A committee of Smithsonian Institution regents has been created to review the institution's financial practices following recent criticism of the Smithsonian by the General Accounting Office, members of Congress and the press.
The regents' committee, headed by Sen. Henry M. Jackson (D-Wash.), also plans to hire an outside firm to examine the institution's organization, management practices, effectiveness and its present relationship to Congress.
Creation of the high-level committee is the first sign that the Smithsonian, a sprawling museum and research complex that depends on federal appropriations for almost 90 per cent of its budget, is concerned about the public criticism leveled against it in recent months.
Until now, Smithsonian officials have tended to dismiss the criticism as uninformed.
Among other things, the GAO found that the Smithsonian has created two private corporations to convert millions of dollars of federal money into "private money" each year that the institutions then spends without regard to federal restrictions.
The GAO auditors also found that the Smithsonian has committed itself over the years to major projects, such as the Cooper-Hewitt Museum of Decorative Arts and Design in New York City and the Chesapeake Bay Center for Environmental Studies near Annapolis, without informing Congress or seeking its approval.
The GAO is inquiring about the reasons why the Smithsonian has about 25 accounts in private banks around the world. They are also still looking into questions concerning the propriety of Smithsonian Secretary S. Dillon Ripley's years of service as a director of the American Security & Trust Co. at the same time millions of dollars of Smithsonian funds were deposited in AS&T checking accounts.
The committee to study the Smithsonian's financial practices and its accountability to Congress was created by Chief Justice Warren E. Burger, who heads the institution's board of regents. Burger apparently created the committee following a Smithsonian budget hearing April 18 before the Senate Appropriations Subcommittee on the Interior and Related Agencies.
At that hearing, Sen. Ted Stevens (R-Alaska) indicated the subcommittee's extreme displeasure with the Smithsonian's handling of its $100 million a year in federal money. Stevens then called for a complete set of congressional hearings to review the institution's relationship to the federal government.
The Smithsonian is a semipublic corporation created by Congress in 1846. Because of its unique status, the Smithsonian receives large amounts of federal money but is run as if it were independent of the federal government.
Smithsonian officials clearly want to preserve the present arrangement, which could be threatened if Congress decided to act on Stevens' call for hearings to review the current relationship.
In a letter to Rep. Sidney R. Yates (D-Ill.), chairman of the House Appropriations subcommittee that passes on the Smithsonian's yearly federal budget request, Jackson told Yates of the new regents' committee and outlined its mission in general terms.
Jackson asked Yates "to maintain the status quo" with respect to the Smithsonian's 1978 budget until the regents committee has time to review the Institution's overall financial structure and its use of both federal and private monies.
Yates made the Jackson letter public yesterday during hearings on the Smithsonian's request for $106.5 million in federal money for the next fiscal year. Yates, who was himself a Smithsonian regent until he declined renomination last January, said he was inclined not to force the institution to revamp its financial practices in a drastic way before the regents committee has a change to act.
Rep. Jamie L. Whitten (D-Miss.), another member of the House Appropriations Subcommittee on the Department of the Interior and Related Agencies, said, however, that he thought the full House Appropriations Committee should begin an investigation of the Smithsonian's financial practices regardless of what the regents plan to do.
Whitten, who had the full House hearing room convulsed in laughter several times during his questioning of Smithsonian officials, said he thought "the GOA is right. I think we (the Congress) ought to have control over an institution that gets so much federal money."
Whitten was piqued at the Smithsonian, he said, because of an article in last December's issue of Smithsonian Magazine in which Whitten said his remarks on the Tennessee-Tombigbee barge canal project in Tennessee were taken out of context.
After getting Ripley to admit that he hadn't read the article, Whitten dead panned: "You mean you have a wonderful magazine like that and you don't even read it?"
"The point I make is not that this (article) is so damaging," Whitten continued, "but I'm trying to find out whether you folks are sitting on top of your own operation. It's apparent to
Apart from Whitten's criticism, there was far less harsh criticism of Ripley and his subordinates at yesterday's house hearing than at the April 18 Senate hearing. The Senate hearing continues next Tuesday. Yates questioned Ripley about the Smithsonian's relationship to Congress and the institution's financial practices but his tone was less critical than was Stevens' two weeks ago.
Yates did, however, criticize the GAO report for not answering all of the questions asked of the auditors by the Senate subcommittee, which ordered the GAO to audit the Smithsonian last year after discovering a secret. $1 million contingency fund maintained for years by Ripley.
Yates also expressed his concern about clarifying the institution's relationship to Congress and strengthening its accountability for the public and private funds that make up the institution's budget, which this year totals about $115 million.
"I suppose this is an historic meeting," Yates said shortly after the hearings began yesterday morning. "We need to find out what the relationship is between the Smithsonian and the federal government. This has troubled me for a long time."
According to Jackson's letter to Yates and a letter from Ripley to Jackson, also made public yesterday, the regents committee and the consulting firm will undertake "a thorough review of the entire situation" the Smithsonian now finds itself in.
"The GAO report and the concerns expressed during the Senate hearing have been discussed with Secretary Ripley and his staff, all of whom are committed to working with your subcommittee, the (regents') audit review committee and the (full) board of regents to resolve these matters," Jackson told Yates.
In addition to Jackson, the regents committee has three other members: Rep. Elford A. Cederberg (R-Mich.), John Paul Austin, president of the Coca-Cola Co., and Murray Gell-Mann, a professor at the California Institute of Technology.
The House hearings on the Smithsonian's 1978 budget will continue this morning.