duplicate offices in areas where there was a large or significant FEP operation. Thus the Northeast had the greatest number of effective FEP agencies. For example, in New England more than 75 percent of the new charges filed with the EEOC were initially filed with the State agency and thus we have sought through the deferral mechanism to strengthen the State agencies there rather than duplicate their work with our own offices.

We are pleased that in the internal reorganization, which will be completed on January 29, there will be virtually no dislocation. The lawyers, of course, are the exception because there was no way to integrate lawyers with investigators without moving lawyers from where they are to the 22 district offices. We signed an agreement which we regard as especially progressive with our union that in any case would soften the effect of dislocation, and will in the case of the lawyers be covered by that agreement as well.

I would like to turn to page 7 of my testimony. I do not think I would save time here by summarizing.

Among its recommendations, the staff report placed a priority on case processing, identifying the "compliance process" as the "most serious weakness in the Commission's ability to enforce the law." It cited "an engulfing inventory of charges which threatens to keep the EEOC from becoming a law enforcement agency . . ." and noted "the inability of the Commission to resolve the steadily increasing backlog of charges." It found that "the number of charges received annually is increasing at a faster rate than the number of charges resolved." It criticized an emphasis on charge resolution without sufficient regard for remedy or the rights of charging parties, noting that "in fiscal 1976, 73.9 percent of all resolutions were either administratively closed or no cause determinations." It noted the "apparently beneficial results" from the use of predetermination settlements, finding this procedure beneficial to potentially both the charging party and the respondent if "careful[ly] monitor[ed]. . . to protect the affected parties." The report cited evidence that as many as one-third of EEOC charges in some areas were outside of the jurisdiction of title VII, and that many other charges were frivolous on their face, a result of intake procedures that did not provide for screening.

The staff report made four recommendations concerning charge processing by EEOC on a timely, efficient, and fair basis:

"EEOC should improve charge intake procedures to prevent processing of nonjurisdictional and frivolous charges.

"Where possible, EEOC should develop standardized forms and procedures for investigating certain categories of cases.

"EEOC should issue right-to-sue notices upon request any time after filing if investigation within 180 days is unlikely; charging parties should be notified periodically after 180 days of private litigation rights under title VII."

These recommendations have all been implemented.

In my testimony before you in July 1977, I went into great detail concerning the new case-processing approach and techniques we proposed to implement. And, Mr. Chairman, I know that you and the staff have requested information on our systems from time to time, and have been reviewing our periodic performance reports.

Thus I do not need to spell out how the rapid charge processing and the backlog charge processing systems work. Field tests for a full year of these new case processing systems, we believe, definitely demonstrate their effectiveness, as measured by objective statistics as well as by the feedback from civil rights and women's groups, citizens, business groups, and respondents who actually use the systems. We believe these systems give the Commission the capacity to process individual cases so rapidly and at such a high rate of benefits that the agency can now move to allocate increasingly more of its resources to pattern and practice work, my priority for the coming year.

We have now accumulated data from a full year of operation for the model offices and 9 months for the other field offices. In the model offices, new charges are being closed, on the average, in 65 days. Settlements and conciliations have increased from 14 percent under the old systems in fiscal year 1977, to 48 percent under the new systems in fiscal year 1978. Almost four times as many people received dollar benefits in these offices-691 in fiscal year 1977 as compared to 2,523 in fiscal year 1978. Dollar benefits for complainants (rapid charge processing and backlog charge processing) almost quadrupled from $1,092,000 in fiscal year 1977 to $4,208,639 in fiscal year 1978.

Mr. HAWKINS. In giving these statistics are you including the model as well as the nonmodel offices?

Chair NORTON. These are the three model offices.

Mr. HAWKINS. These are only the model offices?

Chair NORTON. Yes, sir.

Mr. HAWKINS. Do you have similar statistics for the nonmodel ones as well?

Chair NORTON. The nonmodel office statistics are being taken manually. There is a greater lag in nonmodel office statistics and we do indicate some of those in our testimony. We will get for you information on their dollar benefits as well.

Mr. HAWKINS. Not only that but the charges and settlements? Chair NORTON. Yes.

Mr. HAWKINS. If you will do that, it will help the committee. Chair NORTON. I think your staff has a report on closures, settlements and the like in the nonmodel offices but not a full year report.

[The information referred to above follows:]

Chair NORTON. Administrative closure and no cause changes are significant. Before the new systems that separate old from current charges were installed, EEOC made no such distinction, but grouped all cases as backlog. Thus the fiscal year 1977 administrative closure figure of 35 percent included old and new charges. In the first year of rapid charge processing, current charges show a 20percent administrative closure rate in the model offices. The administrative closure rate in the backlog is 44 percent, but this change from last year undoubtedly reflects the fact that no current charges are now included in backlog figures.

"No cause" for new charges is 31 percent, whereas "no cause" for all charges last year in these offices was 39 percent. This figure is especially significant because the "no cause" rate has dropped even though many cases that might have been cause cases, and presumably conciliated because of the strength of the case, have been settled early in the process by rapid charge processing.

Moreover, new cases are being processed under a single agency standard for cause so that Commission lawyers may litigate cause determinations, instead of rejecting the overwhelming majority of them, as the staff report found was the case in the past. And although the backlog charge processing system is resolving old charges at a greatly accelerated rate, the "no cause" rate for older cases has not risen, but remains 39 percent for older charges in the model offices.

The three model offices have reduced their total inventory by 67 percent. In August, Dallas became the first office in the history of the agency to resolve its entire backlog of cases. Dallas, which resolved 3,400 charges in 11 months, is now operating on a current basis. Moreover, in the three model offices there have been 133

percent more resolutions than receipts, indicating that backlog will not recur. Finally, because of the effectiveness of the new charge processing systems, there were 96 percent more resolutions in fiscal year 1978 than in fiscal year 1977. The results of the new charge processing systems are shown in graphs at Appendix III.

The regular district offices have used the new professional intake procedures, early or predetermination settlement of new charges, and the backlog charge processing system since December 1977. These offices will not get two major reforms critical to the success of the new systems until January-the presence of lawyers with the integration of legal and compliance functions, and the use of the factfinding conference. Yet key indicators reveal excellent overall improvement in these offices. Even without factfinding, 21 percent of the new charges are being resolved in an average of 69 days, and 41 percent of the new charges have been resolved by negotiated settlements. There have been 130 percent more resolutions than receipts in the regular district offices.

I want to move to the third section of my testimony, on State and local programs. We have regarded the reform of the State and local program with perhaps as many now as 25 percent of our charges going to State and local agencies as a corollary of what we have been doing at EEOC itself.

We quoted extensively from your own recommendations at page 12. I would like to read three pages of this testimony, beginning at the bottom of page 12.

I had come to EEOC from an FEP agency and had personally felt the need for comprehensive reform of the FEP-EEOC relationship. We believe that the best way to improve the relationship was to include the FEP agencies in the actual design of the new program. Thus, early this year a planning task force consisting of FEP directors and EEOC personnel began work on the design of the new FEP-EEOC program. The planning process culminated in May with a major conference of directors from every State and local agency involved in deferral called together for consultation on the new program as recommended by the FEP-EEOC planning task force. The principal features of the new program are:

(1) A rational system of worksharing. Because of dual filing and deferral to State and local agencies there is essentially one inventory. The division of this workload is based on the respective processing capabilities of the 706 agency and the EEOC district office as defined in a worksharing agreement. For charges which EEOC will process, the 706 agency has agreed to waive its 60-day exclusive processing right, allowing EEOC to give the charge immediate attention. Every agency we fund has signed a worksharing agreement.

(2) A funding formula adjusted to provide equity, to incorporate bonuses and penalties for performance, and to avoid competition overcharges. FEP agency funds are divided into two major categories: charge resolution and agency improvement funding. The formula for funding provides the same dollar amount per charge to each agency. The projected number of charges to be processed is determined through consultation between the 706 agency and the district office. Using the formula, which is self-adjusting, a 706