Senator ALLOTT. Let me finish my question. Should they be confined to need alone? Or should they actually get into the matter of the adequacy of construction? Dr. FULLER. The criteria are based entirely upon the need for school buildings and the ability to provide those school buildings in the local community. They do not involve any aspect of the instructional program at all. I would like to read to you, Senator, from Senate bill 480, section 6 (a) (4). Here is the key point which prevents Federal control which S. 968 does not. It says: Sets forth principles this is the State educational agency for determining the relative priority of school facility construction projects which shall take into account the relative financial resources of the Federal local school agencies in the States, the relative efforts which have been made and are being made to meet their needs for school facilities out of State and local funds, and the relative urgency of their needs for school facilities, determined according to relative conditions of overcrowding or lack of facilities and relative expense to which unsafe and obsolete facilities are in use. These bills would leave the States to judge, not the Federal Government. That is the difference. Senator ALLOTT. I will read to you the paragraph from S. 968 this morning which, in my opinion, keeps any Federal control out of it which you and I don't agree on apparently. Dr. FULLER. The discretionary words there are the same as those which have been in a great deal of Federal legislation in which we found that Federal controls were exercised, for instance in making up State plans. It says that the Commissioner shall prescribe the standards and procedures. Those are the words that were used in objectionable laws before. Then the Federal agencies wrote a plan, and sent it out to all 48 States after it was written, and it had no State autonomy in it. You had to sign it. If you tried to make it different, they would say, "Well, we cannot change it. We cannot make it different in all 48 States. Why should we make it different for you?" So you have Federal definition, Federal determination, Federal uniformity under S. 968 which you don't have under the other bills. Senator ALLOTT. Referring to your own testimony, you stated that another illustration of excessive Federal discretionary controls is found in section 106 (c), giving the Commissioner the power to include in any contract or instrument made pursuant to this title such other covenant, conditions, or provisions that he may deem necessary to assure payment of obligation purchased under this title. Do you think any restrictions which are placed on there to insure repayment are wrong and excessive? Dr. FULLER. Yes. I do not think the Federal Government has any business sending agents into a local district to ascertain whether their building is in the proper condition to ensure the repayment of bonds. It says: Senator ALLOTT. Can you show me anywhere in the bill where he would have such authority? Dr. FULLER. I think he does there. Senator ALLOTT. I can't agree with you at all. Dr. FULLER. S. 968 says: Include in any contract or instrument made pursuant to this title such covenants, conditions, or provisions as he may deem necessary to assure payment of obligations purchased under this title. He is the judge of whether there has been adequate assurance. He is the judge of what further conditions may be attached, and he is given the authority to attach those conditions to local school district buildings. Senator ALLOTT. Before the money is advanced. That is done to assure against fraud or anything of that kind. Do you see any objection to that? Dr. FULLER. Yes; I do. That should be a State function. That is not a proper Federal function in education. Senator ALLOTT. Even when the Federal Government is advancing the money for it? Dr. FULLER. Federal funds would be intermingled with State money and council policy would call for the application of prudential controls by local school districts and State educational agencies over all funds used in local districts, not by people from the General Accounting Office and other places in Washington. Legally, there could be swarms of Federal employees tramping around in local school districts. I had it when I was State commissioner in New Hampshire in connection with another program, and we had to tell them to get out and stay out, and it was under a statutory provision similar to this. Senator ALLOTT. That is fine. I will go along with you on that. That is fine with me. That is my philosophy, too. Dr. FULLER. Mine, too. Senator ALLOTT. I would like to ask you one other question, although I don't agree with your interpretation of this bill at all in that respect. You have used the statement 2 or 3 times today about putting education on the same level as roads. In other words, as I see it, your state of mind is that this is a competitive thing to see how much money can be gotten by various things. First of all, with respect to roads, you cannot tax education, can you? You do have income coming in from gas taxes, and taxes on oil and other sources, which come into the Federal Treasury, but you can't tax education to bring in such revenue, can you? Dr. FULLER. I would say that that is literally true. I believe that education is an investment in people, as the Chamber of Commerce of the United States says, and that fundamentally that is where the taxes are produced over a period of time. If you use gas tax money and earmark it for roads, then you have to take it away from somewhere else. The point I was making was this Senator ALLOTT. I want to get clear your thinking on that. To me the things are not analogous at all. Dr. FULLER. There is competition for public money at the local level, at the State level and at the Federal level. At the State level we have the Federal Government putting up billions of dollars, and having it matched by the State. 60357-55-18 Let's assume a poor county, let's say in Arkansas-I hope there is no one here from Arkansas who will think that that fine State is being reflected upon by my statement in any way-let's take a poor county in rural Arkansas. Suppose they have a bonding capacity in that area of a million dollars. Here is the choice they have, Senator Allott. They need hospitals, they need roads, they need schools, they need everything in public service. They have a great many needs, and there are many counties like that in the United States. If they can float only $1 million worth of bonds, they can get 22 million or 3 million to build a hospital or they can get $2 million worth of roads or they can get $1 million worth of schools. That puts schools in a very disadvantageous position in competition for State funds in State legislatures, where Federal matching grants are being dangled in the other fields which are competitive with education. Senator ALLOTT. Then your reference in this thing is merely on a competitive basis for the tax dollar. Dr. FULLER. It is competitive, sir. Senator ALLOTT. You are speaking only in that sense. Dr. FULLER. No, not only in that sense. I am speaking in the sense that we need money for schools and school buildings, and we have a school building crisis in the United States, and that it is not fair to put education at a competitive disadvantage with other services in getting public funds. Senator ALLOTT. A couple of weeks ago we had considerable testimony before this committee from several States saying that they had no money whatever, from any source, if I understood the testimony correctly, with which they could match Federal funds in any way under any of these other bills, so how would those States come out? Dr. FULLER. There are matching funds in every State of the Union in numerous fields. The Council of State Governments puts out a book about an inch thick on that. Every State has numerous matching funds. Senator ALLOTT. If that was the testimony, then it was misleading. Dr. FULLER. Yes, it was. Senator ALLOTT. I think that is all. Chairman HILL. You have $2 billion the States are spending now which would be available for matching. Dr. FULLER. Yes, except what we want here is the three things I mentioned first. We want to put the schools where they are most badly needed, and to add the Federal funds in terms of schoolhouses to what would be built anyway. That is a major puropse, so that part of that $2 billion would not be in districts which would be eligible for Federal funds, those that have money of their own. The State plans would set up a priority system, you see, so that- Dr. FULLER. Yes. Chairman HILL. The area of greatest need would have the first priority, Senator. Senator DOUGLAS. I wonder if we couldn't clarify this problem of the free financial support of school construction a little bit more fully. Am I correct in my understanding that one of the reasons why you prefer some Federal aid in the form of grants from current appro priations rather than throwing the exclusive burden upon these localities or the locality and the State is that if you throw the burden primarily upon the locality, the costs are born out of the tax on real property. Dr. FULLER. Yes, sir. Senator DOUGLAS. And that there is no necessary relationship between the amount of real property and the number of children to be educated, Dr. FULLER. Yes. Senator DOUGLAS. And that, in fact, the poorer districts have in the past, and still today tend to have the highest ratio of children. Dr. FULLER. That is correct. Senator DOUGLAS. And that therefore, if you have local financing of school construction, the burden is crushingly heavy upon those who can afford it least. Dr. FULLER. Well, even after they have reached their debt and tax limits, they have very inadequate facilities and very inadequate salaries for teachers, so that they cannot attract competent teachers and retain them, and they have very poor district organization, because the reorganizing and building of modern schools means expenditures, and they have inadequate programs of education. So it is a vicious circle, and the major point, it seems to me that I would want to make, is that physical facilities for education must not be relegated at the direction of the Federal Government to the local property taxes for 30 years, and especially this must not be done in the very poorest districts which we seek to aid. It is a completely unfair thing to do. It is fundamentally wrong. Local real estate is not where the tax money comes from these days that supports competent services in any major field. Senator DOUGLAS. I am not trying to put words in your mouth, but I am trying to see what the reason is. Am I correct in assuming that the reason why you prefer S. 5 is that there we have grants from current appropriations of Federal Government. These grants are primarily derived from taxes on personal incomes and corporate incomes and are therefore, more fully based according to relative ability to pay. Dr. FULLER. Right. Senator DOUGLAS. And therefore, what you are saying is that we should draw on these sources where there is greater ability to pay to help the children in the districts where the local real estate is inadequate to provide the minimum of education which you regard as necessary in a civilized society. Dr. FULLER. I am saying that next to the defense of the Nation itself, where the funds do come from those broader sources, that nothing is more important than education and that it ought to share in those tax sources. Chairman HILL. Wouldn't you say it is a part of the defense? Dr. FULLER. I surely would say it is fundamental to our long-term defense. Senator DOUGLAS. There are some who question the responsibility of the National Government for the education of children, insisting that this is exclusively a local responsibility. What would be your reply to that? Dr. FULLER. The Federal Government spent 15 or 16 billion dollars for the education of veterans since 1945. It has been supporting education since the first Northwest Ordinance of 1785. Then there was the Morrell Act of 1862 and on up the line. The Federal Government has thousands of research contracts. There are colleges and universities where a major portion of their entire budgets come from the Federal Government. There are so many places where the Federal Government has assumed a responsibility that it seems absurd to many of us that the fundamental education of the elementary and secondary pupils, 30 million of them, cannot be the subject of some national concern. Here are all the children, or almost all of them, more than 85 percent of them, here is the basis of the quality of citizenship we shall have a generation from now. If you were to go to Maine, and I raise that again—the National Survey of School Facilities showed that the State of Maine had a smaller percentage of school buildings that were entirely satisfactory than any other State in the Union. If I had time and weren't afraid of usurping the time of three State school officers here, including my boss, Superintendent Bailey of Florida, I could talk about the situation in the three northern New England States at great length. I know that the 239 districts in New Hampshire have need beyond their real estate tax resources. Believe me, this is basic. It is basic that no Congress relegate the schools to the local property taxes and leave all the other services on the more adequate sources of revenue. Senator DOUGLAS. In other words, that there is a national interest in the education of children? Dr. FULLER. Very great national interest, I think. Senator DOUGLAS. Both in order that they may be more intelligent citizens, better citizens, and also, to provide for the training of children from poor districts who later may migrate to industrial States. Dr. FULLER. Certainly. Chairman HILL. Doctor, you spoke of New Hampshire and of the Ordinance of 1787. Isn't it true that Daniel Webster in speaking of that Ordinance said it was the greatest law of any law giver, ancient or modern? Dr. FULLER. Senator, your history is a little bit more up to date than mine, but if you say it is true, I am certain it is. Chairman HILL. If you check the history book, I think you will find that true. Senator GOLDWATER. I have several points here I would like to cover. Chairman HILL. Senator Goldwater. Senator GOLDWATER. I don't think there is any big question about the need in the field of education today. I don't think we are arguing that. I think what it gets down to-and you have expressed it yourself, and I know educational people all over the country expressed the same fear-is a fear of ultimate control vested here in Washington over the schools of the country. I think that is why basically we have always considered the schools or the problem of the school districts, therefore a problem within the States. You mentioned the Federal highway. Mind you, I am concerned with this fear of control, too. You mentioned the Federal highway system. The States no longer have the right to determine the |