resources development, expenditures for,

table F-6, 390Weather Bureau, 196-197Weather service, see MeteorologyWelfare, see also Health and welfareWelfare Administration (DHEW), 232-233White House Office, 165Women's Bureau, 259Woodrow Wilson Memorial Commission, 298Workload increases for selected programs,

1954-65, chart. 34

Youth training and employment, 26

U. S. GOVERNMENT PRINTING OFFICE : 1964 O - 700-000


E D G E I N D E XBudget Messageof the President

Summary Tables

Receipts

Analysis of FederalActivity by Function

New ObligationalAuthority andExpenditures byFunction and Agency

LegislativeBranch

Judiciary

Executive Officeof the President

Funds Appropriatedto the President

Agriculture

Commerce

Defense—M i I i tary

Defense—Civil

Health, Education,and Welfare

Interior

Justice

Labor

Post Office

State

Treasury

Atomic EnergyCommission

Federal AviationAgency

General ServicesAdministration

Housing and HomeFinance Agency

is

UlX

<z

•i2f

z02

ft. 2

QOLU 00

J

NASA

VeteransAdministration

Other IndependentAgencies

District ofColumbia

Special Allowances

Trust Funds

Memo.-AnnexedBudgets

2Q

CCSQ.

3 Measures of FederalFinancial Transactions

Public Enterprises,Trust Funds, andGross Expendituresof the Government

Civilian Employment,Executive Branch

Investment,Operating, andOtherExpenditures

Federal Credit Programs

Federal Activities inPublic Works

Federal HealthPrograms

Research, Development,and Related Programs

Federal Aid to State &Local Governments

Principal FederalStatistical Programs

Foreign CurrencyAvailabilities and Uses

I InternationalTransactions

Historical Tables

A to Z Index

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