to use the money for jobs or use the money for training when it comes to political temptations?

Mr. CAPPIELLO. Truthfully?

Mr. QUIE. Truthfully, yes.
Mr. CAPPIELLO. Jobs.

Mr. QUIE. I think that is the answer.

Every mayor would have to say truthfully the biggest temptation is jobs. That is the concern that this Congress is going to have and I am really concerned that the administration is really willing to go so far as to say "hands off" and let you make the decision.

We are going to do it I am convinced but the temptation is not going to be that we ought to protect you in title II and you don't use some of the job money for training.

The temptation in this Congress is going to be that we are going to put a limit on the amount you are going to use for PEP.

I think the significant thing of the authors of the bill was to say, "We are going to trust the mayors" and I think that is the biggest leap forward that this legislation has made.

Mr. GAYDOS. Will you yield?

I think your answer would be the same whether it was tainted with politics or not. It is a practical conclusion.

If you have a decision to make, you are going to provide something that is readily available, namely a job, as distinguished from training. There is no politics in it whatsoever because if you are talking about politics you can be just as political by putting a man through a training program, and whether or not he completes that program or repeats it and repeats it again, you still have him doing something he is getting paid for.

Mr. QUIE. That is because jobs were not available for them.

If you had the combination of manpower programs of jobs and training, you would not have had that black mark on training programs that now exists where they go from one to the other, because if a man has mentioned there is a stipend in another job training program, he will move rather than sitting down doing nothing.

Mr. GAYDOS. Where does that job exist and where does it come from? Mr. QUIE. I think it is significant, I won't like seeing you put a percentage on title II because you would need a national percentage. If we don't know your percentage you put the Secretary into the determination of how to mix that percentage around the country. Well, let me get to something else because I know the time is short. I do appreciate, Mr. Gunther, that you brought up a problem in counting the labor force in the formula, because I am sure we picked it up from the MDTA language that starts out now with the labor force and I think yo umade a good point that the really important thing is unemployment and poverty.

I think the committee won't have a problem taking a look at this good recommendation. The thing that bothers me, however, is that you go on to hold-harmless and hold-harmless you ask for 95 percent. That means you are holding harmless to the old formula that you used the labor force as a part of it.

Mr. GUNTHER. I think what we are looking for is a transition mechanism from one whole set of delivery systems to a much more comprehensive one and while everyone is in favor of improving the

system and getting us out of sort of, well, we have been chasing our own tails in a circle, we just can't take a 50-percent cut or 45-percent cut and I would suggest that the one way to help fund a hold-harmless level or transition is to put a ceiling on how much extra you might get out of the formula.

Mr. QUIE. You have to put a ceiling, then you suggest you give it to those who were held harmless and there would be a group in between and it would probably be fair to give it to the ones in between; wouldn't it?

Mr. GUNTHER. I really think, what you are trying to do here is focus on the areas of the highest levels of unemployment.

Mr. QUIE. Yes.

Mr. GUNTHER. Rather than trying to meet some sort of general manpower need which I believe you can justify, and I am not talking just about big cities but I am talking about the Hobokens and the South Bends of this country, where all of a sudden you have a problem and "bing" you ought to be able to solve it without doing violence to the whole idea of block grants.

Mr. QUIE. It is sort of putting on a limit that might keep the money from going where it appears there is a worse problem if you use your formula you have there.

Let me ask you when you say "hold harmless" what do you include in that, all of the manpower in emergency employment or just the manpower programs?

Mr. GUNTHER. I think you have to look at both of them differently, because under your PEP program you had a section 5 and a section 6 and this legislation dealing primarily with those that were covered by section 6 so that is part of the public employment we are talking about.

Mr. QUIE. You are talking about section 6 of public employment and the manpower program?

Mr. GUNTHER. Right.

Mr. QUIE. Thank you very much.

Mr. DANIELS. I recognize my able colleague, Mr. Steiger of Wisconsin.

Mr. STEIGER. Just a couple of questions, Mr. Chairman.

One of my concerns is with reference to the counties' statement, what they call the central Federal control and reporting procedures, which they believe are excessive.

Do you share a concern for that problem?

Mr. GUNTHER. I think that if you are going to a block grant system, and that is a word we have been all looking for for a couple of months, that you want to minimize that.

I think Assistant Secretary Kolberg's objective, both when at OMB and now that he is back at the Department of Labor, is to minimize. I think that is the thrust of the administration's position. Our people did not read the bill as being inordinately complicated and requiring too much paperwork.

We have been having manpower, or local manpower people in the last few days talking about this and we did not see this as a great complication.

Mr. STEIGER. But you do agree, do you not, that if we go with a system, we ought to, to the extent feasible, minimize the amount of bureaucratic work required in order to make the system work?

Mr. GUNTHER. Yes, I would hope, Mr. Steiger, that when you go into it, the Department will understand that what you are trying to do is minimize this and set up a postaudit kind of thing where you come in with your client and say what you are going to do, you get your money and at the end of the year you tell him what you did and if you didn't do what you said you were going to do, tell them why and then they come back and say, "Hey, you really goofed up this thing," rather than the way it is now where we have to come in and get their concurrence on what you are going to do before you can do it.

There will be reasons during the course of a year that a city has to change its plan, say, because of a plant closing, something like that, or all of a sudden you have less unemployment in one particular section than another so you change your plan.

I think you will run into this any time you get into block grants. Mr. STEIGER. There is a provision not included in the bill on which I would like a comment, if you would be willing to make one.

There is, as you know and as you mentioned in your statement, provision for a State council but there is no specific authorization for a local council.

Do you think that makes sense?

Mr. GUNTHER. I would think that under the legislation we have that discretion and I believe we, in most instances, would have such a council.

I don't believe you can write here in Washington, a council provision for the local governments prime sponsors, local government units, I think it would be extremely difficult.

Mr. STEIGER. Are you satisfied, again in terms of your reference to the cross-check between cities and States, with the provisions on pages 11 and 12 of the bill which reads, "The Secretary shall not approve a comprehensive manpower plan or any amendment thereto until he determines that it meets the requirements of section 103, and in the case of a State plan, section 104, and that the plan was submitted to, and an opportunity to comment thereon provided, the Governor of the State and appropriate officials in units of general local government of the area to be served."

Now, does that in fact give you the kind of effort in coordination that in your judgment makes sense?

Mr. GUNTHER. I think it would be much preferable to the Senate provision which really ties the city, or could tie the city in knots in dealing with the States.

I think this is a provision which assures an appropriate role for the State and it encourages closer consultation and cooperation rather than adversary proceedings.

Mr. STEIGER. Thank you, Mr. Chairman.

Mr. DANIELS. I now recognize my colleague from New York, Congressman Peyser.

Do you have any questions?

Mr. PEYSER. Thank you, Mr. Chairman.

I am sorry I was late and did not get the benefit of hearing your testimony first-hand even though I now reviewed it, but at this time I will not ask any questions.

Mr. DANIELS. Mr. Steiger?

Mr. STEIGER. Let me go to one other provision, if I can.

The provision on the State vocational grants. The Secretary, under the bill, would make grants to State vocational agencies.

Now in your statement you indicate that you think that by and large it is a good thing. I am intrigued: Why shouldn't the grant for the use of vocational facilities go to prime sponsors?

Why do you reverse it?

Or, why do you believe it should be reversed?

Mr. GUNTHER. I think that we are living with history and that your proposal is a great step forward in shaking up the system and hopefully in our judgment making it work better, but we don't propose shaking the system too much because I think we have to recognize that there are certain providers of service in the States at the State level and you couldn't write a law here, I don't believe that would undo history of the past several decades.

Mr. STEIGER. Well, I am not suggesting that you rewrite history but suggesting rather that it is a little baffling to me that through the use of this vehicle you, in effect, are granting additional funds to an agency which then must deal with a prime sponsor instead of attempting to insure that the prime sponsor has the capability of dealing with the agency, be it the employment service or community action agency or a vocational institution.

The whip hand belongs to the vocational board, not to the prime

sponsor.

Mr. GUNTHER. Well, I don't believe we would have any great quarrel if you wanted to give discretion to the prime sponsor.

I just suggested that I imagine the reason the committee, in its judgment, or those who have worked out this compromise, as we recognize it as such, took into account the additional difficulties of changing the operating system by which vocational education is delivered and I think you recognize the realities of what is happening out there.

Mr. QUIE. Will you yield?

I think a more basic question would be: Is there a possibility of duplicating institutional training? Institutional training does exist in vocational schools and that is really what we are trying to get at. It wouldn't make much sense if a vocational technical school was providing the same training the prime sponsor wanted in his prime sponsor area, or even next to it, so it would be readily available to him, if the vocational educational school would be willing to do it.

So, I would like to ask you what you think if you had the best of all worlds, based on the assumption that you ought to utilize services presently available and how you can make the system work. Mr. GUNTHER. I think when I look at this I have to look at individual cities and how they operate.

There is no doubt in my mind that the city of Milwaukee would use the Milwaukee Institute of Technology because that is one of the outstanding vocational institutions. In fact you have them all over Wisconsin, but there are other States where the vocational educational institutes are not really that strong and therefore in Wisconsin it would be really a mistake to start duplicating that very efficient educational system.

But, in States where this does not exist, I assume that there will have to be something worked out between the State and the prime sponsor, the local governments, and it will be worked out and I am not sure how it is going to take place.

Mr. DANIELS. Gentlemen, thank you very kindly for coming here.

It has been very informative and, Mr. Gunther, you will not neglect to send us a copy of the amendment that you suggested?

Mr. GUNTHER. Yes, Mr. Chairman.

Mr. DANIELS. Thank you.

Our next witnesses are the Honorable Ralph Caso, county executive of Nassau and Mr. Ralph Tabor, director of Federal affairs for the National Association of Counties.

Mr. Caso, you may proceed.

STATEMENT OF RALPH G. CASO, COUNTY EXECUTIVE, NASSAU COUNTY, N.Y., ACCOMPANIED BY RALPH TABOR, DIRECTOR OF FEDERAL AFFAIRS, NATIONAL ASSOCIATION OF COUNTIES Mr. CASO. Mr. Chairman, members of the subcommittee, my name is Ralph Caso and I am the elected county executive of Nassau County, N.Y.

I also serve as the president of the New York State Association of Elected County Executives. I am accompanied by Ralph Tabor, the director of Federal affairs of the National Association of Counties.

It is a pleasure for me, Mr. Chairman, to testify before your subcommittee on behalf of NACO. First of all, we want to congratulate you and the other members of this committee on your perseverance and hard work in putting together this compromise legislation.

We fully recognize the difficulties you have had in trying to satisfy the many viewpoints on manpower reform legislation.

We know it has not been easy.

We realize that no one will be completely happy with everything in this bill. That is true for the counties as well as for the members of this subcommittee.

However, Mr. Chairman, we want to go on record in strong support of both H.R. 11010 and H.R. 11011. We have reasons to prefer H.R. 11010 of which I will say more later.

But, both of these bills embody the major principles of manpower reform which counties have been advocating and we again want to congratulate you on the fianl products. Both bills definitely are good bills from the viewpoint of local governments.

As I mentioned, Mr. Chairman, NACO's policy position on manpower covers a broad range of issues. We feel as you do that public service employment must be a part of the comprehensive manpower reform bill.

It is our conviction that public service employment should be one tool in the manpower arsenal of the prime sponsor.

One success that the 368 counties have had in effective administration and implementation of PEP is their utilization of subagents. Precisely because counties do embrace all jurisdictions within their boundaries, they were able to involve smaller jurisdictions in PEP in much the same way as State governments handled balance of State areas.