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mittee. My concern is to hold hearings across the country, and to get a bill, this bill to the full committee as quickly as possible.

Chairman Perkins. Let me say to my distinguished colleague, I have known the President for a long period of time, and I do not entertain many views that the President of the United States entertains, but I know having served on the committee with him back in 1949, 1950, that he is too true to say that he is for education, and at the same time advocate a national sales tax.

No child in America with any responsibility would come forth with such a program, or platform.

It is just completely nonsense.

Mr. PUCINSKI. Perhaps, Mr. Chairman, in our discussion here today we shot that one down pretty good.

Mrs. GREEN. I am just one of those people Chairman PERKINS. Nobody would believe it is sincere. Mrs. GREEN. I happen to belong to that group which thinks society will never support education as it should until we have a specific, earmarked Federal tax. We have just such an earmarked tax for the maintenance and development of our highways. We have a specific tax dedicated to that particular purpose alone. I am not endorsing a sales tax-but we might well give consideration to a particular tax for the support of education.

Perhaps a “booze for books” tax might provide the earmarked funds for schools.

Mr. PEYSER. I do have a statement with my next question. One, I met this morning with Governor Rockefesler and discussed with him the situation facing New York State.

He is in the process of announcing a major cut in the educational support that the State can give to local school districts, and this is going to be a very substantial cut, and in reviewing the formula, as I saw it on the proposed revenue sharing bill, it showed that New York State would receive approximately $23 million less than it would have received under the present formula.

I am sure this is not the intent, but I would like to hear from the Commissioner.

Commissioner MARLAND. We attempted to touch on that earlier, Congressman Peyser.

The short answer is this, the formula as it was constructed a year ago is moving forward with a moving target.

It may no longer be a valid formula. .

It could be subject to substantial revision, and the kinds of flaws that you have just reported could be rectified.

Mr. PEYSER. I thank you very much, Mr. Chairman.
I will yield to the gentleman from Minnesota.
Mr. QUIE. I would like to ask a question.

Is anybody considering, or talking about a "booze for books” tax down there?

Mrs. GREEN. I might say to the gentleman from Minnesota, that, if he would like to discuss that issue with me further, I am receptive to doing so.

Mr. Quis. If the young lady would yield, I do find that concept of a tax for education very intriguing.

We do that in Minnesota.

The State income tax is earmarked for education. Now, it is tapped for some other uses once in a while, but I think it has done well for education in Minnesota, by having it earmarked as income for education.

I would not reject tying the two together, if such a thing is being talked about, which I would not know anything about.

Mrs. Green. Thank you. I would like to return to the issue of categorical programs.

Many continue to argue that the categorical approach has worked so well. But the point is, it has worked well compared to nothing. The Federal Government has generally taken no other approach.

So when one asks whether they work, the answer is that compared to having no funds at the local level, of course they work.

When you get a few dollars for something, it is always better to have something than nothing but I have yet to hear an educator, if you ask him, “would you prefer to have a dollar in categorical aid, or

a would you like to have that dollar in general aid," I have yet to find a single educator who responds that he would rather have support in categorical aid. I have seen some that say, "I don't care about that categorical business. I am concerned about the real threat of having to close the schools. We do not have enough to pay for the heat and the salaries and so on. So I think we had better start thinking about the more basic necessities instead of being so absorbed in the relatively small basic impact of our categorical programs.

Now, in some of the States you said the amount of the money does not exceed the administrative costs.

I know of several cases in Oregon illustrating this situation. In one instance a check was received for $2.15. This is ridiculous. In another instance two different districts got checks from the Federal Government under the terms of categorical programs for $2 and $10. In yet another case, $19 was received. Then we pretend these catgorical programs are working well.

I think it is a lot of nonsense, and if we continue in this way, we will never solve the problems of education. Let me reiterate: “We must review the categorical approach, but not in relation to nothing. We must compare it to other programs that might be meaningful from the standpoint of quality education.

Mr. KURZMAN. May we reply?
Chairman PERKINS. Go ahead and reply if you want to.

Mr. KURZMAN. A number of points have been made on a lot of different subjects by several members, and I would just like to reply. The point has been raised, for example, there is some inconsistency between our desire to achieve comparability under existing laws, and our proposal to give the local school districts and the States much greater autonomy than they now have in the use of the approximately $3 billion of Federal tax moneys which are now going to the Office of Education, into aid in elementary and secondary education.

It is that kind of autonomy that we are precisely trying to achieve with this bill.

We are trying to limit the number of Federal concerns to a specific list of identifiable concerns which can effectively be monitored by the Federal Government.

That is the whole point of it. The bill limits the Federal involvement to, as I see it, five basic interests, which are overriding Federal interests.

It would give us for the first time a chance to make sure that those main interests are being met.

They are civil rights, comparability, serving the disadvantaged, serving those who reside on Federal property, and serving on an equitable basis, children who are involved in private schools.

Those five interests are spelled out at various points in the bill, and we are trying to eliminate all of the other quite valid at the time of enactment interests which the Congress expressed in the other characteristics of these 33 programs that would be combined.

Mrs. GREEN. You cite as one of the five areas of top priority the disadvantaged.

Why is that of greater priority than the advantaged?

Why do we neglect the kids that are really gifted, and say that our top priority is to turn to the disadvantaged.

Our future leaders will come from the ones that are gifted.
Why should not they receive some attention too in the priority?

Mr. KURZMAN. That question, I think, Mrs. Green, is addressed to what the Congress and the executive branch have expressed through both parties over a long period of time—the need to overcome a very long period of action against the disadvantaged.

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

On that, I guess, I would have to say the Congress is setting the ratio on these programs. In your proposal here, consolidating the programs that the Congress has passed, the disadvantaged get the largest share, but I would imagine if we start moving on into general aid that ratio will change.

Mr. PUCINSKI. We have been talking about booze for books, but we spent $56 billion on education at all levels, 40 percent of local and State level funds are now devoted to education.

It would take an awful lot of booze to raise that kind of tax.

Mr. QUIE. I think it is closer to $18 billion in elementary and secondary schools.

I would like to address myself to some of the comment on the future direction for school financing. On page 18, they put it in blue letters, and in italics, the different State educational expenditure levels, and they are explained largely by variations in their fiscal ability. As we write formulas, you, Dr. Marland, indicated you were going to take another look at the formulas in the proposal you have here, is that correct?

Commissioner MARLAND. I think it is noteworthy that the National Education Finance Study, which was sponsored by the Office of Education, is coming to fruition at this very timely point in history. Indeed, it will have very valuable applicability to the further refinement of that formula.

Mr. QUIE. And so when we do write a formula, either for the proposed special revenue sharing, or if we go to general aid to education, Í think the Federal Government must be an equalizer within the States.

It is the only way it would be equitable.

I wish the gentlemen from the New York were still here. I would hate to see the formula used as it was in title I for the Elementary Education Act, whereas the State which has probably the most, gets the most amount of money. I think that is the inequity of title I. As it happens, there is still more poverty in the southern part of the United States than exists elsewhere, and I think it behooves all of us to help the young people in their education, no matter where they are. That is why I want to make a strong plea for the equalization factor between the States on the part of the Federal Government. The second one really intrigued me, because I have been doubting all the time that this great poverty of funds in the large cities is not what they claimed it to be. When I was in the State legislature, I remember that the cities had most of the wealth, because that is where most of the taxable property existed. It is interesting, on page 19 of that report, it states the major urban core city district had the highest per capita value of any school district. They had an average of 8.9 mills being levied, as against the suburbs, 11.9 mills, so they have a lower mill rate, and a higher true market value of their property. To the extent that we depend on property, as we still are going to be doing for a while, I do not know if that California decision will completely reverse the use of the property tax, or not, but I doubt that will be the case.

You cannot have that drastic a change.

Commissioner MARLAND. Unless that observation remains somewhat incomplete, Mr. Quie, two-thirds of the local tax base on the real estate tax in a city is used for noneducational purposes.

We call that municipal overburden, which subsequently part of that report we will deal with.

A suburban community can support its municipal needs with onethird of its resources. Therefore, two-thirds are available for the schools. For a city, a third or less is available for the schools, because the needs of a city are so much greater than in the suburb.

Municipal overburden is the biggest distinction that is causing that, not the tax rates.

Mr. QUIE. I do not think that will hold true, because the crime that is in the city is moving out into the suburbs at a rapid rate.

Crime exists in the suburbs, it is moving to the rural areas.

The crime in my rural counties is astounding. People used to think they were immune out in those areas, and it is true, but the sheriff's department and police department in the smaller cities and rural counties are not able to convince the people as yet as to the urgency of the need for policemen.

I think that will expand out to rural areas too. I hope it will not be as bad, but the cancer of the city seems to be spreading around the country, and I just do not want us to ignore the problems of the rural areas in education that are quite severe in my judgment.

The last point I want to make, and it is a comment rather than a question, but it goes on further, as to whether it is the problem of the state to providing equality of opportunity, and it is the State's.

I do not think there is any way for us to have the intelligence, being on the Federal level, to bring about every equalizer within the State.

I think we have to depend on the State, and I know this is the pitch you are making in your testimony, and what Mr. Kurzman gave in his testimony, that we have to depend on the States, and give them that responsibility, and the awareness, that which we are gaining from the study, and the awareness we are gaining as individuals, is something that exists out in the States.

They are not deaf to this information. They are hearing it, and they want to do something about it, and I think the most important thing we can do is to provide the assistance to the States on an equalizing basis between the states and let them take care of the equalization within their State.

That is my view.
Chairman PERKINS. Mr. Brademas.

Mr. BRADEMAS. I only have one other observation, Mr. Chairman, because I know our time is running out.

I do think that the administration proposal has not sufficiently taken into account this extraordinarily difficult problem of the failure of the State governments to provide adequate state aid to local elementary and secondary schools, and one has only to look at the extraordinary range of percentage among the several States, to some of which I alluded in my earlier comment, and listen to the statement of our colleague from New York, Mr. Peyser, in which he commented on Governor Rockfeller's slash of state aid to local schools, to see what I am talking about.

I think Mrs. Green was very telling in her observation that your program, Commissioner Marland, as I understood her point, will not add any new money at all to the 7 percent of the expenditures on the elementary and secondary public school level now being paid from Federal funds, but rather your proposal is only a rearranging of the delivery system as to who gets the money. I think the Commissioner has been very candid in acknowledging that this charge is true, that there is no new money being proposed here by the administration.

Now that seven percent is targeted money, and we have already seen that we are not spending that as wisely as we should. That is one reason the administration wanted its comparability proposal.

To spread that modest amount of Federal money more broadly, and not target it, and without asking for any new Federal money, seems to me to be pouring a glass of water on the Sahara. I hope we will have a discussion through the next months on this matter because it seems to me absolutely essential, if you consider the implications of the California case and other cases which in effect say that the State governments must stop discriminating against children in school districts where there is not a good deal of wealth and do something to equalize expenditures. Mr. Pucinski has in this connection very tellingly raised the issue of the possibility of a Federal sales tax, which we all know is a regressive tax, if it is not based on some ability to pay. So I do not think that we can ignore, in considering revenue sharing proposals or, indeed, any other kind of proposals that have to do with the funding of education, especially at the elementary and secondary school levels, the question of the local property tax, relationships among the State aid and the Federal dollar. So I would hope in our continuing dialogue on this matter, Mr. Secretary, and Mr. Commissioner, that we can allude to these various matters and not rule them out of bounds for discussion.

I for one do not like the idea of the Federal Government taking State governments off the hook of fiscal responsibility, and that is exactly what you are going to do if you send Federal aid out to the States, without some sort of requirement that the States maintain their

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