Mr. NEWMAN. Yes, sir.

Mr. RANDALL. And they consider the cost factors arising in any sort of a product; they give it a very thorough evaluation; is that correct? Mr. NEWMAN. Yes.

Mr. RANDALL. I want to commend you for a new thought that we have not seen before, on page 4. Maybe this is something we have needed. You say "the preference contained in the present law would be extended from the purchase of manufactured articles to the purchase of such services as packaging, assembling . . . to substantially increase the amount of work."

Are you talking about some specialty firms that do nothing but, for instance, prepare materials for packaging? What are you talking about there? Be a little more specific, if you would.

Mr. NEWMAN. I am sure some of the witnesses which will follow me can give a lot of detail on this, Mr. Chairman, but here we are saying that the market, especially for products which are requested by the Federal Government, could be expanded quite a bit. We are not just talking about the manufacture of specific items, but we are talking about the packaging and assembling of items. This type of activity, as some of you know, has been an activity which has been carried out on a subcontract basis for many years by sheltered workshops and by severely disabled people and blind people.

Mr. RANDALL. I know that we are getting into an area here which is difficult to fully consider in a hearing of this kind, but I think that we should not bypass it or skirt it in any way. I think we should give some consideration to other disabilities. You are the commissioner. What are some of the disabilities other than the blind. Can you enumerate a few of the severely disabled people?

Mr. NEWMAN. Well, just for starters, if you want to speak about people who have severe deficits of a physical and mental nature, we are talking about mentally retarded and the paraplegic.

Mr. RANDALL. Let's make a record.

Mr. NEWMAN. The paraplegic and quadriplegic; in some instances, deaf people with severe psychomotor problems who have ambulation difficulties and people with other kinds of neurological involvement such as people with severe cerebral palsy or epilepsy.

Mr. RANDALL. That is what we want. I am sure the committee is interested.

Mr. NEWMAN. These are the kinds of disability groups which we are concerned about having an opportunity for maximizing their productive activity, and this bill would help them do this.

Mr. RANDALL. Thank you. You said you had 82 workshops. Is that the total nationwide?

Mr. NEWMAN. Those are workshops for the blind.

Mr. RANDALL. Only for the blind?

Mr. NEWMAN. Which today manufacture these items for Government purchase under the umbrella of the National Industries for the Blind.

Mr. RANDALL. That is the total number of workshops presently involved under the Wagner-O'Day Act?

Mr. NEWMAN. That is the number of workshops which are at present involved in this particular program which is covered by the act. It is

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not the amount which is mandated. It is just the amount which happens at this point to be included.

Dr. MACFARLAND. That is right.

Mr. RANDALL. I was most interested in your testimony at the bottom of page 4 in which you said the number of items could be expanded to 75,000. I am not going to ask you to provide those for us at this time, but you used the term a moment ago, "for starters," so can you give us just a few "starters" other than the old category of brooms and mops?

Mr. NEWMAN. Well, this figure, Mr. Chairman, is a figure which we received, frankly, as a result of oral communication with the GSA people, and it doesn't mean that as of tomorrow these items could become available for these purposes.

It does mean, though, that if activity were to proceed in order to see which kinds of items might be included from this large number, might be used or usable for manufacture and services by these severely handicapped and blind people, that this is the potential market for exploration. You see, because one of the issues before the committee is this issue of "Will blind people lose out if the act were extended to other severely disabled people?" And what we are saying is that if we go about our job properly and open up the opportunities for these products, then not only will those who are now benefiting from this program continue to receive their benefits, but we think the market could be potentially expaned for the blind in addition to the other severely disabled.

Mr. RANDALL. I understood you to say just then that this is one of the real issues of this amendment. In other words, if there would be any opposition to this amendment, it would come from those who fear overencroachment on their present priorities. Is that right Mr. Commissioner?

Mr. NEWMAN. That is right.

Mr. RANDALL. That there would be a downgrading of opportunities, in other words, for the blind?

Mr. NEWMAN. I think this is a very legitimate concern on the part of the blind, Mr. Chairman, and I think that in whatever instructions the committee through its report might give, it might point out, if it were so inclined, that the committee had an interest in expanding the number of items available for this purpose because the bill as I understand it does not preclude this possibility.

Mr. RANDALL. Doctor, do you have any comment to make at this time?

Dr. MACFARLAND. The figure of 75,000 is a ballpark estimate, Mr. Chairman. We talked with a number of organizations. For example, DSA has some 200,000 items.

Mr. RANDALL. That is the Defense Supply Agency you are speaking of?

Dr. MACFARLAND. Right. GSA has about 50,000 items in their warehouses. The Government purchases roughly 4 million items. This does not mean that all or even a substantial part would be feasible for workshop operation, but it means that these are items that can be evaluated, and I am sure out of 4 million, or even out of 75,000 or 25,000 items you could find a substantial amount of production for workshops, over and above the items that are now being manufactured by the

blind and the ones that would be added to the schedule of blind-made products.

Mr. RANDALL. Thank you, Dr. MacFarland. I hope that the staff will consult with GSA and DSA and further explore the items. The gentleman from Maryland.

Mr. GARMATZ. I have one or two questions, Mr. Chairman. Speaking about these items, does the Government purchase any of the items at all from the various institutions? And if so, how much? Dr. MACFARLAND. Through the Wagner-O'Day Act, the Committee on Blind-Made Products has certified and placed on its schedule more than 400 items that are not being manufactured by workshops for the blind. How many other items are being purchased from workshops outside the Wagner-O'Day Act, I do not know.

You have men from GSA who will be testifying, I believe, and they would be in a better position to answer that.

Mr. GARMATZ. I have one more question, Mr. Chairman, if you please. On page 2 you say during the last fiscal year 876,000 were receiving such services, and of this number, 266,000 were successfully rehabilitated. I wonder if you might elaborate a little more on that, and what do you mean, "successfully rehabilitated"? To what extent? That they are not employed anymore by this particular workshop?

Mr. NEWMAN. I would be very happy to. The rehabilitation program is not satisfied if it just provides services to people. Its basic mission is to get people into gainful occupations, and over the years what we mean by "gainful occupation" has expanded somewhat.

First and primary, of course, is to get disabled people into competitive employment; and over the years we have expanded that definition statutorily to include work in other kinds of settings: homemaking and people who do work in their home as well. So that basically we are saying that we provide a service program for people to help them to become gainfully employed; then we wait a period of time to see if they make it; and if so, we say they are successfully rehabilitated. Mr. GARMATZ. A good group could go out and seek other employment outside the particular institution you have reference to?

Mr. NEWMAN. These would be people in the communities. And the bulk of these people, when we say they are successfully employed, we mean they are in competitive employment.

Mr. GARMATZ. Thank you, Mr. Chairman.

Mr. RANDALL. The gentleman from Virginia.

Mr. ROBINSON. I have no questions at the present, Mr. Chairman. Mr. RANDALL. Mr. Stewart?

Mr. STEWART. No questions.

Mr. RANDALL. Tom?

Mr. SAUNDERS. No.

Mr. RANDALL. Mr. Clesner?

Mr. CLESNER. Dr. MacFarland, there may be a lot of items that might be feasible for workshop operations, but the Wagner-O'Day Act as it is presently constituted gives the Federal Prison Industries the first priority?

Dr. MACFARLAND. Correct.

Mr. CLESNER. And as the bills now read, they also preserve that priority.

The difficulty is that the workshops for the blind and other severely handicapped, if they were to be included, under the act, would have

no notice of what is already on the Federal Prison Industries priority list. And does this not make it difficult to go forward to research out and evaluate what a workshop could do to develop and sell at a fair market price?

Dr. MACFARLAND. I think the committee does have information, sir, with respect to what is on the schedule for the Federal Prison Industries. And, again, the chairman of the commitee, I believe, will be testifying, and I think he can explain this to you.

There is a person that sits with the committee from the Federal Prison Industries, by the way.

Mr. CLESNER. The testimony at a recent Conference on Blind-Made Products held on the Senate side indicated in at least one instance the lack of knowledge of items on the Federal Prison Industries priority list.

What I was essentially interested in, and why I directed these questions to you, was for the basic reason that you do have grant money which the other agencies do not have, which could be utilized to develop data, provide the actual evaluation and testing on whether the blind and other severely handicapped could perform services or make commodities which could qualify for the procurement list?

Mr. NEWMAN. Yes.

Mr. CLESNER. Has your agency ever considered giving grants for this purpose?

Mr. NEWMAN. Yes. Yes, we have given a number of grants, which we would be very happy to submit if you request it, which do get to this question of what the disabled person and, more specifically, the blind person, can do on the basis of testing in terms of his potential. We have quite a bit of research in this area.

Mr. CLESNER. Have you considered making grants even to the Committee for the Purchase of Blind-Made Products, which has not had any funds to carry out such functions?

Mr. NEWMAN. We have made grants to the National Industries for the Blind for this purpose, which is the agency which does the allocation.

Dr. MACFARLAND. Our grants are restricted to research and demonstration and are usually for a period of 3 to 5 years. Each of the applications has specificity.

Now this would be an on-going, continuing operation, and I believe this is the reason why they have asked for an appropriation for staff. Somebody should be on top of this all the time.

Mr. NEWMAN. I would like to just supplement those remarks by saying I understand the amount being asked to be authorized, the $200,000 amount, it was considered to be set at this level so as not to have to come back year after year for a different amount, and that kind of sets the level. Although I think in the Senate testimony it was stated that a smaller amount, perhaps $125,000, might be necessary for the first year.

Mr. RANDALL. Mrs. Abzug, our witness is the Commissioner of Rehabilitation Services, Social and Rehabilitation Services, Department of Health, Education, and Welfare. He has a prepared statement which he has given to us. Do you have any questions?

Mrs. ABZUG. I will. I want to listen in for a while. Thank you.
Mr. GARMATZ. May I ask one more question?

Mr. RANDALL. Yes, sir, Mr. Garmatz.

Mr. GARMATZ. Commissioner, in the statement of our colleague, Craig Hosmer, he says:

Studies have shown that in the past efforts to reach the type of veteran who really needs training and rehabilitation and re-education has not been too successful.

Do you get many of those veterans into your setup? Or are they taken care of by a separate agency of the Government?

Mr. NEWMAN. Most of the vocational rehabilitation for veterans who have service-involved disabilities is handled by the Veterans' Administration.

We do have quite a lot of activity with veterans, especially those who have nonservice-related disabilities.

Mr. GARMATZ. He goes on to say:

Many of the more than 120,000 Vietnam veterans now drawing compensation for service-connected disabilities would be eligible for employment in workshops having contracts under the expanded Wagner-O'Day Act.

Mr. NEWMAN. I think that is a reasonable statement.

Mr. GARMATZ. Thank you.

Thank you, Mr. Chairman.

Mr. RANDALL. I want to salute our good colleague from Baltimore, the chairman of a distinguished Committee on Merchant Marine and Fisheries for pointing this out in the testimony of Mr. Hosmer. I am firmly convinced, and more so every day, while we have a lot of things on the agenda in the Congress, but just exactly what and how much are we doing for Vietnam veterans, and particularly those that come back all torn up? If nothing more comes out of this, I am happy that the reference is there. I would certainly want you to give us more information about those 120,000 Vietnam veterans and what is being done for them. Provide any amount of information you can give to us on that score right there. So very little has been done up to this point for those really disabled Vietnam veterans that have come back.

Are there any other questions of the Commissioner or Dr. MacFarland?

If not, then we will proceed.

Thank you very much.

Mr. Menasco is with us. He is the Administrator of the Wage and Hour and Public Contracts Division, Department of Labor.

STATEMENT OF HORACE E. MENASCO, ADMINISTRATOR, WAGE AND HOUR AND PUBLIC CONTRACTS DIVISION, DEPARTMENT OF LABOR, WASHINGTON, D.C.; ACCOMPANIED BY BEN P. ROBERTSON, DEPUTY ADMINISTRATOR, WAGE AND HOUR AND PUBLIC CONTRACTS DIVISION; AND WARREN D. LANDIS, ASSISTANT ADMINISTRATOR, WAGE AND HOUR AND PUBLIC CONTRACTS DIVISION, OFFICE OF GOVERNMENT CONTRACTS, SPECIAL WAGE STANDARDS

Mr. MENASCO. Mr. Chairman, while I am listed as the principal witness, I have held the esteemed title of administrator for less than 24 hours. Therefore, with the permission of the committee, I would