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in the city of Philadelphia; that they had not been to school; that they were paying $10 or $20 a month to instructors to mark'them present. We found down in Murfreesboro a couple of weeks ago the same situation, that many veterans did not attend school, but they paid $10 or $15 to the instructor to mark them present.

Senator Hill. The instructor was falsifying the record ?
Representative TEAGUE. That is right.

Senator Hill. And no penalties under the existing law for committing the fraud ?

Representative TEAGUE. Mr. Chairman, I am not a lawyer. It seems to me that there should be a law somewhere to take care of that. We turned our cases over to the Department of Justice and hope to get some prosecutions.

In summary, I believe that any new act passed by the Congress should make the following provisions :

1. The program should be reoriented from a subsidized educational program to an educational assistance program. Entitlement to education should not be limited to those who can prove that they interrupted their education. A modest amount of aid should be given any veteran who desires to help himself, rather than a large amount of aid to a limited number of veterans.

2. The program should be self-policing. It can be made so by requiring the veteran to make a contribution to his own training rather than the Federal Government attempting to pay the total cost as it does under the present program.

3. The new act should prohibit the enrollment of a veteran in a school which does not have a substantial number of nonveterans and a school should be required to operate successfully for a period of 1 year prior to receiving approval.

4. The administration of the program should be simplified. This can be accomplished by eliminating the conception of fair and reasonable tuition rates and making the payment directly to the veteran at the end of the month of training. From this payment, the veteran will pay his own bills, thus eliminating the necessity for a contract and a vouchering procedure.

5. Supervision of schools and standards for approval should be strengthened.

6. Strict penalties for criminal acts should be established for criminal acts, the rights of a veteran who willfully misuses his entitlement should be withdrawn and Veterans' Administration and State officials should be prohibited from owning interest in a school under contract with the Veterans Administration or becoming associated with such a school during a period of 1 year following termination of employment by the Veterans Administration or the State approving agency.

7. The new act should provide for judicial review of decisions of the Administrator affecting educational institutions and State schools and agencies.

8. The relative authority of the Veterans' Administration and the State approving agencies should be clearly defined and the obligation of the State approval agency should be spelled out in the law.

Senator HILL. Any questions, Senator Aiken?

Senator AIKEN. Do you know of any cases where any Veterans' Administration officials were interested in schools approved by the VA? Representative TEAGUE. That is what we were talking about before; we had 56 cases in Texas. We found that by going to the State capital and checking where corporations were formed. We tried to hit different phases in different States, Senator.

Senator AIKEN. How would you make effective the rule that nobody could leave the Veterans Administration and become affiliated with a school for a year? Would you do that by withdrawing the certification of the school?

Representative TEAGUE. I am not sure, but I believe that over in the Defense Department we have a situation where a man who is in the Defense Department is not allowed to go out to a concern or company with which the Defense Department does business.

Senator AIKEN. He is not allowed to come back and practice before the agency which he leaves for, I think, 2 years.

, , Senator HILL. As I recall the statute, it is 2 years.

Representative TEAGUE. There would be two or three different ways you could do that and you could prohibit the school.

Senator AIKEN. Withdraw certification of the school?
Representative TEAGUE. Yes.
Senator Hill. Certainly that is a matter that ought to be reached.

Representative TEAGUE. Certainly. I am sure there are a number of men who have left the Veterans Administration and have gone to schools, and it was perfectly all right, but there have undoubtedly been cases where that was not true. I do not think this country has dreamed of doing as much for the war veterans as you men have tried to do for World War II veterans under the GI bill.

Senator HILL. Would you consider changing that "you" to a “we”? Representative TEAGUE. I will change that to a "we.”

I might say that this man up in Pennsylvania testified before us that he made $76,000 the year before, and he was not a veteran. We know his schools, some of them, at least, were such that the veterans did not get their training, and the taxpayers did not get their money's worth.

Senator Hill. Are there any questions that you would like to put, Senator Ives?

Senator Ives. I want to commend Congressman Teague for his contribution to our effort over here. His statement is full of ideas which have to be considered and decided. I want to say this, Mr. Chairman, it occurs to me that in legislation of this character it is most essential that the committees of the two Houses operate very closely, not after the legislation has passed by each House, but before, so that we can come forward, both Houses, with as nearly a perfect product as possible initially rather than wait for some conference committee to decide to unscramble some things and try to reconcile those things which cannot be reconciled.

Representative TEAGUE. Yes, sir. I would like to have this bill ready for our boys that are being discharged. Of course, our disabled are being taken care of, but it has just been impossible to get it done. I understand that a comment was made yesterday that we pass it and get it through, but I do not agree with that.

Senator Hill. How long has your select committee been in existence ?

Representative TEAGUE. About 10 months. I never dreamed, Senator, to begin with, what one of these investigations would run into. For instance, we completed one on a regional manager down in Texas,


and it represents some 2,100 pages of testimony. You go into one of these investigations, and you have to contact every veteran in tracing down the dates, when the boy was not in school, when he was present, and when he was not present who marked him as present.

We have tried to be fair as possible, and we did not bring out anything that we were unable to support with documentary proof. I may say that it has been quite a job.

Senator Hill. I certainly want to thank you and commend you, too, for this very fine and helpful and enlightening statement that you brought us here this morning. I would like to commend you as well on the splendid work that you have done as chairman of the select House committee. You have made a great contribution to this cause, trying to put this program on the right sort of basis, knowing, as you have said and as we all recognize, that this is going to be a permanent program, certainly a very long-range program.

Representative TEAGUE. That is right, sir.

Senator Hill. I hope, as Senator Ives has said here this morning, that there may be the closest working association and cooperation between this committee and


committee. Representative TEAGUE. Thank you very much, sir.

Senator HILL. Any time you have any suggestion, any particular thought or information that you think would be of help to us, let us hear from you.

Representative TEAGUE. Thank you very much, gentlemen.

Senator Hill. We will now hear from the Office of the Comptroller General, represented here this morning by Mr. Charles E. Eckert, legislative attorney; Francis T. Matchett, Assistant Chief, Office of Investigations; and Wayne H. Smith, attorney, General Counsel's Office.



Senator HILL. Which one of you gentlemen has been chosen to speak this morning?

Mr. ECKERT. I am Charles E. Eckert, Mr. Chairman, and this is Mr. Matchett on my left and Mr. Smith on my right.

Senator Hill. You may proceed in your own way, Mr. Eckert.

Mr. ECKERT. The General Accounting Office appreciates the opportunity afforded it to appear before your committee in connection with the bill S. 1940.

The bill is designed to authorize the furnishing of education and training benefits to persons having active service in the Armed Forces subsequent to June 27, 1950, and prior to a date to be declared by the President, or by concurrent resolution of the Congress. The program authorized by the bill follows generally the program inaugurated for veterans of World War II by Public Law 346, June 22, 1944, commonly known as the GI bill.

However, consideration has been given in the drafting of the bill to the experience resulting from the operation of the existing program,


as brought out in conferences between the Bureau of the Budget and the various agencies of the Government having an interest in the program, including the General Accounting Office. As a result, numerous safeguards have been included in the proposed bill which will eliminate many of the problems which arose under the program provided for by Public Law 346.

The bill would authorize for persons serving in the active military, naval, or air service during the periods prescribed, educational and training benefits for a period equal to their active service not to exceed 48 months of actual instruction. Veterans would be given a right to 12 months education and training, and as a prerequisite for further education or training it would be required that the veteran's education or training had been interrupted by his entrance into the service. However, such interruption would be presumed in the case of any veteran who had not passed his twenty-third birthday as of June 27, 1950, or the date he entered the service, whichever is later.

Generally speaking, the bill would provide for the assumption by the Government of one-half of the cost of education of eligible veterans and for the payment to such veterans of an appropriate allowance to cover subsistence, supplies, and equipment. It is felt that requiring the veteran to pay a part of the cost of education is desirable in that it would result in the veteran's having a stake in securing education, would be an incentive to the veteran to see that the charges made were fair and reasonable, and would make the veteran aware of the cost and charges being paid for his education.

The General Accounting Office would recommend, however, that this provision contain also a limitation that the amount authorized to be paid by the Government to an educational institution shall not exceed the amount actually paid by the veteran student. It is believed that such a limitation is desirable to insure that the Government will be required to assume an obligation to educational institutions only in those instances where a veteran is required to pay for his education and that consideration will be given to scholarships, grants, or similar forms of educational aid.

As heretofore indicated the bill has been drafted with a view to eliminating many of the abuses found to exist in the present program. However, the General Accounting Office feels that the bill could be materially strengthened in that regard. In a report to this committee dated September 17, 1951, specific recommendations have been made which, it is felt, will accomplish this result.

Senator HILL. I have that letter dated September 17 addressed to Chairman Murray by the Comptroller General. I think without objection that letter ought to go in the record at the conclusion of your remarks.

Mr. ECKERT. I would appreciate that, Mr. Chairman.

These recommendations are based upon the findings of the General Accounting Office, through its audit and investigative activities, with respect to the operations of the present program, as compiled in a report of survey of the program, a copy of which was furnished to this committee July 20, 1951.

Senator HILL. Has that been printed ?
Mr. COBURN. Yes.
Mr. ECKERT. It is the House committee print.

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Senator HILL. If that is so I do not know whether it would be necessary for another reprint.

Mr. ECKERT. Among the recommendations of the General Accounting Office is one to strengthen the program by placing definite requirements on the State approval agencies as to the qualification of schools within their respective States.

Senator HILL. You would write those requirements into the statute!

Mr. ECKERT. Yes, sir. We would not write the specific requirements, but we would write the duties of the State approval agency, as to what they would have to certify. In other words, we do not imply there that the Government would set the educational standards, but only that the State would certify that they have properly set the standards and have inspected the premises of the schools to insure that they are adequately equipped to give a course of instruction.

Senator HILL. Yes.

Mr. ECKERT. Experience under the existing program has shown that State approval of educational institutions has in many instances been no more than a rubber-stamp process.

Senator HILL. Let me ask you, how do you account for that? It happens that in my State of Alabama we had a fine man as head of this program, Dr. Elbert Norton, and he had with him Dr. Robert Cammack, who was in charge of the vocational education section of the department. We had none of this in Alabama. They went about this matter in a very serious way and did a fine job.

How do you account for the fact that the State educational agencies did not meet the responsibility imposed on them in a matter of this kind ?

Mr. ECKERT. Well, I think, Senator, to answer your question generally that at the instance of this program many of the States did not have approval agencies as such in their States, and if they did it involved only higher education and did not reach down into the many other types of schools.

Also I think that the States have not had the facilities or have not had the funds appropriated within their States to insure an adequate staff for these approval agencies.

Senator HILL. I believe, too, in the beginning there was a question, was there not, about whether these State educational agencies would be the approval agencies? Was there not some disagreement there between the Veterans' Administration and the States as to who the Veterans' Administration would have or would recognize or how much they would rely on the State education agencies in that matter?

Nr. ECKERT. I cannot recall. There may have been at the beginning of the program, Mr. Chairman. .

Senator HILL. Is that true, Mr. Smith?

Mr. SMITH. I think it was considered at the time of the original legislation.

Senator Hill. The original legislation, that sort of set the pattern for this thing!

Mr. SMITH. That is right.

Senator Ives. Do you know of any delinquency on the part of the educational set-up in New York State in connection with this program?

Mr. MATCHETT. New York State was clean as far as our survey shows.

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