ROBERT sCHOLTEN. president of the University Park
( - Haider of AAUP. discusses his proposed subcommittees to
the steering committee at the Dec. 8 meeting. Newly
appointed Executh e Secretary Mary Heffernan poses
some problems she says she feels may hamper AAUP's
effectiveness in becoming Penn Stag's bargaining agent.
Tax board member to challenge
Nixon's presidential tax status
SACRAMENTO, Calif. (AP) A
Democratic member of the state
Franchise Tax Board says he will
challenge President Nixon's tax status
under which the chief executive paid no
California income tax for the period of
his presidency.
"I was amazed at the report," said
William M. Bennett, referring to the
White House statement that said Nixon
was a resident of the District of
Columbia not California for income
tax purposes.
"I thought he had filed a tax return,"
said Bennett, who said he would make
the challenge tomorrow.
The White House issued a written
opinion from Los Angeles tax attorney
Dean S. Butler which said Nixon "is not
a resident of the state of California for
purposes of paying California income
Weather
Cloudy, breezy and turning much colder
with snow flurries and snow showers.
Possible accumulations of 1 to 2 inches
and temperatures falling into the 20's by
afternoon. Tonight very cold with
flurries and snow showers continuing.
Tuesday, variable cloudiness with
flurries, high 28, low 17.
Defense
industries
gave
$5 million
to Nixon
Collegian
the
daily
AAUP steering committee
taxes...and is not obligated to file a
residency income tax return from 1969 to
the present time."
White House sources said Nixon would
have had a state tax obligation of about
$64,000 if required to file a California
return. The tax rate on his salary in
California would be 11 per cent.
State law forbids officials from
discussing any aspect of an individual's
income tax status even whether he or
she files a return.
Bennett raised the question of Nixon's
state income tax liability a month ago,
saying he wanted to know if the
presiaent was luny meeting his obliga
tion.
Bennett said at that time he assumed
that Nixon was filing California returns.
He specifically wanted to know if he had
reported such items as capital
_improvements from his San Clemente
property.
After the White House report was
released Saturday, Bennett said: "We
know that he lives in San Clemente. We
know that is his home. Unless there is an
exemption there presumably is a tax
liability."
Bennett also has challenged the rate of
local property taxes Nixon has been
assessed at San Clemente.
State Controller Houston I. Flournoy,
a Republican and chairman of the
WASHINGTON (AP) Officials
of the country's 10 biggest defense
contractors gave more than $5.4
million to President Nixon's
reelection campaign last year, Rep.
Les Aspin said yesterday.
Aspin said the figure represents
only the known contributions, but be
suggested there may be more
unreported. He said he is asking the
Senate Watergate committee to
look into the possibility of still
secret gifts.
The Wisconsin Democrat 'also
said a pattern to some gifts
suggested that some money may
have been from corporate funds.
Aspin said his study is "solid
evidence of the endless trade-off
between the big business and the
Pentagon. It shows unmistakably
the stake big business has in
maintaining a bloated military
budget."
"When you get right down to it,
to promote faculty union
By ROBYN MOSES
Collegian Staff Writer
Penn State's faculty has taken another step
toward collective bargaining with the American
Association of University Professors organizing a
steering committee for unionization.
At a meeting Dec. 8, AAUP members from
several University campuses s - et-qp a committee
to promote AAUP as Penn Sta,te's bargaining
agent. The committee will be headed by two
chairmen, one from University Park and one
representing the Commonwealth campuses.
The greatest problem facing AAUP's campaign
will be communication, according to Mary
Heffernan, newly appointed Executive Secretary
for the steering committee at Penn State, and
nationa representative from the Washington
headquarters.
"I don't want us to get lulled into a sense of false
security. Our one greatest flaw will be
communications, due to the sheer size of this
massive campaign and the number of - people
involved. Communications on the University Park
campus alone is going to be difficult," Heffernan
said.
Geographic dispersion is another problem the
AAUP committee will have to overcome to make
the campaign successful, she added. Newly
appointed Commonwealth Campus Chairman Jim
Whittaker, director of the psychology laboratory
at Capitol Campus, said he feels the committee
will have to overcome the feeling of branch
campuses that this is a University Park-based
operation which does not include them.
Other members, including Vilma Hunt,
associate professor of biological health at
Franchise Tax Board, said earlier that
Bennett's request probably would be
taken up in executive session because of
the confidentiality factor.
Bennett said, "What I will be
discussing is the law. There's nothing
confidential about any of that."
The law on state residency for income
tax purposes is complex.
Martin Huff, executive officer of the
Franchise Tax Board, said last week
that voting residence is not a factor.
But the "Guidebook to California
Taxes" lists voting residence as One of
the tests given to determine if a person is
a resident of California for tax purposes.
Huff listed the following qualifications
for liability: "Every individual who is in
this state for other than a temporary or
transitory purpose. Every individual
domiciled in this state who is outside the
state for a temporary or transitory
purpose. Any individual who is a
resident t;l' this state continues to be a
resident even though temporarily absent
from the state."
The tax guidebook, considered an
eminent authority on California taxes,
says: "The underlying theory is that the
state with which a person has the closest
connection during the taxable year is the
state of his residence."
The third member of the Franchise
Tax Board, which oversees the state
many defense contracts are nothing
more than political patronage, and
here's the proof," he said.
Aspin said he found the gifts
"particularly alarming" because of
the government contracts held by
the donors involving public money.
"There is every reason to believe
that, in more than a few cases, tax
money has been used to make these
contributions," he said.
Aspin said• the largest
contributions were made by oil,
electronics and aircraft companies.
The largest item on his list is
$1,009,000, which he said came from
officials of the Gulf Oil Corp., and
members of the Scaife family.
IBM was second with; $326,545.
Tenneco, the sixth ranking defense
contractor and builder of nuclear
craft for the Navy, gave $307,286,
accoromg to Aspm.
Other familiar names on the list
include: Litton Industries, $226,187;
President gambling
he paid proper taxes
WASHINGTON ( AP )—President
Nixon is gambling more than quarter
million dollars of his own money that a
joint congressional committee will agree
he paid the proper amount of federal
income taxes since taking office.
As he made a massive, unprecedented
disclosure of his private finances during
the weekend, the President asked the
House-Senate Committee on Internal
Revenue Taxation to decide two
questions:
Woodbury
University Park, and newly appointed committee
member-at-large agreed saying, "We should be
conscious of a two phase goal. We're heading in
the same direction as the branch campuses. It's a
matter of having mutual confidence and a mutual
goal."
University Park AAUP Chapter President
Robert Scholten proposed having five board
( chapter ) presidents from campuses which
already- have AAUP chapters to serve on the
steering committee to remedy the situation.
He also proposed starting a - Council of
Representatives consisting of a least one member
from each campus and at least one member from
each college and other units, such as the Library
Staff, at University Park.
According to Scholten, such a council would
"carry on a 'grassroots campaign' by meeting
with individuals and small groups."
By achieving harmony with branch campuses,
AAUP hopes to weaken the ties Commonwealth
Campuses have to PSUBranch, the other
organization vying to be Penn State's faculty
bargaining agent.
This would require a large budget because
AAUP's campaign may stretch into next year,
Heffernan said,
Ronald Maxwell, assistant professor of English,
was tenatively assigned the job as University
Park chairman. Anthony Foderard, professor of
nuclear engineering at University Park, was
appointed steering committee treasurer.
Several subcommittees were proposed by
Scholten, including one for University gover
nance, one for tenure and academic freedom, and
one for fringe benefits, salaries and promotions.
income tax system, is Finance Director
Verne Orr, a Republican and appointee
of Gov. Ronald Reagan.
If the board declares a person must
file - a California return, the individual
can appeal to the five-member State
Board of Equalization of which Flournoy
is a member and Bennett is chairman.
The board is controlled 5 to 1 by
Democrats.
An adverse decision of the Board of
Equalization can then be appealed to the
superior court.
RCA, $172,636; American Motors,
$159,577; Standard Oil of California,
$157,500; Ford, $133,441; Du Pont,
$129,675; Standard Oil of New
Jersey; Exxon, $119,373, and
General Motors, $93,247.
Additional • -government
contractors, whose officials or
employes gave smaller amounts,
include: General Dynamics,
McDonnell Douglas, Flying Tiger
airlines, Goodyear, General
Telephone, Texaco, Hughes,
Lockheed, Gulf & Western,
Westinghouse, Motorola, ITT,
General Electric, Shell Oil, Silerry
Rand, Xerox, Bendix and Chrysler.
Aspin said nearly two-thirds of
the money, $3.2 million, was given
before the April 7, 1972, starting
date of the new law requiring
reporting of contributions and was
revealed under court order. He said
the $5.4 million total was "probably
just the tip of the iceberg."
Monday, December 10, 1973
Vol. 74, No. 70 16 pages University Park, Pennsylvania
Published by Students of The Pennsylvania State University
—Did he act legally in claiming about
$500.000 in deductions for donation of his
vice presidential papers to the
government-deductions which helped
reduce his federal income taxes to less
than $6,000 in the past three years.
—Did he make a $117,000 gain in the
1970 sale of a portion of his San Clemente
estate, as one set of personal auditors
recently concluded, or did he show no
gain, as his tax advisers decided at the
time?
If the congressional committee
decides against Nixon on both counts,
presidential aides said Nixon would file
amended returns and pay additional tax.
That tax could amount to more than
$250,000. With interest, the total could
top $300,000.
Key elements disclosed in documents
released by Nixon and by the
examination of the President's 1969-1972
tax returns made available to newsmen
show:
—He has become virtually a
millionaire since taking office. An audit
showed his net worth increased from
$307,000 on Jan. 1, 1969. to $988,000 on
May 31, 1973. His assets include about
$430,000 in bank deposits and real estate
valued at more than $964,000. Most of his
liabilities are real estate mortgages.
—Because of major deductions for the
vice presidential papers, for interest and
property taxes, he was able to reduce his
federal income tax liability to $72,682 for
1969, $793 for 1970, $B7B for 1971 and $4,298
for 1972.
—He also claimed tax deductions for
all operating expenses of one of his Key
Biscayne, Fla., homes and for. 25 per
cent of his San Clemente operating
expenses. And he pocketed as taxable
income $89,000 of the nearly $200,000 he
received for official purposes.
—Since becoming President, he has
paid no state or local income taxes.
District of Columbia law exempts
elected U.S. officials from D.C. income
taxes.
—During his vice presidency, a trust
fund was set up for his daughter Tricia
by Elmer Bobst, then chairman of the
Warner-Lambert Pharmaceutical Co.,
while government regulation of the drug
industry was being proposed.
—Tricia Nixon cashed in the trust
fund's Warner-Lambert stock in 1967
and loaned her father $20,000 to invest in
two Florida vacant lots costing $38,000.
The lots were sold for $150,000 in 1972,
and father and daughter are paying
capital gains taxes on their shares of the
profits.
—He and his wife have decided to turn
their San Clemente estate over to the
government upon their deaths. Since the
estate is valued at more than $500,000
lawyers said Nixon could qualify for an
immediate tax deduction of $120,000 if
Arabs to
by 5 per
KUWAIT (AP) Arab oil ministers
yesterday said they will cut back oil
production by another 5 per cent in
January, but pledged to lift their total
embargo against the United States as
soon as Israel starts pulling out of
occupied Arab lands.
The pledge issued in this wealthy
Persian Gulf oil sheikdom stipulated
Arab oil would resume flowing to the
United States only at the beginning of
implementation of a pullout agreement
signed by Israel and guaranteed by
Washington.
The accord must detail conditions for
"withdrawal of Israel from all
territories occupied since the June war
of 1967, with foremost priority to
Jerusalem and in accordance with a
fixed timetable," the ministers said.
The Saudi Arabian oil minister, Sheik
Ahmed Zaki Yamani, said in
Washington on NBC's "Meet the Press"
that Arabs would remove the U.S.
embargo "when Israel agrees to
withdraw and the United States
guarantees the withdrawal" from lands
occupied since the outbreak of the 1967
war. '
Yamani's version of the Arab stand
appeared softer, tying the flow of oil only
to a guaranteed agreement and omitting
the Kuwait demand for prior beginning
of the pullout.
Yamani's partner in a world tour
explaining Arab oil policy, Algerian
Industry Minister Belaid . Abdesalam,
told reporters in Washington U.S.-bound
oil shipments can resume as soon as
Israel sets the timetable for total
withdrawal to its 1967 borders.
The announcement of another 5 per
cent reduction in the month-by-month
worldwide oil squeeze came just, nine
days before the Arab-Israeli peace
conference opening in Geneva Dec. 18.
It and the offer of renewed oil
shipments to the United States clearly
Were intended to strengthen the Arab
negotiating hand in the talks. The Arab
idea was that the United States and its
the deed is signed over soon. But
presidential aides said it is unlikely
Nixon would claim any such deduction
- —Vice President Gerald R Ford
yesterday said President Nixon's "total
disclosure" of his personal finances
should satisfy "any reasonable member
of Congress" and the American people
that he has done nothing illegal
But. Ford said, "I am sure there will
be AmeriCans who will feel there should
have been a larger tax "
He said questions of impropriety
should be eased by the President's
decision to turn over to the government
his San Clemente. Calif . home
Also, ne said. Nixon will be helped by
letting a Senate-House committee decide
whether he paid the proper amount of
taxes.
The vice president made the
comments in his fist radio-television
panel interview since — being sworn in.
appearing on ABC's "Issues and
Answers."
Answering questions, Ford said: "I
have no intention of running for public
office" in 1976. "I don't know how
emphatically I can say it than I've said
before."
He said he did not want to be pinned
drawn completely about the future, but
that at this time he said he didn't see any
circumstances that would change his
mind.
Ford said giving the San Clemente
home to the government should "‘‘lpe
out any allegea...impropriety'• In
Nixon's tax payments.
Ford said examination of Nixon's
financial disclosures "will satisfy any
reasonable member" of Congress or the
public that the President acted properly,
—The White House said Nixon sent a
private letter to the congressional
committee during the weekend asking it
to undertake the independent review.
The panel's chairman, Rep. Wilbur D
Mills, D-Ark., had agreed to do so when
Nixon telephoned him last Thursday.
Mills said he did not know how the
committee would proceed, but
indications were that the issues raised
by Nixon would be turned over to its staff
experts for study.
The committee is composed of five
senior members of the House Ways and
Means Comniittee and an equal number
of Senate Finance Committee members
Democrats hold a majority, but most of
them are considered conservatives.
The President, meanwhile, faces
another potential tax challenge.
Sen. Lowell P Weicker Jr , a
Republican member of the Senate
Watergate Committee, is reportedly
considering asking the Internal Revenue
Service to examine Nixon's deductions
for donation of the vice presidential
papers. .
cut oil
cent
European allies will be more apt to
pressure Israel for withdrawal
concessions as they feel their oil supplies
diminishing further in winter
temperatures.
The Israeli defense minister. Moshe
Dayan, yesterday said on television in
the United States he had not felt any U.S.
pressure for Israeli concessions at the
Geneva peace conference. He said on
CBS-TV's "Face the Nation" he had
asked for additional arms aid during his
current U.S. visit "more of the
same...more planes and more
electronics."
In Tel Aviv, a senior Israeli Foreign
Ministry official submitted a
preliminary report to the International
Red Cross representative accusing
Egypt of killing at least 28 Israeli
prisoners of war and of torturing others.
The Arab stand was defined at a
Saturday meeting here of oil ministers
and other representatiyes of the 10
members of the Organization of Arab
Petroleum Exporting Countries. The
delegates said the new cut will begin on
schedule Jan. 1 and will amount to 5 per
cent of December's already slashed
production levels.
The Arab oil nations decided Oct. 17 to
cut back production 5 per cent a month
until Israel pulls out of the Egyptian,
Jordanian and Syrian land captured in
1967 and the Syrian and Egyptian land
captured in the October Middle East
War.
On Nov. 4 they increased the initial
cutback to 25 per cent, with the 5 per cent
monthly reduction still applying. In
addition, the Arab nations totally halted
oil shipments to the United States and
the Netherlands in retaliation for Middle
East policies viewed as particularly pro-
Israeli.
Their squeeze denounced as
blackmail by their opponents and
praised as good strategy by their
backers has made the world energy
shortage even more acute and
contributed to severe disruptions in
Europe and the United States.