in the Army Corps of Engineers where he was responsible for some of the largest and most complex construction programs in the country. We are very fortunate to have a man of such caliber responsible for a vital part of our Bureau.

Mr. Hanes is Director of Industrial Engineering. He has a long career in varied engineering activities, graduate studies in civil and industrial engineering. He is building our industrial engineering capabilities with great energy and great enthusiasm.

Mr. Cole, second on my left, is Deputy Director of Research and Development. I am sorry that Dr. Reilley, Director of Research and Development, is not able to be here today. He had a surgical operation last week and is now recuperating.

Mr. Cole is a graduate engineer and has a distinguished career in management and organization of techncial activities in the military sector. He will very ably represent our R. & D. activities.

Mr. Harris is a graduate industrial engineer who works for General Hyzer in the management and control of our several hundred construction engineering projects. He will make the principal presentation in the construction engineering area.

What we would like to do this morning, Mr. Chairman, is to give you an overview of our work in very general terms.

Now, it is quite obvious that with research and development being responsible for some 350 projects and 200 industry contracts, we cannot give you a project-by-project review. Industrial engineering, which is a small but growing organization, is responsible for 50 projects. Construction engineering under Mr. Hyzer has some 500 individual projects of various sizes and degrees of complexity.

So we will not attempt to delve deeply into any specifics, but try to provide for you a review of what we think is important and significant and of interest to this committee. We also are aware that we testified before this committee on May 23, 1967, and had the privilege of presenting at that time our plans and our programs, ongoing and for the future.

I think we have considerable additional progress to report at this time. I would like to proceed with the presentation, emphasizing first construction engineering, in order to provide continuity with Mr. O'Marra's presentation yesterday.

So we will spend the first half, approximately, of our presentation in the area of engineering support for the major facilities program which is the responsibility of the Bureau of Facilities under Mr. O'Marra.

I will return after this presentation to talk at further length about our research and development and our industrial engineering activities.

Now, with your permission, we will proceed with Mr. Harris.

Mr. HARRIS. Mr. Chairman, this portion of the presentation is what the Bureau of Research and Engineering does to support the postal modernization program. It is an explanation of how the program is derived and here are some charts which illustrate what the scope of the program is and how it will be implemented.

The program starts by defining the mail volume, which is a result of personal income and population growth.

Here you can see where we are today and how the mail volume has grown and is projected to continue to grow.

MAIL VOLUME,

PERSONAL INCOME,
POPULATION

Cy 1946-1971

INDEX (AVG. 1946-50 = 100)

From the mail volume projections we are able to develop our space requirements, mechanization requirements, personnel requirements, both at headquarters in the planning area and in the field as far as manning the post offices is concerned, and the funding that is required to support the program.

The space requirements are derived from the Bureau of Operations. They establish the plan, provide it to us, and we in turn are responsible for costing the facilities and for the mechanization in support of the program.

Then all other bureaus will be responsible for developing the personnel and funding requirements.

From the mail projections, the Bureau of Operations establishes a 5-year space program. What I would like to try to explain here is approximately where we are today; where we have approximately 100 million square feet of space that is adequate. This is the area which Mr. O'Marra discussed yesterday where we have inadequate space and here is our deficit in space at the present time.

In other words, we have almost a double program. One program is to try to make up the space which we do not have now to operate satisfactorily; to make up the space or to replace the space which is unsatisfactory and then to maintain an ongoing program which will satisfy the increase in mail volumes.

Now, in addition to the new space required to satisfy the increase in mail volumes, we will also be experiencing between 6 and 10 percent obsolescence each year. In other words, facilities because of increased mail volumes-will have to be replaced. So it is almost a double program that we are working on at this time.

As far as the scope is concerned, in order to get on top of the program we have approximately $300 million required during the next 5 years in the area of fixed mechanization equipment. Fixed mechanized equipment is that equipment which is installed in a post office which is custom designed and satisfies a particular requirement.

This $300 million is divided into two segments, approximately $200 million required for new equipment, new systems, and approximately $100 million required to modify or to alter the systems which we currently have in operation required by the changing mail volumes and the changing mix in the mail.

There will be approximately $55 million required during the next 5 years for nonfixed mechanized equipment. Nonfixed equipment is equipment which can be moved within a facility or between facilities. This is noncustomized, it is standardized and can be used for the same end product in any facility.

VOLUME OF LETTER SIZE MAIL HANDLED BY MECHANIZATION

MAIL PREPARATION MACHINES

FACE AND CANCEL

To give you some kind of an understanding of the scope of the program, this top curve defines the total volume of mail which is capable of being machine run in the mail preparation area. These projections

being developed by the Bureau of Operations do not represent the total volume of mail but just that which is capable of being machine run. Here we show what the program is and what our goals are for satisfying the problem of trying to mechanize the preparation of letter-sized mail.

VOLUME OF FIRST CLASS LETTER SIZE MAIL HANDLED BY MECHANIZATION

MAIL DISTRIBUTION MACHINES-LETTER SORTERS

The top curve represents the volume of first-class letter mail which is capable of being handled by letter sorters. Here again, this is not the total volume, but just that which is economical to process. The bottom curve is the goal which we anticipate reaching in order to mechanize this particular operation. To explain why the lower curve