Mr. SHRIVER. It is not his budget that says $25 million. It is our program detail in support of the budget. Mr. LAIRD. This justification is from the Office of Economic Opportunity, something you prepared, and it shows a budget request of $25 million for fiscal year 1967. Mr. SHRIVER. That is right. Mr. LAIRD. This has just been prepared within the last week? Mr. SHRIVER. That is right. But what that is is a recounting for your benefit of the way we spread the money across these various programs. In this case Congress asked us to be specific several months ago. But when you give us the money for title II, Congressmen, without specific earmarking we can spread it in any way that seems most effective within that title. This is our program workup. This is not a rigid formulation such as money absolutely appropriated for that particular purpose. Mr. LAIRD. The record will speak for itself. I apologize for interrupting, Mr. Chairman. Mr. SHRIVER. The President's most recent statement is to the effect that we ought to expand the legal services program. He is not alone in that. The American Bar Association, the American Trial Lawyers Association, the National Bar Association, everybody, I think, has. Mr. LAIRD. The Wisconsin Bar Association. Mr. SHRIVER. Well, the Wisconsin Bar Association. They have been bombarding us with statements that we should spend more money in that area. Mr. FOGARTY. What I have been hearing recently is that the administration is going to cut back practically everything in the nondefense area. Mr. LAIRD. Including research on the artificial heart and things like that, from what I hear, including your whole program, too. PROGRAM PLANS UNDER A $1.5 BILLION BUDGET The chairman has suggested that you supply for the record a detailed statement of what the result would be if the budget were cut to $1,500 million. Mr. SHRIVER. Yes, sir. Mr. LAIRD. Just who would be hurt and how many programs would be curtailed and what would the effects be? Mr. SHRIVER. Yes, sir. (The information follows:) IF APPROPRIATED $1.5 BILLION, WHAT WOULD OEO Do? An appropriation of a $1.5 billion for FY 67 would cause a drastic cutback in the War on Poverty. Fiscal year 1965 was only half a year; OEO made its first grant on November 24, 1964. Appropriations for 1965 total $800 million. For 1966 $1,500,000,000 was appropriated. This sum did not permit even the annualization of some of the programs inaugurated in 1965. Obviously $1.6 billion would have been required to annualize the $800 million which we had on a half-year basis in 1965. As a result there are extremely few communities where the war on poverty actually reached anything close to the communities' desires for war against poverty projects in fiscal 1966. For this fiscal year the $1.75 billion which we request for the war against poverty represents for the most part a levelling off of the program achieved in fiscal 1966 and a continuation of that program through this fiscal year. Thus it is apparent, if Congress reduced our request to $1.5 billion, OEO would be required: a) to cut back on the existing sums of money now being distributed to most cities in the United States. Those cities in turn would be required to dismiss poor people and others now at work in community action programs. b) to reduce beneficial programs like Upward Bound, Legal Services, Neighborhood Youth Corps and Head Start, none of which could be financed at current operating levels with a budget of $1.5 billion. c) to level off, or probably cut back, a few hundred slots in VISTA. These are examples of the kind of actions which would have to be taken if Congress required OEO to live within a budget of $1.5 million. More important, however, would be the psychological impact of such a reduction on the thousands of volunteer Americans who have organized community action agencies, neighborhood councils, advisory councils, etc. all across the United States. There is no doubt that more local initiative has been generated in the past year in support of local war against poverty efforts than in any comparable peacetime program in the recent history of our government. It would be a serious setback to all of these people and it is probably true that once disappointed, these people would be less likely to respond to a future request for a volunteer effort of this magnitude. PROGRAM PLANS UNDER A $2 BILLION BUDGET Mr. FOGARTY. And setting forth what could be done with an appropriation of $2 billion. Mr. SHRIVER. Yes, sir. (The information supplied follows:) IF APPROPRIATED $2.0 BILLION, WHAT WOULD OEO Do? The primary determination on how OEO would allocate $2.0 billion would be the Authorization Act passed by the Congress. In both bills, the Senate Committee's of $2.5 billion and the $1.75 billion passed by the House, funds are earmarked for special programs. The paramount thrust of these actions is to add funds or earmark funds for work training programs, increased NYC and adult job and training programs proposed by Senators Javits, R. Kennedy, Nelson and by Congressman Scheuer. In addition, the Senate Committee added $100 million for health centers. We share the concern of the Congress that many of the adult poor are capable, with some training, to take better jobs than they now have and, more importantly, that many of the slum poor are being left behind in the prosperity the nation is now enjoying. These are people who are capable of holding low skill-level jobs and need jobs now. With additional funds, we could mount programs of jobs and work training for approximately 50-75,000 poor. This would enable us to fund an expanded NYC program, as well as other employment programs for adults, and to place 5,000 to 10,000 jobs in each of several urban and rural places. With additional funds, we could build as many as 25 health centers beyond the eight now planned. In addition, we would hope to expand such new and promising programs as: Upward Bound-Foster Grandparents-Legal Services-Special Summer Activities. Even with such an increase, OEO would hope that the earmarking for special programs can be avoided. With flexibility in the appropriation, OEO can respond to the demands of local communities as these communities assess their needs. AMENDMENTS ADOPTED ON HOUSE FLOOR Mr. FOGARTY. We will put in the record a brief description of each of the amendments to the House committee bill that were adopted on the floor. (The information follows:) AMENDMENTS TO H.R. 15111 ADOPTED (Material in parenthesis indicates section in H.R. 15111 where amendment appears or is reflected) 1. Assignment of Enrollee. Amends section 103 (b) of the Act to require that in arranging for the education and training of Job Corps enrollees, to the extent feasible, they shall be assigned to training centers and conservation camps near their homes. (section 103). 2. Qualifications of Contractors. Amends section 103 (b) of the Act to require that the Director issue regulations establishing suitable qualifications for agencies and organizations with which he contracts to provide education and training for Job Corps enrolless, in order to assure that they possess the capacity and educational resources to carry out the agreements adequately and accomplish the program's purposes. (section 102). 3. Cost per Enrollee. Amends section of the Act to require the Director to take action necessary to insure that the cost of operating Job Corps centers in any fiscal year (excluding capital costs) will not exceed $7,500 per enrollee in such centers. (section 104). 4. Transfer of Enrollees Under Parole or Probation. Amends section 104 of the Act to require the Director to establish procedures to insure that the transfer of Job Corps enrollees from a State or local jurisdiction will not violate parole or probationary procedures of the State. Where such a youth is enrolled with the approval of State authorities, the Director is required to make provisions for regular supervision of the enrollee and to make reports to the State authorities conforming with the State's parole or probationary requirements. (section 104). 5. Dismissal of Job Corps Enrollees. Amends title I-A of the Act adding new section 112 to authorize directors of Job Corps centers to take appropriate disciplinary measures against enrollees, including dismissal from the Corps, subject to expeditious appeal procedures to higher authority under regulations to be established by the OEO Director. (section 105). 6. Community Activity. Amends section 104 of the Act to require Job Corps officials, whenever possible, to stimulate the formation of indigenous community activity in areas surrounding Job Corps centers to provide a friendly and adequate reception of enrollees in community life. (section 105). 7. Experimental and Demonstration Projects. Amends title Ì-A of the Act to add a new section 111 to authorize the Director to establish up to 4 experimental and demonstration projects to provide vocational education and training and youth employment on a combined residential and non-residential basis, utilizing resources of the Job Corps and NYC programs. The Director is required to submit a progress report to the Congress on these projects no later than March 1, 1969. (section 106). 8. Composition of Community Action Boards. Amends section 206 of the Act to forbid the Director of OEO from approving a community action program which is conducted, administered, or coordinated by a board, unless at least one-third of the membership of the board consists of representatives of the poor. Also provides that these representatives shall be selected in areas of concentration of poverty by the residents of those areas, with particular emphasis on the participation of those who are poor. In other areas a selection process, such as neighborhood meetings, shall be used which permits the greatest possible participation of the poor. (section 202). 9. Community Action Agency Audit and Accounting. Amends section 202 of the Act to provide that no funds will be released to a public or private non-profit agency until the public financial officer or the C.P.A. who will maintain the accounts certifies that he will accept responsibility for providing financial services adequate to insure the establishment and maintenance of an accounting system by such agency and its delegate agencies with the internal controls adequate to safeguard the assets of such agencies, check the accuracy and reliability of accounting data, promote operational efficiency and encourage adherence to prescribed management policies. Within 3 months after a grant or contract has been made, OEO shall make or cause to be made a preliminary audit survey to review the grantee and delegate agency accounting systems and internal controls. Thirty days after this survey is completed the Director shall determine the adequacy of the systems and controls to meet the standards set forth in the original certification. If he determines that the standards have not been met he shall notify the grantee and consider the possibility of suspension of the grant. If suspension is ordered, the grantee shall have 6 months within which to correct the deficiencies and have the suspension lifted. If it fails to do so, the grant shall be terminated. The Director of OEO is required to establish rules and regulations to insure that the standards of accounting encouraged in the original survey requirement are maintained throughout the grant or contract. (section 207). 10. Research and Demonstrations. Amends section 207 of the Act to require that the annual report of the Director under section 608 of the Act includes description not only of OEO's research and demonstration activities but of the results or findings of research and demonstrations which were reported during the previous fiscal year. (section 208). 11. Emergency Loans. Modifies the proposed emergency loan program which H.R. 15111 as reported would establish under section 207 of the Act to remove the requirement that maximum feasible use be made of Federal credit unions. (section 208). 12. Legal Services Programs-Local Bar Comments. Requires that proposals for legal services programs must be submitted to local Bar associations for review, comment, and recommendations. For new proposals this should be done at least 60 days before their approval. (section 210). 13. Adult Basic Education. Amends section 215 (a) of the Act (effective July 1. 1966) to make the Trust Territories of the Pacific Islands eligible for grants under the Adult Basic Education program. Also amends section 216(b) to provide that the Federal share for the Trust Territory shall be 100 percent. A conforming amendment to section 609(a) of the Act includes the Trust Territory within the definition of "State" for the purpose of the Adult Basic Education program. (sections 213, 214, 608). 14. Funding of Migrant Programs. Amends section 321 of the Act to provide that of the funds appropriated for FY 1967, not less than $28,500,000 would be used for assistance under title III-B for assistance to migrant and seasonal employees and their families. (section 302). 15. Transfer of Small Business Loan (Title IV) Program. Transfer the small business loan program (title IV of the Economic Opportunity Act) to the Small Business Administration and removes the requirement that financial assistance be consistent with any community action program in a community in which the assistance is extended. (section 401). 16. Printing and Binding. Amends section 602 (m) of the Economic Opportunity Act to remove existing authority to expend funds, under certain conditions, for printing and binding "without regard to any other law or regulation". Under existing law, this authority can be exercised only after prior notice is given to the Joint Committee on Printing and submission of a justification of such use. (section 601). 17. Job Corps and Community Action Salary Comparability. Amends title VI of the Economic Opportunity Act to add a new section 610-1 requiring the Director to take steps to assure that persons employed in carrying out the Job Corps and Community Action programs are not compensated at a rate exceeding the average rate paid to persons providing substantially comparable services in the State where the program is being carried out. (section 604). 18. Job Corps and Community Action Salary-Increases. Adds a new section 610-2 to the Act providing that no person whose compensation exceeds $6,000 per year, and is paid in whole or in part from funds appropriated for the Job Corps and Community Action programs, shall be employed at a rate exceeding by more than 20 percent the salary he was receiving in his immediately preceding employment. The Director is, however, authorized to grant exceptions for specific cases. (section 601). 19. Limitations of Supergrades. Amends title VI of the Act to add a new section 618 providing that. of positions in OEO and its field offices, those in classifications GS-16, 17, and 18 of the General Schedule of section 5332, title V, United States Code, shall not exceed one for every one hundred employees. (section 609). 20. Limitation on Federal Administrative Expenses. Amends title VI of the Economic Opportunity Act to add a new section limiting administrative expenses incurred by Federal agencies under the Economic Opportunity Act so that they do not exceed, in any fiscal year, 10 percent of the amount authorized to be appropriated for that year. Compensation of Federal employees is specifically included as an administrative expense; grants, subsidies, contributions, and payments to individuals who are not Federal employees are specifically excluded. (section 618). WORK EXPERIENCE PROGRAM Mr. FOGARTY. On this comparison of the budget, the House bill and the Senate bill for the work experience program that you mentioned just a short time ago, you request $160 million and the House cut it down to $119 million and the Senate is $160 million. Mr. SHRIVER. Yes. Mr. FOGARTY. What about this work experience program? How do you think it is going? I thought it was a pretty good program. Mr. SHRIVER. I think it has been extremely good in many places and in other places it was weak and not as popular as some of these other programs. What actually happened, I think, is that when the House committee decided that they wanted to put more money into Headstart and into the Neighborhood Youth Corps and a couple of other programs that they thought were extremely successful and popular they had to get the money from someplace else in the bill. They took it from this title, I suppose, because they felt that was the one where they had the least evidence of success. We have Mr. Truelson from HEW here with us and he could speak to the advantages and successes and the failures, if it is all right with the chairman. Mr. TRUELSON. I agree with Mr. Shriver about the observations he made about action in the House. This is what happened in terms of going from $160 million to an authorization of $119 million. The program has been, I think, very successful in many places. The places where we have had difficulty we are moving to phase out of the program. As an illustration in McKinley and San Juan Counties project, New Mexico, the community could not move the program. We sat down recently with the State welfare director, with the local welfare director and some of the CAP people in those counties and it was decided they could not move the program effectively. They could not get the training spaces filled. I would say the places where we have had difficulty we are moving to improve or phase them out. Right in Rhode Island we have had a very successful program. PARAMEDIC PROJECTS We have more than 600 now in the program evenly divided between men and women and a great deal of emphasis placed in the paramedic field. There are people moving into jobs in Rhode Island every day from this program. On the average throughout the country we are moving about 1,200 a month into jobs. Mr. FOGARTY. Why couldn't that paramedic program be successful everywhere? Mr. TRUELSON. I believe in title V we are. |