The Smithsonian Institution, after more than a year of congressional scrutiny and criticism, has agreed to consider itself a federal agency and to modernize its management and its methods of dealing with Congress.
The moves - recommended by a special consultant and approved by the Smithsonian's prestigious board of regents - are intended to bring about significant changes in the financial and administrative practices of the giant, 131-year-old research and museum complex.
They would give Congress boarder authority to examine and control the Smithsonian's budgets, limit the instution's right to dispose of property without congressional consent, and bolster the Smithsonian's own management and auditing staff. They also would apparently remove long-existing uncertainty over whether the Smithsonian is a quasi-federal institution - partly governmental and partly private - that can evade federal strictures.
The recommendation - implicity critical of the Smithsonian's management practices, though couched in mild terms - were drawn up by Phillip S. Huges, a former assistant U.S. comptroller general who has been nominated as an assistant secretary of the new Department of Energy.
The Smithsonian's board of regents - chaired by U.S. Chief Justice Warren E. Burger, the Smithsonian's chancellor - adopted Hughes' findings and proposals without dissent at a board meeting Tuesday, according to Smithsonian officials. Smithsonian Secretary S. Dillon Ripley later praised the consultant's report, saying "I think it does a great deal to clarify where we have been and where we are now."
The Smithsonian has been a focus of recurring controversies and U.S. investigation since March, 1976, when it was disclosed that Ripley maintained a now-abandoned discretionary fund of about $1 million, apparently unknown to Congress.
The General Accounting Office, Congress' auditing arm, concluded in a report last March 31 that the Smithsonian had created two private corporations to convert millions of dollars of U.S. funds to "private money," which it then spent without observing federal restrictions. The Smithsonian, as a result of congressional action, is moving to climinate or separate itself from the two corporations criticized by GAO.
The Hughes report, made public yesterday, goes considerably beyond the points raised by GAO, focusing on what it describes as "the boarder questions of relationship between the Smithsonian and the federal government."
On the central issue of whether the Smithsonian is a U.S. or partly private institution, the Hughes report concluded it is "partically and operationally a federal instrumentality, agency, or 'establishment' . . .which was created by Congress to carry out the trust objectives of the (James) Smithson will." Smithson, an Englishman, left his fortune to the U.S. to set up the institution.
A Smithsonian spokesman said that the regents, in adopting Hughes' report, had accepted Hughes' description of the institution as accurate. About 90 per cent of the Smithsonian's approximately $100 million a year in net operating expenses is financed by federal appropriations, grants and contracts.
The decision to characterize the Smithsonian as a federal agency caused some concern at the regents' meeting, according to a reliable source, because of what was described as a possibility that it could have a "chilling effect" on private donations to the institution. Nevertheless, the source added, the regents accepted the term.
In his report, Hughes also concluded that the Smithsonian does not have the right to dispose of most of its major museums, buildings and other properties without congressional consent.
This conclusion contradicted assertions by Smithsonian officials during congressional budget hearings last April that they could sell off the National Air and Space Museum or the Museum of Natural History without Congress' approval. The statements irked some members of Congress.
Although the Hughes report did not suggest any fundamental changes in the Smithsonian's overall structure, it proposed several key shifts in the institution's management. These included appointment of an under secretary to manage day-to-day operations, enlarging the institution's auditing staff to conduct more frequent audits, and establishing a system of "five-year forward planning" to prepare for future growth and changes in the institution.
To improve it's accountability to Congress, the Smithsonian was urged in the Hughes report to seek congressional authorization for all significant projects involving federal funds and to discuss with the Senate and House Appropriations Committees any project that, while started without U.S. funds, might eventually require federal aid.
Such policies would give Congress considerably broader ability to review the Smithsonian's plans and budgets than it has had in the past and would also, the report notes, avoid surpreses for members of Congress, who might otherwise be asked to pick up the tab for Smithsonian ventures about which they did not previously know existed.