Evening star., 1940-01-30

RecreotionuI Group
Owes U. S. $lS7. .592,
Report Declares
Branding the activities of the
Welfare and Recreational Associa-
ton as without legal authority and
vigorously criticising the financial
practices of the organization, which
operates cafeterias and other fa-
cilities for Government employees
on Federal property. Acting Con-
troller General Elliott today de-
clared it owed the Government $l87,-
592.70, which should be demanded.
Mr. Elliott further declared the
contract with the Government un-
der which the association has func-
toned should be Cancelled In ac-
cordance with the six-month- notice
provision. Even this contract was
illegal, the Acting Controller Gen.
eral said, inasmuch as it was en-
tered into between the then director
of public buildings and public parks,
1t. Col. U. S. Grant, III, on be-
half of the Government and Maj.
Carey. H. Brown, assistant director,
as vice president of the associa-
ton. This, Mr.. Elliott said, was de-
spite the fact the United States
may not be bound by contract ex-
cept as authorized by Congress.
The report suggested that the IA
cilities might be operated by prl-
vate concerns or that the Govern
ment might take them over under
the supervision of the Federal Works
Agency.
Write-Of Criticized.
In particularly vigorous language
the report criticized depreciation
write-off against certain facilities
in 1868 approximating $4,000,
which it said was authorized by the
general manager of the association,
F. w. Hoover, and approved by the
Board of Trustees, who are under
officials of the Government. The
report declared the 1896 Write-off
of nearly $4,000 was Ito avoid pay
ing the Government its full share
of profits" amounting to SO per
cent.
Members of the Board of Trus-
tees are key officials employed by
various Government departments
who by virtue of their oaths of
Office should protect. rather than
ignore, the Governments rights
and interests" the report said
In another communication made
public today, bearing on the affairs
Of the association, the Acting Con-
troller General refused to pass on
the validity of the enforced check
of against wages of non-union
cafeteria employees which the asso-
citation is making by virtue of an
agreement with c. I. 0. caeteria
workers whose union dues also are
checked off. The check-off plan
was device employed to halt the
strike that was threatened recently.
and Mr.. Elliott said it was a mat
ter strictly between the association
and the unoin
Long Investigation Ended.
The Elliott report followed a
lengthy investigation by representa-
tives Of the General Accounting Of
flee and of the Division of Investiga-
ton of the Interior Department,
which covered the affairs of the
association from its Inauguration on
July /, 1927, to December 81, 1898.
1t was sent to the administrator Of
the Federal Works Agency, which
exercises control.
In that time, the report said, the
organizations net worth has in
creased from approximately $4,000
to around s484,000. The books of
the corporation, it continues, show
operating profits of $850,09 Sc, but
this figure is questioned, the in
vestigators determining that it
should be 81 1,191 320.6l, which would
increase the amount due for division
between the asSociation-a nom
profit corporation, incidentally
and the Government S34l ,22705.
Numerous disbursements were
made by the association" the report
continued, ''in addition to those
necessary to properly conduct the
activities existing at the time the
contract was made, and those activi-
ties which have subsequently been
established which were not proper
or necessary expenditures for the
operation of the activities contem-
plated
Expenditures Challenged.
The report, which said a further
audit is still to be made, declared
items aggregating $780, ,062 40, rep
resenting voluntary and contractu-
raj donations to welfare societies"
in the Government constituted i'm
proper payments. This was the
largest single group in this category.
1t said that S28,198.4l was charge
able to illegal recreation unit expen-
ditures and $86 ,36049 to illegal ex-
penditures by the welfare unit.
A number of units consistently
showed deficits, the report contin-
ued, listing the total involved at
$183 ,064.34. These units, it contin-
ued, were cafetrias in the Apex
Building, Library of Congress, De-
partment of Justice, Loans and
Currency Division, Potomac Park,
at Tenth and U streets NV, and in
the Supreme Court Building. Also
listed were:
Lunch counters in Census, E
Building, Pierce Mill Tea House and
Shops Lunch.
Swimming pools at Anacostia,
Francis Junior High and Banneker
Schools.
Golf courses at Tidal Basin, Ana
costa and Francis Junior High
Schools and at Sixteenth street and
Colorado avenue NV.
Lincoln Memorial Museum, Ship
ping Board newsstand, Pierce Mill
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