January 20, 1976

final draft of HR Select Intelligence Com's rept on intelligence community, portions of which were obtained by NY Times, reflects com's interest in cost of gathering intelligence, accountability for funds that are spent, effectiveness of Amer agencies in predicting internatl crises and risks involved in covert operations; much of HR com's investigation focused on processes by which intelligence operations were funded and approved; com says it has found inadequate acctg procedures by Mgt and Budget Office in overseeing the $10-billion spent annually on overseas operation of intelligence agencies; com cites examples of what it considers questionable spending; rept suggests that not all items were purchased for official purposes (L)

Spanish Govt drafts some 70,000 rr workers after 1 of Spain's biggest waves of strikes in 40 yrs begins to disrupt train service; 55,000 postal workers already are under mil rule and subject to court martial for refusing to work; threat of draft also hangs over 4,000 Madrid subway workers after negotiations with private subway co broke down; Premier Carlos Arias Navarro comments (M)

Mayor Frank L Rizzo, emerging as pre-eminent pol figure in Philadelphia, forms own Loyal Dem Campaign Com to supplant Dem City Com of pol boss Peter J Camiel (M)

Franjieh reptdly appeals to Karami to reconsider resignation; Govt source says large number of Palestinian guerrillas and Moslem gunmen are on move in Bekaa Valley; Chamoun charges invasion by Palestine Liberation Army; says force numbers 8,000; calls movement 'tantamount to a Syrian invasion'; Karami reptdly has agreed to reconsider his resignation if cease-fire could be arranged first; new truce, 22d in 3 1/2 mos, is proclaimed, but fighting reptdly continues; Phalangist Party gunmen continue their attacks on Beirut's suburbs; large number of Moslem and Kurdish prisoners are taken; Franjieh reptdly speaks by telephone with Assad; Lucien Dahdah, Franjieh's son-in-law, returns from Damascus, where he has been laying groundwork for meeting between Franjieh and Assad; Beirut airport remains closed for 4th day; Middle East Airlines has grounded all 23 of its passenger jets and canceled all scheduled flights; illus; maps (L)

Jan 20: Israeli officials express concern over intensified fighting and pol chaos in Lebanon, but both civilian and mil sources contend that Israel would not intervene unless Syria does so first; source says that despite heavy fighting in Lebanon, situation along Lebanese and Syrian frontiers remain unchanged; sources confirm repts that 2 battalions, roughly 1,500 men, of Palestine Liberation Army crossed into Lebanon from Syria within last wk; Israeli Likud Opposition leader Shmuel Tamir calls for urgent debate on Lebanese situation (M)

Ford in State of Union address, seems to outline platform on which he will seek election; illus (M)

article on tax proposals in Pres Ford's State of Union Message (M)

A prisoner was killed and three guards and a prisoner were wounded during an up‐ rising at Trenton State Prison when convicts tried to seize a maximum‐security wing with smuggled weapons. Details on Page 28.

FCC on Jan 19 approves increase in AT&T long-distance phone rates that is expected to cost customers additional $225-million a yr; increase is sufficient to raise over-all rate of return on investment to 9.5% from current 8.75%; AT&T vp James R Billingsley holds increase falls short of what is required (M)

US Appeals Ct, in 2-1 decision, reverses '75 lower ct ruling and overturns racial quota for NYC school principals, calling practice 'constitutionally forbidden reverse discrimination'; quota was imposed by Fed Dist Judge Harold R Tyler Jr to protect jobs of blacks and Puerto Ricans who were assigned relatively recently as principals or supervisors in school system; decision detailed; decision, which grew out of '70 civil rights case brought by school principals Boston M Chance and Louis C Mercado, is lauded by supervisors union spokesman (M)

Bayh it defeated by Carter by 2-1 margin in Iowa's Dem precinct caucuses; Dem party hq projection indicates Bayh will go to natl conv with 7 delegates from Iowa; Bayh's heavy campaigning in state recalled (M)

FDA bans Red No 2 dye, nation's most widely used dye in foods, drugs and cosmetics, because of new concern that it might be cancer-causing agent; ban does not require recall of products already on market; FDA Comr Alexander M Schmidt says there is no evidence of public health hazard; many foods mfrs have been switching to Red No 40 (M)