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The President's budget for 1972 contained only an illustrative breakdown of the amounts that would otherwise be allocated to the 33 existing formula grant programs consolidated by the education revenue sharing proposal. What we attempted to do was to show how the amounts of money presently budgeted under existing authorities would be reallocated to the five broad national purpose areas. An additional $200 million was added so that we could insure that no State would receive less than it did in fiscal year 1971.

Misunderstanding of this funding level question, since the bill authorizes no specific amount, obscures the real merits of the proposal.

Related to this is the reaction that “present programs would be more effective if they were fully funded; then there would be no need for education revenue sharing.” At first glance this argument appears to have some appeal, but its appeal rests on a continuation of the current grant structure. It ignores the obvious complexities and difficulties which Federal categorical programs already pose for school administrators. In fact, full funding of the present programs would not eliminate the need for education revenue sharing: it would become even more urgent than it already is if we are to save the elementary and secondary education system from strangulation by Federal

red tape.


Another reaction to our proposal is the question: "Are the States capable of spending the shared funds responsibly?” This is an odd question on the face of it since States and local school districts are currently spending 93 percent of all funds expended for public elementary and secondary education. It seems anomalous to argue that they are somehow unfit to manage the 7 percent contributed by the Federal Government.

If we acknowledge that some States will spend the money more wisely than others, we must also ask how any State can be expected to be fully responsible, as long as Federal programs deny them full responsibility. I would make this point even more strongly: unless we establish the conditions under which States and localities accept responsibility, we will never consider them capable of the tasks at hand. If we do not make it absolutely explicit that State and local failures cannot be blamed on the National Government and that incompetence cannot be tied by a long string of excuses to Washington, then local and State agencies will never be held accountable for their actions. This Nation has operated too long under the self-fulfilling prophecy that State and local governments are too weak to carry public burdens; to make sure the prophecy came true, State and local governments have been continually weakened. It is time for a different prophecy.

3. CIVIL RIGHTS SAFEGUARDS As I have noted above, we have provided in section 13 that the nondiscrimination provisions of title VI of the Civil Rights Act of 1964 will apply to programs and activities receiving funds under the bill. We believe that this is adequate and would provide full protection.

Some criticism has been made that shared revenues would be intermingled with State and local funds so that the civil rights guarantees will not be enforceable. This is untrue: funds under this bill would be no less traceable for civil rights purposes than they are under existing categorical programs, which of course now fund virtually the same grantee agencies as would be funded under the bill. Moreover, in order to make this absolutely clear, section 18 requires strict accounting to the Secretary of Health, Education, and Welfare by the States for the use of the shared funds, including full reporting and disclosure to the Secretary. Just as at present, the Federal Government will have full power to enforce the civil rights guarantees that must go along with the funds collected from all Federal taxpayers. As the President stated in his state of the Union message in describing this aspect of all his revenue sharing proposals:

Neither the President nor the Congress nor the conscience of the Nation can permit money which comes from all the people to be used in a way which discriminates against some of the people.


In concluding, I would like to point out that as a practicing school administrator, I have long been aware of the condition underlying the need for revenue sharing in education. When I joined the Office of Education it became even more clear that with the increasing Federal role in elementary and secondary education we had reached the point where major reform in grant management was necessary. As Mr. Kurzman has so forcefully emphasized, the categorical elementary and secondary education laws and programs have proliferated to the point where, especially at the local and State level, thousands of man days are required simply to manage the paperwork.

In the main, these laws in their time were right and good. Many remain so today, supporting essential Federal priorities of the Nation's elementary and secondary schools. In education revenue sharing, it is intended that we sustain the purposes and priorities implicit in the original legislation of the 33 programs, but at the same time greatly simplify the delivery system. It is our belief that Congress meant to make these funds available quickly and in uncluttered fashion to the eligible local education agencies. I know that I speak for virtually all school superintendents in the United States when I say that we must sometimes wonder whether the game is worth the candle and whether the multiplicity of Federal regulations, guidelines, reports, forms, correspondence, State plans, local plans, overlapping evaluations, etc., are justified in terms of the funds received. Of course, there is no doubt that the funds are desperately needed. However, many hundreds, if not thousands, of creative and talented people, both in the Office of Education and in the State and local systems are tied down with unnecessary paperwork. Under this proposed law they would be able to turn their talents to the real teaching and learning opportunities within their profession.

I might further add that we believe that special revenue sharing concepts, at least in part, originated in the Office of Education and became a part of the administration's legislative program in a wider context affecting many other agencies. It is not something that was imposed upon us. I can speak with enthusiasm for the appropriateness of education revenue sharing at this time and assure you that this bill preserves the priorities implicit in the laws which it brings together.

And I can assure you that administratively those priorities can be


sustained at the local level in a simple and staightforward delivery system which

my office will manage. Further, I can assure you that it will be a great boon to the thousands of professional people throughout the land who are charged with the stewardship of public funds and who want very much to see this bill enacted. They have so resolved. Finally and most importantly, I can assure you that they possess the competence and integrity to administer this law as Congress intends it and in so doing to increase greatly their efficiency.

Thank you very much, Mr. Chairman.

Chairman PERKINS. Let me compliment both of you on your statements.

I certainly do not share the viewpoint expressed in many instances. I would like to suggest we abide by the 5-minute rule so all of us will have an opportunity to question the Commisioner and Doctor Kurz

I will address three or four questions to both of you gentlemen.

Do you presently have in mind an educational expansion program beyond what you have testified to, in connection with H.R. 77961

Commissioner MARLAND. If you are speaking for Federal support of elementary and secondary education, I will try to answer that very briefly.

On September 30, the President assembled in his office the principal leaders in elementary and secondary education from throughout the Country, representing such organizations as NEA, AFT, school administrators, state boards of education, local boards of education, and so forth.

At that time the Serrano decision in California, only recently announced by the court, indicated an inequity in distribution of public funds in that State.

The President turned to the Secretary and me at the conclusion of that meeting and said, Mr. Richardson and Mr. Marland, we expect you to consider alternatives to this problem; I can answer your question by saying we are indeed heavily engaged in considering such alternatives.

Chairman PERKINS. How long do you think it will be before you can come before the committee and give the committee your views on those alternatives?

Do you feel you can do it in 20 days, or 30 days or 60 days?
I had a feeling you were going beyond H.R. 7796.

Commissioner MARLAND. On a wholly different subject, you are quite right; However, I feel the subject, as Assistant Secretary Kurzman said, is quite unrelated.

We are dealing with a process bill, and the other subject which you have raised is a money bill. As for predicting the date, or number of days required, it would be presumptuous for me to assume for the administration at this stage that they will be ready to deliver this within any number of given days.

I would hope in the light of the very serious problems, which you and other members of the committee have described as desperate, especially in the cities of this land, that there will be early action in the administration in considering various alternatives.

Chairman PERKINS. Do you feel you will have your statements put together by the middle of January, to give the committee the benefit of your views, or will it take longer?

the past.

Doctor Kurzman, do you care to comment ?

Mr. KURZMAN. I think it is difficult at this point in the process to pinpoint a specific time, Mr. Chairman.

Chairman PERKINS. These hearings are going to be a continuous thing, and we want to invite you back the moment that you can give us a date, that you are ready to come before the committee with additional suggestions to support the elementary and secondary schools.

I hope you will get in contact with the committee forthwith.
Commissioner MARLAND. Thank you, Mr. Chairman.
I assure you we will do just that.

One other factor which somewhat constrains our prediction of a date firm is, as you know, that both the Congress and the President have named a School Finance Commission. The two Commissions are now serving as one with a requirement to report their findings to Congress no later than April.

Chairman PERKINS. One other question.
Categorical programs in my view have served a great purpose in

I think that is indisputable, but undoubtedly we may have too many of them, and there may be some of them that can be eliminated, but others cannot be eliminated. My question, under your proposed revenue sharing plan for the elementary and secondary schools, with the programs that you plan to discontinue, how much less money will the school districts in the States receive than they are presently receiving through the categorical programs?

That is the question I would like to have answered. Mr. KURZMAN. The purpose of the legislation is not to deprive them of any funds. The purpose is to utilize the same funds in a much more rational way.

Chairman PERKINS. I know that is your purpose, but as it works out, after you eliminate some programs, school districts come up on the short end.

How do you explain that? Mr. KURZMAN. We are in the process of reviewing the extent to which there would be any short fall, and, of course, the intention was clearly stated at the time the bill was introduced in April that any short fall would be corrected.

Chairman PERKINS. You have not completed that review yet?
Mr. KURZMAN. That is correct.

Commissioner MARLAND. I would like to add to that, Mr. Chairman, I think it would be useful for the committee to know that we recognize that the formula, which is a part of this bill, has some flaws.

We know that and we are continuing work on the formula. One of the complications is that the data keeps changing so that we are working with a moving target. Therefore, as you have noted, some States may not under this present formula receive precisely as much as they did before. That is one of the reasons for the hold harmless feature of this bill.

I think it would be useful for us, at the time we come close to moving toward the adoption of a formula, to share with the committee and the committee staff the refinements of that formula, so there will be a joint participation.

Chairman PERKINS. That formula has not been finally refined? Commissioner MARLAND. That is correct.


Mr. KURZMAN. And that is necessary, Mr. Chairman, in part, because of the time which has elapsed since the proposal was first introduced.

As I said earlier, when it was introduced, the formula was designed to provide an extra margin of $200 million above what was already appropriated for the 33 programs that would be consolidated in this bill.

Chairman PERKINS. Mr. Quie.
Mr. QUIE. Thank you, Mr. Chairman.

I will yield to the gentleman from New York for a question, but first I want to say that for a long time I have been for consolidation of the categorical programs, and what you two gentlemen have given to us this morning is the best statement I have ever seen in support of consolidation.

Mr. KURZMAN. Thank you very much.

Mr. QuiE. I know it does not take much to convince me on it, since I was convinced before.

Mr. KURZMAN. Your leadership on the subject is well known.
Mr. QUIE. I think it is the direction that we have to go.

I am convinced the Federal Government will have to assume more than just 7 percent of the elementary and secondary costs, but we just cannot write adequate general aid legislation unless we first consolidate the categorical aid programs and have resolved the question of church and state.

I think you made here another step forward. I will ask some other questions about that, but I promised to yield to my colleague from New York, who has to leave.

Mr. Reid. I wish to thank the gentleman for yielding.

I just want to say I am delighted to be here and to hear the thoughtful testimony from Secretary Kurzman and Commissioner Marland.

I just want to ask whether either of you could present briefly a general status report including specific economic facts on the school districts across the country, specifically, how critical is their condition, and to the extent you think it appropriate, we would welcome any figures you could subsequently submit. My impression is that school districts across the country are increasingly in great difficulty, and certainly this is true in a number in New York. Any economic facts on that would be most welcome.

Commissioner MARLAND. Congressman, we are not in a position to deliver detailed facts.

I could give you a position from my point of view, which I think equips me to make such judgments. I would have to testify that conditions are very grave in many of our communities around the country, and especially in the big cities.

My work in the past week has taken me across the country from Portland, Ore., to Chicago, to New York. It is no accident that in those communities I was surrounded by very anxious school board members, very anxious leaders in those communities, very anxious community press, wondering what is going to happen. I can assure you the conditions are grave and I can assure you the administration is taking them with equal seriousness.

Mr. REID. Thank you.

Mr. Quie. Now, I would like to pursue the question of nonpublic school children a little bit more.

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