SUSPENDING LEGISLATIVE BUDGET UNTIL MAY 1, 1949

FEBRUARY 10. 1949.-Ordered to be printed

Mr. MCKELLAR, from the Committee on Appropriations, submitted the following

REPORT

[To accompany H. Con. Res. 221

The Committee on Appropriations, to whom was referred the concurrent resolution (H. Con. Res. 22) report the same favorably to the Senate without amendment.

This concurrent resolution proposes to postpone from February 15, 1949, until May 1, 1949, the date of reporting the legislative budget, as set forth in section 138 (a) of the Legislative Reorganization Act of 1946, as it may apply to the budget for the fiscal year ending June 30, 1950.

Section 138 of the Legislative Reorganization Act of 1946 reads as follows:

SEC. 138. (a) The Committee on Ways and Means and the Committee on Appropriations of the House of Representatives, and the Committee on Finance and the Committee on Appropriations of the Senate, or duly authorized subcommittees thereof, are authorized and directed to meet jointly at the beginning of each regular session of Congress and after study and consultation, giving due consideration to the budget recommendations of the President, report to their respective Houses a legislative budget for the ensuing fiscal year, including the estimated over-all Federal receipts and expenditures for such year. Such report

shall contain a recommendation for the maximum amount to be appropriated for expenditure in such year which shall include such an amount to be reserved for deficiencies as may be deemed necessary by such committees. If the estimated receipts exceed the estimated expenditures, such report shall contain a recommendation for a reduction in the public debt. Such report shall be made by February 15.

(b) The report shall be accompanied by a concurrent resolution adopting such budget, and fixing the maximum amount to be appropriated for expenditure in such year. If the estimated expenditures exceed the estimated receipts, the concurrent resolution shall include a section substantially as follows: "That it is the sense of the Congress that the public debt shall be increased in an amount equal to the amount by which the estimated expenditures for the ensuing fiscal year exceed the estimated receipts, such amount being $

S. Repts., 81-1, vol. 144

The committee realizing that there should be a complete resurvey of section 138 of the Legislative Reorganization Act of 1946, which is the section pertaining to the Legislative Budget, respectfully suggests to the Joint Committee on the Legislative Budget that it carefully study section 138 of the act with a view to making recommendations as to whether section 138 should be repealed, whether it should be amended, or whether in lieu of the method prescribed in section 138 for fixing a more effective control over appropriations and expenditures, Congress should provide for an omnibus appropriation bill as a means of placing before the Congress the over-all appropriation figure and permitting the Congress to have before it for action all the ensuing fiscal year appropriation bills at one time.

COMMUNICATIONS STUDY

FEBURARY 10, 1949.-Ordered to be printed

Mr. JOHNSON of Colorado, from the Committee on Interstate and and Foreign Commerce, submitted the following

INTERIM REPORT

This is an interim report by a subcommittee of the Senate Committee on Interstate and Foreign Commerce, which was appointed by Chairman Wallace H. White, Jr., on June 19, 1948, to study certain communications problems. The subcommittee originally consisted of Senators White, Tobey, and McFarland; on July 30, 1948, Senator White resigned and appointed in his stead Senator Hawkes. The subcommittee on August 8, 1948, adopted an agenda (which is printed herewith as an appendix) and began inquiry and the assembling of data. However, Senator Hawkes was unable to participate actively in the work of the subcommittee and this interim report is submitted by Senators Tobey and McFarland. This report was submitted by the subcommittee on January 24, 1949, and unanimously approved and adopted by the full committee on February 9, 1949.

It will be noted that the agenda adopted by the subcommittee outlines an extremely broad study involving practically every phase of communications. Obviously, in the period thus far available to the subcommittee, only a few of the agenda items could be surveyed, The subcommittee, therefore, limited itself to a consideration of what it regarded as the more pressing matters from a time standpoint. In making this report, and such recommendations as it deems pertinent, the subcommittee believes it important to emphasize that a communications study of the scope outlined in the agenda should be continued and carried to a conclusion in the interest of a sound national and international communications industry, the national defense, and the general public interest.

1. Organization of Commission and Administrative Problems.-B..sically, a major problem in the communications field relates to the regulatory agency itself. It has been well said by an experienced legislator that "good administrators make a bad law work but bad administrators can vitiate even the best law." No independent agency in our

Government over the years has been the subject of more criticism and legislative investigation, much of it earned, than has the Federal Communications Commission.

We are of the opinion that the administrative faults, which still exist, are due basically to an archaic and clumsy organization of its administrative machinery. We are aware that the Commission, even today, frequently ignores and bypasses its own rules in arriving at decisions; that it continues the extra-legal conduct of judicial law making which is repugnant to sound regulation; and that on occasion it arrogates to itself powers and authority which we fail to perceive in the basic act.

Our survey of Commission operations and our consultations with Commissioners themselves convince us that a great deal of the very valid criticism made against the Commission could be eliminated, or at least modified, by an internal reorganization.

We are informed that the Commission has prepared and tentatively approved the draft of an order modifying its internal organization. We are, in a general way, familiar with the broad outlines of that plan. Without approving or rejecting its plan, we offer the following observations and recommendations.

The Administrative Procedures Act and the Commission's own policy provides for the use of hearing examiners in all contested cases. Such hearing examiners, under present procedure, hear evidence and prepare what is known as a proposed decision. That decision may, or may not, become the final decision of the Commission as a whole. During the past 10 years or more, as a result of conferences and recommendations made by bar associations, administrative bodies, and the judiciary generally there has been general recognition and approval of the hearing examiner system in order to speed up procedures in administrative bodies. There also has been frequent reference to the creation of divisions or panels within commissions to divide the work and thus expedite final decisions in contested cases. This background was undoubtedly one of the factors that motivated Senator White in proposing a panel system for the Federal Communications Commission in his bill of the Eightieth Congress and may have actuated the Commission itself in drafting its proposed plan.

We must observe that the panel system has its weaknesses. We believe it is one of the axioms of judicial procedure that the body created to render decisions is expected to render those decisions as a whole. Litigants have a right to expect that a decision which may vitally affect them has been passed upon by the entire Commission created to make such adjudications. Many Members of Congress feel, and we believe rightly, that creation of a panel system may result in bypassing of the Commission as a whole with contested decisions being left to three Commissioners, which could mean under certain circumstances that one Commissioner finally decides the issue. On the other hand, we are aware that the Commission must find a method of speeding up its work and reducing the current backlog of cases, which we are informed represents as much as 15 months' work.

It is our view, however, that adoption of the panel system without enactment of legislation specifically dealing with the subject is not contemplated by the existing law which contemplates that all decisions must be made by the whole Commission. We are of the opinion that any attempt to make decisions by less than the whole Commission would not be in accord with the Communications Act. But we

believe that the work of the Commission would be expedited by following a procedure somewhat similar to that of our appellate courts. We therefore suggest the following.

With respect to contested cases, in which two or more private litigants, or the Commission and a private litigant, are involved, we firmly believe that the decision should be that of the whole Commission. We are of the opinion, however, that even these cases can be handled more expeditiously with full protection to the rights of litigants by assigning the case to a group or subcommittee of the Commission for writing of the final decision. However, the same group or subcommittee of Commissioners should not be assigned to every case or type of case; it is essential that all Commissioners participate actively in all phases of operation of the Commission. This permits the fullest consideration of contested cases by all of the Commissioners and permits those who dissent from the majority view to prepare a dissent.

In this connection, we deem it important to emphasize that in the preparation of such final decisions by the Commission as a whole, it should have the legal aid of personnel who are not a part of the legal staff who prosecuted or represented the Commission during the hearing or rehearing procedure. The present system in which members of the Legal Division who prepared the case in the first instance and who prosecuted it, or represented the Commission viewpoint during the hearings, also aid in the preparation of the final decision is not conducive to production of a fair and unbiased decision, we believe. We do not suggest that the staff of the Legal Department would wittingly twist the law. We do suggest that they are human and that having been advocates of one view during the proceedings it is only natural that they will attempt to carry that view through in the final decision. We believe the Commission can obviate many of the criticisms that have been made on this score by the creation of a legal review board, not subject to the jurisdiction of the Law Department, whose sole duty would be to aid the Commission itself in the legal review of the hearing examiner's proposed decision and the preparation of the Commission's final decision.

A somewhat similar procedure to that outlined above for contested cases also could be followed with respect to uncontested cases. The decision prepared by the group or subcommittee of Commissioners to which each such case was assigned would naturally become the final decision of the whole Commission unless objected to by the majority. This leads to consideration of a further point with respect to the present organization of the Law, Engineering, and Accounting Departments of the Commission. Our observation is the present structure is not the most efficient, does not make the best use of the personnel, and that it does not square with current problems of the Commission. We are of the opinion that the Commission should be organized along the lines of its work load-i. e., broadcast, common carrier, and safety and special services and that the Law, Engineering, and Accounting Departments be made functioning units in such a divisional set-up, with the general counsel, the chief accountant, and the chief engineer directly under the Commission itself. It would appear that such a functional organization would permit far more rapid consideration of applications and cases, and at the same time free the responsible heads for consideration of over-all administration. We think it important to emphasize that the rule-making function