MAY 17 (legislative day, MAY 13), 1954.-Ordered to be printed Mr. LANGER, from the Committee on the Judiciary, submitted the following REPORT [To accompany H. R. 3522] The Committee on the Judiciary, to which was referred the bill (H. R. 3522), for the relief of Arthur S. Rosichan, having considered the same, reports favorably thereon, with an amendment, and recommends that the bill, as amended, do pass. AMENDMENT Page 1, line 5, strike the figure "1,935.85" and insert in lieu thereof the figure "659.85". PURPOSE The purpose of the proposed legislation, as amended, is to relieve Arthur S. Rosichan, Buffalo, N. Y., of liability to repay to the United States the sum of $659.85, which amount represents sums disbursed by him while he was employed as disbursing agent for the District of Columbia Transient Service of the Federal Emergency Relief Administration in the period from September 1, 1933, through December 31, 1934. STATEMENT During the period from September 1, 1933, through December 31, 1934, Arthur S. Rosichan was employed as disbursing agent for the District of Columbia Transient Service of the Federal Emergency Relief Administration. He has estimated that $450,000 was expended in the transient program of the District of Columbia during his tenure. Mr. Rosichan's job during this period was to take care of the transients during their stay in Washington, and to secure their return to their normal place of abode at the earliest possible time. The program was of such an emergent nature that disbursements were made directly through Mr. Rosichan without the assistance of any certifying officer and with the assistance only of an inexperienced bookkeeper. Mr. Rosichan submitted his resignation from this position on January 12, 1935, which was accepted by the District of Columbia Commissioners effective December 31, 1934. Three years after he resigned he received his first notification that the General Accounting Office had disallowed certain expenditures made by him during his employment. Since that time he has been attempting through the General Accounting Office, and the Department of Justice, to settle these disallowances on an administrative basis. The Auditor of the District of Columbia, in a letter dated April 26, 1938, addressed to the Chief, Accounting and Bookkeeping Division, General Accounting Office, Washington, D. C., states that under date of August 11, 1936, an auditor's representative furnished an affidavit to the effect that "an examination of this account was made from month to month for the period November 1, 1933, to November 30, 1934, inclusive, and at the time all vouchers were audited and approved by me, they bore the proper certification and approval, were supported by the necessary subvouchers, and turned over to the accountant of the Bureau for Transients.", On September 22, 1942, the General Accounting Office certified that Mr. Rosichan was indebted to the United States in the amount of $2,478.80, and under date of December 22, 1943, the matter of this indebtedness was referred to the Department of Justice for appropriate action. Under date of November 1, 1944, Mr. Rosichan submitted certain explanations to the General Accounting Office which served to justify the allowance of credit for items aggregating $542.95, thereby reducing the balance due the Government to the sum of $1,935.85, which represents the amount for which relief was proposed in the bill as it passed the House of Representatives. Of this latter figure approximately one-third of the total amount disallowed-$659.85 represents erroneous payments made by Mr. Rosichan. The remainder represents the difference between the cash which came into Mr. Rosichan's possession and the amount properly accounted for by him as of November 9, 1934. The committee is disposed to grant relief from liability to Mr. Rosichan for the expenditures erroneously paid by him during his employment as disbursing agent for the District of Columbia Transient Service. In the hectic atmosphere in which this employee worked it is not surprising that some expenditures were made which may not have conformed strictly to the rules and regulations governing expenditures at the time. However, the committee does not feel that it would be justified in relieving Mr. Rosichan from liability for the difference in his cash account when there is no evidence before the committee to establish the purpose for which the money was used, or to justify the discrepancy in any way. Consequently, the committee recommends favorable consideration of this bill in a reduced amount representing payments which the General Accounting Office deemed erroneous under pertinent rules and regulations. A report has been received on this legislation and on a similar bill for the relief of the same claimant introduced in the 81st Congress. The report of the District of Columbia Commissioners on this bill recommends that relief be granted to Mr. Rosichan. The report of the Assistant Comptroller General of the United States on the predecessor bill, however, states that the General Accounting Office is unable to recommend favorable consideration of the bill. Attached to this report is the report of the District of Columbia Commissioners and the Assistant Comptroller General; a statement by the claimant under date of April 17, 1953, and a letter of the Auditor of the District of Columbia addressed to the Chief Accounting and Bookkeeping Division, General Accounting Office under date of April 26, 1938. GOVERNMENT OF THE DISTRICT of Columbia, Hon. CHAUNCEY W. REED, EXECUTIVE OFFICES, House of Representatives, United States, Washington, D. C. DEAR SIR: In your letter of April 17, 1953, you requested a report on the facts in the case as disclosed by the files of the office, together with my opinion as to the merits of the bill and copies of papers on file that are material to the facts in connection with H. R. 3522, entitled, "A bill for the relief of Arthur S. Rosichan." Based upon the record submitted to me, it appears that Arthur S. Rosichan was appointed special disbursing agent for the Bureau of Transients September 29, 1936, at a salary of $3,000 per annum, and that he submitted his resignation January 12, 1935, which was accepted by the Commissioners effective December 31, 1934. During the time that the Transient Relief Bureau was in existence, there was expended during the fiscal years 1933, 1934, 1935, and 1936, $1,780,760. In the early stages of its operation, in order that expenditures could be made promptly there was established a special deposit account on the books of the Treasury in which checks received through the Relief Administrator were deposited. These checks were endorsed by the Commissioners to the Treasurer, United States, for deposit to the credit of Arthur S. Rosichan, special disbursing agent, symbol 94-050, during his term of office. Early in 1935, however, this procedure of depositing funds directly to Mr. Rosichan's account was discontinued and the funds were covered into a receipt account and thereafter disbursed by our regular disbursing officer, J. R. Lusby. The record does not show the exact amount disbursed by Mr. Rosichan, but there is on file a statement prepared through April 1934 in which monthly grants totaling $201,792.75 had been expended by him. Since his accounts and vouchers supporting payments were transmitted directly to the Federal Emergency Relief Administrator, that source may be contacted if it is felt desirable to determine the amount actually obligated and disbursed by him. You asked me for my opinion as to the merits of the bill. I would say that the record seems to indicate that the items of expenditure totaling $1.935.85 disbursed during the term of his appointment were the result of errors in judgment rather than an attempt to circumvent the provisions of the then-existing statutes and regulations affecting the expenditure of public funds. This agency when established was one of the first to expend large sums of money for direct relief, and no precedent had been established for the handling of such types of relatively small amounts to a great many individuals and, while this does not excuse the officer from obtaining the proper acquittance for expenditures made by Mr. Rosichan, I am inclined to the view that relief should be granted. Since the original records were transmitted by Mr. Rosichen to the Federal Emergency Relief Administrator, I am only able to provide you with copies of pertinent records prepared by Mr. A. R. Pilkerton, Principal Assistant Auditor, District of Columbia, (except two) affecting the expenditure of transient relief funds during the period in question, which are as follows: 1. Copy of a letter addressed to the Treasurer of the United States dated December 14, 1933. 2. Copy of a report made to the Auditor by C. B. Whaley, one of the Assistant Auditors, dated February 14, 1934. 3. Copy of a letter addressed to Morris Lewis, Director of Transient Activities, Federal Emergency Relief Administration, from the Auditor, District of Columbia, dated February 23, 1934. 4. Copy of a report made to the Commissioners by the Auditor, District of Columbia, dated April 19, 1934. 5. Copy of a letter dated December 3, 1934, from the Auditor to the Director of Public Welfare. 6. Copy of a report made to the Chief, Accounting Division, General Accounting Office, dated April 26, 1938. Very truly yours, Attachments (as listed). ASSISTANT COMPTROLLER GENERAL OF THE UNITED STATES, Hon. EMANUEL CELLER, House of Representatives. MY DEAR MR. CHAIRMAN: There has been received by reference a copy of your letter of May 1, 1950, to the Administrator, General Services Administration, transmitting a copy of H. R. 8262, 81st Congress, 2d session, entitled "A bill for the relief of Arthur S. Rosichan," and requesting to be furnished with a report of the facts in the case, together with an opinion as to the merits of the bill and with copies of the papers on file that are material to the case. The said bill provides for the relief of Arthur S. Rosichan from liability to the United States in the amount of $1,935.85, representing the balance due in his account as disbursing agent for the District of Columbia Transient Service of the Federal Emergency Relief Administration for the period from September 1, 1933, through December 31, 1934. By settlement No. G-118895-Ms, dated September 22, 1942, the General Accounting Office certified Mr. Rosichan to be indebted to the United States in the amount of $2,478.80 and under date of December 22, 1943, the matter of this indebtedness was referred to the Department of Justice for appropriate action. Under date of November 1, 1944, Mr. Rosichan submitted to this Office certain explanations which served to justify the allowance of credit for items aggregating $542.95, thereby reducing the balance due the Government to the sum of $1,935.85, that being the amount for which relief is proposed in the pending bill. There is enclosed a photostatic copy of the said settlement of September 22, 1942, together with copies of the consolidated statement of account, bill of par ticulars, and the pertinent correspondence. In connection with each of the disallowed items there will be found in the bill of particulars a statement showing the reason for the action taken by this Office as to each item. It will be noted that approximately one-third of the total amount_disallowed-$659.85-represents erroneous payments made by Mr. Rosichan. For example, there were 17 payments of $25 each, or for a total of $425, to certain medical officers for alleged extra services during periods when they were carried on the administrative roll on a part-time basis. As a final item in the account there was disallowed the sum of $1,276, representing the difference between the cash which came into Mr. Rosichan's possession and the amount properly accounted for by him as of November 9, 1934. It is the duty of disbursing officers of the Government to faithfully and fully account for all moneys which come into their possession in their official capacities und upon their failure to make a proper accounting they become personally liable for such funds. It seems clear that in making the disbursements in this case-to which the General Accounting Office issued notices of exception-Mr. Rosichan failed to exercise that degree of care required of responsible disbursing officers. Upon the basis of the present record this Office is unable to recommend favorable consideration of the pending bill for Mr. Rosichan's relief. Sincerely yours, FRANK R. YATES, Assistant Comptroller General of the United States. Mr. WALTER LEE, Judiciary Committee, House of Representatives, Washington, D. C. DEAR MR. LEE: I am attempting to set forth here for the benefit of the members of the Judiciary Committee the circumstances which surrounded my job as Administrator of the transient program in the District of Columbia in 1933 and 1934, and which have made it necessary for me to seek relief from General Accounting Office disallowances through H. R. 3522. In 1933 I was employed by a private social agency as their executive. In September of that year I was asked by the Board of Commissioners of the District of Columbia and by the officials of the Federal Relief Administration to take on immediately the job of developing a program to care for nonresidents in the District of Columbia. The reason that the program was so emergent at that time was that hundreds and thousands of people were coming to Washington to see their Congressmen in an attemgt to get Federal jobs. Most of them were penniless when they arrived here and there were no provisions for their housing and feeding in the District except in a small municipal lodginghouse. The FERA insisted upon this program being put into effect, and for some reason the money was not given to the District of Columbia for this purpose but was appropriated by the FERA and paid directly into an account with my disbursing symbol in the United States Treasury. The matter was so emergent that my Board was requested by the District of Columbia Commissioners to make me immediately available, and because there was no staff and it was necessary for the program to be set up rapidly, I was asked to serve as disbursing agent, as well as administrator of the program, and was told that my reports and my current accounts were to go directly to FERA. My recollections on the subject of staff are rather hazy, but I recall that my first step was the hiring of a bookkeeper directly from a bookkeeping school who, after a 1-day indoctrination in the FERA Office, was immediately put to work, since facilities had to be acquired and people had to be taken care of at that same instant. The bookkeeper, who was hired was Mr. Cobb, who was responsible for preparing vouchers and payments, and was responsible for keeping a complete set of books. He was, as can be imagined, unfamiliar also with governmental regulations surrounding the expenditure of funds. I had had no experience at all in this phase of work and had to rely upon him for preparing the vouchers correctly and doing the administrative aspects of the bookkeeping and accounting job. I was hired by the Commissioners on September 29, 1933, and went to work immediately. The size of the program can be judged by the fact that there were weeks in late 1933 and early 1934 when we had as many as three and four thousand transients applying for service every week. It was my job to develop housing facilities, set up feeding facilities, develop work-relief projects, and eventually to set up transient camps, one of which was set up in Beltsville, Md,. and one in Virginia. From the period when I started until April 1934, when the accounting and bookkeeping procedures were put under the control of the District of Columbia Auditing Office by order of the FERA, I had disbursed approximately $134,000 with another forty or forty-five thousand dollars already obligated. During the whole period of time from September 29, 1933, until December 31, 1934, when I resigned without prejudice, the transient program in the District of Columbia, expended an approximate total of some $450,000, for which I signed all the checks. In addition, I also had to act as certifying officer and certify the vouchers, because there was no such thing as a certifying officer, and I asked my accountant to initial all of the vouchers so that I might be able to handle them. At that time, I considered my responsibility as disbursing officer among the least of my responsibilities, because I was working anywhere from 12 to 18 hours a day in trying to set up the program and keep it going while at the same time taking all of the calls from Congressmen and Senators who were interested in having their constituents housed and fed, and returned to their homes. My orders were also to use as many of the transients as possible in responsible spots in the program, since there was a limitation in the amount which could be spent for administration. As a result, part of my bookkeeping staff, practically all of my work relief staff, and my administrative feeding and housing staff came from among the ranks of the transients themselves. There was never any indication during the time that I was in charge of the program that any disbursements had been made incorrectly or that the procedures followed were not in conformity with governmental procedures. La mples of the kinds of things that we were asked to do are the following: 1. A call would come from the District Commissioners relayed from the White House, asking us to escort a group of veterans picketing the White House, down to the railroad station and purchase transportation for them anywhere they said their homes were. |