mined by agreement of the parties or by action brought in the United States district court for the district in which such facility is situated) of the facility, as the amount of the Federal particpation bore to the cost of construction of such facility. "SEC. 806. As used in this part "DEFINITIONS "(1) The term 'Advisory Council' means the National Advisory Council on Education for Health Professions established by section 725; "(2) The terms 'construction' and 'cost of construction' include (A) the construction of new buildings, the expansion of existing buildings, and remodeling, replacement, renovation, major repair (to the extent permitted by regulations), or alteration of existing buildings, including architects' fees, but not including the cost of acquisition of land or offsite improvements, and (B) initial equipment of new buildings and of the expanded, remodeled, repaired, renovated, or altered part of existing buildings; but such terms shall not include the construction or cost of construction of so much of any facility as is used or is to be used for sectarian instruction or as a place for religious worship; "(3) The term 'nonprofit school' means a school owned and operated by one or more corporations or associations no part of the net earnings of which inures, or may lawfully inure, to the benefit of any private shareholder or individual; and "(4) The terms 'school of veterinary medicine' and 'veterinary medical school' mean a school or college providing training leading to the degree of doctor of veterinary medicine. "NONINTERFERENCE WITH ADMINISTRATION OF INSTITUTIONS "SEC. 807. Nothing contained in this part shall be construed as authorizing any department, agency, officer, or employee of the United States to exercise any direction, supervision, or control over, or impose any requirement with respect to, the personnel, curriculum, methods of instruction, or administration of any institution. "REGULATIONS "SEC. 808. (a) The Surgeon General, after consultation with the Advisory Council and with the approval of the Secretary, shall prescribe general regulations for this part covering the eligibility of institutions, the order of priority in approving applications, the terms and conditions for approving applications, determinations of the amounts of grants, and minimum standards of construction and equipment for various types of institutions. "(b) The Surgeon General is authorized to make, with the approval of the Secretary, such other regulations as he finds necessary to carry out the provisions of this part. "TECHNICAL ASSISTANCE "SEC. 809. In carrying out the purposes of this part, and to further the development of State, or joint, or coordinated regional or other interestate planning of programs for relieving shortages of training capacity in the field of veterinary medicine through constructing teaching facilities, providing adequate financial support for schools, or otherwise, the Surgeon General is authorized to provide technical assistance and consultative services to State or interstate planning agencies established for such purpose." "PART B-STUDENT LOANS "LOAN AGREEMENTS "SEC. 820. (a) The Secretary of Health, Education, and Welfare is authorized to enter into an agreement for the establishment and operation of a student loan fund in accordance with this part with any public or other nonprofit school of veterinary medicine (as defined in section 806) which is located in a State and accrediated as provided in section 803 (b) (B). "(b) Each agreement entered into under this section shall "(1) provide for establishment of a student loan fund by the school; “(2) provide for deposit in the fund of (A) the amounts allocated under this part to the school by the Secretary, (B) an additional amount from other sources equal to not less than one-ninth of amounts deposited pursuant to clause (A), (C) collections of principal and interest on loans made from the fund, and (D) any other earnings of the fund; "(3) provide that the fund shall be used only for loans to students of the school in accordance with the agreement and for costs of collection of such loans and interest thereon; "(4) provide that loans may be made from such fund only to students pursuing a full-time course of study at the school leading to a degree of doctor of veterinary medicine, and that while the agreement remains in effect no such student who has attended such school before July 1, 1967, shall receive a loan from a loan fund established under section 204 of the National Defense Education Act of 1958; and "(5) contain such other provisions as one necessary to protect the financial interests of the United States. "LOAN PROVISIONS "SEC. 821. (a) Loans from a loan fund established under this part may not exceed $2,000 for any student for any academic year or its equivalent. In the granting of such loans, a school shall give preference to persons who enter as first-year students after June 30, 1964. "(b) Any such loans shall be made on such terms and conditions as the school may determine, but may be made only to a student in need of the amount thereof to pursue a full-time course of study at the school leading to a degree of doctor of veterinary medicine. "(c) Such loans shall be repayable in equal or graduated periodic installments (with the right of the borrower to accelerate repayment) over the ten-year period which begins three years after the student ceases to pursue a full-time course of study at a school of veterinary medicine, excluding from such ten-year period all periods (up to three years) of (1) active duty performed by the borrower as a member of a uniformed service, or (2) service as a volunteer under the Peace Corps Act. "(d) The liability to repay the unpaid balance of such loan and accrued interest thereon shall be canceled upon the death of the borrower, or if the Secretary determines that he has become permanently and totally disabled. "(e) Such loans shall bear interest, on the unpaid balance of the loan, computed only for periods during which the loan is repayable, at the rate of 3 per centum per annum, or the going Federal rate at the time the loan is made, whichever rate is the greater. For purposes of this subsection, the term 'going Federal rate' means the rate of interest which the Secretary of the Treasury specifies during June of each year for purposes of loans made during the fiscal year beginning on the next July 1, determined by estimating the average yield to maturity, on the basis of daily closing market quotations or prices during the preceding May on all outstanding marketable obligations of the United States having a maturity date of fifteen or more years from the first day of such month of May, and by rounding off such estimated average annual yield to the next higher multiple of one-eighth of 1 per centum. "(f) Loans shall be made under this part without security or endorsement, except that if the borrower is a minor and the note or other evidence of obligation executed by him would not, under the applicable law, create a binding obligation, either security or endorsement may be required. "(g) No note or other evidence of a loan made under this part may be transferred or assigned by the school making the loan except that, if the borrower transfers to another school participating in the program under this part, such note or other evidence of a loan may be transferred to such other school. "(h) Where all or any part of a loan, or interest, is canceled under this section, the Secretary shall pay to the school an amount equal to the school's proportionate share of the canceled portion, as determined by the Secretary. "AUTHORIZATION OF APPROPRIATIONS "SEC. 822. (a) There are hereby authorized to be appropriated to the Secretary of Health, Education, and Welfare to carry out this part $510,000 for the fiscal year ending June 30, 1965, $1,020,000 for the fiscal year ending June 30, 1966, $1,540,000 for the fiscal year ending June 30, 1967, and such sums for the fiscal year ending June 30, 1968, and each of the two succeeding fiscal years as may be necessary to enable students who have received a loan for any academic year ending before July 1, 1967, to continue or complete their education. Sums appropriated pursuant to this subsection shall be allotted among loan funds at schools which have established loan funds under this part. “(b)(1) The Secretary shall from time to time set dates by which schools with which he has in effect agreements under this part must file applications for allotments to their loan funds. (2) If the total of the amounts requested for any fiscal year in such applications exceeds the amounts appropriated under this part for that fiscal year, the allotments to the loan fund of each such school shall be reduced by whichever of the following is the smaller: (A) the amount requested in its application, or (B) an amount which bears the same ratio to the amounts appropriated as the number of students estimated by the Secretary to be enrolled in such school during such fiscal year bears to the estimated total number of students in all such schools during such year. Amounts remaining after allotment under the preceding sentence among schools whose applications requested more than the amounts so allotted to their loan funds, but with such adjustments as may be necessary to prevent the total allotted to any such school's loan fund from exceeding the total so requested by it. *(3) Allotments to a loan fund of a school shall be paid to it from time to time in such installments as the Secretary determines will not result in unnecessary accumulations in the loan fund at such school. "DISTRIBUTION OF ASSETS FROM LOAN FUNDS "SEC. 823. (a) After June 30, 1970, and not later than September 30, 1970, there shall be a capital distribution of the balance of the loan fund established under this part by each school as follows: "(1) The Secretary shall first be paid in an amount which bears the same ratio to the balance in such fund at the close of June 30, 1970, as the total amount of the allotments to such fund by the Secretary under this part bears to the total amounts in such fund derived from such allotments and from funds deposited therein pursuant to section 820 (b) (2) (B). "(2) The remainder of such balance shall be paid to the school. "(b) After September 30, 1970, each school with which the Secretary has made an agreement under this part shall pay to the Secretary, not less often than quarterly, the same proportionate share of amounts received by the school after June 30, 1970, in payment of principal or interest on loans made from the loan fund established pursuant to such agreement as was determined for the Secretary under subsection (a). "LOANS TO SCHOOLS "SEC. 824. Upon application by any school with which he has made an agreement under this part, the Secretary may make a loan to such school for the purpose of helping to finance deposits required by section 820 (b) (2) (B) in a loan fund established pursuant to such agreement. Such loan may be made only if the school shows it is unable to secure usch funds upon reasonable terms and conditions from non-Federal sources. Loans made under this section shall bear interest at a rate sufficient to cover (1) the cost of the funds to the Treasury, (2) the cost of administering this section, and (3) probable losses. "ADMINISTRATIVE PROVISIONS "SEC. 825. The Secretary may agree to modifications of agreements or loans made under this part, and may compromise, waive, or release any right, title, claim, or demand of the United States arising or acquired under this part." TECHNICAL AMENDMENTS SEC. 4. (a) Section 1 of the Public Health Service Act is amended to read as follows: "SHORT TITLE "SECTION 1. Titles I to VIII, inclusive, of this Act may be cited as the 'Public Health Service Act'." (b) The Act of July 1, 1944 (58 Stat. 682), as amended, is further amended by renumbering title VIII (as in effect prior to the enactment of this Act) as title IX, and by renumbering sections 801 through 814 (as in effect prior to the enactment of this Act), and references thereto, as sections 901 through 914, respectively. DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE, Hon. HARLEY O. STAGGERS, Chairman, Committee on Interstate and Foreign Commerce, House of Representatives, Washington, D.C. DEAR MR. CHAIRMAN: This letter is in response to your request for a report on H.R. 490, a bill "To authorize a three-year program of grants for construction of veterinary medical education facilities, and for other purposes." The bill, the purpose of which is to increase the supply of veterinary medical personnel in the United States, would add a new title to the Public Health Service Act, the major provisions of which would: (1) Authorize a new three-year program of construction grants for the construction, replacement, and rehabilitation of teaching facilities for the training of veterinary medical personnel; and (2) Authorize a new program of loans for students of veterinary medicine. CONSTRUCTION GRANTS The bill would authorize a new three-year program of construction grants to accredited public or other nonprofit schools of veterinary medicine to assist in the construction of teaching facilities. This authorization would parallel the construction provisions of the Health Professions Educational Assistance Act of 1963, as amended, which currently authorize construction of teaching facilities for the training of physicians, dentists, optometrists, pharmacists, podiatrists or professional public health personnel. The bill would authorize appropriations of $15 million for the fiscal year 1965 and for each of the two succeeding years for grants to assist in the construction of new or expanded teaching facilities for the training of veterinary medical personnel. In addition, $2 million would be authorized to be appropriated for fiscal year 1965, and for each of the two succeeding fiscal years for grants to assist in the replacement or rehabilitation of existing teaching facilities. Like the provisions of the Health Professions Educational Assistance Act, the Federal share of a construction project could not exceed 66% per centum of the cost of a new school or of construction providing a major expansion of training capacity of an existing school; the Federal share could not exceed 50 per centum of the cost of other construction. The bill would also authorize grants of not more than $25,000 for preparing initial plans for proposed new construction. (There is no such planning provision in the Health Professions Educational Assistance Act.) In considering grant applications, the Surgeon General would take into account the effectiveness in expanding and maintaining enrollment and in promoting an equitable geographic distribution of opportunities for veterinary medical training. STUDENT LOANS The bill would authorize a loan program for students pursuing a full-time course of study leading to a degree of doctor of veterinary medicine. This loan program would be patterned generally after that for medical, dental, and optometry students (and, effective July 1, 1966, students of pharmacy and podiatry) authorized by the Health Professions Educational Assistance Act. Students in need of financial assistance would be eligible for loans, with preference being given to students who enter as first year students after July 30, 1964. The maximum amount of a loan could not exceed $2,000 a year (the maximum is $2,500 a year under the Health Professions Educational Assistance Act), with interest computed only for the period during which the loan is repayable at 3% per year or the "going Federal rate", whichever is higher. Loans would be repayable over a 10-year period which would begin three years after the student ceases to pursue a full-time course of study at a school of veterinary medicine wishing to participate in the program under agreement with the Secretary of Health, Education, and Welfare. The school would be required to provide $1 for every $9 of Federal contribution to the loan fund. Loans would be administered by the school and students would make application to the schools, For these purposes, the bill would authorize appropriations of $510,000 for fiscal year 1965, $1,020,000 for fiscal year 1966, $1,540,000, for fiscal year 1967, and such sums for each of the succeeding three fiscal years as may be necessary to enable students who have received a loan for any academic year ending before July 1, 1967, to continue or complete their education. Sums appropriated would be alloted among the respective schools which had established loan funds under agreements with the Secretary. ADVISORY COUNCIL The bill would also amend section 725 of the Public Health Service Act to increase from 16 to 17 the number of members of the National Advisory Council for the Health Professions, so as to add to its membership a leading authority in the field of training in veterinary medicine. That Council would review applications for construction grants, and would also advise the Surgeon General on general regulations covering the eligibility of institutions, the order of priority in approving applications, the terms and conditions for approving applications, determinations of amounts of grants, and minimum standards of construction and equipment for various types of institutions. Today we are facing critical shortages of health professional and allied health professional manpower to provide medical care for the people of this Nation. This Department has recently testified before your committee urging enactment of legislation to support the training of persons in the allied health professions physical therapists, medical technologists, dental hygienists, and other health professionals to strengthen the health team and extend the reach of services that can be provided by physicians and dentists. We are committed to providing quality health care to every American. The extent and complexity of that commitment require that we must use all our health resources and funds as efficiently and effectively as possible. If we are to catch up and keep up with the demands for human health services, urgent priority must be given to the training of the members of the health team providing those services. In the face of these critical shortages of personnel for the provision of personal health services, we are unable at this time to recommend enactment of special health legislation to assist in the basic professional education of veterinarians. This is not to say that veterinary science does not make sugnificant contributions to the field of human medicine, to medical research, or to the maintenance of an abundant and safe food supply for our citizens. The veterinarian plas a key role in laboratory animal medicine; in the testing of biologicals and pharmaceuticals used in both human and animal medicine; in safeguarding humans against the diseases of animals which are transmissible to man; and in protecting American livestock and poultry against foreign animal disease. We recognize these contributions and are grateful for them. Furthermore, we would call your attention to the fact that schools of veterinary medicine are eligible to receive construction funds under the Higher Education Facilities Construction Act administered by the Office of Education. Similarly, students of veterinary medicine are eligible, and are receiving, loans under the National Defense Student Loan program. Under the latter, it should be noted, a veterinary student can obtain a maximum loan of $2,500 for any one academic year as compared with the $2,000 maximum authorized in this bill. In the light of other competing and urgent needs in the health manpower field we are not able at this time to recommend enactment of this bill. We are advised by the Bureau of the Budget that there is no objection to the presentation of this report from the standpoint of the Administration's program. Sincerely, WILBUR J. COHEN, Under Secretary. GENERAL COUNSEL OF THE DEPARTMENT OF DEFENSE, Hon. HARLEY O. STAGGERS, DEAR MR. CHAIRMAN: Reference is made to your request for the views of the Department of Defense on H.R. 490, 89th Congress, a bill "To authorize a three-year program of grants for construction of veterinary medical education facilities, and for other purposes." |