4 EMPLOYEE HOUSING MAINTENANCE Finally, I would like to urge that the committee restore the limitation on maintenance of facilities in section (2a) (11) from the $3.7 million level proposed by the House Committee to the budget level that we requested, $5.1 million. This item covers only housing that is retained by the Commission for use by employees. We can't afford to neglect housing maintenance. It is doubly imperative that we not neglect it because we have no plans to build new housing. The Commission has to live with what we have and that is a task that is challenging enough, given the problems of maintenance in a tropical environment. Mr. Chairman, I believe this bill, if adjusted as I propose, reflects the most accurate estimate that can be made at this time of the expected net revenues and required operating costs of the Commission luring fiscal year 1981. I would appreciate the committee's help in getting the amendment which I have sought this morning. I suggest that Mr. McAuliffe might summarize his statement as well, and then proceed to your questions. Senator LEVIN. Thank you for your statement and the brevity of it. We will put the entire statement in the record. [The prepared statement of Mr. Blumenfeld follows:] PREPARED STATEMENT OF HON. MICHAEL BLUMENFELD, ASSISTANT SECRETARY OF THE ARMY (CIVIL WORKS) Mr. Chairman, members of the Committee, I am Michael Blumenfeld, Assistant Secretary of the Army, Civil Works. As a portion of my responsibliity, I oversee the operation of the Panama Canal Commission on behalf of the Secretary of the Army. It is a pleasure for me to appear here today as you receive testimony concerning the Authorization Bill for the Panama Canal Commission for Fiscal Year 1981. ORGANIZATIONAL MATTERS Since my last appearance before this Committee on March 7, 1980, a number of actions have progressed. The members of the Board of the Commission have been appointed by the President following confirmation of the U.S. members by the Senate. I am the Secretary of Defense's representative on that Board. The Board convened for the first time in Panama on June 2. I was selected to serve as Chairman of the Board. Primary items on the agenda included overview briefings on personnel and financial matters; a review of actions taken by the Commission thru May that might normally have been subject to Board guidance or decision; approval of the Board Regulations; establishment of the Executive Committee and three other Board committees; and preliminary discussion of a Code of Conduct. The meeting, I believe, established a sound framework for future operations. A second meeting is planned for late July, also in Panama. As mentioned, the Board had preliminary discussions on a proposed Code of Conduct for Commission employees and Board members. The Board decided to defer further consideration until such time as there has been additional discussion between US and Panamanian representatives to clarify the standards of conduct that will conform to the laws of each country and are acceptable to all members of the Board. The Code Will be an agenda item at the meeting next month. As you are aware, after the Code is approved by the Board, the Department of State will undertake the negotiations required by the Panama Canal Act. The Commission staff has formulated draft recommendations on the Panama Canal Employment System that will replace the Canal Zone Merit System. The new system continues merit system principles and protections for employees, and also carried out specific requirements of the Treaty related to personnel policy. While it is too early to discuss any particular provision of the system, I would like to highlight the policies that form the basis of the proposal.