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May 11, 1977
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Approved For Release 200.0/09/03 : CIA-RDP84-00933R0004000300.34-0 May 11, 1977 CONGRESSIONAL RECORD ? SENATE ffghting the Mob. ACcording to a study bY G. Robert Blakely, director Of the Cornell Institute On Organized 'Crime, all levels of governtherit- employ" Only 400 lawyers who specialize in brgarilzed Crime. Says he: "The Mafia now has more lawyers than we have." Permitting ,easier bugging and wiretapping Of known members of drganfZed4crime. The crinrtS neW'retienire investigators' to demon- strAte that a sp crime has probably been COMMittett, 1f the. eavesdropping does not turn up enough evidence end the suspects are not propmtly indicted, they must be in- formed about the bugs or taps. plotting stronger legislation. The Carter Administrator last week `moved in this 'direc- tion PT proposing laws 'that Would prohibit the laundering of fvtob inorieY,lighten loan sharking 'thtatUtes -and 'provide stiff prison sentences for operating, racketeering syndi- cates. The: Proposals, however, clO not solve the central problem: the very difficulty of proving charges of money-washing, loan- sharking and running illegal rackets. Giving convicted' racketeers longer prison sentences. The GAO study found that over a four-year period, 62% of the Sentences im- posed on Organized criminals by federal courts involved fines but no imprisonment and only 20% were tor sail ten-tie of two years or more. One reason: many judges feel that the mobsters' crimes, except the killings of each other, are nonviolent and thus les? serious than, say, Mugging. When jailed, mobsters are generally model prisoners' and, 'with their high-priced legal help, Win parole's more eAsilY than the average convict. Above all, there must. be an end to Amer- icans' tolerance for any kind or organized crime. Romantic notion about the dons and winking acceptance of their goods and serv- icestaCeAte_ailatmospliere that helps the Mob to 'flourish._ Without a 0-refound shift in Pnb- lic attitudes, even the limpet aniesqive law enforcement drive against the "Mafia ahd organized crime has scant chance' of perma- nently cutting into their activities, let alone putting them out of business. vlzzCODDiorma' s They live quietly in the exclusive Suburbs of River Perest and the Hamptons. 'There may be a ranch house in Palm Springs or a Mi- ami condominium as well. They can afford the best of everything, but they have almost nowhere to go, few Pleasant ways to page the time. Their husbands are often away,on buSi7 ness, or in Jail, Or calling on their mistresses. The Wives are, isolated only' by body- guards but alsolV"ignorande of the details of their husbands business aetiVities,_ The men's, arorltday deeds are not discussed at dinner. Today most Mafia wives are native Ameri- cans, but their marriages reflect the old- country values Of silence and obedienee, Family bonds have weakened. but neither the generation gap nor the suburban biasnora has dissolved thein, -Fathers 'MO bankroll their sons in A leltimate business or pay their way through rnedfeal schoOl. "But if the sons don't have the brains," says' an inves- tigator, "they are given work in the Mob. The sorts don't become plumbers or factory work- ers. That Wouldn't look right." Many of t the daughters go 't6 college, but only a few seek careers, most marry early. . . ? . The Maria's code limits social activities. "'Made' guys (Manosil don't like their wives to ini,ngle with the wives of Other 'Made' guys; says fbriner MOb lieutenant, ."be- cause imight rOvea Sornithn.g., about each other. The only thing Wives _go to is wakes, weddings and funerals." ? Detroit News Reporter Shelley Eichenhorn intervieiked for TimS the wives of three mid-, dfi47,t14 high-level MqfloSi. Her report: ese?,snspended in contradic- _ tree-lined Grosse Fointe streets and, prre. cells, handmade lace and machine guns, frmity portraits and FBi mug shots,. They disbelieve the ugly headlines about their men, and they bristle at the stereotype of themselves as provincial peasant wives who never leave the nursery or their knees. "They're not vulgar or bold-acting," says one Grosse Pointer. 'They are mother and grandmother types?and good ones. Take Mrs. Anthony Giacalone [wife of a top Mafia figure in Detroit's ' ruling family], she's a quiet, lovely lady. Why, she even contributed $20 to the March of Dimes." Mafia wives rarely unburden themselves to friends, and sometimes not even to their par- ish priests. Says a Grosse Pointe priest: "One woman's husband is in prison. She doesn't want to be asked how he is. The subject is never introdueed. Her man is away; she misses the father of her children." When Mass is over, one top-ranking Mafia wife returns home where a plaque proclaims her Madonna of the Kitchen. A housekeeper is here today only because the wife is ill. She makes a point of saying that she cares for her own house, It is a matter of pride. We live a quiet life. It is not our intention to be noticed," she says. happiest sometimes when they leave my name off the list of charity contributors." Sundays, her family gathers in the living room. There are shelves of family pictures, arid a wall plaque reads: God Bless Our Family. FiVe children and three grandchil- dren say grace. The head chair is for their father; he is in prison. Across the city in a gracious colonial home, another Mafia wife speaks with pride of her husband, a graduate of a prestigious univer- sity who served honorably in the Army. A re- cent family portrait hangs above the fire- place. Her husband is not in the picture; he is serving a five-year term. "The worst thing I had to face was the day my husband went to prison," says the wife, a pleasant, stylish blonde. "For him, the worst day came when his kids were kicked out of a private Grosse Pointe club. "I'm so sick of the Italian image of the uneducated housewife. The women / know give their time to charities and hospitals. They don't get in the papers. They don't do it for that. I feel for the Watergate wives. I admire them for standing by their husbands. I uphold that. "They have taken my husband out of my home for no reason. Others are murderers, and they walk the streets." Most of the wives are totally untouched by the violence that pervades their husbands' lives. Not Jeanne Randazzo. Her husband Frank and two other men were shot to death last summer in the basement of the Rendez- zoo' modest home on the east side of Detroit. The gunman, a government informer named Ernie Kanakis, was acquitted on the ground of self-defense; he told a jury that the oth- ers had tried to kill him with ice picks. "Life is nothing," says Jeannie. "Life is a vaporous smoke. On the night Frank was killed, he said, 'Don't cook, we'll g0 out to dinner, He took a shower like he always did, and we went 'to, dinner with my son and daughter. After dinner, about 11:45 p.m., Frank said he had to see someone who was buying Our '74 Cadillac. H. said to wait for him at the Golden, Coach, Restaurant. When he didn't come back by 10 p.m., my son said, .11 I know Dad, he fell asleep in front of the TV set.' "So we went home. I couldn't get in my own house .because of the police and the neighbors. The bodies were still in the base- inent, I hail to move in with my mother for thyee, days while the police cleaned up." _ In the. Randazzo parlor, red and white checkered bows brighten dried-flower ar- rangenie,nts left over from Frank Randazzo's ft41.?P34. Were. ,married 37 years," says wiping tears from behind 'black-rimmesi glasses. "Before you know it, it's goodbye." Approved ForRelease 2000/09/03 : CIA-RDP84-0093 S 7391 By Mr. TOWER: S. 1488. A bill to provide for monitor- ing of soil moisture in drought-prone areas, to provide information thereon and accelerate financial and technical assistance to lessen impact of drought on farming and ranching operations; and S. 1489. A bill to amend the Soil Con- servation and Domestic Allotment Act to prevent soil erosion during a drought emergency; to the Committee on Agri- culture, Nutrition, and Forestry. Mr. TOWER. Mr. President, I am in- troducing today two bills which will both help to prevent the worst consequences of drought in the United States and rem- edy those which cannot be planned for or prevented. It is essential that the Department of Agriculture be able to better predict drought occurrence and warn farmers ? and ranchers of' its imminence. Although the rudimentary machinery is in place within USDA, the program does not? work satisfactorily, as we can all attest from our recent experience in the West. My bill would correct this deficiency by directing the Secretary of Agriculture, through the Soil Conservation Service, to monitor soil moisture, rural water sup; plies, and other drought-related indices in drought-prone areas to provide inf or- - mation for making decisions about early actions which can be taken by both Gov- ernment and landowners to minimize the adverse effects of drought. This bill would also accelerate the soil conservation program by helping farm- ers to implement those measures which lessen the potential and the impact of drought. Without such measures, we are in jeopardy in this country of losing Our present ability to feed and clothe the Nation. The second bill, Mr. President, would authorize assistance on a matching basis for weather modification measures, when these remedial efforts are needed and de- sired by local conservation districts. The bill does not authorize the Federal Gov- ernment to undertake such weather modification work on its own or without the request of local soil conservation dis- tricts. The power to plan or implement these efforts to modify weather patterns and precipitation will remain at the local level. Mr. President, I think this last provi- sion is very important. Weather modifi- cation to relieve drought areas remains a controversial alternative. It is still as much an art as it is a science, and the decision to implement such procedures is one which is appropriately a local initiative. It is also important, however, that the Department of Agriculture expend ap- propriate efforts to assist those farmers and ranchers in an area to take these steps, should they be deemed desirable. My bill, if enacted, would provide up to 80 percent of the cost of weather modi- fication work, with the remaining share paid by the conservation district or com- bination of districts that request assist- ance. The cost of both bills is relatively low. In the case of the weather modification assistance bill, $5 million is authorized for each fiscal year through Septem- ber 30, 1080. 3R000400030034-0 , Approved For Release 2000/09/03 : CIA-RDF'84-00933R000400030034-0 S 732 CONGRESSIONAL RECORD?SENATE May 11, 1977 , . President, drought is a long-term eeneervatio ' n of soil, water, and related re- disaster, a gradual depletion of resources sources. "(3) 'Weather modification' shall mean any which saps the vigor of the Nation's activity performed with the intention of pro- agricultural sector. By helping to pre- ducing artificial changes in the composition, vent, to plan for, or end drought-related behavior, or dynamics of the atmosphere. disasters, we can in some measure insure (D)isrrticatte'fshcall include the several States, continued vitality of the farm sector. I the otlhuemvbiira,itnheIsl Commonwealth know each' of my colleagues is concerned of Puerto Rico, Islands, d the eand n United Mr. that goal, and I would hope they territory or insular possession Mr States. would -view these tvio bills as viable steps "(5) The term 'Governor' means the chief - in that direction. executive of any State. Mr. President, I ask unanimous con- "(b) (1) Pursuant to the request of a Gov- sent that the two bills I have introduced ernor, the Secretary is hereby authorized to today to alleviate drought disaster be declare a state of drought to exist in those Printed In the RECORD. areas designated by the Governor in the Goy- 713:pre being no objection, the bills were ernor's request to the Secretani. "(2) Whenever a drought is declared as in Ordered to be printed in the RECORD, as ti 2(b) 1) within a district or combina- one but in each instance, Congress Ad- follows: tion & 148$ n of districts, the officials of the district or one, but journed before the House could take ac- combination of districts may make applica- Mr. CHILES. Mr. President, today I join with Senator PERCY and Senator HEINZ in introducing a bill to save up to $150 million a year in Federal leas- ing of automatic data processing equip- ment. As an amendment to section 111 of the Federal Property and Administrative Services Act of 1949 (40 U.S.C. 759) , this new subsection (H) authorizes the Administrator of General Services to en- ter into multiyear leases through the use of the automatic data processing fund without obligating the total anticipated payments to be made under such leases. In each of the last two Congresses, the Senate passed bills identical to this . Be it enacted by the Senate and House tion to the Secretary for financial assistance tion. This time around, both Senator of Representatives of the United States of for weather modification purposes. PERCY and I are looking forward to work- ? America in Congress assembled, That this "(3) Upon such a request from a district or ing with Senator HEINZ to enact this leg- A t rna be cited as the "Drought Disaster combination of districts, as in section 2(b) islation into law. In this period of economic stress, it is our obligation to initiate and encourage efficient and conscientious spending in our Federal agencies. Wasteful spending practices are today outrageous. This bill is one part of a broad campaign to over- haul the Government's antiquated sys- tem for spending $70 billion a year in the purchase of goods and services. This legislation was recommended by the Commission on Government Pro- curement and supported by the General Acounting Office in a report entitled "Multiyear Leasing and Governmentwide Purchase of Automatic Data Processing Equipment and Results in Significant Savings"?B-115369-0f May 7, 1974. As GAO concluded in that report: Almost all of the $390 million that the government spent to rent ADP equipment In fiscal year 1969 was for short-term rentals . . . generally the most costly acquisition method. Furthermore, GAO discovered: Since many agencies do not seek compe- tition before renewing leases under schedule contracts, there is no assurance that the Government is leasing a major part of its ADP equipment at the lowest possible cost. Most manufacturers and suppliers offer discounts under multiyear leases. Since most Government leased ADP equipment is for 3 or more years, GAO concluded that the rental of the equipment under multiyear leasing would be the most efficient use of the limited funds available for such equip- Warning and Assistance Act of 1977". , (2) the Secretary, through the Soil Conserva- Etna. 2. The Secretary of Agriculture, tion Service, shall make financial assistance through the Soil Conservation Service, is di- available to the district or combination of rette:d under existing authorities to moni- districts for the purpose of assisting and in- tor sbil moisture, rural water supplies, and itiating weather modification measures rec- other drought-related indicators in drought- ommended by the district designed to allevi- prone areae in order to provide information for Making 'decisions about early actions which , can be taken by Federal, State, and local goVerninents and landesvners or land users to minimize the effects of drought. Sag. 3. The Secretary is further directed to accelerate financial and technical assist- ance .to farmers and ranchers and to develop and help implement those additional con- serVation techniques or measures that will lessen the impact of a drought on their op- eratidaa, thus aeSuring a continued supply of fOod and Tiber far the Nation. ' S. 4, Such measnies on irrigated lands -- shall include but not be -limited to irriga- tion system change or reorganization, land leveling, ditch lining or piping, water flow control structures, and water re-use systems; - provided that such measures are planned and iplernehted to provide improved water qual- ity including salinity Control; further tech- nical assistance will include information on the capability of Soils' to Produce food and fiber under, clibizglit Conditions while main- 'taming a soil conservation prograah to reduce wind and water erasion; further aesistance will be accelerated to local organizations in 'pooperation with states or other Federal agen- da, to develop Water resources plans which -w0t11.4:llessen the-effects of recurring droughts. Sep. 6. there is 'authorized to be appro- priated such sums ae are retjuired to Carry out the provisions of this Act. S. 1480 'Be it enacted by ,the Senate and House of Representatives of the United States of America in Congress disembled, That this Act may be cited ag the "Drought Emergency Relief 'Act of 1977". SEC. 2. The Soil Conservation and Domestic Alotnient Act is amended by including there- in the following: ? "(a) DEFINITIONS?As used in this amend- ment-- ' . , ."(1) 'Drought' shall mean that which exists whenever the Secretary of Agriculture (here- aft g referred to, as the pecretary), pursuant to tpi, request of the Governor of a state. de- ,diareq,,that severe econornic' losa IS imminent Unless an ibid,pp,6 Of piTelpitatica occurs in the affected liTealri time to prevent or lessen said economic ' ? ? ".(2) 'Distriet' shill Mea? a consereation district as constituted uriderEfate law In ad- Oardance With 'the prOviiithis Of section 8(b) 11 Of p Soil 'Conservation and Doniestic Allot- to , ate the drought condition. The total amount of such financial assistance provided by the Secretary to meet a drought shall equal 80 per centum of the total cost of the weather modification program during that period of implementing such drought alleviation or prevention program. "(c) The remaining portion (20 per centum) of the cost of the weather modifica- tion described in section 2(b) (3), shall be borne by the district or combination of dis- tricts in which a drought has been declared, such money being raised by the district or combination of districts as the officials of the district or combination of districts may prescribe within the limits of the State laws which initiated the district. "(d) Funds shall be made available by the Secretary to a district or combination of dis- tricts when the district or combination of districts are declared to be in a state of drought as defined in section 2(a) (1) and after the district or combination of districts have raised the required local funding as pre- scribed in section 2(c) ." SEC. 3. (a) The Secretary is hereby author- ized to transfer and utilize for the purpose of section 2(b) (3) any funds included in the Agricultural and Related Agencies Appropria- tions Act for fiscal year 1977. This transfer and utilization of funds shall not exceed $5,000,000 for the fieeel year ending Septem- ber 30, 1977, these funds to remain available until exnended. (b) The funds transferred and utilized in ment. section 3(a) may be replaced at the request It is essential that competitive proposals of the Secretary in a future supplemental be solicited for initial lease, purchase, or appropriation, renewal of ADP equipment as well as soft- SEC. 4. There are authorized to be appro- ware, maintenance, related equipment, sup- pleated such sums as may be neceesary to plies and services. Competition should not be carry out the purposes of this amendment, limited to manufacturers, but should In- not to exceed $5,000,000 for the fiscal year elude the proposals of third-party sources ending September 30, 1978, and $5,000,000 for and nonmanufacturing businesses. the fiscal year ending September 30, 1979, and Presently, GSA has authority to enter into $5 000,000 for the fiscal year ending Sentem- multiyear leases, payment of which comes her 30, 1980, all funds to remain available from a revolving fund established by section until expended. 111(c) of the Property Act. But under 31 U.S.C. 665(a) : 13y Mr. CHTIES (gni- himself, Mr. No officer or employee of the United States PERCY. and Mr. HEINZ) : shall make or authorize an expenditure?in e S. 1490. A bill to authorize the Admin- excess of the amount available therein. Accordingly, the amount payable for the trator of General Services to enter into entire period of the multiyear lease must ltiyear leases through use of the auto- not be -obligated from the fund at the time tic daf a processing fund without ob- of contracting. However, as GAO recom- ting the total anticipated payments mended, this legislation would authorize e made under such leases; to the GSA to enter into lease agreements without ittee on Governmental Affairs. immediately obligating the total anticipated t Act having for its prime purposes the Coin Approved For Release 2000/09/03 CI -00933R000400030034-0 Approved For Release 2000/09/03 : GIA-R0P84-00933R000400030034-0 May 11, 1977 CONGRESSIONAL RECORD ? SENATE S 7393 payment, but rather than cash balances of the ADP fund be maintained in such amounts as is neeessary for cash disburse- Merits of payments. In an August 20, 1973, letter to, the Presi- dent of the Senate, Arthur Sampson, Admin- istrator Of GSA, stated: A GAO comparison of multiyear versus short-term rental rate,or 1,066 systems in the government's inventory of June 1969 indicated possible savings of $70 million un- der 3-year leases and $155 million under 5- yeak leases. I aSic nnahimous consent that the big and some pertinent descriptive material be printed in the RECORD. 'There being no objection, the bill and material were ordered to be printed in the RECORD, as follows: S. 1490 Be it enacted by the Senate and House of Representatives of the United States of Americain Congress assembled, That section 111 of the Federal Property and Administra- tive Services Act Of 1949 (40 U.S.C. 759) is amended by adding at the end thereof the following: , "(h) Notwithstanding any other provision of law, the Administrator la authorized tg enter into multiyear contracts under ? this section financed through the fund and may incur or authorize obligations in excess of the amount available in the fund, except that (1) the amount of unfunded obliga- tions incurred during any fiscal year shall not exceed the amount specified in an ap- propriation Act for that fiscal year, (2) the cash balances of the fund shall be main- tained in such amounts as are necessary at any time for cash disbursements to be made from the fund, and (3) the term for the per- formance of any such contract shall not ex- ceed ten years. "(1) As u,sed in this section, automatic data processing equipment also includes, but is not limited to, hardware, software, maintenance, related equipment and sup- plies, and related services." EXCERPTS FROM REPORT PURPOSE This bill amends section 11 of the Federal Property and Administrative Services Act of 1949, 79 Stat. 1127, as amended (40 U.S.C. 759) by adding two new subsections (h) and (i). These subsections would permit the Ad- ministrator of the General Services Adminis- tration (GSA) to enter into multiyear leases (nOt to exceed ten years) of automatic data processing (ADP) equipment at amounts in eXCeSS of what is available in the fund, pro- vided the amount of unfunded obligations authorized is not needed and the balances of the fund are maintained in such amounts as are necessary at any time for cash dis- bursements to be made therefrom. Thus, the 'United States Government, the world's largest user of ADP equipment, would be able to take advantage of multiyear lease savings that are available to any private business. The bill also clarifies that tile authority to enter into multiyear leases of automatic data processing equipment ex- tends to collateral maintenance, software and pllser kinds of supplies and services that norinally flow with ADP equipment acquisi- tion. NEED FOR THE LESISLA'TION , The, clevernment is expending $35 to $75 Million more for instailed computer equip- ment under short-term leases it Would under firm-term multiyear leases. Millions of dollars of additional savings are possible through the use of multiyear contracting for new equipment and maintenance services associated with long-term leases. S. 2785 would permit the Government to obtain bet- ter terms, more effective competition and, In short, operate in the marketplace in a manner comparable to commercial _lessees of automatic data processing equipment. Presently, GSA has multiyear leasing au- thority for acquisition of automatic data processing equipment through the ADP Fund. However, since, under 31 U.S.C. 665(a), "No officer or employee of the United States shall make or authorize an expenditure-1n excess of the amount available therein:" the amount payable for the entire period of the multiyear lease must be obligated from the fund at the time of contracting. This provision severely limits the use of the ADP Fund for multiyear leasing; therefore, GSA and other Federal agencies are generally forced to enter into short-term leases, or long-term leases with termination rights. Both of these types of leases are consider- ably more expensive than firm-term multi- year leases. * * ANALYSIS OF THE BILL The bill amends section 111 of the Federal Property and Administrative Services Act of 1949 by adding two subsections. Subsection (Ii) would enable GSA to en- ter into multiyear leases at amounts in ex- cess of what is available in the ADP Fund. Restrictions are placed on this authority to enable Congress to maintain visibility and control over the Fund. An additional provi- sion limits the terms for performance of multiyear leases placed under the authority of this subsection to ten years. Following is a further elaboration on each of the above three elements of subsection (h): Firm-term multiyear leases GSA's authority to execute firm-term multiyear leases for automatic data process- ing equipment is severely restricted because governing laws require obligation of the to- tal post for the entire period of the lease at the time of contracting. These laws provide, in part, that: "No officer or employee of the United States shall make or authorize an expendi- ture from or create or authorize an obliga- tion under any appropriation or found in ex- cess of the amount available therein; nor shall any such officer or employee involve the Government in any contract or other obligation, for the payment of money for any purpose, in advance of appropriations made for such purpose unless such contract or ob- ligation is authorized by law. (31 U.S.C. 665(a)). "No contract or purchase on behalf of the United States shall be made, unless the same is authorized by law or is under an appro- priation adequate to its fulfillment," . . (41 U.S.C. 11) Subsection (h) would remove this restric- tion, thereby permitting GSA to use firm- term multiyear leases rather than short- term rentals of one year or less. During the hearings on S. 2785 the Com- puter and Business Equipment Manufac- turers Association (CBEMA) representative cautioned that if the Government applies the authority of this bill in such a manner as to conflict with normal commercial oper- ations, then countercosts would arise which would offset the advantages of true multi- year leasing. He pointed out that in return for payment of a lesser sum over a specific number of years, the ADP vendor expects a long-term commitment or cash flow which Approved For Release 2000/09/03 : can be discounted by a bank or used as col- lateral :for a loan. The Committee took the position that the objective of the bill is to gain for the Government the same benefits that are available to the private sector from multiyear contracts. Accordingly, the Com- mittee desires the Government's use of multiyear contracting to be consistent with normal commercial practice. The Committee expects GSA to use a multiyear contract that is, in fact, a marketplace mechanism. Another point that arose during the hear- ings was whether the multiyear contracting authority should be extended to user agen- cies. CBEMA suggested that S. 2785 is un- necessarily restrictive in limiting multiyear leasing to GSA's ADP Fund. After a thor- ough evaluation of this suggestion, the Committee determined that the CBEMA ob- jective of maximizing use of the multiyear authority could best be accomplished within the framework of Public Law 89-306 that established GSA as the focal point for ADP management within the executive branch. The approach adopted in S. 2785 of estab- lishing the ADP Fund as the single source' of funding for multiyear ADP contracts has a number of advantages: GSA can consider the useful life of ADP equipment to the Government as a whole. Individual agencies, either from annual ap- propriations or from revolving funds, would only be able to commit funds for their indi- vidual needs. The provision in the bill that, "the amount of unfunded obligations incurred during any fiscal year shall not exceed the amount specified in an appropriation Act for that fiscal year," assures congressional control over these expenditures. Broadening the bill to authorize other agencies, through annual appropriations or revolving funds, to con- tract on a multiyear basis would diffuse ? accountability to such a point that Congress could lose a great Measure of fiscal control. By funding all firm-term multiyear con- tracts through the ADP Fund (including those procurements delegated to other agen- cies), single payment discounts from vendors of 2 to 4 percent annually are expected. One source of ADP funding to interface with the market and its supporting financial institutions would enhance the Govern- ment's bargaining position for the acquisi- tion of ADP equipment. The concept in S. 27135 of the ADP Fund serving as the single source of funding for multiyear ADP contracts is entirely consist- ent with the responsibilities assigned to GSA by Public Law 89-306. Senate Report 89-938, pertaining to this law, discussed the need for the Fund and GSA's operation of the Fund In these terms: The. Fund would afford an effective means of attaining economic acquisition of Gov- ernment ADP equipment. Were all ADP purchase and lease money in "one pocket," the Government would be in a stronger bargaining position in dealing w:lth the manufacturers. But the most compelling need for the re- volving fund is in establishing the single puchaser concept in Government AD? acquisition. Essentially, all Federal agencies would lease equipment from the GSA revolving fund. By proper use of the authority conveyed in the Brooks bill as amended by S 2785 all of the above advantages can be realized, while maximizing use of the multiyear con- tracting authority. It will also be possible to use selectively, the capabilities for ADP procurement that exist within the user agen- cies. The procedure to be employed bi GSA t-00933R000400030034-0 Approved For Release 2000/09/03 : CIA-RDP84-00933R0004000-3003Z70 S 7394 CONGRESSIONAL RECORD ?SENATE May 11, 1977 In implementing S. 2'785, is explained in the Agency's letter of April 5, 1974. It should be noted 'that in recent years GSA hag' dele- gated approximately 81 percent of the ADP procurements to user agencies (in terms of dollar value). Under the GSA procedure, when a procure- ment delegation is made to an agency to enter into a firm-term multiyear lease with- out full obligation of funds, the authority to cite and obligate the ADP Fund will also be delegated. The Fund then would under- write the contract and ,make payments " to the vendor, and the us( n? agency -Would. reim- burse the Fund from annual apiiropriations. To insure that there is no legal impedi- ment to QSA delegating an agency author- ity to cite and obligate the Fund, the Gen- eral Accounting Office was asked for an opin- ion. GAO confirmed that there is no pro- hibition against this practice, as long as GSA maintains adequate overall supervision of Federal agencies procurement of ADP equip- inent and provided the amount of unfunded obligations authorized is not exceeded and that there is sufficient balance in the ADP Fund to make required cash disbursements. ADP fund Use of the Fund, as prescribed by S. 2785, is consistent with the principles of congres- sional visibility and control as set forth in the,,Senate's budget reform legislation (S. 1541, as amended) . The provisions In the bill that (1) the amount of unfunded obliga- tions incurred during any fiscal year shell not exceed the amount specified in an appro- priation Act for that fiscal year, and (2) the cash balances of the Fund shall be main- tained in such amounts as are necessary at any time nor cash disbursements to be made from the Fund, will enable Congress to exer- cise control over the amounts that may be obligated for ADP leasing. These restrictions conform to the requirements established in Public Law 89-308 for operation of the ADP Fund. Contract terra The limitation of ten years on the term for the Performance of a multiyear lease pro- vides an essential control but permits flex- ibility in the negotiation of multiyear leases. One reason for selecting ten years is that the current life of ADP systems is eight to ten years. Another reason Is that it corresponds to GSA's contracting authority in the tele- coluniunications area. The fact that multi- year contracts may cover up to ten years does not alter the requirement that multiyear leases are to be justified on a case-by-case basis as the most cost-effective method of acquiring needed ADP equiPment. Subsection (i) was included in the bill to make it clear that the authority in subsec- tion (h) applies to more than leases for hardware. Software development, related equipment, maintenance, supplies, and serv- ices may also be procured by firm-term multiyear contracts. The description of au- tomatic data processing equipment in sub- section (1) is compatible with the General Accounting Office interpretation of auto- matic data processing equipment as it is used in the Brooks bill. Mr. PERCY. Mr. President, along with Mr. CHILES and Mr. HEINZ I am intro- ducing legislation to amend section 111 of the Federal Property and Adminis- trative Services Act of 1949, 79 Stat. 1127, as amended (40 U.S.C. '159). This legislation would permit the Adminis- trator of the General Services Adminis- tration to enter into multiyear leases of automatic data processing equipment through the use of the automatic data processing fund, provided cash balances moval, and similar services for periods of the fund are maintained in such not exceeding 4 years; to the Committee amounts as are necessary at any time on Governmental Affairs. for cash disbursements to be made there- Mr. PERCY. Mr. President, I am today from. introducing legislation along With Mr. This bill was originally recommended CHILES and Mr. HEnqz which would au- by the General Accounting Office in a thorize procurement of janitorial, pro- report to the Congress entitled "Multi- tective, trash removal, and similar serv- year Leasing and Government-Wide ices for periods not exceeding 5 years. Purchasing of Automatic Data Proces- This legislation is similar to S. 3635, sing Equipment Should Result in Sig- which was introduced last year by Sena- nificant Savings." In this report, re- tor CHILES, Senator WEICKER, and my- leased April 30, 1971, GAO states that? self, and it is consistent with other legis- The rental of equipment under multiyear lation I have sponsored to allow for sig- leases, as an alternative to short-term rentals, nificant cost savings by providing for has become essential if the Government is longer term contracting authority. By to make maximum use of its limited funds initiating such Multiyear contracts, both for acquiring ADP equipment. administrative expenses and actual costs As a result of this report and my own can be reduced. study of the subject, I introduced S. 2785 Currently, GSA has 390 janitorial serv- on December 6, 1973. This bill passed ices contracts in 440 buildings. These 440 the Senate on September 19, 1974, but buildings represent 17 percent of the no action was taken in the House. Government-owned and GSA-leased The bill which Senators CHILES and buildings. However, since these buildings HEINZ are introducing with me today is average over 125,000 square feet Of space, Identical to that bill, and to S. 1260, they represent over 34 percent of all which Senator CHILES introduced during GSA-managed space. Additionally, there the 94th Congress 5 1260 also passed. are 'approximately- 210150 trash removal the Senate, but never reached a vote in and similar contracts in an estimated the House. 2,200 buildings, or 85 percent of the I appeared as a witness last year in Government-owned and GSA-leased- hearings on S. 1260, and I told the Sub- operated buildings. All of these contracts committee on Federal Spending Practices are currently limited to a maximum that "for us in Government to assume length of 1 year, necessiating higher that we only live year to year and there- contract costs as Weil as yearly costs asso- by cannot commit ourselves in such a way elated with annual hid invitations, adver- to take into account the economies that tising, bid evaluation, and contract are available to us is perfectly ridicu- awards. bus." The United States is the world's GSA has submitted anticipated savings largest user of ADP equipment, yet it is of $1.5 million annually on 3-year con- currently unable to take advantage of tracts and $1.63 million annually on 4- multiyear lease savings that are available year contracts. Since this legislation au- to any private user. Each year which thorizes contracts of up to 5 years, it is passes without this bill becoming law estimated that annual savings will be in costs the American taxpayer significant excess of both these figures. Further- amounts of money which could be used more, successful experience resulting for more constructive purposes, from this legislation can ultimately lead The General Services Administration to further savings by extending contract estimates that the passage of this legisla,- authority in other areas. tion could result in savings of $150 mil- I commend this legislation to the at- lion over the next 5 years, and up to $50 tention of my colleagues, and I hope that million annually thereafter. Over the we will move quickly toward its adoption. past 2 years, Senator CHILES has led a Mr. HEINZ. Mr. President, I am commendable effort to increase efficiency proud to join with Senators PERCY and In Government by overhauling anti- CHILES in introducing two bills to make quated Federal spending practices. I the procurement of services by the firmly believe that this legislation takes Federal Government more efficient and an important step in that direction, less costly. Section 111 of the Federal Property Act, which this bill would amend, authorizes and directs the Administrator of GSA to: Coordinate and provide for the economic and efficient purchase, leasing and mainte- nance of automatic data processing equip- ment by Federal agencies. The introduction of these two bills shows our continuing commitment to and interest in reforming Federal spending practices. Even though these two bills cover only narrow areas of Federal spending, I believe that they are, important for two reasons. First, In my opinion, which is shared and significant savings will accrue to the substantiated by GAO and GSA, this bill Government. And, second, these ?two truly does make such leasing of ADP bills will demonstrate the sizeable po- equipment "economic and efficient." Ac-j tential for cutting down on Federal cordingly, I urge its expeditious adop- spending. tion. By Mr. PERCY (for himself, Mr. CHILES, and Mr. HEINZ) : S. 1491. A bill to authorize procure- ment of janitorial, protective, trash re- Presently, there is a 1-year limitation on contracts for the procurement of janitorial, protective, trash removal, and similar services. One of our bills would authorize multiyear contracts for these services, so long as such con- Approved For Release 2000/09/03 : CIA-RDP84-00933R000400030034-0 Approved For Release 2000/09/03 : CIA-RDP84-00933R000400030034-0 TRANSMITTAL SLIP DATE 17 May 77 TO: DDA ROOM NO. 7 B DING REMARKS: v/chI' C/475 C /;:c5be OD 16 i if. 5 CAn , ------- ." FROM: OLC ROOM NO. 6 c 19 BUILDING HQS EXTENSION 6604 FORM NO .0,1 1 REPLACES FORM 36-8 1 FEB 55 4.1' WHICH MAY BE USED. (47) Approved For Release 2000/09/03 : CIA-RDP84-00933R000400030034-0