We have used that approach in block grants in many places. The first one I think was a block health grant back in about 1967. Some of the Governors were rather apprehensive when they began. Their general reaction was, what good will it do? Because the Federal administrators will make the strings so tight on approving our plan that the effect will be the same as categorical grants anyway. This has not happened. I think it would not happen with the educational grant.

I have summarized and shortened my statement. There are details in it which I have not covered, but I would ask that the full statement be entered as part of the record of this subcommittee.

Senator PELL. Without objection, the full statement will be inserted in the record at the conclusion of your testimony.

I can see why you as a Governor would support the block grant approval. I was wondering why you felt that that approach will improve the quality of education, the diversity of education opportunities for the youngsters across the country.

For instance, under the proposals of the revenue sharing bill there is no provision for libraries. They are just knocked out of the picture. It is hard to imagine education without books.

I would be interested in your views, agreeing that it would certainly be simpler for administration, and agreeing that there should be a degree of consolidation—and this we hope to do in this bill—how by adopting the whole course of the proposal of the administration we would improve the quality of education for the children?

Mr. RAMPTON. I do not know about going the whole course because I have not read the President's proposal that carefully. But let us take libraries as an example.

In our State school finance formula we have had for many years a categorical item for libraries in the school districts. We took it out last year because we found out that the schools were spending substantially more for libraries than was in that categorical grant.

In this case our categorical grant has run its course and served its purpose. It had pointed up a need for expanded libraries within the schools. The school districts, and the individual schools have accepted the responsibility, taking it on themselves, and were going beyond that in terms of expenditures for libraries, hence the reason for the categorical grant being eliminated.

Now, our categorical grants for libraries were very broad just for libraries, period. Some of your grants are very restrictive and they do not fit the situation in an individual State.

Let me give you another example of what can happen with a very tightly structured categorical grant. A woman called me Sunday afternoon before I left home. She is a woman who heads a neighborhood organization in a fairly depressed part of Salt Lake City.

In order to achieve some racial balance in a certain school there, they are busing some Chicano students—not very many of them—into a neighboring school area within the same school district.

The school where the children would go ordinarily, according to their geographical situation, is eligible for title I funds, and those children need it. The school into which they are being bused, in order to achieve racial balance, is not qualified for the title I funds under the present guidelines. Therefore in order to meet one Federal re

quirement, we are depriving the children of an educational advantage which they should have under another Federal grant.

If we had more latitude in handling a situation like that, certainly we could avoid it.

Senator PELL. If enough youngsters are bused into the school, it will meet the requirements under the category for title I.

Mr. RAMPTON. Oh yes, if we bused enough in there, but obviously what the school district is doing is merely busing enough out of a compacted area to get down below a certain formula. The compacted area is not all or not even predominantly Chicano, and by getting a certain number of children out, they just meet a practical situation, but, yes, if you want to bus all the city so you can have equal involvement in each school, but I do not think that is going to occur. That would certainly create an artificial situation.

Senator PELL. Another problem that I see is that the groups that do not have much muscle either at the polls or on the political scene will tend to be short changed unless there are some safeguards for them, and these safeguards in the past have been the categorical programs.

As we know, historically the poor and the black are very bad about voting. They do not have the same percentage of voting as do the more prosperous or the whites as a rule. Hence they have less muscle when it comes to the political processes.

I am wondering how these people who need education the most, who probably should have more money spent on them

Mr. RAMPTON. I agree they should have more.

Senator PELL [continuing]. Will continue to have that money spent without the safeguards of the categorical programs.

Mr. RAMPTON. While they do not have political muscle, Senator, I think at least to you and to me they have a political appeal that far exceeds political muscle. I think that is true in most States with most State legislatures.

I have a review of our Utah formula. Let me tell you what we are doing about that. We are distributing our money-about 75 percent of the support for the high school and elementary schools now comes from the State level-to the school districts on what we call a weighted pupil formula.

A typical average student from first grade through high school is rated at one.

We recognize that there are certain students in certain school districts that have a higher per unit cost of educating. On the one hand, the small rural school district because of the great distance of travel and the necessary smaller class loads has a higher per unit cost. So on that end a student in one of these schools may be rated one and a half or two.

We also recognize that in the field that the Federal Government covers by what you call compensatory education there is a higher unit cost, and disadvantaged students are rated higher-the highest value given is 2.59. This would be for not only the disadvantaged students but the students with some physical or mental disability.

But a typical disadvantaged student who may have the complete capacity to absorb the instruction in the public school but comes from a home where he has not had the preschool opportunity to prepare for

this may be up around 2. So we are attempting to take care of that right in our formula.

If you come along with categorical grants and do it again, then you put too much money there, or, on the contrary, if we know that you are going to put it in a categorical grant, we reduce our weighted pupil average. However, I do not think you are going to get the money distributed as well as we can distribute it out there.

Although we have another categorical grant that we label compensatory education, just as you label yours compensatory, our big money for compensatory education is built right into this weighted pupil formula, and many other States are doing that.

I want to repeat that I am not criticizing the program up to now. I recognize the need for a categorical program, but it is my belief that if a categorical program has not after 5 or 6 years been able to demonstrate its worth to the administrators, maybe it should be abandoned. If it has demonstrated its worth, the administrators are going ahead with that program, even though the money is no longer tied with the categorical strings.

Senator PELL. I must say you make a very compelling argument. I am wondering if your State is not of an exceptionally high order in the rank of States when it comes to equalization formula.

Mr. RAMPTON. I think it is. We are second only to Hawaii which has a single school district.

Senator PELL. That might be a factor in this.

Mr. RAMPTON. I do not think so, Mr. Chairman. I hope that you will have your staff analyze these seven school States that have adopted new formulae in this last year. I am convinced from talking to the other Governors at our Governors' conference that the question of revision of school finance formulae and achieving equality, not of dollars spent but of educational opportunity, is the very first priority of every Governor in these United States right at the present time. Senator PELL. One final question. How do you see this improving the quality of the education of the child?

Mr. RAMPTON. It will improve the quality of education by giving better direction to the expenditure of these funds-let us take Utah as our example. This year the State put into high school and elementary education about $213 million. The Federal Government gets an amount in there-I cannot tell you exactly what it is, but I guess around $15 million in all areas.

If this money could be combined in a unified program, I think it could be more efficiently expended than if the State has one program and the Federal another.

Senator PELL. Thank you. Could you give us the official position of the Governor's Conference? Did they pass a resolution in connection with this?

Mr. RAMPTON. Not in regard to this specific problem because at the last time we met for the purpose of making policy these particular bills had not come up. We had the present policy generally, but we do have a position which follows the principle of the Serrano case endorsing the complete equalization of opportunity of education in the State.

May I mention one other thing. This is not before this committee at the present time, but you have before the Congress now some budg

etary procedures requiring, as I recall, that moneys be appropriated in full before the fiscal year to which they are to apply. If that happens, that is going to be one of the best things that can happen to us. It is rather disconcerting to get a call from HEW saying, We have $150,000 for which your State is qualified under a new appropriation that just went in, but you have to qualify for it before 2 months or your eligibility will pass.

You do not set up a very good program under those circumstances. If we can get the money in some kind of block grant conditioned upon-again I emphasize-conditioned upon the States themselves adopting a formula that is consistent with what you have been trying to do and then get advance funding so that we know for a period in advance what we can look to, we believe that you will come to real State-Federal cooperation in providing better education for our children.

Senator PELL. Thank you.

Senator Stafford, do you have some questions?

VIEWS OF GOVERNORS CONFERENCE

Senator STAFFORD. Thank you, Mr. Chairman.

Governor Rampton, I believe you testified that you were not representing the official view of the National Governors' Conference. May I ask if in your judgment you are expressing the majority view of the Governors' Conference?

Mr. RAMPTON. I think I am expressing almost the unanimous view. I am chairman of the Committee on Fiscal Affairs and Government Management, and as such I think even in the interim period I have the right to state the official position of the Governors' Conference.

Senator STAFFORD. Very good. Could you tell us approximately what percent of Utah's public school system is financed by State funds? Mr. RAMPTON. 75.3.

Senator STAFFORD. And the balance comes from various Federal programs?

Mr. RAMPTON. About 75.3 and comes from the State. The other 24.7 comes from the local property tax. The amount of Federal money that comes in is about 6 percent of the whole program.

I gave the Senator some figures here a few minutes ago. I know our State contribution is now $213 million or will be in this fiscal year. I cannot account for all the Federal funds because most of it goes directly to the school districts. In my judgment it is about $13 million to $15 million.

So the amount of Federal dollars to the whole program will be somewhere around 6 percent.

Senator STAFFORD I did not hear all of your testimony because I was delayed in getting here by another appointment, Governor. Are you familiar with, in general, the administration's proposals for special revenue sharing for education?

Mr. RAMPTON. I read the President's message yesterday, and I am aware of the documents that were sent out a year or year and a half ago by the office of education. Yes, I am aware of those.

VIEWS ON ADMINISTRATION PROPOSAL

Senator STAFFORD. Might I ask you on the basis of the documents you have examined, and what you read yesterday, whether or not you would, as a general proposition, endorse the administration's proposal? Mr. RAMPTON. I would be willing to put this modification into it, and I do not think it fair-to meet the question Senator Pell raised a few minutes ago I would be willing that the bill provide that in order to qualify for the block grant or special revenue sharing the States must adopt on their own a formula which recognizes the very problems that the categorical grants have been trying to get after.

Until they do adopt a State distribution formula that gets at those problems, they should not be eligible for the block grant, but would continue to get categorical money. That would give a dual system of administration for a little while, but I am sure it would not continue beyond the next session of each State legislature because they are working on this.

IMPACT AID

Senator STAFFORD. I did hear your testimony with respect to impacted aid, and I gather the effect of impacted aid can often be in effect a discrimination in favor of those areas which receive it because they get that money in addition.

Mr. RAMPTON. May I ask the young lady to show you on the blackboard what I mean.

Senator STAFFORD. All right.

Mr. RAMPTON. May I come up there and lean over you?
Senator STAFFORD. Why, certainly.

Mr. RAMPTON. [Drawing diagram.] Here is we will say the financing level of the various districts. Some of this low ability is accounted for by the fact that they do not have the taxation ability because of the presence of a Federal installation.

We come along with our State programs, and equalize all that, fill in all these gaps. Then you come along with the impacted aid and build this money on top of it, so you are getting an inverse situation of discrimination.

Senator STAFFORD. I think I understand that and I thank you for the diagram.

Mr. Chairman, I have no further questions at this time. Thank you very much.

Senator PELL. Thank you, Senator Stafford, and thank you, Governor Rampton, for taking the time to be here, and letting us have your views. I am very pleased with them indeed.

[The prepared statement of Mr. Rampton, and other material subsequently supplied for the record follows:]