VETERANS REGULATION AFFECTING COLLEGES OF AGRICULTURE AND THE MECHANIC ARTS-VETERANS REGULATION ON COURSES OF EDUCATION OR TRAINING TUESDAY, APRIL 4, 1950 UNITED STATES SENATE, SUBCOMMITTEE OF THE COMMITTEE ON LABOR AND PUBLIC WELFARE, The subcommittee met, pursuant to call, at 10 a. m., in room F-37, United States Capitol, Senator Lister Hill (acting chairman of the subcommittee) presiding. Present: Senators Hill and Aiken. Senator HILL. The subcommittee will kindly come to order. We will proceed with the consideration of H. R. 7057, an act to amend Veterans Regulation No. 1 (a) with respect to the computation of estimated costs of teaching personnel and supplies for instruction in the case of colleges of agriculture and the mechanic arts and other nonprofit educational institutions. (H. R. 7057 and S. 2909 follow in turn:) [H. R. 7057, 81st Cong., 2d sess.] AN ACT To amend Veterans Regulation Numbered 1 (a) with respect to the computation of estimated costs of teaching personnel and supplies for instruction in the case of colleges of agriculture and the mechanic arts and other nonprofit educational institutions Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That, effective as of December 28, 1945, paragraph 5 of part VIII of Veterans Regulation Numbered 1 (a), as amended, is amended by adding at the end thereof the following: "In the computation of such estimated cost of teaching personnel and supplies for instruction in the case of any college of agriculture and the mechanic arts, no reduction shall be made by reason of any payments to such college from funds made available pursuant to the Act entitled, 'An Act donating public lands to the several States and Territories which may provide colleges for the benefit of agriculture and the mechanic arts', approved July 2, 1862, as amended and supplemented (U. S. C., 1946 edition, title 7, secs. 30-329, inclusive); and in the computation of such estimated cost of teaching personnel and supplies for instruction in the case of any nonprofit educational institution, no reduction shall be made by reason of any payments to such institution from State or municipal or other non-Federal public funds, or from private endowments or gifts or other income from nonpublic sources. SEC. 2. Upon receipt of appropriate claims therefor, the Administrator of Veterans' Affairs is authorized to make adjustments in accordance with this Act in contracts which are in effect on the date of approval of this Act as well as prior contracts and is authorized to make back payments and refunds in accordance with such adjustments. Passed the House of Representatives March 20, 1950. RALPH R. ROBERTS, Clerk. 1 [S. 2909, 81st Cong., 2d sess.] A BILL To amend Veterans Regulation Numbered 1 (a) with respect to the computation of estimated costs of teaching personnel and supplies for instruction in the case of colleges of agriculture and the mechanic arts and other nonprofit educational institutions Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That, effective as of December 28, 1945, paragraph 5 of Part VIII of Veterans Regulation Numbered 1 (a), as amended, is amended by adding at the end thereof the following: "In the computation of such estimated cost of teaching personnel and supplies for instruction in the case of any college of agriculture and the mechanic arts, no reduction shall be made by reason of any payments to such college from funds made available pursuant to the Act entitled 'An Act donating public lands to the several States and Territories which may provide colleges for the benefit of agriculture and the mechanic arts,' approved July 2, 1862, as amended and supplemented (U. S. C., 1946 edition, title 7, secs. 301-329, inclusive); and in the computation of such estimated cost of teaching personnel and supplies for instruction in the case of any nonprofit educational institution, no reduction shall be made by reason of any payments to such institution from State or municipal or other non-Federal public funds, or from private endowments or gifts." Senator HILL. I believe Mr. Birdsall is here from the Veterans' Administration. Mr. Birdsall, are you first qualified to speak on this bill, sir? Senator HILL. Suppose you come up here where we can hear you. Senator HILL. We would be happy to have you proceed in your own way and give us the Veterans' Administration's views and any suggestions or criticism with reference to this bill. STATEMENT OF G. H. BIRDSALL, ASSISTANT ADMINISTRATOR FOR LEGISLATION, VETERANS' ADMINISTRATION; ACCOMPANIED BY H. V. STIRLING, ASSISTANT ADMINISTRATOR FOR VOCATIONAL REHABILITATION AND EDUCATION, VETERANS' ADMINISTRATION; AND A. H. MONK, DIRECTOR OF TRAINING FACILITIES, VETERANS' ADMINISTRATION Mr. BIRDSALL. Very briefly, first of all, the Veterans' Administration made a report to the Committee on Labor and Public Welfare on a bill on a similar subject, Senate bill 2909. That report was March 4, 1950. H. R. 7057, now before your subcommittee, is at variance with S. 2909 in this respect, that H. R. 7057 would authorize a retroactive adjustment to those colleges where they complied with the regulations of the Veterans' Administration. This bill would amend the regulations of the Veterans' Administration. House Committee Report No. 1720 contains an explanation of H. R. 7057 and the main issue in the particular bill has to do with the deducting of the amount appropriated by the Congress under the Morrill Act which is used for the instruction personnel in the landgrant colleges. The retroactive adjustment from December 28, 1945, to June 30, 1950, would involve a maximum estimated expenditure of $10,000,000. The additional estimated cost for the fiscal year 1951 would approximate $2,000,000. Senator HILL. As I understand it, the only difference between the Senate bill and the House bill is the retroactive feature in the House bill; is that correct? Mr. BIRDSALL. That is the fundamental change, Senator. Senator HILL. That is the fundamental change. Mr. BIRDSALL. The Veterans' Administration in its report did not recommend for or against the bill. However, in that connection, the Bureau of the Budget advised the Veterans' Administration that while they had no objection to our furnishing the report as prepared, it was suggested that we might wish to call the attention of the committee to the larger costs that might be involved if the precedent of this proposed legislation were made applicable to other programs. Senator HILL. Let me ask you a question at this point, Mr. Birdsall: Let us get the issue before the committee. Is this an instance in which it is felt that a duplication exists in the way of payment of funds? In other words, where the Federal Government is paying so much under the Morrill Act, under the Smith-Hughes Act, and the George-Deen Act, on the one hand, and then paying additional funds under the GI bill of rights, as amended; is that right? Mr. BIRDSALL. That is the point at issue, sir. Senator HILL. That is what this bill is all about? Mr. BIRDSALL. Yes. Mr. Stirling is here, and on that detailed information I would like to have him make a statement, Senator. Senator HILL. Mr. Stirling, that is the heart of this bill, is it not? Mr. STIRLING. That is correct. Senator HILL. Can you give us a statement pointing this thing up? Mr. STIRLING. As Senator Hill and Senator Aiken will remember, at the outset of our program we permitted institutions of higher learning, especially the land-grant colleges, to charge us their customary charges or their nonresident rate, or an adjusted rate. If they charged us the customary charges or the nonresident rate the issue that is before this committee is not involved, but where they came in and asked for more than the customary charges and requested payment based on teaching costs and classroom supplies, and they brought in also the fact that they were also receiving money through these funds for the payment of teachers, we felt, as a matter of principle, that we could not duplicate that payment. Our regulations requiring such deductions have been in effect for some time, that is, since January 1946. Senator HILL. You mean, for instance, where a land-grant institution is receiving funds, say, under the Morrill Act or under the SmithHughes Act, you did not feel that you could go in and duplicate those funds emanating from the GI bill of rights? Mr. STIRLING. Where they showed that they were spending some of that money for teachers' salary and then asking us to pay for that teachers' salary too. Senator AIKEN. Let me ask: If this bill does not pass, what is the effect on land-grant colleges; will it make it difficult for them to operate? Mr. STIRLING. I think, Senator Aiken, that the money involved is not the issue with the land-grant colleges. I think it is the principle that they are trying to get established by the Congress that the money that has been coming to them for a number of years should not be touched at all by the Veterans' Administration, or any other governmental agency, when they are doing a job. Senator AIKEN. What about the money appropriated by the State legislature? Mr. STIRLING. That is not involved. Senator AIKEN. That is not involved at all? Mr. STIRLING. No, sir. Senator HILL. In other words, under the GI bill of rights the Veterans' Administration has the power to pay certain teachers' salaries, or supply funds that go for teachers' salaries; is that right? Mr. STIRLING. We are authorized to pay not in excess of teaching costs and classroom supplies. Senator HILL. Not in excess of the costs for the teachers and for the classroom supplies? Mr. STIRLING. That is right. Senator AIKEN. You mean the additional teachers' costs? The additional costs involved by reason of accepting the GI students? Mr. STIRLING. We pay that. Senator HILL. In other words, you take no exception there. Senator AIKEN. You pay that. Do you contemplate continuing paying that anyway? Mr. STIRLING. Oh, yes, sir. Senator AIKEN. So that is not involved here? Mr. STIRLING. No, sir. The only thing involved is this, if you take one teacher at a land-grant college, and there are only about 70 institutions (land-grant colleges) involved, they are all land-grant colleges, where an institution is asking us to pay for a teacher's salary, and then out of these funds, the Morrill-Nelson funds, or the other funds that also pay for that teacher's salary, the regulations do not permit us to duplicate that payment. Senator HILL. It has been called to my attention that the House committee, in making its report, makes this statement (reading): The committee believes that the funds which have been appropriated from time to time for the benefit of the land-grant colleges were meant to be used for the purposes enumerated in the various acts without regard to the Servicemen's Readjustment Act. It is of the opinion that such funds should not be deducted in figuring costs for the training of veterans under the Servicemen's Readjustment Act. Certainly there was no intent on the part of the Congress to penalize landgrant colleges, yet this would be the result if the Veterans' Administration regulation is permitted to stand. This legislation, therefore, would be effective as of December 28, 1945 (the effective date of Public Law 268 from which the original Veterans' Administration regulation stems), and provides that land-grant funds for teaching would no longer be deducted from the estimated cost prepared for the Veterans' Administration. It is estimated that something between 5 and 10 million dollars is involved. Have you any comment to make on that statement, Mr. Stirling? Mr. STIRLING. I do not think I have, Senator Hill. Senator HILL. In other words, your question is, where the landgrant college is getting funds under the Morrill Act, or the SmithHughes, or the George-Deen, or one of these other acts, whether or not those funds shall be credited when you come to pay the college under the Servicemen's Readjustment Act; is that not right? | Mr. STIRLING. That is right, Senator. Senator HILL. The Morrill Act was one of the great landmarks of this Republic, really. Senator AIKEN. A good act. Let me get this clear, what the effect will be. I am a little hazy on the matter. I have land-grant-college people coming to me saying that this is going to affect them adversely; will make it more difficult for them to get along. I am just thinking out loud. Mr. BIRDSALL. Senator, we could not make a definite estimate, but it is indicated that the amount involved probably would be around $2,000,000 a year, or $10,000,000 for the accumulated period. Senator AIKEN. I was wondering why the land-grant college should become so disturbed over the matter. It seems to me they felt that they would be required to get additional appropriations from the State legislatures and it was doubtful if all could do that. Have you any comment on that? Mr. STIRLING. I cannot speak for the Land-Grant College Association. Senator AIKEN. Is there anyone here from the land-grant colleges? Senator HILL. Not at the meeting this morning. Senator AIKEN. All right. Senator HILL. Let me ask you this question: The veterans' education program has been going on for practically 5 years, has it not? Mr. STIRLING. Since June 22, 1944. Senator HILL. Practically 6 years. Was not this question raised before? Did you not come to Congress and ask us to specifically authorize you to make these offsets? Mr. STIRLING. No, sir; we did not. Senator HILL. Was the question raised in the Seventy-seventh Congress? Mr. STIRLING. No, sir. Senator HILL. In other words, this is the first time this question has been posed, either affirmatively or negatively, so to speak, to the Congress; is it? Mr. STIRLING. That is correct, sir. Senator HILL. I see. And you took the position that you did because you felt that such was the intent of the law? Mr. STIRLING. We take the position because of the principle that we believe should be followed in the Government service in not duplicating a payment of Federal funds. Senator HILL. Well, have these land-grant colleges protested to the Veterans' Administration? Mr. STIRLING. When it became effective, and some of the institutions had not followed the regulations, and large sums of money were involved in, perhaps, retroactive collections, the issue was pretty well cut and drawn by the land-grant colleges, and they waited on the Veterans' Administration. Our Solicitor ruled that the Administrator had the authority-legal authority-not to pay any attention to these other funds, but that he could not make his decision retroactive, and the land-grant colleges believe that it should have been made retroactive, and they presented it to the Congress. Senator AIKEN. Are all of the land-grant colleges affected by this legislation? Mr. STIRLING. Just about half of them. About 35, sir. Senator AIKEN. How does it happen that there is a difference, that some are affected and some are not? Mr. STIRLING. Some of the land-grant colleges are on the nonresident tuition basis. If they charge the nonresident fee we do not pay |