terms of involving school systems and teachers in social service or related activities, and that comes out sounding not like a bad deal, but indeed, like a good one.

Mr. CORMAN. I have to tell you that once before the Rules Committee I used the same expression you just did, and Mr. Midden pointed out to me, "Any time you rob Peter to pay Paul, you get a great deal of moral support from Paul."

Mr. CORMAN. There is some feeling even within the Ways and Means Committee that when you spend money on poor people you are robbing taxpayers. I am worried about that philosophy we leave to the States these funding decisions and excuse them from matching fund requirements when 20 of the States are not currently achieving their potential. I suspect that these are the areas where the social services are the weakest.

Mr. KURZMAN. Now, the income limitations, Mr. Chairman, are tougher in our block grant proposal than they are in current law. I think that is a very important point to make. So even if they used it for educational services, they would still have to meet these tougher income constrictions that we are proposing. So, it isn't a question of taking-if your comment just now implies that somehow the States would be free to shift the money away from poor people-the answer is "No." Even if they shifted it into more educational activities than currently, not only would they have to take it from elsewhere in full view of everybody in the State who previously had gotten the money, but they would not number Federal law-and this we would be monitoring-be able to give it to people who don't meet the income restrictions.

The Senate bill, I should say, on the proof of eligibility, one of the things you asked the Secretary about earlier, I would like to reinforce our position on it if I could. We not only object to the money in it, but we very strongly object to the elimination of this targeting on the poor that is in that Senate bill.

We think that that is clearly going in just the wrong direction. If there is any difference between this program and general revenuesharing, it is that this program focuses on the poor, on people who are below the poverty line or receiving public assistance, and we think that is where it ought to be and remain.

That is what the block grant would do.

Mr. CORMAN. I just wish that I thought you were as enthusiastic in support of getting us more money, as I would be in getting the Senate to retreat on their provision for no needs test.

Mr. KURZMAN. If there were a block grant, you know you would get

more money.

Mr. RANGEL. I want to ask, why do you have educational money in this type of bill in the first place?

Mr. KURZMAN. It isn't proposed that it be an educational bill. All we are saying here, Mr. Rangel, is that

Mr. RANGEL. Why don't you have the restrictions in this bill? Mr. KURZMAN. Well, I think Mr. Morrill is the best person to answer that.

Mr. MORRILL. There are two major ones eliminated-although we did leave some of the prohibitions with respect to construction and cash payments that had been in title XX-relating to health and education.

The reason for those coming out are found in the example I used. Very often you get a mix of services where an educational component or a health component is appropriate to the program and should be allowed in title XX.

We tried in the original bill-since there were many gaps between title XIX medicaid and services and between straight out educational programs and services-to get them as close as we could so that there weren't gaps in a senible array of comprehensive services at the local level.

Mr. RANGEL. What type of program would go into the schools? I need something as an example.

Mr. MORRILL. Well, the kind of things that come to mind is if, for example, you are providing, say, community-based services for the mentally retarded children. You may well want to have both a health and educational component as part of an overall package of services delivered not by the school system necessarily, but by that service

agency.

Mr. CORMAN. We have a lot to do here so we will vote and come back. We will be back in 5 minutes.

[Short recess.]

Mr. CORMAN. The subcommittee will resume its hearing.

Mr. Rangel, did you have some additional questions?

Mr. RANGEL. No, sir.

Mr. CORMAN. Mr. Stark?

Mr. STARK. No, sir.

Mr. CORMAN. Counsel?

Mr. JENSEN. I would like to personally thank the people like Bill Morrill, Steve Kurzman, and Mike, who during the time of the development of title XX made an effort to work out a compromise, I was in a different position at that time, but I want to publicly make known my appreciation for their efforts at that time.

Mr. KURZMAN. We want to thank you, too, for your efforts and the efforts of the subcommittee and both committees of both Houses for their cooperation. As the Secretary said in his opening statement, it was a remarkable getting together that we would love to resume.

Mr. JENSEN. On April 2, you published your new regulations on allowing States to establish their own procedures for establishing eligibility for title XX services, including using the simple declaration of income as compared to extensive documentation of income which many people objected to.

Can you provide the information to the subcommittee on how the States have responded to that as far as changes, both needed changes and what proposals are in the coming year?

Mr. KURZMAN. We would be happy to do that if we could for the record, please.

Mr. JENSEN. Fine.

[The information follows:]

Mr. JENSEN. There was also considerable concern expressed during the hearings held by the subcommittee in March about invasion of privacy and confidentiality of individual client records both as related to information gathered during eligibility determination and the whole reporting requirements.

What efforts are being made to alleviate those kinds of problems? Mr. MORRILL. We are now working on that within the Department. We are persuaded that there is a way to obtain the basic data that the Department and, indeed, the States need for examining and evaluating the effectiveness of the services provided and how those services work out for individuals-many of whom have multiservice needs--without getting into trouble with the confidentiality or privacy of the individual record.

We do think it will require some changes to our regulations and some working with the States in terms of how to maintain that basic data information without getting into difficulty. But we have that well under way and I am-Mike may be able to speak to the exact status, but there will be something forthcoming in the near future on that.

Mr. SUZUKI. As far as 228.63, which was the individual basic data file, the Department has revoked that regulation. It is coming into the Register, yesterday or today, I believe, because of the concern about the unique identifier and a critical date, May 15, that the system had to be in place or there was dollar jeopardy, we have revoked that particular section. In the preamble we have stated that we still feel that the system should be able to get this information. We will use a new approach, something called a notice of intent to publish regulations. We will publish it in the Federal Register laying out the pros and cons of our particular approach to move it out of the FFP section into compliance. This is the proposal, but we are not making it yet. We are going to invite comment because there is such concern about violation of confidentiality. We feel the issue has to be out in the open so people on both sides can talk to it.

There is a need for data. We have talked with members of the subcommittee staff about being able to report to you how many people are really served with this $2 billion.

In some ways we can't get that figure without an unduplicated count, literally. So, we want to raise these issues in a notice of intent so we will have the debate and commentary and the Department will determine how to move.

Mr. JENSEN. You propose to fold the current $60 million of staff training funds within the $2.5 billion ceiling.

Can you provide for us the information on what is the current spending by each of the States for staff training and that as compared to a set dollar amount of staff training funds available on a regular formula allocation, for example, on the basis of population as title XX is?

Mr. KURZMAN. We would be happy to supply that, Mr. Jensen. As you know, just one correction there, the training is an add-on to the $2.5 billion, it is not within it. We talked about $36 million.

Mr. SUZUKI. That is the amount of money that the States already at the services ceiling are spending in addition to the services ceiling. So, there is a kind of a hold harmless add-on to protect the current spending level of States.

We will give you the data, but remember there is sometimes confusion because there are training activities that have to be split out. Some is cash payment training, a portion of it is services. The States report it separately. We have been working it out and we will give you the figures.

[The information follows:]

FEDERAL SHARE OF EXPENDITURES FOR STATE AND LOCAL TRAINING BY FISCAL YEAR