vocational education might possibly be paying its part of the bill totally.

But, then, again, it might be more. In some States, I think at least in my State, it would be more.

Mr. FORD. We discovered, primarily from the complaint of the people in the library, that a custom was growing up in the State department of charging so-called overhead costs or support costs to separate functions, and I heard somebody throw a figure of $5 a square foot out there.

Do you customerily get a charge back from the State department for using part of the building, part of the other things necessary to keep the building going and so on?

Is there attached to you as the vocational education division of your State office some portion of this overall cost of running the State department of education?

Mr. GUEMPLE. I was the one that used the figure, no, sir, they do not charge us back.

Mr. FORD. Do any of you have that arrangement? I see three. California.

Mr. BARRETT. In addition to some direct charges for utilization of facilities, we pay on classified salaries or professional salaries, 41 percent in direct costs in support of other offices within the department of education and in some cases to other State agencies, department of finance and other support agencies, so the answer is "yes." Mr. FORD. Is that also the case in Minnesota?

Mr. VAN TRIES. Yes, sir. I think the indirect cost rate is negotiated with the Federal Government and we have a number of services which are provided to us and this negotiated indirect cost rate is applied to the Federal funds as well as to the State funding that are in our budget.

Mr. FORD. And Washington?

Mr. BINNIE. Mr. Ford, in the State of Washington we are a separate agency and not attached to any other agency. We have to pay the rent bill. We lease a building for vocational educational staff.

Mr. FORD. You don't pay anything into the State department? Mr. BINNIE. We don't pay anything to the State department in the way of percentage, no, but we pay for fixed costs of housing the

agency.

Mr. FORD. If I could get you to address the business of tradeoff that has been described, the gentleman from California said he didn't think it would be a tradeoff. Incidentally, it was called to my attention that when the Office of Education did an audit in California back in 1973, they discovered that you had people on the VE administrative staff or on the payrool who had, because of the reorganization, been transferred so that they were no longer working in vocational education. At that time the explanation you gave to HEW was that this occurred because the State did not modify its departmental and indirect costs allocation plan to reflect the extensive reorganization.

Now, what has been said partially answers the question in my mind whether it would in fact be a tradeoff. I suppose I am asking you to put yourselves on the spot, but I can say to you, in my own

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experience from being in our State legislature before coming here, that the legislative committees are extremely reluctant when it comes to adding payroll to executive spots like the ones you occupy, while, when the Federal dollars come out, there is no specific person-byperson examination of who you hire and what their job is.

Isn't it in fact easier to develop your professional staff and whatever support staff you need in a State office using Federal funds than to get it from your legislatures and Governor?

When you are talking about a tradeoff, we are kind of kidding each other a little, aren't we? The fact is you can get money for professionals out of the Federal funds that your legislature won't give you; is that true?

Mr. VAN TRIES. Mr. Chairman and Mr. Ford, I think that this has been true in the past.

In our State I am not sure it is going to be true in the future. I think in the past, the practicality of the politician was such that State levied taxes and State collection of revenue from State sources provided a good deal more mileage politically to be returned to the local community.

Many of these local communities do not care whether the money is Federal or State as long as they get it.

We are able to rely on Federal funds to build up a staff where the State legislature would have been reluctant to add that to the State complement, as you have indicated.

I think now, though, that at least in our particular State, this is changing. We now have a complement, and it does not make any difference whether it is Federal or State, that is the complement, and no mater where that is funded from that number of positions is all we can have regardless, so I think the situation is changing. Mr. FORD. Does anyone else want to comment?

Dr. GINGER. I would like to comment on it. I think the answer just given was pretty much the philosophy we had until 3 years ago. Now, we are moving out of this kind of operation with Federal money and moving State money in to pick up all of this. We do not charge State rent, the State budgets pays it and occupies the space and operates just as the rest of the department.

We use State money for rental and State money for this kind of operation because we realize that that soft money may leave. Hard money we hope will stay; that is, State money, and for that reason we are moving as fast as we can away from this other philosophy. We do charge indirect costs but we let that indirect cost; it is a different percentage for different kinds of Federal agencies; we use that to take care of the business operation, whatever service is provided within that department, but it is provided for everyone.

So, at the moment, and this has been a struggle for two straight sessions of our legislature, to get an additional amount of money flow from State sources to operate the department of education. But this is the way we are going in our State.

Mr. SHOEMAKER. I think there is some principle to take a look at here. The point you make is pretty sound I think in terms of practice. Studies in the fifties done by the U.S. Office of Education consistently showed the only unit of State department education which

had a leadership role in relationship to local communities was the division of vocational education.

This was consistent over a period of a number of years. The answer was very simple, that the point that you made that the division of vocational education-because of the assistance from Federal funds we are able to provide leadership staff and services for these local communities.

I think historically Congress showed, as you added, the ESEA Act. title V, that this improved significantly the State department of education.

Now, I think the question is: Is it worth it? I think this is the question that has to be asked and: Has the investment been worth it? I would suggest to you that dollars can flow to many places and nothing change unless there is a leadership role within the State In terms of the pattern that the investment you have made in vocational education, that part of that is in leadership and that leadership has resulted in change in programing.

So I think your point is very true and very clear and forgive me, sir. I think it is likely to stay on the whole very similar to that for sometime.

If you have been in the State legislature you know the reasons and the problem.

Mr. FORD. Mr. Quie, and I am not trying to speak for him, but I have been concerned about this pattern evolving, so I am concerned when I see what the GAO report says about percentage of money involved here.

I think what you are telling me-in trying to answer that concern, we have to recognize that in the real world the chances are there won't really be a tradeoff. If we somehow restricted your use, that the effect might be a reduction in the professional staff you had available rather than simply trading Federal dollars for State and local dollars, that the State and local dollars might be hard to come by?

Mr. BARRETT. I would indicate, if I were not here I would be home trying to defend my local budget where I might lose more than here. The General Accounting Office report is starting to hit us hard as vacancies now appear on my staff, with the possibility there could be a limit on the cost of administration now.

Now, the decisionmakers, have the opportunity to really bear down. So I think, even without testing your concept beyond just the fact that someone might be considered, or considering limiting the money. I am running into problems filling vacancies already There is no question that while the State money is a tradeoff in one way, if, in California 10 years ago, we would have had to go to the State legislature for our staff, we would not have the staff that we have now. That is changing.

Now, the attitude is, when the Federal dollar gets to California, it becomes a California dollar and expenditure of those funds should go through the same kind of decisionmaking process as does the State dollar.

But it is changing: there is no question. Ten years ago it was very easy to add staff with Federal moneys and very difficult to add staff with State moneys.

Mr. FORD. One final area here.

I think my principal concern and criticism of the GAO report is that the opening sentence is misleading because it says "This is our report on the role of Federal assistance for vocational education" and proceeds to examine only one form of Federal assistance for vocational education.

Now, some of you gentlemen touched lightly on some of the others. I know that title I money out of the Elementary and Secondary Education Act is being used for vocational education at the secondary level where the high school is the target school and title II is being used to purchase teaching materials that are used for vocational education.

There are some title II programs that have been involved in vocational education. MDTA, most certainly has, and general revenue sharing, depending of course on which State you are in. If it is physically dependent school districts, substantial amounts of general revenue sharing money is being allocated to vocational training not only of school age but after school age people.

With several economic opportunity program survivors that are now buried in HEW and Labor it is a little bit misleading if we are trying to appraise the total impact of Federal dollars on vocational education.

Would you agree with that?

Mr. VAN TRIES. I think I would agree with that. I think that another thing that should not be overlooked by the committee is the fact that more and more State legislatures are now going to program planning and budgeting themselves.

This means that every program that we have in the State is subject to scrutiny by a super-school board, not only the State board of education, but the State legislature itself acting as a super-school board.

In our State our whole budget is predicated on all of these funds, title I and everything else that is coming into the State, and how the legislature wants to set those priorities and to operate the vocational program of the State.

So I guess one point Iwould make is that people tend to think that the vocational funds come into the vocational division and vocational board and are expended without any reference to anybody else in the State having something to say about how those funds are expended.

That is not true because the legislature itself sets those priorities by virtue of approving a program plan and budget.

Mr. FORD. Then you do exercise disrection over the expenditure of funds beyond those that we are talking about here today as vocational education funds that come from Washington. If the local education agency decided to allocate them for vocational education, at that point they really come within the purview of your activities and professional guidance and direction and what have you?

Mr. VAN TRIES. In the case of Minnesota, Mr. Ford, the only vocational funds we use are Vocational Education Act funds. We don't use the other funds you mentioned.

Mr. FORD. Then the very last question would be: Is it correct then to assume, when your statements here are giving us proportionate

figures on State, local expenditures versus Federal expenditure, that the Federal expenditure is limited to the vocational education funds under the so-called Vocational Education Act and do not include an estimate of the other types of Federal funds I mentioned? Mr. VAN TRIES. That's correct. We have not included those. Mr. FORD. The gentleman from Washington.

Mr. BINNIE. Mr. Ford, I used total figures that came in in comparison of enrollments of vocation education versus dollar impact earlier in my testimony, but when I compared the $62 million plus State and local to vocational education funds that was compared to Public Law 90-576 funds.

Mr. FORD. Would the rest of you agree with that, that the figures we have now in the record on the comparison of Federal versus State/ local, the Federal funds described in those statements are only the Public Law 90-576 funds?

Mr. BINNIE. Yes.

Mr. FORD. Thank you very much.
Chairman PERKINS. Mr. Lehman?

Mr. LEHMAN. Thank you, Mr. Chairman.

Recently, I met with various groups in the 13th Congressional District of Florida and one of the subjects in regard to vocational education, that keeps coming up. When I mentioned the hearings we are going to have in Washington is, of course, my high school youngster is going into vocational education because he will not be allowed to go into the honors class since he will be kept out of college preparatory classes. Several weeks ago up here we had a close up group and I saw a couple of kids from it and I said, "Are you in vocational education"?

Nothing.

Tomorrow at 2:30, 24 hours from now, I will be talking to 200 young people in Operation Close Up who will be here in Washington from Dade County.

I bet if I ask if any of them are in the vocational education program, not one of them will be in vocational education.

So what I would like to see happen, is there anything we can write into this law that will see that the vocational education will not be deprived in any way as far as academic achievement? By doing so there will not be anybody stigmatized by this being regarded as a secondary type of academic education.

Mr. SHOEMAKER. If I may say briefly, as you heard several States indicate those who graduate from CETA high school levels, and that includes my State, are eligible to enter any of our universities, State universities in the State of Ohio.

Studies will show you that while let's say only about 7 to 10 percent of our graduates go on to college, which I say is about as maximum as it should be, a higher percentage of those will graduate than will of the normal population going.

The research on education over the years shows you one simple thing. Thirty-seven years of research on your college preparatory program fails to show you the college preparatory program is even the best way to go to college. There is no research to support the college preparatory program is doing anything except one thing, measuring your intelligence.