ernment that I have ever known of is the encouragement of the small business system.

Mr. Suss. Thank you.

Mr. SCHWENGEL. Is there any new authority for SBA in this bill?

Mr. Suss. No, sir; there is no new authority. It was decided that we had adequate authority and programs to join in this effort in a substantial way.

Mr. SCHWENGEL. So whatever you told us you can do whether we pass this bill or not and you probably will do?

Mr. Suss. Yes, sir; except that we will be cooperating with the new organization to the greatest extent possible.

Mr. SCHWENGEL. There is no new authority. There is not anything, if we pass this bill that you cannot do now?

Mr. Suss. Except that we expect many new opportunities for us to go into this area and assist small business by this bill if it is passed. Mr. SCHWENGEL. Actually there is no new authority for SBA? Mr. Suss. There is no new authority.

Mr. SCHWENGEL. Thank you.

Mr. DAVIS. That means you do not need any but if this bill works administratively you will have greater opportunity to help more small business people in this 10-State area.

Now one more time: Is Mr. Perkins here?

We will adjourn until 10 o'clock tomorrow.

(Whereupon, at 11:50 a.m., the ad hoc subcommittee adjourned to reconvene at 10 a.m., Wednesday, May 20, 1964.)

APPALACHIAN REGIONAL DEVELOPMENT ACT OF 1964

WEDNESDAY, MAY 20, 1964

HOUSE OF REPRESENTATIVES,

AD HOC SUBCOMMITTEE ON APPALACHIAN REGIONAL
DEVELOPMENT OF THE COMMITTEE ON PUBLIC WORKS,

Washington, D.C. The ad hoc subcommittee met at 10 a.m., pursuant to recess, in room 1302, Longworth Building, Hon. Clifford Davis (chairman of the ad hoc subcommittee) presiding.

Mr. DAVIS. The subcommittee will be in order.

We will proceed quickly because we have Secretary Celebrezze with us this morning and he is trying to be in two place at once. That seems to be characteristic and typical of Cabinet officers these days.

We are delighted to have you, Mr. Secretary. While we have your prepared statement, if you care to, you may summarize the statement and, of course, without objection, your complete statement will be made a part of the record.

We will be glad to have you proceed in your own way.

STATEMENT OF ANTHONY J. CELEBREZZE, SECRETARY OF HEALTH, EDUCATION, AND WELFARE; ACCOMPANIED BY DEAN COSTON, DEPUTY ASSISTANT SECRETARY (LEGISLATIVE SERVICES)

Secretary CELEBREZZE. Thank you, Mr. Chairman and distinguished members of the committee.

In the consideration of House bill 11065, commonly referred to as the Appalachian Regional Development Act of 1964, I wish to express my strong support for this legislation. This bill was developed as a result of the studies of the President's Appalachian Regional Commission, part of which I participated in personally, and part of which the Department participated in. It was a combination of effort on the part of Federal, State, and local governments to survey the situation in this region of our country known as the Appalachian

area.

We found that while the Department of Health, Education, and Welfare has in past years put a great deal of money into aid programs in this area, we found that what was lacking in the area was the physical development to sustain the economy.

We know from past experience in our programs that when people are hungry or when they are poorly clothed, it is part of the function of Government to clothe them and to feed them. The question is, Are we going to continue along the path of dependency or do we try to hit at the root causes of dependency?

The only way to get at the root cause of dependency is to look at the economic condition of a community to find out whether or not we can do something to uplift the economy, through physical development so that there are jobs available. As a result of lifting the physical facilities of the community there will be a broad enough tax base to support its school system and to maintain the other physical needs that are required for the purpose of sustaining a good economy and a healthy community.

Our experience has shown us also that in the development of the physical needs, two basic things are important insofar as the population is concerned. One is a sound, basic educational system; second, a sound, basic health program.

If you don't have roads to cover these areas, then you don't have schoolbuses in which to get the children to the schools. You can build the schools in the area, but if you don't have the access roads to get to those schools, you will not get the children to school.

We know from our basic experience in the Department of Health that there is a high incidence of certain diseases in these areas because of unsanitary and polluted water. We have, in the past, through the accelerated public works program, supported some projects in the Appalachian area to build sewage treatment plants.

But we also know that all the communities concerned cannot put up these sewage treatment plants. I won't burden you with statistics this morning; we have our charts and we can provide that for you as to the number of communities that are without treatment plants-we feel that by taking care of these physical needs-the sewage treatment plants, the roads, the schools-we can be of assistance.

I don't have to tell any member of this committee the importance of education in a community. I don't have to tell the members of this committee, of the exodus of people from these areas even though sometimes they do go to college. They don't go back to the home community because there is nothing there. Therefore, they go to the large cities to make their way.

If we can uplift this whole Appalachian area, which touches some 10 States, which touches millions of people, then these individuals will have the incentive to stay in their own home communities and develop them.

Again, a basic concern, the concern of the Department of Health, Education, and Welfare, is, for example, that there has been, last year, public assistance in this region to the extent of $376 million. If we continue our present course, each year that sum will increase.

Unless we can uplift the economies of these communities, unless there are job opportunities, unless we have the physical plant to induce industry or to induce commercial aspects of our economy to come into the community, unless we can develop the roads for recreational purposes and for tourists, we are going to continue on this road to depend

ency.

That is our great battle today. How do we stop this cycle of dependency? What this bill provides, is over and above all the things we are doing now. It would give us the opportunity to pinpoint this area and put more money into it than would be placed under our regular programs.

Under all of our regular programs, there are limitations. Each State can only get so much. The appropriations are at a certain ceiling. They provide for important projects. But if you are going to lick this problem, then you have to pinpoint and do more.

Any of you gentlemen who have traveled through this area, and I am sure many of you have, can see the great scars, for example, from strip mining, where they just ripped the earth wide open and left it there. We know as a result of many abandoned mines there is acid mine drainage which we are trying to cope with in my Department, too. We know that these things can, with the proper initiative on the local, on the State, on the Federal level, and with the proper appropriation of funds, be cured to create better living conditions in these areas. The bill does one other thing that is not possible under existing law. For example, it is of little value to go in and tell a community, "If you do this, the Federal Government will give you 50 percent of the matching funds."

There was a question I asked many times as five times mayor of Cleveland: "Where do I get my 50 percent?" That 50 percent can only come if you have developed a sound tax base. A sound tax base comes from industry and commerce. Unless you first develop that, then whatever you do in the future you are always going to be running in the red because you do not have sufficient funds from a tax base to provide matching funds.

The bill provides that in certain instances we can pay up to 90 percent of matching funds. If the community can't put up the other 10 percent, then the Department of Commerce can aid them in putting up the 10 percent, so that eventually they can broaden their tax base to the point where they can sustain these projects. What we are trying to do is give them that start now.

I think that is the purpose of this bill. We have the poverty bill before Congress, which deals basically with human needs. The Appalachian area bill deals basically with physical needs in a community. If you combine these two efforts, then I think we shall succeed in our battle to break the cycle of dependency and to give these people an opportunity.

It is of little value to tell a coal miner at the age of 50, who is out of a job, out of work, that the gross national product has gone up to so many billions of dollars. It doesn't mean a thing to him. But it is important to that coal miner if you can bring industry and commerce into the community where even at the age of 50, probably with an investment on our job retraining program, we can retrain him to do something else and get him off of the dependency rolls.

That is our main objective-to give a combination of a broader tax base to these communities to help themselves, and, of course, dealing with the individual and having him work for what he gets rather than continue to be on dependency. In many areas there are generations after generations, fathers on relief and then children on relief.

That, in brief, is the purpose of the Appalachian bill. I think it is long overdue. I think that part of it is perhaps the fault of the Government itself, in that we permitted this tearing up of the earth, tearing down of timber, the gutting of the land and leaving it isolated. Now we have to do something about it.