Evening star., 1951-08-09
Truman Soon 10 Name
Board 10 Curb Profits
In Defense Contracts

President Truman is expected
to name the Renegotiation Board
within a week or two" ending
nearly five months of industry I'M
easineSs and clearing the way for
the elimination of excess profits
in the multibillion dollar defense
program.
Set up as an independent agen-
cy under the Renegotiation Act of
1851. which was signed by Mr..
Truman on March %, the board
is charged with determining
whether any contractor who does
a minimum of $250,000 worth of
defense business a year has made
excessive profits.
The White House delay in nam
ing the board was explained by
an aide, who said: There's been
no hurry-there's been no work
to do (for the board. But things
are moving a bit now and nomina-
tionS should be along in week or
two"
Members Will Be Civilians.
What Mr.. Truman has to do is
to consider the recommendations
one each-made by the Secre-
taries of the Army, Navy and Air
Force and the General Services
Administrator, name another per-
son and designate a chairman. All
are to be civilians.
The delay actually has caused
TO backlog of work, according to
Frank Roberts, chairman of the
Armed Services Renegotiation Pol
icy and Review Board, the Gov
ernment's top expert in this field.
Under the law. contractor
has three months after the close
of his fiscal year to file his finan-
cial statements" Mr.. Roberts
pointed out.
AS virtually no companies have
fiscal years ending in April or May,
there would be virtually no flnan-
cial statements on hand even if
there was board to receive
them" he added.
The first big rush is expected
October l, when firms having fis-
cal years which end June 80 must
have filed their statements.
The board after studying these
statements must determine the
amount, if any. of excess profit
and bill the contractor accordingly. /
If the contractor contends the
amount of money to be returned
to the Government is unfair he
may appeal to the United States
Tax Court for a determination
Mr.. Roberts predicted that the
board. once named and approved
by the Senate. would need about
so days before it could operate
under full steam. 1t will have to
recruit personnel and set up Offices
here and in the field This may
explain signs of action by the
White House.
But while there has been no case
work plling up, contractors never
theless have been anxious about
renegotiation.
Many Questions Received. .
Mr.. Roberts. whose Office has
been handling inquiries from in
dustry, told The Star that he re-
ceiVes about 10 letters and calls
week and that most frequently
asked questions are: When is the
board going to be nominated? Are
there any regulations available?
Who is the President going to
name to the board?
The matter of regulations prob
ably has caused as much uneasi-
ness as any other item, according
to Mr.. Roberts. Until the board
makes known its regulations.
financial planning by firms doing
Government defense business
must be a little uncertain.
Many businessmen, too, want
to know the makeup of the board
as soon as possible because there
may be tip-off as to how strict
an Interpretation may be put on
the factors the law says must be
considered in determining an ex-
cess profit.
1t is Mr. Roberts prediction
that the new board will take the
regulations set-up under the Re-
negotiation Acts of 1912 and 1948
as base or starting point and
make necessary adjustments and
new rules as the circumstances
dictate.
The Armed Services Board has
been functioning under the 1948
law and will be replaced by the
new agency.