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Tuesday, March 3, 1998.











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Chairman's Opening Remarks

    Mr. LEWIS. This morning we would like to welcome Mr. James Lee Witt, Director of the Federal Emergency Management Agency for a hearing on the budget request for Fiscal Year 1999.

    Mr. Director, before we get to some of the specifics, I want to state for the record that these last couple of years have been the most interesting working with FEMA, to say the least. And we have disaster after disaster across the country, whether it be fire, tornado.

    We do have an earthquake now and then in California. I've suggested in the past we used to have earthquakes to keep the population out, but that's getting to the point of being ridiculous. We know of recent floods and the tornadoes in Florida.

    There was a time when, of all of the government agencies around, the Agency that you're the director of was one that many of were inclined to perhaps close down. I remember in my early career in the Congress, that was a proposal of mine personally, long before this responsibility. In the meantime, I think it should be said for the record that the Agency is an example, an illustration of what we ought to be doing about changing the direction of government.

    Indeed, members across the aisle—this is not a partisan question—are very impressed by the fact that FEMA, the Federal Emergency Management Agency, is out there doing the job when America is faced with a challenge in one location or another.
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    While some are worried about a growing number of dollars when we have a series of crises, dollars that are laid out almost immediately, at the same time, most of us realize that America does come together when we face crises together.

    The budget request for 1999 includes $844,031,000 for the regular appropriation. That's in contrast to $841,958,000 in the 1998 budget year. In addition, this request includes $2,258,485,000 in contingency emergency appropriations.

    My colleague, Mr. Stokes, who is the ranking member on the Committee, is delayed this morning. He will very likely have an opening statement that we will move to when he does arrive. In the meantime, I'm not sure if any of his colleagues would like to add to these opening remarks or maybe we can go on to questions.

    Mr. Director, we will place your entire statement in the record. If you'd like to summarize your statement, we'll move on to questions quickly. But before that, I'd like to welcome to the Committee for the first time I think in one of these hearings your wife, LeaEllen, whom we're pleased to have with it. LeaEllen, nice to see you.

    Mr. Director.

Director's Opening Remarks

    Mr. WITT. Thank you, Mr. Chairman and members of the Committee. I will keep my remarks brief so we can get into the questions.
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    I'd like to introduce Gary Johnson, who is our Chief Financial Officer at FEMA, and, Mr. Chairman, we have some new faces here with us today: JoAnn Howard, our new Federal Insurance Administrator; Mike Armstrong, the former Regional Director in Region VIII, who is now the Associate Director for Mitigation and doing a great job; Ernie Abbott, our new General Counsel, on the end; and Michelle Burkett, whom you know; was our Regional Director in Chicago. She's moved to headquarters now, and is in charge of Policy and Regional Operations.

    Mr. LEWIS. She moved from Chicago to Washington?

    Mr. WITT. Yes, sir. She said it's not as cold.

    Although Congressman Stokes is not here, I would like to say that he has been a wonderful person to work with, as are you and this Committee.

    He was the Chairman when I first became Director of FEMA. I never will forget the first day that I came up and met with Mr. Stokes nor his comments to me as to what changes he would like to see at FEMA especially in support of diversity and equality. I just wanted to commend him and thank him for his support.

    Mr. LEWIS. I thank you for that.

    Mr. WITT. I know one day you held a briefing up here after the Oklahoma City bombing.

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    Mr. LEWIS. Yes.

    Mr. WITT. Congressman Stokes came by. I know he had 1,000 other things to do, but he made a point to come by to thank the FEMA employees for what they had done in Oklahoma City. We all remember that very well.

    We have had one of the busiest years, for disaster response and recovery ever at FEMA. This year, during the recent visits to Florida and California with the President in the aftermath of tornadoes and flooding, we saw that the devastation in these two states is just incredible.

    There's been a total of 41 confirmed deaths in Florida, and a total of 17 confirmed deaths in California from the mud slides and floods. Obviously, it's just devastating for those individuals.

    During the Christmas holidays, Mr. Chairman, we had the typhoon in Guam. I'm very, very proud of our employees who responded to the typhoon in Guam during the Christmas holidays, had to be away from their families, and did a great job in response to the needs there. The typhoon broke a record in wind speed at 236 miles an hour during the typhoon. The devastation was really bad.

    The employees at FEMA have worked hard and been dedicated. Congressman Gilman from New York made a statement at a hearing recently. He said that the reason he's very proud of FEMA and its employees is the fact that after the camera, the newsmen, and newswomen leave, the employees still show the same dedication, concern and compassion as they do when the cameras are there. He said, ''I want to thank you for that.'' I have seen that change at FEMA. It's wonderful to see how people respond to the needs of others across the country.
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    El Niño. At Laguna Beach, the devastation there caused people to lose everything they had worked all their lives for. It was just incredible to see every day heroes, people saving other people and children, and the will of those people to rebuild and recover. It was just unbelievable. I saw one lady with a broken arm, who didn't even have it in a cast.

    El Niño has caused damage across the country, all the way from California to the New England states in New York, New Hampshire, Vermont, and Maine.

    I think one of the things that helped us in California to prepare for El Niño was the El Niño summit we held in October with Senator Boxer, the Vice President, and over 900 participants from communities across California. The preventative measures that those communities working with our Region IX put in place made a significant difference in the dollars and lives lost in California to date and continue to do so.

    We have a request for $307.7 million for disaster relief funds, and $2.26 billion in emergency contingency funds, for a total of over $2.5 billion. That's our five-year average less Northridge plus support costs. This appropriation will ensure that we can continue to pay our overall requirements for more than 400 open disasters.

    Let me address open disasters. We have put together closeout teams to close out old disasters. We have teams on the East Coast, in the middle of the United States, and on the West Coast. Since the beginning of the fiscal year, we have closed out 66 old disasters by these teams focusing only on closeout.

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    In this fiscal year we have put back into the Disaster Fund $177.9 million that was deobligated from these open disasters. We had disasters open as far back as Hugo, Hurricane Andrew, and Loma Prieta. One of them went back to 1979.

    Some of them require very little work to close out. What happens is that after our people out in the regions respond to a disaster, they go back to their offices to catch up on day-to-day program work. Some of the closeout activities slip by the wayside. We're now focusing and closing these old disasters out so we can return the money back to the disaster fund.

    I think you know, Mr. Chairman, since 1993, when I came to FEMA, I have made it a priority, to focus more on response, recovery, and preparing for future disasters. In our budget, we have a request for $50 million for pre-disaster mitigation spending. It is the future, and it does matter.

    We're kicking off seven pilot projects using the $30 million that Congress gave us in this year's budget. The enthusiasm of these seven communities is just unbelievable. This is a Federal, State, Local, and private partnership. We're pulling industry into the partnership because they know that if they're affected by a disaster it will affect their bottom line. I can just give you example after example of the differences we hope to make.

    We're here to answer your questions. We'll be happy to provide anything in writing that we can't answer and we're happy to work with you, Mr. Chairman.

    [The information follows:]
    "The Official Committee record contains additional material here."
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    Mr. LEWIS. Well, thank you, Mr. Director.

    In those remarks you mentioned the employees of FEMA who are out there doing the job. I must say to you that I will personally never forget the invitation that you extended to me. My wife accompanied me just following the disaster at Oklahoma City to go through and see the devastation in the surrounding community. There actually were bodies still in the building. The job those employees were doing, to say the least, is something that is difficult to erase from your memory.

    Earlier in your remarks you had words of praise for the work of my colleague and the fellow whom I call my Chairman, Mr. Lou Stokes, who has just come in the door. I wonder, Louis, are there any opening comments? You're welcome.

    Mr. STOKES. Thank you very much, Mr. Chairman. And good morning, Director Witt.

    Let me say, Mr. Chairman, I don't have any formal opening statement, but I would like to take just a moment or two, if I may.

    First I want to thank Director Witt for his very kind and generous words this morning. It's a pleasure to welcome you back before this subcommittee at all times. During the period of time that you have served as Director of this agency, I think all of us on this subcommittee have been extremely impressed by the kind of service you have rendered for this nation with the numerous disasters that have occurred during your tenure.
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    Last year Chairman Lewis and I and other members of the Subcommittee had a chance to visit the Virgin Islands to see your operation down there as a result of a disaster that had occurred there. And I can tell you I think all of us—I believe I speak for this whole Subcommittee—how impressed we were. We saw your people in the field and how they had responded to this disaster.

    And for us, it was more than the academic type of exercise we undergo on this Committee. We actually saw how people respond to a disaster and the results of the kinds of problems that you would encounter in doing so. So I want to thank you for the opportunity to view that situation in its entirety.

    I also want to say that those of us who have been on this subcommittee as many years as Mr. Lewis and I have been here knew that when you took over this agency, you took over a troubled agency. And the management techniques and strategies that you have brought to bear with this agency have now made it one of the best agencies in our government.

    So I just want to commend you for the kind of service you have given this country. It's been a pleasure.

    Mr. WITT. My pleasure.

    Mr. LEWIS. Mr. Stokes, I want you to know that——

    Mr. STOKES. Mr. Chairman.
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    Mr. LEWIS [continuing]. The Director is not only pleased to hear your remarks, but his wife, LeaEllen, who is with us today is pleased to hear the remarks, too.

    Mr. STOKES. I'm pleased to see you here.

    Thank you, Mr. Chairman.


    Mr. LEWIS. Thank you, Mr. Stokes.

    Mr. Director, as part of the Disaster Relief budget request for Fiscal Year 1999, it's being proposed that the Congress provide an additional $2.3 billion, the use of which would be contingent upon certain conditions being met. Those conditions are essentially the conditions currently in place for requesting an emergency supplemental appropriations except that no further congressional action would be required.

    First, why is there a budget request for this contingency emergency appropriation, rather than using the supplemental appropriations process?

    Mr. WITT. Mr. Chairman, based on historical information we have been able to track that is what we project we will need. The 5-year average, less the Northridge earthquake, which was the most costly disaster this country ever had, plus disaster support comes to over $2.5 billion.
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    This year we had some calm months in October, November, and December, but we're facing El Niño now, and hurricane season is coming up. But the historical 5-year average is from $2.3 to $2.5 billion each year.


    Mr. LEWIS. Well, to be more specific on that point, is it essentially a shift in policy without formal policy action? Has FEMA ever encountered significant delays in providing assistance as a result of congressional delay in providing supplemental appropriations?

    Mr. WITT. Actually, Congress has been very supportive when we've needed supplementals to support disaster response and recovery costs.

    Mr. LEWIS. So essentially what you're saying is that during your time as Director, we've had this experience of averages costing a lot more than just the standard appropriations and so why not just automatically put it up front?

    Mr. WITT. We know probably at some point in the budget year, we would have to ask for a supplemental if annual obligations continue at the same rate we've experienced in the past.


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    Mr. LEWIS. I know that some of us on the Committee, especially those of us from the West, have sensed a growing concern or reserve by some members where in their part of the country they haven't experienced disasters recently. We've had some questions raised suggesting: Well, if those people want to live on the coast, let them pay their own bill.

    I've made the point that we come together as a country at times of disaster, but, nonetheless, there is that reserve. I gather this is a reflection of some of those expressed concerns.

    Mr. WITT. I hear that sentiment as well at times, but I don't think I've ever seen Congress not support a disaster supplemental for any bipartisan reasons, when there is a need to meet the needs of individuals who have been affected. We're very appreciative of that. Everyone usually puts politics aside and supports efforts to help communities recover. That's good, because our goal is to be there when there is a need.

    I think that when we see people building on the coast or see more disasters occurring in one State more than other States, we need to remember that at any given time, there could be a disaster in any community or in any state. Disasters affect everyone, not just the coast.


    Mr. LEWIS. Mr. Director, in your statement, you indicate that when scientists predicted El Niño, FEMA worked with the highest-risk states and communities to have people better prepared than ever before. Can you provide for us some concrete examples of how advanced warning has resulted in better preparation and give us some idea of what costs your agency has avoided as a result of such warnings?
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    Mr. WITT. The prediction and projection that data NOAA and the Weather Service provided us really helped a great deal, particularly in California, in the Gulf states, and in Florida. Because of their predictions and projections, we were able to convene a summit in Santa Monica to work with local communities.

    Our Region IX office worked with the State (OES) Office of Emergency Services in California to put on training courses for communities to learn what they could do to be prepared.

    The communities themselves went way beyond what they normally do. They cleaned out their river channels, cut dead trees away from power lines to keep them from falling on the power lines, bought and stockpiled sandbags to put around homes, and distributed those bags to homes that were in the floodplain.

    The city manager of Oakland told me they started an initiative for people in the neighborhoods to ''adopt a storm drain.'' The city provided the volunteers with a raincoat and rake, and it was their responsibility to keep the storm drains open. The community did all kinds of creative things to make a difference.

    Berkeley said that they saved over $7 million because of the prevention work that they did. Severe conditions were widespread in California. Santa Barbara had over seven inches of rain one night, but had very minimal flooding because of the preparedness measures they had taken.

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    Mr. LEWIS. Along with those heavy rains that you've mentioned throughout California, particularly the coastal areas, there's been a heavy amount of snowfall in the mountains. Indeed, last week some were indicating that maybe you were right at the edge of a record time snowfall and snow pack.

    What efforts are currently underway to avoid massive flooding in the springtime? Let's assume we get a warm rain in the latter part of April, early May. Doesn't that portend another kind of disaster? Tell us about that.

    Mr. WITT. Mr. Chairman, I'm very concerned about this. I talked with the state OES in California. Right now they are two inches short of having a record snowfall in the mountains. If they experience a warmup very quickly from a warm rain in the mountains, then we have a serious potential for some major flooding.

    I talked to General Fuhrman with the Corps of Engineers, and they're working with us to make sure that all the levies are in good shape. This past year they worked very, very hard in getting those levies fixed and repaired to be in the best shape possible because that will be a key.

    They're also looking at the reservoirs to see what water they can release to keep the major flooding down. But with the problem of El Niño and all the rains coming in, it's difficult to release a lot of water because it could cause more flooding.

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    Mr. LEWIS. The ground is soaked?

    Mr. WITT. The land is saturated. That's one reason we're having so many mud slides.


    Mr. LEWIS. You mentioned levies. Aren't there some special problems in Orange County that——

    Mr. WITT. In Orange County, the Corps of Engineers de-certified the levies because the levies were originally certified for 100-year flood protection. Because they decertified those levies, it caused us to give the community an AR flood zone rating that requires the residents to buy flood insurance at a lower rate until the levies can be repaired. Then the community can be taken out of that rating.

    Usually the Corps repairs levies on a drainage district like the one that goes through Orange County within two years. But the Corps did not get the funding to repair those levies in two years. It's possible that the repairs will stretch out to 10 years, maybe 15.

    All the mayors from Orange County met with me to discuss their concern that this will be stretched out that long, and that they are going to lose valuable revenue each year. One mayor said, ''In my community, I'm going to lose $132 million in revenue that people would normally spend because now they're going to have to buy flood insurance.''

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    Mr. LEWIS. Yes.

    Mr. WITT. It's pretty tough. And Orange County did get some flooding this last time.

    Mr. LEWIS. Mr. Director, I remember one of the vivid memories as a young boy standing at my back window in southern California dropping a ping-pong ball out the window. It dropped about 18 inches or 2 feet and hit the water and went out to the back fence.

    People don't really believe that these disasters are going to occur until they're upon them. And it's very important that we get people to be prepared and to react as you have suggested.

    Mr. Stokes.


    Mr. STOKES. Thank you, Mr. Chairman.

    Mr. Director, I realize that reliable estimates of the damage occurring in California, Florida, and elsewhere is still being developed, but based on what you know today, do you think FEMA will need supplemental disaster relief funding in 1998 to meet all of those requirements?

    Mr. WITT. Congressman Stokes, I believe we will be okay in 1998. Gary will share some figures with you. Right now it looks as though if we do not have a real serious hurricane season with major damage, we'll be okay.
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    Mr. STOKES. Gary, would you, please?

    Mr. JOHNSON. Sure, Mr. Stokes.

    Right now the current status of the fund would indicate that we are likely to be able to meet our obligations for prior year disasters, as well as what we would expect to happen assuming Mother Nature cooperates with our forecasted requirements for fiscal year 1998.

    The issue does, though, begin to surface as it relates to fiscal year 1999. Our estimates right now for California from the recent El Niño events, as well as for Florida are consistent with our estimation procedures for this current year.

    Mr. STOKES. So at this point, you think it would be fairly reliable in terms of your estimates?

    Mr. JOHNSON. For the current year.


    Mr. STOKES. Not counting the Northridge earthquake, FEMA's average annual disaster response-recovery costs have been about $2.4 billion during the past 5 years. Do you know what the comparable costs have been during the past five years for state and local governments?

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    Mr. WITT. Congressman, I do not have that figure from states. They did a survey. NEMA did a survey, and found their costs to be astronomical as well. Also, the economic loss for businesses in communities, which we're studying now, is unbelievable.

    Not only is it FEMA's cost and states' and locals' costs, but a lot of other federal agencies spend quite a bit for response and recovery, including EDA, SBA, Corps of Engineers, and many others. So across the board it's very expensive.


    Mr. STOKES. Do we have any estimate, Mr. Director, in terms of private insurance? How much of this has been borne by private insurance?

    Mr. WITT. The private insurance industry has experienced some serious losses from the Florida tornadoes. I think the estimate that I got from them was somewhere close to $100 million just in Florida. So they are taking considerable losses.


    Mr. STOKES. Considering these costs that you just made regarding state and local governments and the private sector in responding to catastrophes, do you think FEMA's expenses are too high, too low, or just where they should be?

    Mr. WITT. We have been able to streamline the agency, and to start cutting disaster costs with a central processing system. We've been able to save close to $35 million a year, and also give better customer service in the areas of inspections, applications, and disbursing checks.
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    Congressman Stokes we also consolidated 65 warehouses across the United States. I asked Bruce Campbell, head of Operations Support, to inventory and consolidate them in to 3 warehouses, one on the East Coast, one in the middle of the United States, and one on the West Coast. We also recoup all the equipment from disaster field offices and refurbish and repackage it, to be used in another disaster. We've been able to save $13 million a year just by doing this.

    So we're trying to cut disaster costs and streamline operations.

    The frequency of disasters hasn't changed that much. It's the magnitude of the disasters, like the ones in the upper Midwest, South Dakota, North Dakota, and Minnesota.

    I think back to a time when we never saw a town of 50,000 people just totally flooded. In 1993, we saw 9 states and 500 counties flooded. So it's the size of the disaster that we're seeing now.

    Gary, do you have any comments?

    Mr. JOHNSON. Just to add to Director Witt's comments and respond to your question, for the period of 1988 to 1992 for all disasters the average cost in 1999 dollars is just over a billion dollars compared to the average of the last 5 years, less Northridge, which is $2.4 billion.

    If we were to include all disasters from the period of 1993 to 1997, the average would be $3.8 billion. So if you take all disasters, it would be $1 billion for an average of the earlier 5-year period compared to the average of the later 5 year period of almost $4 billion.
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    Mr. STOKES. Let me ask you this, Mr. Director. According to the most recent report on state emergency management funding prepared by the National Emergency Management Association, total funding in Fiscal Year 1996 provided by the 44 states that responded to the survey exceeded $2 billion.

    Per capita spending increased from less than $6.50 in 1994 to nearly $9 in 1996. According to the survey, state emergency management funding represents one percent of an average annual state budget.

    Are you satisfied with this level or do you think the state should do more?

    Mr. WITT. Congressman Stokes, I think we all can do more. We have done a lot in the mitigation area. If you look at the average that we have spent over 5 years, almost $2.5 billion, we are spending up to 15 percent instead of 10 percent of grant costs in mitigation after we have a disaster, per the 1993 Volkmer amendment.

    This has been very successful. We've bought out over 20,000 pieces of property out of the floodplain across the United States, moving people and businesses out of harm's way where they'll never flood again. We're saving millions of dollars by doing that. We have documented that every dollar we spend on buyouts saves two dollars in future disaster costs.

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    My goal in pre-disaster mitigation is to know what states are high-risk states and what areas within those states are high-risk communities. We have been working to target those communities to eliminate the risks and to undertake preventative actions such as retrofitting homes and businesses.

    If we can spend $2.5 billion in response and recovery, then we seriously need to look at spending more in prevention before the disaster ever happens.

    When we have a disaster, we do mitigation after the response to prevent future disaster damage in that community or those buildings, schools, hospitals, and other areas. But why don't we do it before we have the disaster? Then we won't have to spend the money on response and recovery because we will be prepared for the risks that we face. We can achieve it through a public-private partnership with industry and state and local governments. We're testing this in our pilot projects now.

    It should be very successful. The excitement out there is incredible. Seattle, Washington became a pilot community. The city manager brought all of the private industry people in around the table. FEMA put in a million dollars of seed money there. To add to that million dollars, the community raised six million dollars from private industry.

    The community is going to retrofit over 2,000 schools and low-income and elderly homes against the earthquake risk. AmeriCorps volunteers are helping to do that while on their spring break.

    We can do so much more on prevention that will keep us from spending so much in the future on disasters. This is the direction we need to take.
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    Mr. STOKES. Thank you very much, Mr. Director. Thank you, Mr. Chairman.

    Mr. LEWIS. Mr. Stokes.

    Mr. Hobson.


    Mr. HOBSON. Thank you, Mr. Chairman.

    Director Witt, I want to welcome you back and join Chairman Lewis in the kind words he said about you. I've enjoyed working with you and the people in your agency. They're very professional. And I think my state has tried to perform along also with the good Director.

    The partnership here I think is very good to continue. I have some concern about that state and local partnership. My director, Dale Shipley, and several other state emergency managers have expressed their concern about the funding level in the state and local account.

    Many of the states, including Ohio, have prepared for the 50 percent matching requirement in SLA funding. What the states are not prepared for is the drastic reduction in the overall SLA number. The FEMA request eliminates the $16.6 million in SLA 100 and adds half that amount to SLA 50.
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    The FEMA proposal does not include last year's additional $3 million for SLA. I take a little personal rejection. I worked very hard to get that in there.

    FEMA has focused solely on SLA 100 funding and made reductions there by moving the 50/50 match. But FEMA ignored the overall short fund in SLA since the states end up covering 70 percent of their emergency management programs to the federals, 30 percent in SLA.

    The net impact of all of this, of FEMA's proposal, on the states is a reduction in federal spending of $11.4 million from last year and a requirement for state and local governments to match the $8.3 million placed in a 50 percent matching category.

    Now, I know some of the people are upset about the 50 percent, but I'm not really fighting that because I don't think that's a bad idea. I've generally been a proponent of trying to get more bang for the buck, but I think this is just too much for all the states to absorb at one shot.

    I'd like to work with your agency to find a way to get more money back to the states for the SLA Program because I think they do a good job with this.

    Would you like to comment on the SLA?

    Mr. WITT. Sure. Congressman, over the last four years, we have worked very hard without taking any cuts from the states. You all have been very generous in supporting the efforts to put more funding in the SLA funding for the states each year.
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    This was a very tough decision on all of us. Congressman, I come from state and local governments and I know where that money goes and how important it is.

    For the last two years I've been meeting with the state directors at their national conferences, and I've told them that Congress indicated last year that we need to take state and local grant programs to 50/50 cost share. We have increased the 50/50 cost share programs from the 100 percent funded category which used to fund the old Civil Defense Programs, such as the population protection planning. We have moved, not only on the national level, but also the state and local levels, to all hazard planning.

    I have told the states to make arrangements because we're going to have to go to a 50/50 cost share. A lot of the states, like Ohio where Dale Shipley works, did make arrangements with their state legislators to address the reduction. Some of the states did not. Those states that did not are really screaming at me, and I don't fully blame them. I would, too. But that was the intent of Congress, to go to a 50/50 cost share.

    Mr. HOBSON. Fifty/fifty is not a problem. It's when the overall number also comes down with the 50/50.

    Mr. WITT. Yes.

    Mr. HOBSON. And that's hard.

    Mr. WITT. The overall number in Emergency Management Assistance (EMA) funding didn't come down, did it Gary?
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    Mr. JOHNSON. The 50 percent money went up but the overall state and local assistance, as you've correctly characterized, Mr. Hobson, has dropped $11 million.

    Mr. HOBSON. And that's a little hard for them to absorb, I think. But we can talk about that.

    Mr. WITT. Okay. A lot of people don't understand that while 50/50 cost share money goes to the states, it also funds 50 percent of the salaries of the county emergency managers. The funding goes all the way down to the state, and to the local level. It's very important.

    Mr. HOBSON. I've got two parochial things I want to talk about. Then I want to come back to something else.

    Mr. LEWIS. You have somebody's time.


    Mr. HOBSON. I know. That's why I'm rushing along.

    And, again, I want to congratulate you people. There's some remapping going on out there. And it presents some difficulties in some places. I want to thank Mike Armstrong and Matt Miller and Doug Bellomo and Fran McCarthy for taking the time to meet with me about a local situation.
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    The thing that concerns me is when we do this remapping, it's got to be realistic. And they've got to take in the local certain types of situations without going to the huge modeling that you have to do in some of these situations. But communities, somebody's got a building and they've been planning expansion. And suddenly on comes a remapping.

    And there's somebody in a flood area that they didn't realize they were in a flood area before. You look at it, and you say, ''Gee, is this a 100-year deal?'' I don't want to deal with 100 years that are coming back to haunt us in some places, and it's a problem.

    You don't want to have these people building something where the likelihood is going to happen, but there's got to be some understanding that this is not an exact science as we look at some of these things.

    I appreciate the attitude that the people came in with. I just hope the results are as good as the attitude was when we looked at these things.

    Mr. WITT. Congressman, you're exactly right on the mapping. Mike Armstrong, his staff and I have been very, very concerned, as the Chairman has. We have done some pilot testing of different ways to do mapping more quickly for the local communities because it does hinder them in rebuilding or developing a community.

    We're so far behind on mapping. We just don't have the money to do the mapping that needs to be done. Mike and his staff have put together an estimate of $823 million to do the needed remapping, but don't have $823 million in our flood program to do that mapping.
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    If we're ever going to catch up, then we're going to have to do something to expedite this mapping. We're also working with the communities. If they can get engineers to do their remapping, then we will certify their own remapping, we do that as well.


    Mr. HOBSON. That's what we're trying to do in this situation a little bit.

    I've got one other question, parochial thing. And I've got to tell you I have had a very good relationship with your agency as far as credibility goes. But this is one that bothers me a little because I'm not sure that the proper contracting approach is there. I want to bring it to you, not just on this issue, but to make sure that it's being done right across the agency.

    As you know, over the past years I've shared Chairman Lewis' interest in updating FEMA's emergency response equipment and vehicles. Knowing of FEMA's need in this area, a company in my district, MTL of Beaver Creek, began working with FEMA over two years ago and, in compliance with FEMA's instructions, submitted an unsolicited proposal to FEMA's Acquisition Support Division, first in December of '96 and then a revised proposal in May of '97.

    I've got two problems with what happened with this particular proposal. One, I do not understand why it took eight months for FEMA to respond to MTL's proposal. And, two, when FEMA finally responded to MTL, the letter reads that FEMA's policy is to acquire such products by competitive methods.
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    I don't object to that, but you should know going in. Going in, they were told this was going to be a sole source-type situation. And then when another part of the agency gets a hold of it, it suddenly switches on some people two years later. And as a small business guy, I can tell you that that doesn't help when you're on small budgets to be able to do that.

    Is it FEMA's policy not to procure such items through unsolicited proposals? And then, my response, if it wasn't, then why wasn't MTL told that in the beginning?

    Mr. WITT. Congressman, I wish I could answer your question. I'll look into it and get back to you. We do try to compete everything as much as possible.

    Mr. LEWIS. If you could respond to the record.

    Mr. WITT. Yes.

    Mr. HOBSON. I know you do. And that's why I bring it up.

    Just very quickly, Mr. Chairman. I'm not going to ask you to answer these questions either——

    Mr. WITT. Okay.

    Mr. HOBSON [continuing]. But they're two that I ask everybody that comes in here.
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    Mr. LEWIS. Could you submit those for the record?


    Mr. HOBSON. I want you to talk at some point about your overall rent and then, more importantly, about the year 2000 and then problems and make sure you don't have any because we're asking everybody that.

    And, lastly, what concerns me,—and I told the Chairman and you beforehand I was going to ask this, and you somewhat answered it going in—one of the things that concerns me, you know, I watched these pictures of these gorgeous homes along the coast and they're falling in.

    I grew up in an area along the river in Cincinnati. I'd go to work in the morning, and I'd be okay. Then I come out. My car's got two wheels in the water because the water would come up and things would back up. So I'm familiar with this.

    What seems to many of us to happen—and we need to work on this more—is maybe we shouldn't build back all those places. I don't know. You can put little red tags on some of them and say, ''We aren't going to do this again'' or do you have the authority or do the local communities have the authority so that we don't—we know we're going to have disasters and we know we want to respond to those and we want to help people, but we can't keep going back and, say, a million-dollar house and keep going back or a two million-dollar house, which I don't have many of them in my district.
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    People in my district are going to say, ''Whoa. Wait a minute. What are you guys doing here?'' Do we continue to go back in and rebuild that house or what do we do to stop and mitigate this a little better?

    Mr. WITT. We now have over 19,000 communities participating in the flood program. Under this program, if a home has been damaged over 50 percent from a flood, then that home has to either be elevated or relocated.

    Mr. HOBSON. Elevate or relocate.

    Mr. WITT. Elevate or relocate. As we bought out 20,000 pieces of property over the years, it has not only helped cut disaster costs, but it has also complemented our Flood Insurance Program due to the fact it's removed possible repetitive losses out of the way.

    Now, as far as the million-dollar house sliding off the hill that you've been seeing on the television, we don't fund that house.

    Mr. HOBSON. Well, I think that's important for the public to know.

    Mr. WITT. We aren't going to fund that house.

    Mr. HOBSON. We aren't going to fund that.
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    Mr. WITT. I think the California Coastal Commission has done a really good job. If a home does slide off like the one on TV, or a home is damaged or destroyed on the coast, then they have a requirement to move the house back when rebuilding.

    As far as mud slides are concerned, I often get the question, ''Are you going to let these people build back here?'' Of course, we discourage building in high-risk areas, and we encourage working with the state and the local community to do a buyout relocation program with mitigation, and Community Development Block Grant dollars and Economic Development Administration dollars to get those people out from harm's way before that land goes back to open land use management.

    Mr. HOBSON. Good.

    I just want to thank you for all the work you've done. And I want people to know that you just don't go into big communities and work. You'll go into small communities and work——

    Mr. WITT. Yes, sir.

    Mr. HOBSON [continuing]. With those small communities. I think that's very important work that you do, and I want to thank you and thank your wife for putting up with you being gone so much and doing all of this good work. It's nice to have an agency that you can count on. And I think that this country counts on you, and you have responded.

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    Thank you very much, Mr. Chairman.

    Mr. WITT. Thank you, Congressman.

    Mr. LEWIS. We turn to the very patient and very professional gentleman from West Virginia, Mr. Mollohan.


    Mr. MOLLOHAN. Well, thank you, Mr. Chairman.

    Mr. Witt, I would like to join the Chairman and ranking member and my other colleagues in welcoming you to the hearing and complimenting you on the fine job you're doing.

    I was here as a much younger member of the Committee when FEMA was having the kind of problems that have been described here. And you have done a marvelous job in turning that around and giving the agency credibility, largely from your fit professional efforts.

    I also want to thank you specifically for your good efforts in West Virginia. It seems like you all are always in West Virginia. And we appreciate your help there.

    I'd like to follow up on Mr. Hobson's last line of questioning. Just to understand, how do you treat these areas that are particularly prone by experience and just by analyzing the condition? How does the Flood Insurance Program and your attitude toward these areas? How can we do it differently?
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    In West Virginia, we have lots, as you know, in the hollows up and down these streams, lots of construction in floodplains. And I guess in California, probably these homes were like the Ohio River when they were built. They weren't built on the edge. They were right at 100 feet back in West Virginia to get to these homes and drop them into the river.

    How are they treated, these different situations: homes in California and floodplains in the Midwest? And how should they be treated in your opinion?

    Mr. WITT. Well, Congressman, in most cases, we're even inheriting traditional building stock that was built before there were ever building codes or building standards. We're seeing that traditional building stock getting damaged in these flood risk areas and other areas.

    Mr. MOLLOHAN. They're the at-risk?

    Mr. WITT. Yes.

    Mr. MOLLOHAN. The ones that——

    Mr. WITT. We have tried to be very diligent in focusing in those high-risk areas to get people and businesses out of harm's way working with the state and local community.

    Carl Bradford does a great job for West Virginia. He is really targeting some of these at-risk areas with mitigation dollars. We have tried to utilize and to maximize the Federal, state and local dollars to get the most benefit, CDBG, FEMA, EDA, and SBA are all working together to give the community and state the biggest bang for the buck, as we would say.
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    We don't treat jurisdictions any differently. If they're in a high-risk area we have enough money, and the state targets that area for buyout relocation, then we support that effort.

    We have been able to accomplish a lot, but the problem we have is that we just don't have enough money to do what needs to be done.


    Mr. MOLLOHAN. Well, say you have a disaster and there are these traditional structures in disaster fund areas. Do you provide assistance to those homes or those structures? And what kind of assistance is it?

    Mr. WITT. The normal process is that disaster victims will apply for assistance, either by calling a 1–(800) number or by obtaining an application. If the community has been wiped out, victims can apply for temporary housing for up to three months.

    Applicants first go through the process to determine if they're eligible for a basic low-interest SBA loan. Then if they're turned down by SBA, they are automatically referred through a process for an individual and family grant, which we fund at 75 percent, but the state runs the program.

    If their home is repairable, applicants can possibly get a maximum $5,000 as a minimal repair grant to make that home liveable in lieu of getting temporary housing, this saves money in the long run.
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    So the process is that a person goes through SBA first. If they're turned down for a loan to SBA, then they would fall back into the grant program.

    Mr. MOLLOHAN. Okay. Now you're moving toward mitigation. And that's what these pilot projects are all about, is it not?

    Mr. WITT. Yes.


    Mr. MOLLOHAN. You have one pilot project in West Virginia. I heard you talk about the one in Washington, where you had a lot of private sector resources being thrown into it. In areas that perhaps you can't draw upon those private sector resources to the extent you described, how are these pilot programs working?

    Mr. WITT. Very well. We're beginning to see many communities across the United States take the ''Project Impact,'' information book, go through it, and do some of the pre-disaster mitigation themselves.

    That's what we're trying to do with our information: develop a program that anyone can put in place. We have a checklist of exactly what they would need to do and how to do it.

    Evansville, Indiana, a community that has earthquake risk and flood risks, is not a pilot project community. I went to Evansville and had breakfast with their Chamber of Commerce and 200 business men and women. They have already raised $168,000 to hire a planner. They determined they were going to be a national model, whether designated as a Project Impact community or not.
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    Other communities are joining. Governor Batt in Idaho has submitted legislation, I understand, to stop building in 100-year floodplains, and in high-risk areas. A mayor in Texas has put into place stiff penalties for building in flood-risk areas.

    So our message is getting out. People are starting to look at this. Congressman, we're also looking at giving the states two years to adopt their new building codes. If they have a disaster now the only thing we can do is build to the pre-disaster building codes. If they change the codes, then we can rebuild to the new codes.

    States are going to have to take some responsibility, too. They need to develop some good building codes and enforce those codes.

    Mr. LEWIS. It needs to be said here that we must give priority to that mapping/remapping, however——

    Mr. WITT. Absolutely.

    Mr. LEWIS [continuing]. Because 100-year floodplains are defined at X time. And people in the desert, for example, wonder how you quite got there. But in the meantime, the point is very, very important.

    Mr. WITT. Yes, it really is. It's a responsibility that individuals and, local and state and Federal governments have. If we all take that responsibility seriously, we will make a difference.
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    Mr. MOLLOHAN. In one area, you're planning to eliminate the 100 percent grants to state and local assistance and you're taking this money in the 50/50 match program. Following up a little bit again on Mr. Hobson's questions, are you finding that there are areas of the country that are having difficulty meeting this 50 percent match?

    Mr. WITT. In meeting the 50 percent match, no. I think the difficulty in a couple of states stems from the two years I've been saying that Congress is telling us to go to 50/50 cost sharing.

    Most of the states had their legislators take care of this in their appropriations. The problem in many states is that legislatures only meet every two years. A couple of states that did not go forward and ask their legislators to make the adjustment they are the ones that are in trouble.

    Mr. MOLLOHAN. But fundamentally you're not getting any responses from any states that ''Look, we're just not able to meet this match'' or ''Our localities aren't able to meet this match''? You're not seeing that problem?

    Mr. WITT. I've only had two states that came back and said, ''We're going to lose people because you're doing this.'' But they didn't get anything done through their legislators either.

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    Mr. MOLLOHAN. Thank you, Mr. Chairman.

    Mr. LEWIS. Thank you, Mr. Mollohan.

    Mr. Frelinghuysen.


    Mr. FRELINGHUYSEN. Thank you, Mr. Chairman.

    Good morning, Mr. Witt. May I join all of the Committee members in commending you and your fellow employees at FEMA for some great work around the nation addressing some unbelievable catastrophes. And certainly from those of us from the Northeast, we appreciate all the attention you've given in recent times.

    Mr. WITT. Thank you.

    Mr. FRELINGHUYSEN. Fortunately, I've been able to view on television more than I have seen you in action at any particular site. While New Jersey may have its problems periodically, I see you in a very public way reassuring people by your physical presence. And I commend you. I also hear good things from our governor's office in New Jersey about your work with various state officials as well.

    I do have several questions, first being it's my understanding that your agency has proposed a rule change for applicants appealing a denial for funding under the Hazard Mitigation Grant Program. The rule change would reduce the number of appeals from three to one. According to your proposed rule, the appeals process to my mind would sort of almost begin and end with a Regional Director.
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    I certainly understand that this is broadly a result of efforts to streamline the regulatory process, reduce administrative costs, but most other federal agencies do have a multi-level grant appeals process in place, basically to ensure due process for the applicant and not to place extraordinary power in the hands of any Regional Director.

    And in no way am I implying that there's anything wrong with the Regional Director. Quite to the contrary. However, many communities around the nation, certainly the ones that I'm familiar with, invest a lot of time and money bolstering their defenses against natural disasters. As such, we need to ensure that every detail has been fairly addressed upon all levels by FEMA.

    Could you share the rationale in proposing this rule change, giving me some idea of the number of appeals that would be affected, the time frame, as well as any budgetary implications?

    Mr. WITT. The appeal process that we have had in place in FEMA for years is very cumbersome. There is a lot of red tape. It takes too long to go through the appeal process and to get a decision for that local government to be able to do what they're trying to do.

    We did go out with comments on the rule after the state directors were here for a national conference in Washington, I met with all of them personally and privately one morning to get their feedback and comments. They agreed that instead of one, we would do two appeals, one to the Regional Director and then to Washington. They agreed that would speed up the process and give them a decision more quickly, which is what we're trying to do.
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    Congressman, we've been getting appeals in from states and local governments as low as $150 and $500. I have chastised the State Directors a little bit because it's their responsibility to say, ''This is a good appeal'' or ''This is not a good appeal.''

    The States agreed to work more closely with us to bring in extra temporary hires just to work appeals. We had 370 appeals in one week. There's no reason for that. But I think you'll be proud of what we're doing.

     We get most of our appeals from the Public Assistance Program. We are reengineering that program now to speed the recovery effort up with local governments we will basically give them the opportunity to review with us actual construction cost estimates when we write them up in order to cut the number of appeals down almost nothing.

    Mr. FRELINGHUYSEN. So due process is being recognized.

    Mr. WITT. Yes.

    Mr. FRELINGHUYSEN. You sort of revisited that issue. And I assume, Mr. Director, you've responded to correspondence where some of our members have written you——

    Mr. WITT. Yes.

    Mr. FRELINGHUYSEN [continuing]. From a number of states, including my own.
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    Mr. WITT. Yes.


    Mr. FRELINGHUYSEN. The second question is: Several counties along the New Jersey coast experienced some pretty incredible coastal storms and flooding earlier last month, which decimated a lot of the protective structures.

    I believe our state's own emergency operations plan was adequate to meet the storm needs, but that was only true in four of the affected counties. I understand that last month our governor contacted you and the White House requesting an expedited disaster declaration for a couple of those counties. I just wondered where that request stands.

    Are you familiar with that by chance?

    Mr. WITT. Yes, sir. We have been working with the State of New Jersey's emergency management and received all the information. We should be finished with it very quickly.


    Mr. FRELINGHUYSEN. Okay. Third question. I also serve on the Energy and Water Subcommittee. We in a bipartisan way support a number of beach replenishment programs.
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    In your opinion, do these beach replenishment programs, such as New Jersey is involved in—we spend a lot of money on it—help reduce the money being spent by your agency on noreaster damage or just general storm damage?

    Mr. WITT. The engineered dunes that are in place do help to protect the health and safety of some of the coastal property. I can't say that the beach replenishment helps protect property. I think it's an economic problem.

    Mr. FRELINGHUYSEN. Surely that's true, yes.

    Mr. WITT. But the engineered dunes do help protect some property. I think the engineered dunes are similar to what levies are.

    You have many agencies with responsibilities for different parts of this issue. As I testified at the Water Resource Committee not long ago, I think to streamline these programs and make them less cumbersome to local government we need to identify one agency, and let that agency have the authority and funding to take care of levies and engineered dunes. That should be the Corps of Engineers. They're the experts. If we do engineered dunes, we have to task the Corps of Engineers to do the dunes, as well as the local government.

    I've talked to the Corps about this, and they're very receptive because now if a local government comes to us for emergency repairs and fixing a levy, then we have a part of it, the Corps has a part of it, and the Soil Conservation Service has a part of it. We need to tighten that up and give it to one agency with the authority and responsibility for all of these aspects.
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    Mr. FRELINGHUYSEN. My last question. In last year's hearing, we discussed the Chemical Stockpile Emergency Preparedness Program, which your agency was working in partnership with DOD, specifically the Army. There were some issues that needed to be worked out with FEMA and DOD at that time.

    Can you give us an update on FEMA's work within that partnership to date?

    Mr. WITT. Congressman, I'm happy to report to you that we have signed a new agreement with DOD. For two years, I have been telling DOD that if we didn't change this program, FEMA was going to pull out because I was very unhappy, our staff was very unhappy, state and local governments were very unhappy.

    So under the new agreement, DOD literally gave us the responsibility and the money for off-post emergency preparedness, which is what we wanted.

    It was not working the way it was. There were too many chains of command in the process. It was very tough on local governments. Now our regions and the state and local governments have the responsibility with less oversight. It's going very well now.


    Mr. FRELINGHUYSEN. Well, I commend you for it. And, lastly, since the Chairman doesn't appear to be cutting me off, on the Radiological Emergency Preparedness Fund, this says in 1999, FEMA requests an appropriation of $12 million to establish a foundation for a new fund for the program.
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    Just a few comments on that. Who did this before the creation of this entity? I'm sure it's one of these good objectives, but if you could just fill me in as to who did what before the creation of this fund and new responsibilities?

    Mr. JOHNSON. Congressman, what you see in the budget request is a different mechanism to finance the Radiological Emergency Preparedness Program.

    Previously and up through the current year, funds to support the REP Program, have been requested as part of our salaries and expenses and emergency management and planning assistance appropriations. I believe for fiscal year 1998, the amount is about $12.5 million.

    FEMA bills the utilities for the full cost of the program.

    Mr. FRELINGHUYSEN. You do that right now?

    Mr. JOHNSON. Yes.

    Mr. FRELINGHUYSEN. But this would formalize that?

    Mr. JOHNSON. Well, there's definitely a subtle change. Currently when the revenues came back in, they are deposited in the Treasury as offsetting receipts. What we are proposing through the REP fund is, rather than having those revenues coming back from the utilities and being deposited in the Treasury, they will be deposited in the REP fund and be available to directly finance the program beginning on October 1st, 1999, the start of fiscal year 2000.
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    Mr. WITT. Also by doing this, it allows the utilities to actually budget better for their programs. It should work out very well.

    Mr. FRELINGHUYSEN. Utilities have invested quite a lot——

    Mr. WITT. Yes.

    Mr. FRELINGHUYSEN [continuing]. In these types of issues and haven't seen a great payout. I assume that they're supportive of what you're doing here.

    Mr. WITT. Yes.

    Mr. FRELINGHUYSEN. Thank you, Mr. Chairman. Thank you, Director.

    Mr. LEWIS. Thank you, Mr. Frelinghuysen.

    The gentle lady from Florida, Mrs. Meek.


    Mrs. MEEK. Thank you, Mr. Chairman.

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    Welcome, Director Witt. He's good to see you and your staff again having come from Florida, where we have had any number of disasters. And to see the efficiency with which your department handled them is commendable. It's commendable to see the problems that you have faced. And you have been able to surmount them. We thank you.

    My questions, however, are very similar to the ones the other members have asked. There appears to be underlying questions regarding state and local governments and how you handle that kind of funding. Other members have called this to your attention. My state is no exception to that, not only on the local level but the state as well.

    They're concerned about the amount of funds that they will receive now for their local emergency assistance programs. And they feel, as I can perceive it, that they were not given enough time to really phase out what they were doing.

    This came down as a mandate that this had to happen. They didn't have time to address this in their state legislatures to make up for whatever shortcomings this mandate from national FEMA may have incurred.

    They're saying that they didn't yet form a notification early enough and they weren't in the process. And I could go and on, Mr. Witt, with the number of things that they're concerned about.

    I think some of it has some credibility to it in that it is a local problem. When there is an emergency in Dade County or in the State of Florida, the locals are very much concerned. Loss of life, devastation, all of this is very important.
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    Two things seem to concern them most. One is flood insurance. What I'm hearing, Director Witt, is that your capacity to predict that the amount of needed flood insurance may be skewed toward the fact that the instrumentation—what you're using to measure potential damage—is inadequate. My information shows that in the flood insurance area, your instruments or whatever you're using are only accurate within five feet. And certainly in Florida, most of the coastal areas of Florida, it is hard to assess the flood vulnerability with that kind of instrumentation. They're saying that your measurement tools, even though they're costly, are only accurate within five feet. How valid is that; I'd like you to respond a little bit later.

    Let's take the Deerfield Beach model, which you just sent off through pre-mitigation, you had thought about and worked on. How do you plan to assess those needs in the future? In the model community there, you would need more accurate kinds of measurement that would perhaps be gotten only from more sophisticated means of measurement. Do you plan to proceed with any of that kind of improved measurement so you would be ready?

    I'm concerned because there are a lot of trailer parks, a lot of commercial property, a lot of mobile homes in Florida.

    Mr. WITT. Right.

    Mrs. MEEK. And I'm just wondering if you and your staff had thought about how you're going to plan for this in the future. Is it in your plans now? And if so, how do you plan to use the funds that you're asking for in your budget request at this time?

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    I have lots of questions, Mr. Witt, but because you're such a fine Southern gentleman and I like you very much, I'm going to put the rest of my questions——

    Mr. LEWIS. Be careful, Mr. Witt. [Laughter.]

    Mrs. MEEK. It's true. He stood the test of time, Mr. Chairman.

    Mr. LEWIS [continuing]. I'm going to put the rest of them in the record. But I'll go back and reiterate what my major concerns are: the accuracy of your assessment of flood insurance and the measurement which you use to try to depict that in that we're concerned in that 40 percent of the national flood insurance policies are bought in Florida. So it's a great concern to the states there.

    And my second concern was the discontent among the emergency management people regarding the lack of transitional time they had from being able to prepare themselves for the reduction and not being able to seek other funds.

    The third one had to do with how you're going to address some of these issues in your mitigation strategy. How are you going to address whether or not your pre-disaster mitigation is in some way not going to be to the detriment of these traditional approaches which you've used in the past? Those are the three questions, Mr. Witt.


    Mr. WITT. First, on the flood elevation and the mapping, we are required to be within one foot of elevation for the mapping.
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    Also, we're trying to look at the different ways that we can do mapping, either through satellite or imagery, in order to give state and local communities the very best information that we can. Also, we will work with a community if they have their own engineers and they're willing to do their own mapping. We will then review that.

    And you're right, Congresswoman. It's very important. It is really critical to have the elevation within a foot because it would affect a lot of businesses and homes around that county or city if we are not.


    Regarding mitigation, you mentioned Deerfield Beach as a pilot project community. I can't tell you how proud I am of what the State of Florida has done. Joe Myers, Governor Chiles, and the legislators have supported the mitigation in Florida in a bipartisan way. They have supported buyout relocation and elevation of homes and businesses in Florida. They have put a lot of money into those programs.

    We have many communities in Florida that have already benefitted from Project Impact and continue to do so. Are you familiar with the high school in Deerfield Beach?

    Mrs. MEEK. Yes.

    Mr. WITT. That high school is that town's shelter. That high school had not been retrofitted for a hurricane, but the safety of that school for these children and as a shelter for the community was critical to the mayor and the community.
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    One of their projects is to retrofit the high school against a hurricane. There are many other smaller projects that they're doing joined by Home Depot, Embassy Suites, and the Power and Light Company which are making an effort to cut dead back away from the power lines limbs. So this is a pretty good effort they're doing in Florida.

    AmeriCorps will be joining us during their spring break in Florida as volunteers to help make the homes of elderly and low-income safer against a hurricane.

    So its working really well. I just wish we had more money to do more mitigation projects to make communities safer. Hopefully we will in the future.


    Your third question was regarding state and local funding?

    Mrs. MEEK. Yes.

    Mr. WITT. For two years, Congress has asked us to go to a 50/50 cost share. Last year in the report language they didn't ask us, they instructed us to go to a 50/50 cost share.

    For two years, I have been telling the state directors that they needed to focus on this because I was concerned that we were going to have to go to a 50/50 cost share.

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    We wrote every governor a letter advising them that this was going to happen. We put the information out to the states to make sure they understood and, to make sure that they were going to start making arrangements. Many states did, a few of the states didn't, and this got them and all of us in a Catch-22.


    Mrs. MEEK. So you do feel, Mr. Director, that your mapping techniques are adequate under the circumstances?

    Mr. WITT. I think they could be better. They're adequate, but they could be much better. My goal is to be able to do it much faster, because building and communities are growing so much. We just don't have the money to do the remapping that they're asking us to do.

    Earlier I made the statement that to get all the maps across the country updated, it would cost $823 million. We need to do this because it's causing us a serious problem.

    Mrs. MEEK. Thank you Mr. Chairman.

    Mr. LEWIS. Thank you, Mrs. Meek.

    Mr. Walsh.

    Mr. WALSH. Thank you, Mr. Chairman.
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    Good morning, Mr. Witt. It's good to see you again. Welcome back. It's been said that the toughest job in America is being President of the United States. And the second toughest job I've heard is being Mayor of New York City. You've got to have at least the third toughest job in the country. And you do it very well.

    Mr. WITT. Thank you.


    Mr. WALSH. And I think you hear that from both sides of the aisle, which is remarkable.

    I'm going to use this hearing as an opportunity to make a point. And the point is that we later this year will be having a battle over transportation funds. ISTEA it's called. It's been said that states like mine, New York, don't send as much into the trust fund because we don't buy as much gasoline because we use mass transit. So some states make the case that since we don't send as much money in, that we shouldn't get the benefit of ISTEA.

    And I'm asking or imploring or suggesting to my colleagues from Florida and California, who my constituents sends millions and millions and millions and millions of dollars to every year for hurricanes, earthquakes, fires, mud slides——

    Mrs. MEEK. Why are you looking at me? [Laughter.]

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    Mr. WALSH. There was a problem in Homestead Air Base in Dade County a few years ago I remember. We consider that our responsibility and our obligation. And I would just hope that that would have some sway with the legislators from those parts of the country to give us the consideration that we need because our infrastructure is older, far more in need of repair. And it's a fairness issue for us. So I just wanted to use this opportunity to make that point.

    Mr. LEWIS. Please, Mr. Walsh——

    Mr. WALSH. Mr. Chairman.

    Mr. LEWIS [continuing.] Realize that we understand your point. And we certainly will try to keep it as a part of our consideration.

    Mr. WALSH. Thank you very much. I must have made my point. [Laughter.]


    I think that, again, you do a remarkable job in very difficult circumstances. And the few times that, fortunately, I've had to deal with FEMA, they've been very responsive.

    We had an ice storm in New York State this year. And it also affected Maine, Vermont, New Hampshire. It was Canada's, I'm told, greatest natural disaster ever, which is pretty remarkable, tens of thousands of power poles down, farms.
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    There are a lot of farms in the north country in New York State. Many people don't realize that, but it is very much still an agricultural state. And the ice came, and then power lines went down. And then the snow came on top of the ice. So the roads couldn't be plowed. So farmers couldn't get the product to market.

    It was truly a disaster. And your folks were there on the spot quickly. And I wanted to thank you on behalf of my constituents to the north for that.

    One of the things that happened was a lot of the dairy farmers not only had to dump milk, but they also lost cows. They couldn't milk the cows. They didn't have power. And farms are bigger than they used to be. So they couldn't milk them all by hand, although many were milked by hand. And so cows got sick, mastitis. They went dry.

    I just say that because we're going to have to be a little bit creative, I think, in order to respond to that need that those farmers had the losses that they suffered. USDA, I know, is interested in trying to work with us on this.

    Do you have any thoughts? Have you experienced that elsewhere in the country?

    Mr. WITT. Yes, sir. I was in New York State with Governor Pataki at some of the dairy farms. FEMA provided some generators for the farmers so they could milk their cows. They would take one generator, rotate it among three farms, and milk the cows at different times. The farmers would have to milk their cows, then dump their milk because the power was out at the processing plants.
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    They had a tremendous loss. A lot of people don't realize the economic loss not only to the farmers but the entire state and all of the New England states.

    So President Clinton asked us to look at a long-range recovery plan. Lacy Suiter, Associate Director for Response and Recovery, is here. We just finished the plan yesterday.

    It clearly addresses all the New England states. We invited all the state directors of emergency management in from the New England states along with all the federal agencies, and just sat around the table and talked about the disaster, the effect of it, and what we may need to look at in the future to help longer-term recovery.

    The Department of Agriculture was there, SBA, all of them. It very clearly identifies shortfalls in areas that we need to look at possibly through legislation or with other agencies for long-term recovery because disasters affect maple syrup farmers, orchards and dairy farmers. All of them. Right now there's no assistance except loans.

    Mr. WALSH. Yes. That's right.

    Mr. WITT. It's really tough.

    Mr. WALSH. When you don't have a cash flow because of the loss that you suffered once the price of milk is depressed, you can't pay the loans back. It's a pretty vicious cycle.
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    Mr. WITT. We have no programs to help the agriculture program.

    Mr. WALSH. Well, the date of the——

    Mr. LEWIS. I'm going to mention——

    Mr. WALSH. Sure.

    Mr. LEWIS [continuing]. Mr. Walsh, that there is some precedent for this, however, last year. But before that, as I understand it, through supplemental appropriations bills following disasters, we have given specific assistance through the agriculture provisions of those supplementals, some disaster relief.

    Mr. WITT. That's true.

    Mr. LEWIS. Specifically, in California, we have problems with dairy cows as well right now. I mean, hundreds, if not thousands, are being killed. But how you fund or help people in those circumstances, there is a pattern through the agriculture provisions of the supplemental that could help.

    Mr. WALSH. The data that you have gathered I'm sure will help us to make our case with USDA. And they have suggested that they would be willing to work with us on this. And we will have to be creative.

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    Mr. WITT. Look at our report. It's a very good report. It's to the point. OMB signed off on the report as well as the other agencies.

    Mr. WALSH. Great.

    Mr. LEWIS. I have just learned in the last couple of days that in Chino, California, some 6,000 cows——

    Mr. WALSH. Yes.

    Mr. LEWIS [continuing]. Have dropped dead from exhaustion. Cows or calves in births fall into the mud. I mean, it's really a huge, huge thing that I've never anticipated.

     Mr. WITT. You know, we're seeing different patterns. The Association of Western Governors signed an agreement with FEMA, the Department of the Interior, Department of Agriculture, Corps of Engineers, all of us to look at not only the drought problems but also flood problems. It's getting very serious, particularly for farmers.

    Mr. WALSH. This year with the El Niño weather cycle, watching the Weather Channel is a frightening experience. It's become horror TV. [Laughter.]


    And it does affect us all, and it's very unpredictable. I noted that you went out front early on watching for this and planning as best you could.
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    I have just one other question in this round. And that is that regarding the Emergency Food and Shelter Program, this program, the need for this program, has never been greater. In my community, the need is significant. And it seems that the OMB request is rather low.

    Could we do better, do you think?

    Mr. WITT. The request is for $100 million. Two years ago we had $130 million in that program. I think the Food and Shelter Program is probably one of the more successful programs that we have in the federal government because less than three percent of that money is administrative money.

    Mr. WALSH. That's remarkable.

    Mr. WITT. The money goes out directly to the state and local communities, to shelters, to Meals on Wheels, all of those things that help people who really need help.

    But the administration is asking for the same level as last year, $100 million.

    Mr. WALSH. Well, we'll discuss that as we go down the road. It may need to be increased, especially given the conditions we're seeing all around the country.

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    Mr. WITT. That's tough.

    Mr. WALSH. Thank you very much, Mr. Chairman.

    Mr. WITT. Thank you, sir.


    Mr. LEWIS. Thank you, Mr. Walsh.

    Mr. Director, the first time I met Lea Ellen was when you and I were together in southern California on a trip that involved, among other places, UCLA. We were looking at work that had been done, work that still needed to be completed in connection with the January 1994 Northridge earthquake. That visit, as you know, was this year.

    The difficulty I'm pointing to is that, while disasters take place, there are some who are concerned about the fact that after we appropriate money, sometimes long periods of time go by before money actually gets to the spot or construction takes place.

    FEMA established three closeout teams in Fiscal Year 1998 to resolve issues which had prevented the Agency from closing disaster declarations and programs. How many disaster declarations and programs are currently open?

    Mr. WITT. There are over 400 open disasters that go back all the way to Loma Prieta and Hurricane Hugo, some of them need minor things to close them up and either deobligate or obligate money. We have closed 66 already since we put the teams in place this year.
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    We anticipate we'll be able to close 183 during the rest of the year.

    Mr. JOHNSON. We've established a goal, Mr. Chairman, for the close out teams to reduce remaining costs for prior year disaster declarations prior to the end of this fiscal year by $1.3 billion and to close 183 disasters. Our first quarter activity has shown some definitive progress. Now that the teams are operational, we hope to realize these particular goals.

    Mr. LEWIS. Well, there is that on-going concern about the length of time people place claims, et cetera. And you know, it's one thing to be out of home, to say the least, personally out of pocket, but to have a promise and then have that promise not delivered in time creates an environment that's——

    Mr. WITT. You're absolutely right. The two areas that we have most difficulty in is the Hazard Mitigation Program which seems to take forever to get projects approved and obligated. We've tried to do the best we can to streamline that program. We've asked the States to develop a Hazard Mitigation Plan which prioritizes their goals in their State in order to help us expedite mitigation grants.

    Working with the State Emergency Managers, and the National Committee, we are trying to streamline that program. We even are looking to HUD and other agencies as to the Environmental Impact Statement reviews that they do. HUD leaves it to the community and the State to do the environmental assessment and the study. They're the ones that have to comply with the EPA and those other requirements.
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    At FEMA, the community and State do the environmental study, but then it has to be reviewed by FEMA. That may be a way we can streamline.

    The other thing Mike Armstrong and I are working on now is to give the Hazard Mitigation Grant Program to the State with very little oversight, except for auditing by the IG. My goal is to do the mitigation as they rebuild the project. We're also establishing a time frame, a two-year frame. If they do not have those grants obligated in two years, then they're going to lose it.

    Mr. LEWIS. You and I discussed mitigation, a lot of us will discuss it more before the hearing is over today, but I'm really talking about the length of time it takes to close out disasters. We've talked a lot today, and you and I in recent weeks about current problems of flooding in California, the tornadoes in Florida, et cetera. Let's assume that we set aside the most recent disasters. Before that, as you suggested, clear back to Hugo, the disaster is still open.

    How long would it take, if we didn't consider these most recent disasters, how long would it take to close out all those disasters on the books including that 1994 Northridge earthquake.

    Mr. WITT. We're setting a goal to try to close everything out within two years which is critical. What we're doing through the re-engineering of the public assistance program I think will mean that when we close a disaster field office, we will pretty much close that whole disaster. That's my goal, because we just cannot continue as we're doing. First of all, it costs too much money administratively for state and local governments as well. It delays the rebuilding of that community. We're going to change it where we can speed it up, while maintaining accountability. It's going to reflect what we're articulating under GPRA. It may put an extra burden on the IG's office because of audits they're going to have to do, but he's up to it. I know he is.
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    Mr. LEWIS. I get this question continually from Members whose constituencies are expressing concern. I know of your concern, but could you give the Committee a better understanding of what are some of the primary issues that prevent closing out these disasters? Why the time has extended well beyond two years, etcetera?

    Mr. WITT. Well, it's probably about a 50–50 split between the States and FEMA. We're trying to expedite and streamline our processes. The States are also working on it. In California, as an example, they have a lot of mitigation money that they still need to get out to local governments to do projects, but if you look at what's happening, California, and their own employees at the state level are pretty much taxed from all the disasters and everything they need to do. States have got to take more responsibility in expediting projects as well.

    We have to make sure that any part of it we review is expedited. The biggest problem we've had and the most complaints we've had from local governments haven't been as much related to mitigation as it has been the public assistance program. That's where we really get a lot of complaints, and it's simply for the fact that when we obligate the money to the State based on the damage survey that we have written and approved, it's then the State's responsibility to pull the money down out of Smartlink and give it to the local government. A lot of times there's a delay there. So now, when we notify the State that the money is available for them to drawdown, we notify the local government as well that the money for their project is available and the State has it, and they're to put it down to you. So we're changing that a little bit.
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    Mr. LEWIS. Let me follow through on that just a little bit more. I mentioned Northridge 1994. This is 1998, well over three years at any rate. And yet I remember a major story in Southern California where some earthquakes and bridges collapsed and major arteries that were transportation arteries for the south land. A sizeable bonus was given to a contractor who came in and reestablished that bridge, one of the major bridges in record time. That would indicate that the facility may be available for the States to move quickly. Clarify the bottlenecks a little better.

    Mr. WITT. Well, the Department of Transportation working with CALTRAN in California was able to do a lot of creative things there that under our legislation and regulations we can't do.

    Mr. LEWIS. Such as?

    Mr. WITT. Expediting the contracts as they did and offering very creative bonuses. We can't do that. That was very beneficial, because without those bridges, transportation was just at a standstill.

    If we re-engineer the public assistance program, then we will be able to expedite the process. We will not have the situation we had in Northridge and in the floods out there. I think most of you are pretty aware that we do damage survey reports or DSRs to write up the pieces of a project that have been damaged and are eligible for funding. We've retrained our inspectors in this and we're going to do a pilot this summer to see what we need to change, but this will expedite this program. I get so many calls from Members asking why hasn't their county or city received the money yet. You and I have talked about this many times.
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    Mr. LEWIS. Yes.

    Mr. WITT. So you know we feel the need to do this, for you and for our customers.

    I think it's going to be a great improvement. When we write that DSR it will be based on actual construction costs and estimates. Also if a local government can document the amount of damages under Category A and B, debris removal and protective measures that they've taken, we will advance them 50 percent of the total amount that they're going to receive up front to help them expedite their response to that disaster.

    Mr. LEWIS. You know, I can't help but be concerned about the television picture of rather expensive homes on the sides of cliffs, and beautiful locations in the mountains, etcetera, but oftentimes the picture doesn't include that very poor family where everything they had has been wiped out by a mudslide or an earthquake or whatever. While I very much commend you for these actions taken in regarding the close out teams and setting goals of closing out disasters in a two year time limit, nonetheless, there is a problem there that's on-going and I would hope that you would continue to have this be the highest priority.

    Mr. WITT. It is. Disaster close outs and the streamlining of the public assistance program are two of my top priorities. It's got to change.

    I've told the regional offices and the States that all of us have put up with this long enough. It's time to make a change here. We have to do this differently and we all have to be accountable for it. Local government is going to have some responsibility here too. We all will. We can do this. When I was County Judge in Yell County Arkansas I had the responsibility—I was the Chief Administrative Officer.
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    Mr. LEWIS. That's not what you did before this job.

    Mr. WITT. I was part of the emergency management team. I was County Judge, a County Administrator for ten years. We had a flood from the El Niño in 1982 or 1983 that washed out 33 bridges in my county and 1,100 miles of road. It was a federally declared disaster, and I know how well this worked and how fast it was, when FEMA and the State came into my county, looked at the damages, and wrote up the DSRs. I sent road inspectors out with the State people and FEMA. When they came back in from writing up all those DSRs for our county, I sat down in my office and I either approved or disapproved or agreed or disagreed with them. We worked that disagreement out in my office and you know what? It was funded. There were no appeals. There wasn't anything. That's what I want to see. If we can do this, then we can solve our problem of closing out and rebuilding, quickly.

    Mr. LEWIS. The Committee has that same priority. Mr. Frelinghuysen?

    Mr. FRELINGHUYSEN. No questions.

    Mr. LEWIS. Mr. Walsh.

    Mr. WALSH. I don't at this time.

    Mr. LEWIS. Mr. Stokes has just arrived. You may want me to go forward.
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    Mr. STOKES. Go ahead.


    Mr. LEWIS. Last year, Mr. Director, the surveys and the investigation staff completed a report which focused on a need for urban search and rescue teams, their mission and their funding sources. While urban search and rescue teams had generally operated well in different circumstances, the Committee's investigation highlighted several problems which may require both administrative as well as legislative remedies.

    The report states that neither a needs assessment nor an objective study has ever established how many teams should exist. Yet, recently two new teams were established.

    Is it true that there has not been a needs assessment and if so, why were two new teams recently established?

    Mr. WITT. We had 25 teams located across the United States. The only area that did not have teams was the middle part of the United States. However; we have one of the largest threats in the country, the New Madrid earthquake fault in the middle of the United States which covers Tennessee, Arkansas, Mississippi, Indiana, Missouri, and Illinois. There's a total of 14 States that could be affected by the New Madrid. That was the only area that we were not comfortable with not having a USAR team.

    Lacy, I don't know about the needs assessment. Can you comment?
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    Mr. SUITER. Yes sir. We have a process underway right now to determine what the total number of teams should be, the make up, and where they should be located. We expect that report by July 1st.

    Mr. WITT. I knew we were working on that, but I didn't know when it was due.

    Mr. LEWIS. The USAR program is based on the principle of support being provided by federal, state and local entities, yet FEMA has not defined the cost to maintain the program. And States provide little, if any, financial support. What is the funding responsibility of the federal, state and local government?

    Mr. WITT. Most of our funding for search and rescue teams is spent up front, as a team is brought on. We've created a funding line item so Congress would know funding levels for the search and rescue teams.

    Mr. JOHNSON. The amount for 1998 and 1999, Mr. Chairman, is the same. It's $4,021,000.

    Mr. WITT. Most of the search and rescue teams are supported by FEMA and their local governments. In California, we have eight teams, I believe, in Orange County and other counties supported by their communities. They're very proud of the teams and very supportive. We used 15 teams in in Oklahoma City at that response. These teams are very proud, and the community is very proud to help support them. We have a responsibility too, since we call them out for very serious situations. In Florida, a team was down there searching for victims in the tornadoes. In Hurricane Fran, they were searching for victims on the coast. They're very good and we can be very proud of them.
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    Mr. LEWIS. Mr. Director, FEMA has used disaster relief funds to equip teams when they are deployed rather than properly seeking appropriations to purchase necessary equipment prior to deployment. This can lead to hasty procurement of equipment at sometimes very high prices. Why has FEMA not requested appropriations to purchase equipment in advance of such needs?

    Mr. WITT. When I found out they were purchasing equipment in this manner, I decided we needed to have a line item in our budget for USAR to let Congress know what we're spending on this program.

    Mr. LEWIS. Last question on this subject area. FEMA does not appear to have clear statutory authority for USAR teams and has not promulgated regulations to manage the teams.

    While there are memoranda of agreement of the 21 participating teams, the agreements are deficient in such areas as liability coverage, workers compensation, ownership of equipment and so forth. What efforts are under way to clarify in statute or regulation the authority to the teams and the status of their members.

    Mr. WITT. I think that part will be done after the assessment.

    Mr. SUITER. That's correct.

    Mr. LEWIS. I'm sorry, why don't you identify yourself?
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    Mr. SUITER. I'm Lacy Suiter. The whole assessment process, identifying all the issues we just discussed?

    Mr. WITT. I have talked to the teams about who has the liability for the teams when they're activated by us, is it the local government or is it us. It is a problem.

    Mr. LEWIS. Mr. Stokes.


    Mr. STOKES. Thank you, Mr. Chairman. Mr. Director, according to your annual performance plan, FEMA is to achieve a goal, one is to protect lives, prevent loss of property from all hazards and within this goal one of the five year operational objectives is to reduce by 5 percent the rate of loss of life and property, and fire-related hazards.

    First, let me ask you if it is true, as testified to Congress last month by officials of the General Accounting Office, the United States has historically had one of the highest fire loss rates and deaths and dollar losses of the industrialized world.

    Is that true?

    Mrs. BROWN. Yes. I'm Carrye Brown. May I answer that?

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    Mr. STOKES. Yes, Ms. Brown.

    Mrs. BROWN. It is true.

    Mr. STOKES. And why do you think this is the case?

    Mrs. BROWN. One of the reasons is Americans tend to disregard fire safety. They just take it for granted. Also, a lot of fires also do occur in the homes and most of them don't have fire detectors or smoke detectors where those deaths occur.

    Mr. STOKES. Would you say there's a lack of knowledge regarding fire danger that's prevalent throughout the United States?

    Mrs. BROWN. Yes. I think Americans have to be reminded. The Fire Service community is doing an outstanding job of putting out fliers and informing Americans, but they have to be reminded about a problem that is taken for granted. Most of the time I think the crimes are the issues, but we don't think of fires.

    Mr. STOKES. Let me ask you this, you are the Director and may want to respond, but your annual performance plan states the first performance goal is to identify the national fire program, analyze, publish and disseminate related data and information. And this tends to indicate that we don't even know what the problem is yet. Can this be right?

    Mrs. BROWN. May I reply?

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    Mr. WITT. Yes.

    Mrs. BROWN. We do have an idea of the problem because we have had a National Fire Data Center for several years, but we want to do a better job of it. Infomation is provided on a voluntary basis, through the State Fire Marshall's office. It's collected by fire fighters around the country so we do have a sense of the fire problem. That was one of the issues identified way back in 1972 in a report called ''America Burning.'' It said that there needed to be something like a U.S. Fire Administration to help get accurate data and with that accurate data you can then help the nation help fire departments, and help fire marshals around the country to better identify the problem, and we can work on those issues that are national in scope. That's what we do.

    In fact, I'm very proud to tell you that our National Fire Data Center is going to be a PC-based system. We're also putting a lot of research results up on the Internet so it will be easier to access this information. So we're definitely in the process of doing that. We have a sense of the problem as a result of that.

    Mr. STOKES. Now in order to reduce it by 5 percent, what are we going to have to do to make this 5 percent reduction?

    Mrs. BROWN. There are several things that we have to do, but I think one of the harder things that our Agency understands is that we have to work in support of the fire service community. We have to talk with them and work with them, with accurate data on how they see our role as well as their role in reducing fire losses. We do that through stakeholders' meetings. We do that through working with the various fire organizations around the country. So we work hand in hand in developing solutions that are basically local based.
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    Mr. STOKES. Thank you.


    Mr. WITT. Also, the President asked us to work with the churches in an arson prevention program. That program was very successful and the U.S. Fire Administration, the fire service and the churches and all worked with us to make that possible.

    Also, the National Council of Churches came back to meet with me. They said that because our efforts had worked out so well, they want to work with us now in doing a prevention training program in every church across the country, for their congregations. This will be one tool that the Fire Administration and all of us will be able to use not only on fire, but to address other hazards as well.


    Mr. STOKES. Director, let me ask you this. Another operational objective under Goal 1 is through the National Flood Insurance Program to reduce annual disaster flood losses by $1 billion.

    Can you share with us what are your specific tactics in order to achieve this goal?

    Mr. WITT. By utilizing what we are doing now with the mitigation program, disaster programs and buyout relocations of property we should meet that goal.
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    Joann Howard, FIA Administrator, her staff and I have been trying to target the repetitive losses that we have in the program, and to see what more we can do in that area. The wise decision that Congress made to allow us to use $20 million identified in the 1994 Flood Reform Act towards targeting repetitive loss areas in each State will make a big difference as well. This is the first year we've been able to put the money out. So I think we can achieve it. It's very ambitious, don't you agree, Joann?

    Ms. HOWARD. I believe so. We're certainly working in that direction.


    Mr. STOKES. Director, let me ask you this, the 1998 Appropriations Act for FEMA provided $30 million for predisaster mitigation activities, but we fenced all but $5 million of that amount until receipt of a long-term comprehensive national predisaster mitigation plan.

    The Conference Report on the 1998 Act directed that the plan be developed, peer reviewed and submitted to Congress by March 31st of this year. That's a date that some of us felt was not terribly realistic for preparation of such a comprehensive effort.

    Tell us what is the status of this National Predisaster Mitigation Plan and tell us when you hope to be able to transmit it to the Congress and what group or groups have or will peer review the document?
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    Mr. WITT. The committee working on it believes it can meet the goal of March 31st. We'll do our very best. We have members on this committee that are from the insurance industry and every area that would be a peer review.

    Mr. LEWIS. Identify yourself for the record.

    Mr. ARMSTRONG. I am Michael Armstrong. We have representatives from the C–PAND group; representatives from the insurance industry; people from the academic community; know, national consultants; and state consultants. It's pretty broad based.

    Mr. STOKES. And what are we doing with the unrestricted $5 million?

    Mr. WITT. The $5 million has allowed us to kick off five of the pilot communities. We have two more pilot communities to kick off, one in West Virginia and one in Maryland. We're working with the States' local governments to identify and prioritize the most high risk communities in each State. It's going well. The States have submitted their proposals already for the next round of communities.

    Mr. STOKES. Which of the communities were selected?

    Mr. WITT. Which communities? Deerfield Beach in Florida; Wilmington, North Carolina; Pascagoula, Mississippi which was devastated by Hurricane Camille; Oakland, California; and Seattle, Washington. There is one project involving two counties in West Virginia and one project in Maryland that we're going to be kicking off soon.
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    Mr. STOKES. Can you give us the reasons for their selection, those particular communities?

    Mr. WITT. Two reasons. One was the risk factor. The other was the interest of private industry, the city, and state government in making this happen and making it work. In Seattle, Washington, to give you an example, we used $1 million seed money there. They have raised another $6 million from private industry to retrofit 2,000 homes of low income and elderly in areas that probably never would have been retrofitted. In addition, Americorps, working on summer and spring breaks, is going in to remove all heavy objects from top shelves and put them down on the bottom shelves, and make sure that book cases are secured to walls. The interest and the support from private industry for this project are unbelievable. It's just incredible.

    G.E.'s joined us, as have Home Depot, Lowe's Building Supplies, and Embassy Suites. Merrill-Lynch wanted to come to New York to meet with two other investment firms. I met with Jamie Gorelick at Fannie Mae—where they're looking at working with us and with mortgage lenders to do a signature program for communities, so that they will be able to borrow the money to retrofit homes and business against the threat. Washington Mutual has joined us to make low interest loans available to homes and businesses that need to either elevate, retrofit against an earthquake, or protect against wild fires.

    Mr. STOKES. You've done pretty well, I'd say.

    Mr. WITT. The reason we want to do this, and the reason we need to do this rather than continue to spend money after disasters are to eliminate a lot of this risk. We can eliminate a lot of the damage if we do this proactively.
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    You know, for five years I've seen people lose everything they own in a blink of an eye. I've seen community after community lose businesses that can never reopened. I've seen citizens lose jobs because those small businesses never reopened. That's why business is interested in this.

    Mr. STOKES. Let me just ask you this and I'll be ready to yield back, Mr. Chairman.

    Is there—you've enumerated quite a bit of nonfederal contribution here.

    Mr. WITT. Yes.

    Mr. STOKES. Is there any way for us to place a dollar value on that nonfederal contribution?

    Mr. WITT. One of the reasons we're doing the pilot communities, is to be able to give a good assessment of how successful the pilot projects are and how much the local, and state governments and private industry, put into the projects.

    I think Congress will be absolutely amazed at the dollar ratio that has been contributed from the local level and the private industry compared to what we're putting in. It's going to do so much. I'll give you an example. The City of Berkeley passed five bond issues that raised over $260 million to retrofit 17 schools and to put an alternate water system in because they know if they have an earthquake on the Hayward fault, it will break their main water system. With this substitute water system they will have water for their critical facilities, hospitals and shelters and to help them deal with wild fires. This is growing, and the interest is there because I can tell you, Congressman, these communities and individuals are tired of these repeated disasters too, and they're tired of fighting the devastation I think you'll see this will be one of the most successful programs with the least amount of money put into it that the federal government ever had.
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    Mr. STOKES. It's very encouraging testimony, Mr. Chairman.


    Mr. LEWIS. It is. Thank you, Mr. Stokes. Mr. Director, usually I would suggest that Members will have additional questions for the record and ask that you respond to some of those specifics that you mentioned if you supplement the record that you've already given to Mr. Stokes, so those questions will be appreciated.

    You remind me that it was the 1933 Field Act in California that was directed to address the question of safety of public buildings. I recall that a number of local governments over the years have struggled with the replacements costs of moving school buildings, tearing down old school buildings and is a direct reflection of that state action where the state legislators essentially said hey, we can't have these public facilities be in this condition and be used by the public over extended periods of time. It's not a new problem. We've been frightened with it for a long, long time. But I'm indeed impressed by the progress you see being made.

    Mr. WITT. You know, Mr. Chairman, and Members of the Committee, I am very, very concerned about our high schools, middle schools and grade schools because we have basically inherited a traditional stock of schools that was built many years ago. A lot of communities simply do not have the money to retrofit those school buildings to even meet life safety. You can look not only at the life safety concerns in the older university and public school buildings but also at the business continuity that would be impacted if there was a major disaster. You take a university like Berkeley, Mr. Chairman. The state now only puts about 12 percent of state funding into universities. The state helps them a little bit on structural retrofit on some of their buildings, but nothing has been done internally to ensure business continuity. You have 35,000 students on any given day there at CAL-Berkeley. You have 8,000 students housed at Berkeley. The rest of these students are housed in the communities surrounding the university. They're a major research institute for the federal government. If you have the Hayward fault go off, it's going to go right down the middle of their football field, and under the science lab. The economic devastation, plus the potential loss of life and injury is unbelievable. I was at Roosevelt High School in Seattle, Washington. They did structural retrofits at this school which is in an earthquake risk area. Previously, that school had nothing to help minimize the risk inside of the school. It had radiator heat, all the tanks were above ceiling, and their pipes were wrapped in asbestos.
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    Mr. STOKES. I mentioned the 1930 Field Act in California. Where I served on the school board, we're replacing buildings of 1966 and 1967. It took that long not only to respond to the Act, but to afford the changes in the meantime. The technology as well as that which we know about architectural work, et cetera, have changed radically. This is a nationwide problem that deserves a lot of attention that involves education.

    Mr. Walsh, did you have a question?


    Mr. WALSH. I did. Thank you, Mr. Chairman. Looking back, we talked about the damage done. Another major impact to this storm, as you know, was the impact on public utilities, public and private utilities. And looking through the blueprint to respond to this disaster, it's very well done. I haven't had the chance to go all the way through it, but a number of options are listed for each industry or party. Looking at the section, page 6, it says HUD Community Development Block Grant program can supplement other federal assistance in repairing and reconstructing infrastructure, including privately owned utilities if the use of the funds meets program requirements, including a national objective or benefit to low and moderate income persons eliminating slums or blight by meeting urgent needs, posing an immediate threat to the health or welfare of the community where other financial resources are not available.

    Now what this suggests is that there may be some economic help or offset to utilities. It's been estimated that the losses in Maine were over $80 million; in New York, $160 million; Vermont, $10; New Hampshire, $15 million. Is there precedent for that for the use of block grant funds or other federal funds to reimburse utilities?
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    Mr. WITT. Congressman, I do not know. I would have to check with HUD to see what they've done and if they have done it before. I'll let you know.

    Mr. WALSH. This was HUD's contribution to the report?

    Mr. WITT. Yes. I'll be happy to check with them.

    Mr. WALSH. There is a meeting scheduled to discuss this, so if you have any further thoughts, I would be——

    Mr. WITT. I'll be happy to.

    Mr. WALSH. That's it, Mr. Chairman.

    Mr. LEWIS. Thank you, Mr. Walsh. Ms. Kaptur.


    Ms. KAPTUR. Thank you, Mr. Chairman, very much. I welcome the Director and say I'm sorry I missed your formal testimony, but I've had a chance to read it. We had commissioners in from Ohio today and they are very persuasive. They wanted me to thank you and also your Agency for the help that they've received over the years in the acquisitions of sirens for warnings for tornadoes, which has really helped us on the western side of Ohio because they sneak across Indiana with very little warning. So we've made progress over the years on that.
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    I wanted to ask you in the new initiatives that you are proposing on Project Impact and on the radiological work that you wish to do, which parts of the country will primarily benefit from those initiatives? Are there certain areas that are targeted, that are more in need than others?

    Mr. WITT. Every state will be part of Project Impact. We've gone out to the State Directors of each state and asked them to submit to us, through our regional offices communities that they feel are very high risk communities. In addition, each state should tell us what that risk is and how we can eliminate that risk in that community, working with them and the community and private industry. The States have come in with recommended communities. We hope that after we finish the report on March 31st that we'll be able to designate those other communities.

    Ms. KAPTUR. I would be very interested to see in summary what the State of Ohio had submitted. I would be very interested in that. And also, perhaps, Michigan, because we share a lake front.

    Mr. WITT. Yes.

    Ms. KAPTUR. And I think it would be helpful to me if one of your kind associates might be able to get back to us.

    Mr. WITT. Mike Armstrong is the guy who's going to be doing this with the states.
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    Ms. KAPTUR. All right, thank you. I wanted to associate myself with the remarks of Mr. Hobson as well on the concern of the State of Ohio regarding, not the unworthiness of those initiatives, but the fact that the money for those is being taken from the allocations that had come to the States from a budget standpoint. If I look at the line items in the budget that is submitted and I see which areas are increasing and which areas are decreasing, we know that the State of Ohio's emergency management budget will be affected by about 10 percent as a result of cutbacks proposed.

    Mr. WITT. We've tried to hold the States harmless in every year since I've been Director because I know the effect it has on the State as well as local emergency management. I was there. I used to work with Dale Shipley. Gary can give you a good idea of what the cuts actually are. I know $11 million looks like a huge cut, but Gary, why don't you share the details with her.

    Mr. JOHNSON. Ms. Kaptur, we were very conscious of the potential impact of this reduction. We looked at the amount of spending that was going into state grants from our Emergency Management Planning and Assistance appropriation, and compared it to our actual obligations under Emergency Management Planning and Assistance for fiscal year 1993 to our 1999 request. In fact, compared to 1993 the overall appropriation request has realized a 20.05 percent reduction. The dollars in state grant money that flows to states, however, from 1993 until the request has actually increased by 4.68 percent. Through the challenges that this Agency has faced with our emergency management planning assistance appropriation since Director Witt has been here, we've been very conscious of doing our best to protect the passthrough dollars to the states.
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    Ms. KAPTUR. Mr. Shipley—I'm glad the Director mentioned his name because he has written us and I apologize, I wasn't here for Mr. Hobson's questioning, but I would like to place a letter in the record from Mr. Shipley in which he indicates that this particular budget request because it reduces the current funding in state and local assistance by $11.4 million and require $8.3 million more than last year in state and local matching funds. That would create a difficulty in Ohio. He just says funding for our counties has not kept up with inflation and is significantly below the anticipated 50–50 cost share. Where he says local funding now accounts for 66 percent of funds expended and many Ohio counties have received no increased funding for up to 10 years. So he is asking us at the federal level here to request the restoration of the proposed $11.4 million reduction and pass a budget with a minimum of $109 million state and local assistance at least equal to last year and I have another piece of paper here that indicates that it would result in a—let's see, State of Ohio estimates it will lose $324,000 or about 10 percent of its federal funding.

    Mr. LEWIS. Ms. Kaptur, I might mention while you weren't here for Mr. Hobson's questioning, almost the majority of Committee has asked similar questions. The Chairman has given the Director a letter from my entire California delegation. It's a great concern and very appropriate that you raise the question.

    Ms. KAPTUR. All right, well, we certainly will——

    Mr. WITT. We will be happy to work with you.

    Ms. KAPTUR. I don't know if Mr. Shipley has written the Agency or not.
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    Mr. WITT. Dale Shipley and I talk.

    Ms. KAPTUR. All the time.

    Mr. WITT. All the time.

    Ms. KAPTUR. Okay. All right.

    Mr. WITT. Dale is NEMA's representative as head of the legislative committee for NEMA. He does a great job in his State, and he also does a great job working with us.

    Ms. KAPTUR. And you do a great job.

    Mr. WITT. Thank you.


    Ms. KAPTUR. I did want to ask on this radiological initiative, exactly what is that?

    Mr. WITT. Gary, why don't you explain? He can explain it a whole lot better than I can since he's our CFO.

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    Mr. JOHNSON. Thank you, James Lee. Ms. Kaptur, what we're proposing is a REP fund which is a departure from our current practice of financing the radiological emergency preparedness program. Heretofore, the Agency has sought funding under our Salaries and Expenses and Emergency Management Planning and Assistance appropriations. The current year estimate for REP is about $12.5 million split between those two appropriations. The Agency bills the utilities for the full cost of the program. The revenues coming in from the utilities are deposited in the Treasury as offsetting receipts. This particular proposal basically does the same thing, except the revenue being billed from the utilities is deposited directly into the REP fund and then, beginning in fiscal year 2000 or October 1, 1999, will directly finance the program. Any balances would be available until expended which also has the potential, through sound management of the program, of reducing the fees that we charge utilities over the long term.

    In addition, we believe that this will be very helpful particularly at the beginning of the fiscal year and there have been occasions where we've had difficulty in getting our appropriation on time be it because of a continuing resolution or what have you and we had to work with the utilities to be able to conduct the exercises and other activities that they perform that are related to licensing nuclear power plants. There have been times when we've had to adjust our schedules to be in accord with the timing of the appropriations for any given year.

    My understanding is that the utilities are very supportive of this because they invest quite a bit of money to prepare for those licensing exercises. This would be one advantage of a proposal to go with a REP fund.

    Ms. KAPTUR. Now as far as the architecture of this program goes, we have a major nuclear power plant in our area. Do I take it that the largest share of funds are spent on the type of emergency management system that is set up, the concentric circles of—all fire and volunteer departments and regular departments that have to be brought in, so this is a continuing responsibility.
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    Mr. JOHNSON. Yes.

    Ms. KAPTUR. Relating to licensure and safety.

    Mr. JOHNSON. Yes.

    Ms. KAPTUR. So this is not an account that will go down. This is an account that will——

    Mr. JOHNSON. The request goes up from the current spending of $12.5 million to about $12.8 million. That's an adjustment to take into account pay raise costs and so forth for the folks that staff this particular program.

    Mr. WITT. Our county dealt with this program all the time, at Arkansas Nuclear 1 and 2. This program is very, very critical working with the communities within that ten mile radius. It's very critical that we work with NRC on these exercises and the tests that we do. If the utilities fail an exercise then we have to go back and redo that portion of the exercise that they failed. This will give the program stability, and will give the power and light companies the opportunity to actually know what the budget is going to be.

    Ms. KAPTUR. I wanted to just ask you, this is sort of an off the wall question, but I served on Foreign Operations so we got into quite a discussion last week with some of the Department of Defense officials about the safety of nuclear power plants in the newly independent states. I'm just curious whether in the Gor Tuchma talks or any of the work that we're doing to try to assure safety of nuclear power plant facilities in those states, including Chernobyl and other facilities built to the same specifications, if any way FEMA has been asked by the Administration to participate because of some special knowledge you might have?
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    Mr. WITT. No.


    Ms. KAPTUR. Thank you. On page 10 of your testimony, you talk about the 20,000 structures to date under your Project Impact be moved out of flood plains across the country as an accomplishment and doing this in conjunction with the flood insurance program. How many structures are there in the country in flood plains?

    Mr. WITT. There are a lot. Joann Howard is our Federal Insurance Administrator.

    Ms. KAPTUR. Welcome.

    Mr. WITT. Joann, would you like to share that information?

    Ms. HOWARD. Well, we are running those figures down. My staff are looking to identify those structures that have had repetitive losses and to determine how many. We are pulling that data from the computers right now as we speak.

    Mr. LEWIS. If the gentlelady would yield, I must say that in Southern California we have current disasters and past disasters. But probably the country's largest flood control project is the Santa Ana River project. It's $1.5 billion flood control project. No small piece of that comes from the fact that following the 1938 flood, which was a huge flood, there was a plain that went all the way down to the ocean through Riverside, Orange County, etcetera. Since that 1938 flood, there are at least 10,000 homes, businesses and otherwise which are located within that 100 year flood plain. So it is obvious that when this disaster is out of mind, we tend to want to go along with business as usual and the question you're asking is——
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    Ms. KAPTUR. This gets me to my next question, Mr. Chairman. On these flood maps, and how much knowledge there is at the local level because we have a lake too. You have the ocean (of course). We have something that looks like the ocean if you've never been to the ocean, the Great Lakes. But I continue to be baffled by the local authorities who permit construction right up to the lake edge. I mean there's no diking. There's obviously, No one looking at MAPS at the local level.

    How far are you in your mapping project? Last year, you said you were halfway finished? I want to know is it digitized yet on the Internet? Not that there wouldn't be charlatans around no matter how many maps we produce, but I have a sense that there isn't a perception that the home buyer may not be making the wisest choice.

    Mr. WITT. Let me attempt to address part of that. We have over 19,000 communities that belong to the flood insurance program. To be part of the flood insurance program they are required to build to a certain standard and also have certain building codes. If they are not in compliance, if they're not enforcing those standards and those codes, then they are taken out of the program and you cannot buy any flood insurance.

    I don't know if the communities you're speaking of are in the flood program or not, but I'd be happy to check for you.

    Ms. KAPTUR. May I ask this question? How many people will purchase homes in such areas even though they need flood insurance?
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    Mr. WITT. If they buy a mortgage the bank or the lending institution is required to tell them that they are in a 100 year floodplain, and that they are required to buy flood insurance for the life of the loan.

    Ms. KAPTUR. And when you say 19,000 communities, you're talking about incorporated areas?

    Mr. WITT. Yes, incorporated areas.

    Ms. KAPTUR. What if you're a township?

    Mr. WITT. Townships and counties can be in the flood program.

    Ms. KAPTUR. I would love to know for Northwest Ohio which incorporated or unincorporated communities are member of your program and which are not?

    Mr. WITT. Congress set up the flood insurance program basically because people couldn't buy flood insurance.

    Ms. KAPTUR. Right.

    Mr. WITT. They also designed the program, to have subsidies because they knew that there were low income people in high risk flood areas that would probably never buy flood insurance. But through relocations and elevations and getting housing stopped in those high risk areas, the program has been very successful.
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    The program itself has probably saved the American taxpayers close to $800 million a year in disaster costs that would otherwise have been paid out without the program. The program is run from premiums and, the administrative collections. Congress set it up where we could borrow money from the Treasury if we had a string of floods and we had a lot of claims come in. Yes, we have to pay that money back, plus interest. We're paying a loan back now.

    As a matter of fact, the Federal Government has made a pretty good amount of interest off us, $12 million this year. So that's pretty good.

    Ms. KAPTUR. I know that my time is up, but very briefly of all the structures then that might exist in flood plains in the country, 20,000 is a terrific accomplishment, but it's probably less than 2 percent? Is that fair?

    Mr. WITT. The 20,000 we bought out have been because in 1993 Congress passed an amendment to the disaster legislation. They increased the amount for mitigation from 10 percent to 15 percent of all the dollars we spend across the board on the public assistance program. By working with the state and local communities to target these flood communities, we've been able to on other federal dollars, from EDA and others, to get the biggest bang for the buck for the communities, and been able to put that land back in open land use management where they can never build back in there again. That's what we've been able to do.

    We could probably triple that amount, if we had the money, but we just don't have that money.

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    Ms. KAPTUR. On the digitized maps, last year you said you were half complete. This year, how far are we?

    Mr. ARMSTRONG. We have a 5 year plan that moves towards digitization as one option. I don't have an exact number for you. We have an inventory of maps. More than 22 percent of the 100,000 map panels are over 15 years old; so we have a number of maps that are quite old that we need to bring up to speed.

    Ms. KAPTUR. Is any of this up on the Internet?

    Mr. ARMSTRONG. Not yet. That's part of our mapping modernization proposal for a comprehensive remapping program as discussed earlier, which will cost just short of $1 billion. It's a high priority item, without question, but among other priorities.

    Ms. KAPTUR. Over what time period, Mr. Chairman?

    Mr. WITT. Five year period.

    Ms. KAPTUR. Thank you.

    Mr. LEWIS. Thank you very much for your questions and it's a very important subject area. You remind me that in Southern California besides all those other houses I talked about, both Disneyland and Anaheim were in that 100 year flood plain.
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    But also, I'm reminded, Ms. Kaptur, that one of my first recollections while serving in Congress was going with a business and community leaders in Needles, California, a small, working man's blue collar town and passing out applications for flood insurance because the Colorado River was rising to the point where they were facing disaster. In those days, you could implement flood insurance in three days, rather than a longer waiting period now. But nonetheless, average people living a couple miles from a river, unless threatened by this, challenged the need for flood insurance.

    Mr. Price.


    Mr. PRICE. Thank you, Mr. Chairman. Mr. Administrator, I'd like to add my welcome to you and your colleagues. Thank you for being here this morning and also for the good work you're doing, particularly your continuing work in North Carolina in dealing with the aftermath of our September 1996 disaster, Hurricane Fran; something we're still contending with.

     First, I'd like briefly to revisit the matter you were discussing with Mr. Stokes, just a couple of quick followup questions there about this comprehensive long-term national predisaster mitigation plan that you have underway. I'm glad to hear that you are actively involving the nongovernment and academic partners in that enterprise.

    Could you just elaborate your answer a bit in terms of your estimated ability to meet that March 31 deadline and also the instructions you've given this panel in terms of work product they ought to produce in fulfilling the congressional mandate to develop a comprehensive long term national predisaster litigation plan?
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    Mr. WITT. We have, I think, a very good panel that's working on this. They have gone through the first phase and are continuing to develop the plan. I think they will meet the deadline. Mr. Bernstein, who is chairing this group, also chaired the Committee for National Earthquake Hazard Reduction Program which is a tremendous help. The panel members are doing this on their own time without pay because they're interested and they're concerned.

    Mike Armstrong has been working with the Committee on this, and has asked the Committee to look at all aspects of predisaster mitigation, and also look at what else we may need to do in other areas to help mitigate future disasters. There is a possibility that some of our partners in the Federal Government that do a lot of research might also work with us in helping us research what steps may be necessary in the future to take for predisaster mitigation. We're looking at the broad scope of things.

    Mr. ARMSTRONG. The panel is really being asked to look at, as the Director said, all the different options that are out there. We want to incorporate the work of research teams, and studies being conducted in the academic communities. The problem is there are so many good things that are occurring out there that there is only enough money to partially fund some things that we think might be helpful.

    The panel is designed to give us the best advice they can on how to maximize the federal dollar and also how to identify other sources as well.


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    Mr. PRICE. Fine, thank you for that elaboration. We look forward to that document. Thank you.

    I'd now like to turn to a matter directly related to Hurricane Fran and of the continuing work in North Carolina to work with that disaster. My office has been in contact with your office regarding an appeal that a subdivision in my district has filed, so I'd like to just focus on that for just a minute.

    Before Hurricane Fran came through and destroyed the sewer system in the Hollybrook subdivision outside of Raleigh, the owner of this system went bankrupt. I'm not going to go into the details of this case, just the bare outlines.

    This had led the North Carolina Public Utility Commission to take over that system prior to the disaster. Now as I understand this dispute, the question of how to interpret North Carolina's laws seems to be where the confusion lies. Sometimes people in Government are all too quick to deny responsibility. In this case, the opposite is occurring. The state is saying that this sewer system was their responsibility when the disaster hit and therefore is eligible for FEMA funding and that, of course, is the key issue.

    It would then follow that the lien FEMA has placed against the Hollybrook community for pump and haul and treatment services should be removed. To date, however, FEMA has not agreed. I understand this matter is now in the third appeal stage. I hope that you are going to review it carefully. This will be a serious review, dealing with the merits of this case. I'd like to have assurance from you on that and also some estimate about whether the 400 citizens of this Hollybrook subdivision can expect a final decision on this matter by the end of March or thereabouts?
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    Mr. WITT. Congressman, I'm aware of the appeal and I know a little bit about the sewer system. The third appeal just came into my office yesterday. I will be reviewing the appeal personally, and I will be happy to get back with you, hopefully before the end of March.

    Mr. PRICE. Good, well, I really appreciate that, particularly your willingness to take a personal look at this. I think we have, if the issue is North Carolina law, I think we can assure you we have a full bank of attorneys and state officials willing to assist you, willing and ready to assist you. We do need to get this resolved. It's, of course, of great importance to the citizens involved and also to our State. I'm grateful for that. Again, we thank you for the attentiveness that our State has had from you in the aftermath of this disaster.


    Mr. WITT. Congressman, let me tell you a story. Wilmington, North Carolina is a Project Impact pilot community. The head of General Electric Corporation there, one of your larger employers, he said that they had gone in and retrofitted their plant to meet a hurricane risk. He said that within a matter of hours after Hurricane Fran, they were ready to reopen their plant and go back into operation, but they forgot one thing—they forgot about their employees. So they joined up as a partner in Project Impact to help their employees put a prevention program in their own homes. We had a different company that joined up because their employees were in a high risk flood area. They've gone as far as paying for half of the flood insurance premiums for the first year to help their employees. So prevention efforts are really catching on and working well.
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    Mr. PRICE. That's very encouraging to know. I appreciate again for all the moral and material support you've been involved in.

    Mr. WITT. Thank you.

    Mr. PRICE. Thank you. Thank you, Mr. Chairman.

    Mr. LEWIS. Thank you, you Mr. Price. Mr. Frelinghuysen.


    Mr. FRELINGHUYSEN. Just to revisit for a minute, Mr. Director. You've collected a vast amount of information on flood insurance issues in cases and you probably have the most unique perspective from a human disaster situation. I just wondered whether you might at some point in time for the record make the recommendations for possible changes to the Flood Control Act of 1994. That was the last vehicle out of town. I understand there's some jurisdictional issues of the EPA. A lot of good work has been done on flood plain management. Every state and region has a history that may be slightly different, but I do think just seeing your budget, each and every year, as one of your programs to continue mitigation insurance to give people the financial ability to rebuild their repetitively flooded or substantially damaged, etcetera, etcetera, I mean in reality, $20,000 is a drop in the bucket. It's extremely commendable. But I just—I'd like to see, quite honestly, a more proactive, some proactive suggestions, building on what you have. When we be talk about actual disasters, it's better when somebody, let's say from the Environmental Protection Agency and if any of those people are here, I don't mean to offend them, some heavy hand because I do think that there are—it's more an issue of land use than it is coming up with more money and that is obviously part of the overall equation, but there are some land use decisions in some areas which certainly have contributed to, I think, some very high costs in this program, as much as we're obligated to fulfill them and I think morally we do have an obligation.
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    I'd like to see some possible suggestions or changes to the law.

    Mr. WITT. Let me comment on that. And you're absolutely correct. Joann Howard and her staff are currently looking at what we can do in the flood insurance program to see, what we can recommend to Congress in legislative language to change that program, to make it a better program, and to do something the repetitive loss area.

    Tom Brokaw and I talked several times about the ''Fleecing of America'' story he did. I was very upset with him about it because of the fact that he said, ''This is your tax dollars.'' Those are not tax dollars. This is a program that is funded by insurance premiums. This program is very important; it's very critical. We always get criticism saying that because of the flood insurance program it is causing development on the coast. That's not so. I have had that comment made to me many times.

    In coastal areas, the program has strengthened the construction that would have been built on the coast regardless of whether the program was in place or not. When Hurricane Opal hit the Florida panhandle, Senator Connie Mack and I went there together. Just recently we were talking about how you could clearly see when you flew up the coast after the hurricane that the structures that were built after they joined the flood program were still there, undamaged, or with minor damage. All the structures that were built before the program was put in place were destroyed.

    It was very clear. The program is a good program, but you're right about the repetitive losses. We need to give Congress some information and some language that we can work with you on. We're doing that.
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    Mr. FRELINGHUYSEN. I thank you for your efforts and I do think that is, as always, a public perception issue out there and we have major television networks concentrating. They obviously have to educate the public, but I think major work has been done. I think you're to be commended and I would urge you on to do further work. Thank you.

    Mr. WITT. You're welcome.


    Mr. LEWIS. Thank you, Mr. Frelinghuysen. Concerning just that area a bit, the need for more education, but advancing technology and information that it is or should be available, included in the budget is a new initiative to upgrade, expand and disseminate seismic rehabilitation manuals and handbooks to design professional and building regulatory officials. How many years do you expect will be required to complete that initiative?

    Mr. WITT. Mr. Armstrong, would you like to answer that?

    Mr. ARMSTRONG. That phase of our seismic program to which you are referring is expected to be completed by the end of 1999.

    Mr. LEWIS. Running a bit to additional technology and information, what efforts are undertaken by FEMA to insure that new technology, as well as information available is included in the professional training of architects and engineers?

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    Mr. WITT. We share information and technology, across the country with architects and engineers. One of the critical areas that we're focusing on right now is steel moment frame buildings. President Clinton made available over $6 million out of his contingency fund because of the failure of some of the steel moment frames, caused by the Northridge and Kobe Earthquakes. We have completed the first phase of that study and hope to have the second phase of that study in 1999. We're doing testing now on the joints of the steel moment frame buildings and I think with the input that we've received from the professional community in this study it's going to be very, very good.


    Mr. LEWIS. What role does FEMA play in the National Center for Earthquake Engineering Research which was funded by the National Science Foundation?

    Mr. JOHNSON. In Buffalo? In Albany?

    Mr. LEWIS. For earthquake engineering research. This is located in Buffalo. It's funded by the National Science Foundation which seemed that there's some linkage that ought to be there.

    Mr. JOHNSON. Mr. Chairman, I believe that we do provide limited funding support working with the National Science Foundation. We have in the past. I think that Mike could probably confirm that and follow-up for the record. We have supported that.

    Mr. LEWIS. I remember California was in competition for that center and didn't get it.
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    Mr. JOHNSON. Mr. Chairman, I remember it well. In my old days, I worked in the earthquake program.


    Mr. LEWIS. Under the National Hurricane Program, 24 states and territories prone to tropical storms are encouraged to develop and apply appropriate building standards. How many of those 24 states and territories currently have appropriate building standards?

    Mr. WITT. Since we did the self-assessment of those states back in 1993, which looked at how well we were prepared, at the state and local levels and if we had the codes we needed in place to help prepare communities, I have seen more done in the area of the coastal states than I had at any time before. Florida has done a fantastic job in developing its codes and also enforcing those codes which are so critical.

    The states have come a long way in a short time in this area.

    Mr. LEWIS. Can you be more specific?

    Mr. WITT. I can't, but I can get you a number.

    Mr. LEWIS. Maybe for the record, you can elaborate on that.

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    Mr. WITT. Yes.

    Mr. ARMSTRONG. There are 19 states that are insured to be high hazard hurricane areas. Of those states, 11 have some sort of uniform code. Three of those states have adopted uniform codes for the exempt single family structure. There are four other states that either are close to developing uniform codes or else most of the communities in those states have adopted uniform codes. Only one state has not adopted a uniform code, but the communities have adopted some sort of higher code.

    However, we are also starting to work toward a merger of several of our international code systems which should be in place by the year 2000.

    Mr. LEWIS. I'd appreciate it if you'd help us by indicating which states make up those 21 states and territories and maybe if you would, I'd like to note further which, if any of those states or territories have experienced hurricanes or tropical storms in the past couple of years, if it required a FEMA response?

    Mr. WITT. We worked with the Virgin Islands and their legislature in helping them to pass legislation for stronger building codes and standards there too.

    Mr. LEWIS. Which illustrates the point.

    Mr. WITT. Yes.

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    Mr. LEWIS. Mr. Stokes.


    Mr. STOKES. Thank you, Mr. Chairman. Mr. Witt, what is FEMA's total effort requested for 1998 and 1999 for counter terrorism and anti-terrorism?

    Mr. WITT. About $6.7 million for 1999.

    Mr. STOKES. If I use these terms interchangeably, do you make a distinction between counter terrorism and anti-terrorism?

    Mr. WITT. $6.7 million.

    Mr. STOKES. Between $6 and $7 million?

    Mr. WITT. Yes.

    Mr. STOKES. With reference to the terms I've used, do you use those terms interchangeably, or is there a distinction?

    Mr. JOHNSON. There is a distinction between anti-terrorism and counter terrorism.

    Mr. WITT. We're talking about the domestic terrorism.
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    Mr. JOHNSON. That's correct. FEMA performs consequence management activities. I think the Administration is beginning to adopt new definitions for anti-terrorism and counter terrorism. We can explain to you what we're doing in counter-terrorism, versus anti-terrorism.

    Mr. WITT. The consequence management responsibilities that we have working with Justice, where they have the lead, is part of our Federal Response Plan for situations like the Oklahoma City bombing, where there's a response to a situation where you have a criminal act and you have a disaster at the same time. This could logistically happen with the terrorist acts.

    Mr. STOKES. But does counter terrorism mean something different?

    Mr. WITT. No sir. The counter terrorism program is a little different than what we do in the anti-terrorism program. Consequence management deals with counter terrorism activities that we're responsible for. The anti-terrorism program is for domestic terrorism such as that under the Nunn-Lugar Act. We don't have any funding specifically from Nunn-Lugar.

    Mr. STOKES. I see. Let me ask you this. Can you explain to us the different efforts relating to terrorist incidents depicted in the preparedness training, and exercise activity and the response?

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    Mr. WITT. The difference in the terrorism training and the response?

    Mr. STOKES. Different efforts that are related to terrorist incidents that are depicted in your preparedness training, and exercises and technique, and your response in the recovery activity.

    Mr. WITT. Recovery activity of a disaster?

    Mr. STOKES. This is more about the budget activity.

    Mr. WITT. Okay. Kay Goss, who is the Associate Director for Preparedness, Training, and Exercises is here, and she might want to speak on this part of the Preparedness Training and Exercise program. Also, Lacy Suiter, the Executive Associate Director the Response and Recovery can talk about the part that is under the Response and Recovery side of it, such as in the Federal Response Plan. He is responsible for the Federal Response Plan.

    Kay, do you want to talk about the exercise program?

    Ms. GOSS. Yes. Initially, in the planning area we are extending the State and Local Planning Guidance to include counterterrorism planning. We are also publishing exemplary practices in emergency management. We are adding new courses all the time in our training area at our Emergency Management Institute in Emmitsburg, Maryland. We are also offering master trainers, and are handing off training to state local officials. We conduct exercises throughout the country at each of our ten regional offices. So that's an overview of what we do in the pre-disaster preparedness area.
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    Mr. WITT. The R&R request for counterterrorism is about $995,000. Also, Congressman Stokes, we have about $2 million that is funded through the U.S. Fire Administration for their terrorism program. Those are grants that go directly down to the states.

    Mrs. BROWN. We have a four phase training program we are developing with the Department of Justice. It's an excellent program.

    Mr. STOKES. Very good.

    Mr. LEWIS. Ms. Brown, could you identify yourself for the record, please?

    Mrs. BROWN. Yes, I'm Carrye Brown, Fire Administrator at FEMA.

    Mr. LEWIS. Okay, thank you. Ms. Brown and Kay Goss.

    Do you want to have Mr. Suiter respond?

    Mr. WITT. Do you have anything to add?

    Mr. SUITER. Well, the Federal Response Plan covers the reaction of the federal family to a terrorist incident. The FBI is the lead federal agency in the whole process, and sets the criteria by which the federal family would respond to the consequence management call. They handle the incident management side of it at the scene of the event. We have our own recovery process.
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    There are several plans and operating procedures all underway governing how the federal family will respond.

    Mr. STOKES. What part of the budget does that represent?

    Mr. SUITER. $995,000.


    Mr. STOKES. Director, I thank you very much and as I said earlier, it's always a pleasure to have you appear before this subcommittee. Well-functioning administrative agencies receive the kind of accolades that have been accorded you at this hearing and obviously it's well deserved.

    Mr. WITT. Thank you, sir. We want to thank you for all your help, and I want to personally thank you for your guidance when I first met with you in your office. Mr. Chairman, he said we've got to get a picture of this and that was in 1993.

    Mr. STOKES. I've still got that picture.

    Mr. WITT. I do too. He was kind enough to autograph that for me and we all want to thank you.

    Mr. LEWIS. Mr. Director, as Mr. Stokes has indicated, this is a very unusual circumstance. I wonder if I could take an unusual step if my colleagues don't mind. Ms. Witt, will you stand up, please? Will you step up here right next to your husband?
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    I want to express the appreciation for this entire committee, but also for the Congress for the fabulous job that you have done and extend that to all the members of your staff who are present. It's been a great experience for us to see this Agency develop in the fashion that it has over these years and Lea Ellen deserves a lot of the credit because she's allowed you to go out to California and other places all over the country and we want you to know, Ms. Witt, that we are very proud of the work that your husband is doing I think the public needs to be reminded one more time that the 1999 budget proposal involves $844 million plus dollars in terms of the fundamental budget, but also there's a supplemental of $2,250,000,000 in essentially what used to be called supplemental requests. Recognizing that we had a pattern here, $3 billion is for the year that's ahead of us that involves potential needs for disaster purposes. It's a very important federal responsibility, but I must say if we could get the rest of all of our agencies that the Appropriations Committee has to deal with to respond in a similar fashion, I think the country would be better off and it might even cost less money as we go forward. Unless my colleagues have additional questions, this has been a very worthwhile and I think productive session. We appreciate your being with us and the meeting is adjourned.
    "The Official Committee record contains additional material here."

Wednesday, March 4, 1998.



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    Mr. LEWIS. The meeting will come to order. Good morning, ladies and gentlemen. Senator Wofford, it is a pleasure to welcome you. Senator Wofford, we are welcoming as the Chief Executive Officer of the Corporation for National Service and he will be presenting to us this morning the testimony and recommendations regarding the Corporation's budget for fiscal year 1999.

    For the record, I wanted to just outline that in 1997, the actual appropriations for the Corporation were $402,500,000. There were FTE in numbers of 196. The 1998 appropriation was $428,500,000, with an FTE of 227. The 1999 request is for $502,316,000, the same number of FTE as the previous year, the difference being an increase of $73,816,000.

    Senator Wofford, we understand most of the reasons for adjustment in requests. In the meantime, I would hope that you would feel comfortable presenting your entire testimony for the record. Give as much of it as you like either in summary or off the top and the members will have questions for you regarding the programs involved. So welcome.

    Mr. WOFFORD. Thank you, Mr. Chairman.

    Mr. LEWIS. Before you go on, though, you have a very, very good friend who has announced that he is not going to run for reelection in 1998 so he will not be with us the next time you testify before the Committee. I would like to call on that friend, Louis Stokes, for any remarks he might want to make.

    Mr. STOKES. Thank you, Mr. Chairman. I do not have any formal opening remarks. I just wanted to extend to Mr. Wofford our appreciation for his appearance here again. It is always a pleasure to welcome him here and to hear his testimony and I look forward to his testimony on this occasion. Thank you.
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    Mr. LEWIS. As you begin, Senator Wofford, I want to mention to those who are present that we had planned to have a break in the middle of our testimony and come back this afternoon. I think probably what we are going to do instead is just to go right through the process. We could finish earlier than you might have anticipated as a result of that, but we did that yesterday and it seemed to work. Mr. Wofford?

    Mr. WOFFORD. Mr. Chairman, thank you.

    Congressman Stokes, I salute you for everything you have done for national service in the broadest sense, including the Corporation for National Service. You have played a role in this in the highest office of public citizen and you are going back to a front-line place.

    Mr. STOKES. Thank you, Senator.


    Mr. WOFFORD. Mr. Wicker and members of the Committee, let me begin by thanking this committee for the support last year which helped make 1997 such a success for national service. My written statement details our progress on many fronts. There are only four, I think, I want to note and then turn to another critical subject.

    Our work in disaster relief. AmeriCorps members are serving right now in California and Florida with the Red Cross and with FEMA. I saw them in action last week in California with James Lee Witt, who spoke glowingly of the outstanding work that they are doing with FEMA not only in disaster relief but in prevention of disasters and helping to make buildings and communities disaster-proof.
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    Mr. LEWIS. I might mention that James Lee Witt was before us yesterday, and among other things, Mr. Witt, who is a great person, has never seen a friend he did not like. [Laughter.]

    Mr. WOFFORD. With that footnote, which I will keep in mind the next time I am with James Lee.

    Secondly, our partnership with Habitat for Humanity, where some 500 AmeriCorps members are serving this year. I renew our commitment to help carry out the project that you initiated, Mr. Chairman, to build a Habitat home in every Congressional district. It is a wonderful project and our national service network is rallying all over the country to its support.

    Third, the rapid growth of our education awards program to about 14,000 new low-cost AmeriCorps positions with nonprofit and faith-based groups. It is a model of how national service can grow in effectiveness in the private sector while drastically reducing the per-member cost.

    And our progress and plans for America Reads—fourth points—including more than 3,000 AmeriCorps members who will begin serving in local literacy programs this summer and fall, thanks to the resources that you provided last year.

    My oral testimony, however, will focus not on these items of extraordinary progress in some areas and great breakthroughs this last year but instead on our management and auditability, a primary concern for this committee, for the Corporation, and for me. The immediate challenge is to produce auditable financial records. Our objective is an unqualified opinion on our fiscal year 1998 financial statements. We are determined to reach that objective.
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    Today, I can report that we have corrected a great majority of the specific problems identified by prior auditors. We have also made many other improvements to strengthen overall management of the Corporation, but we still have work to do.

    To complete that job, we have enlisted the active assistance of the top management team of the Office of Management and Budget. Together, we have drafted a plan and a timetable for making the necessary management improvements. Our action plan covers five broad areas. Let me describe what we have done and our plan for completing the job under each of those items briefly.

    First, improving recordkeeping of the National Service Trust is crucial. There are now some more than 90,000 people who have been enrolled in that trust and we will be passing the 100,000 mark before long. We have already consolidated the staff and centralized the functions of the trust within the Office of the Chief Financial Officer. Now the most important step is to install a new digital imaging system to enter new enrollments and clear up discrepancies related to the old records. This system will be online this fiscal year.

    Second, in cash reconciliation, we have made major changes to assure the accuracy of our financial records. We have made software improvements and established an automated link between our financial system and the external system that handles the obligations and expenses of grantees. By August of this year, we will be reconciling cash to each of our two appropriations on a monthly basis and clearing identified items in a timely manner.

    Third, in the critical area of grants management, we have significantly improved the way we track and monitor grant funds. We have increased controls over grant obligations and implemented new procedures for approval of expenses. By April, we will have in place procedures to review grantees' records of AmeriCorps members' service hours. We will incorporate these procedures into our next round of program site visits. We are also establishing new practices to strengthen our recordkeeping regarding grant receivables and payables.
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    Fourth, in the area of budget and funds control, the Corporation has instituted a procedure to protect against over-obligation of grant funds. No grant now is issued until it is physically entered into the general ledger by the accounting staff. We are working, I should emphasize, under the limitations of our current inadequate information management system. We will permanently solve this problem when we install a new financial management system in fiscal year 1999.

    Fifth, as other financial controls, we are issuing new policies with respect to a range of functions, including procurement, payroll, and enhanced oversight of budget commitments.

    Mr. Chairman, we will be vetting this plan with OMB, which will be an active partner in its implementation, and with our active and very helpful Inspector General Luise Jordan who is here with us today. We will submit a detailed and realistic plan to you by March 18 and will report to you on our progress every 60 days thereafter.

    To carry out this plan in a timely manner, we need your help. You gave us that help last year. Your committee was generous with administrative funds, but as you know, we did not ultimately receive our full request. This year, we need full funding of our request for administrative funds, and once you have had the opportunity to review our plan, we would like also to work with you to obtain reprogramming flexibility to address critical needs of the Corporation, especially the management issues that I have been discussing.

    Solving these management problems is essential to the success of our programs. Whether building Habitat homes, tutoring children to read, running after-school programs, assisting victims of disasters, AmeriCorps members and the people they serve depend on our success in achieving and maintaining sound management of the Corporation. With your continued focus and your continued support, I am confident that we will reach the level of excellence that you and we all seek. Thank you, Mr. Chairman.
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    [The statement of Harris Wofford follows:]
    "The Official Committee record contains additional material here."

    Mr. LEWIS. Thank you very much, Mr. Wofford.

    I would like to open my questioning process not by a question but rather a comment. You may be aware that the House that Congress Built Project is expanding across the country in terms of member interest. We are now somewhere at the 200-member level in terms of commitments of building homes in districts across the country and some considerable effort is being made at this moment to make people aware who have not been aware of this project.

    I must say that Habitat for Humanity has been tremendous out there in its response. But the partnering that is a part of this whole process is very impressive and we have broken ground in the West, Mr. Stokes, just recently in Apple Valley, California, with the first groundbreaking for such a piece of that project in a small community on the desert side of California. There is a lot of interest and it does cut across the board in terms of public and nonprofit as well as business interest in communities as I have experienced it thus far. I am very excited about its prospect and do appreciate your interest and cooperation, as well.


    Mr. WOFFORD. Habitat for Humanity, Millard Fuller and his colleagues have suggested that I send to our whole national service network, which goes beyond the AmeriCorps members to the senior RSVP program of 450,000 volunteers and to our whole network of local agencies and to our State commissions, a letter calling on them to offer their help in each of those districts where you are operating and to help in some districts where you have not started.
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    I assure you that from the National Civilian Community Corps, General Chambers is here, across the board we are giving top priority to those programs, including spring break projects, where AmeriCorps members in Lynchburg and elsewhere are going to be organizing college volunteers, running the sites, organizing the youth including hundreds of college volunteers for Habitat blitz builds.

    Mr. LEWIS. The very natural linkage between the fundamental force behind your work and this project is obvious to anybody who looks, but I find it very interesting at the local community level, the kind of response that we are getting.

    Mr. WOFFORD. Mr. Chairman, it was interesting that originally, Millard Fuller, the founder of Habitat, was doubtful about seeking Federal resources for this. His board very much felt the need of full-time people, such as the AmeriCorps members could be. He went along, but with a lot of doubts. As you may have noted from the letters he has written to Speaker Gingrich and Senator Lott, he has become a tremendous supporter and he has asked for more and more.

    He sees the combination of full-time service with unpaid traditional volunteering as crucial. They select and recruit these AmeriCorps members that work with them in their projects. They tend to select people that have already been volunteers, and then they have a cadre of leaders. As you saw when you were at the first houses that Congress built, as in the previous blitz here, the team of AmeriCorps people in the District of Columbia last summer were the mainstays of the organizing of that site and assisting various members of Congress and me and others in knowing what to do.
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    Mr. LEWIS. I am very intrigued by, and you and I have not talked about it for a while, Mr. Stokes, but as you know, Fannie Mae was leading the private sector with a $1 million contribution. Freddie Mac has now made a similar contribution to this project and others in the private sector are beginning to respond, so I think there will be some funding base that will stimulate what happens in volunteer groups, nonprofit groups, and organizations like Habitat in these communities.

    Mr. STOKES. If you would just yield to me for a moment, when Senator Wofford mentioned our working on the two houses that Congress built here in the District, we did get a chance to see these young AmeriCorps volunteers in operation, out there working alongside those of us who were out there trying to find out what we were doing, many of them having the expertise to tell us how to do what we were trying to do.

    Mr. LEWIS. Yes, we were trying to find out what we were doing. [Laughter.]

    Mr. STOKES. But it was good to see in operation how these young volunteers are working on these type of projects. I share with you the experience you must have had with Apple Valley, where you saw this being carried forth out there. I am looking forward to our doing this out in Cleveland, too.

    Mr. LEWIS. I hope to join you, perhaps.

    Mr. STOKES. And I look forward to having you.
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    Mr. LEWIS. You keep inviting me, but I never quite get there.

    Mr. STOKES. That is right.

    Mr. LEWIS. Mr. Wofford, last year, the Chairman of the House Education and Workforce Committee strongly opposed any legislation earmarking funds in the VA/HUD appropriations bill for the America Reads program. The conference agreement did not include any bill language earmarking funds for America Reads but the joint statement of the managers indicated $25 million was included for literacy and monitoring activities. How is the Corporation interpreting that conference report language and how will it be implemented?


    Mr. WOFFORD. First, Mr. Chairman, it is important for you to know that children's literacy has been a matter of very active involvement and leadership by AmeriCorps from the beginning. One of the most notable projects in the country in elementary children's literacy was a project in Kentucky, Slice Corps. It has had remarkable results. When I arrived, I found that two-thirds of our AmeriCorps assignments were dealing with children and youth and thousands of AmeriCorps members were organizing or participating in tutoring programs. In fact, you have an attachment to the testimony of just one selected project in each State where we are involved in children's literacy.

    Secondly, you should appreciate that the America Reads goal was being set by mayors and governors before the President raised it to a national level, quite rightly and boldly. Governor Bush of Texas, six months before the President's speech, proclaimed the clearest, most profound goal of Texas was to see that every child learns to read by the end of grade three and then reads to learn. Boston Reads, Baltimore Reads, Houston Reads were all underway before there was what is called the America Reads initiative.
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    Now, since the national campaign was launched by the President, many, many more communities have galvanized their forces. In almost all of those communities that I know of, from Houston Reads, whose launch I attended with Barbara Bush, they have called on AmeriCorps, our senior programs, our Learn and Serve programs, to be key parts of their local initiatives. The additional resources you gave us for children's literacy enabled us to play a valuable and even crucial role in many communities in this country in developing their local initiatives to America Reads.

    There was a lot of misunderstanding, in my opinion, about America Reads because of the boldness of the President's proposal and his setting a goal that we see that every child reads by the end of grade three and calling for a million volunteer tutors. It probably gave the impression this was to be some great organized Federal program that organized a volunteer army of one million tutors. From the beginning the essence of it has been local and State initiatives, and community-based, university-based, and school-based literacy programs.

    Our resources have enabled them to flower. Among other resources—the summit of General Powell and the Presidents in Philadelphia and the America's Promise campaign have contributed. That is part of the report that every child have an effective education. The rallying of those forces is underway.

    Now, the bill that was passed in the House has not passed the Senate. Whatever bill emerges will, in some significant way, enable the Education Department to be a fuller partner in this program. I hope a bill passes and I hope the bill includes the many good things in the House bill about teacher training and building on Congressman Goodling's parental elementary tutoring project called Even Start, in which we are very active. I hope that Congress acts this year but we are moving ahead full speed as part of these local initiatives all over the country.
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    Mr. LEWIS. Senator, as you are very aware, there are two bodies in this place, the House and the Senate. I think you do know that from time to time the House does pass bills that the Senate actually ends up not passing. [Laughter.]

    Indeed, you also know that this bill involves a variety and mix of interests, all the housing programs, programs that relate to the veterans medical care system, NASA, the National Science Foundation, a variety and mix. But you may not know that 85 percent or more of our bill is not authorized. Indeed, if we were to not appropriate funds for programs that are not authorized, we would not fund housing for the disabled, housing for the elderly, any number of programs. Nonetheless, we are instructed, directed by the Speaker and others, especially by individual chairmen, that we ought to be very sensitive to authorizing chairmen.

    I think you know what my views are about America Reads and the potential of some of those programs. In the meantime, though, when you have the House Education and workforce Committee Chairman saying that you should not earmark x, I am asking you how you interpret our language——

    Mr. WOFFORD. Oh, I am sorry, Mr. Chairman. I did not focus precisely on that because his remarks in the committee report that I am aware of were related to this bill that is going forward in the House——

    Mr. LEWIS. Correct.

    Mr. WOFFORD [continuing]. Where this passed and the Senate.
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    Mr. LEWIS. Everybody says they would want to make sure that our bill does not become a disincentive for their bill becoming a conference item, et cetera, et cetera, but when you get to the other end of the track, nonetheless, we are stuck with their position.

    Mr. WOFFORD. That is why I said that before there was any thought of a new bill in Congress or of an America Reads campaign, we were working with local literacy programs around the country on a large scale.

    Mr. LEWIS. I understand that.

    Mr. WOFFORD. These are the examples that I gather were not attached.

    Mr. LEWIS. That is all right.

    Mr. WOFFORD. I understand he was not only skeptical of the AmeriCorps participation, he was also skeptical of the emphasis on volunteer tutors in that bill. In the House bill, there is not that emphasis. I think there may be changes in the ultimate bill, if there is an ultimate bill, that we would be even more supportive of. But it would not affect, unless you make it so, the extraordinary role that we are now playing.

    Yesterday, Philadelphia launched Philadelphia Reads and it did it with two VISTAs and one professional. The mayor gave it a great launching and they are calling on the national service family to play a key part in Philadelphia. That is what we see happening on a bigger scale this coming year with your help.
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    Mr. LEWIS. My specific question said, how is the Corporation interpreting that conference report language and how will it be implemented. I would like to have you read that again and maybe broaden that for the record——

    Mr. WOFFORD. I would like to——

    Mr. LEWIS [continuing]. But let me elaborate a bit. It says, do you plan to limit the amount of grants for the 1998 funds for literacy and mentoring activities to $25 million?

    Mr. WOFFORD. No, because we have a substantial number of programs underway, some of our most outstanding programs, that are not new programs. That is why I was stressing that two-thirds of our existing programs are related to children and youth and many, many of them are engaged in tutoring. These are extra sources to add to the extraordinary work we are doing in elementary literacy already around the country. So we would not and I would not expect you to want us to substitute these new resources for already existing programs and commitments that have been made by State commissions.

    Mr. LEWIS. Let me repeat again, the conference agreement did not include any bill language earmarking funds for America Reads, that the joint statement of managers indicated $25 million was included for literacy and mentoring activities, and then I went on to ask, do you plan to limit the amount of grants from 1998 funds for literacy and mentoring activities to $25 million. You said no and then went on from there. So I would like to have you read that again when you look at the record.
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    Mr. WOFFORD. We will reply to you further. We do not think that the fate of that bill has any implication in a restrictive form for the major existing programs under our authorization, which calls for us to help meet the educational needs of this country.

    Mr. LEWIS. I mention to you again that a big part of our bill is not authorized but we are directed to be very sensitive about authorizing chairmen's concerns, and so you might want to have a conversation about this section with the Chairman of that Committee, as a matter of fact.

    Mr. WOFFORD. I would like to have some new conversations. I am a great admirer of Congressman Goodling—

    Mr. LEWIS. As we all are.

    Mr. WOFFORD [continuing]. And I know his deep interest in doing this. I am a great enthusiast for his Even Start project.

    By the way, Mr. Chairman, I noted in my written testimony, we will be very shortly sending a reauthorization bill for the Corporation for National Service to the Congress. The President has called for it. It has very significant bipartisan support and I will be very, very interested in working with you on the bill and your comments and criticisms of it. It will be a work in progress.

    Mr. LEWIS. Since you indicate that there probably will be more than $25 million expended in this subject area, what is the total amount of 1998 appropriations that you estimate will be granted for literacy and monitoring activities?
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    Mr. WOFFORD. May I submit that for the record? I cannot give that to you out of my head, but we will show you what it amounts to.

    [The information follows:]

    The additional $25 million was earmarked for the expansion of literacy activities, and the Corporation will allocate these new funds for that purpose through grants to be awarded in the spring and summer of 1998. These funds are in addition to the base of support for all activities, including national service programs already engaged in literacy, as provided by the Committee over the last several years and carried forward into fiscal year 1998.

    As the Committee is aware, over the last several years based upon decisions made primarily by Governor-appointed state commissions, more than two-thirds of the Corporation's national service programs have had an emphasis on children and youth, and a major focus of these programs has been in the area of education. The education activities vary considerably based upon local determination and interests, and include but are not limited to literacy related activities for children and families.

    National service projects are not required to report budgets and expenditures by activities within a grant. For example, if an AmeriCorps projects supports both environmental and education activities, the grantee is not required to indicate the amount of the grant supporting the environment and their amount supporting education. Or, if a Learn and Serve grant supports both a literacy after-school program for young children and environmental education, a grantee is not required to provide detail concerning the amount for literacy and the amount for environmental education. Therefore, it is not possible for the Corporation to provide an exact total amount for literacy activities in fiscal year 1998.
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    The Corporation does anticipate that, in addition to the $25 million, 97 AmeriCorps programs and 42 Learn and Serve Higher Education programs will receive grants that will support in some part, literacy activities for young children and their families. In total, these grants amount to approximately $56 million, but as noted above, these amounts support more than just literacy activities. Further, as noted elsewhere in the testimony, these education activities have been in existence for several years, and reflect the Corporation's efforts to carry out the purpose of the National and Community Service Act, one of which is to meet the unmet educational needs of the United States.

    Mr. WOFFORD. I have given you just one project in each State and most States have a number of projects.

    Mr. LEWIS. And we will probably relay your response to the Chairman of the Education Committee.

    Mr. WOFFORD. Mr. Chairman——

    Mr. LEWIS. I am not really being confrontational, but rather, it is important for you to know that this dialogue is going on.

    Mr. WOFFORD. Mr. Chairman, I cannot obviously speak for Congressman Goodling, but I have heard nothing from him outside of the context of this America Reads bill that suggests that he is against the work that AmeriCorps has been doing in children's literacy, including the work in his Even Start programs.
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    Mr. LEWIS. It is important for you to be aware of these issues. I will review it one more time. You understand the two-body circumstance around this place. In the meantime, oftentimes, we do hear from chairmen that they do not want to have our bill be a disincentive for their completing their work with the other body and so forth. So that discussion does need to take place and I think your joining in that discussion would not be a problem at all.

    Last year, the administration proposed the America Reads initiative. That proposal includes two things, one, an earmarking of funds in the appropriations act for the Corporation, and two, the enactment of legislation to implement the Department of Education's part of the program. Neither proposal was enacted. The administration's 1999 proposal for America Reads is similar to the 1998 request in that it assumes the enactment of legislation for America Reads initiative and an earmarking of Corporation funds.

    While legislation for the Department of Education's part of the program was not enacted, the House-passed legislation involved child literacy, as we discussed. As I understand it, the Senate has not taken up the legislation. Briefly explain the differences and similarities between the House-passed bill and the America Reads proposal.


    Mr. WOFFORD. The House-passed bill, in its report that you were referring to, stresses that it is meeting the budget agreement obligation for a very substantial investment in the goal of America Reads and seeing that children read by the end of grade three. It also states that they believe they have improved on the President's proposals that were allocated a very substantial amount of funds in the balanced budget agreement.
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    So the basic answer, I realize I am repeating myself, is that America Reads is not something that has to be concocted and seen as a Federal program. It is a national goal that many governors and many, many mayors have gone all out for making commitments and launching these programs. If no bill passed the Congress, which would be very unfortunate because I cannot think of a better strategically right or morally right goal, but if no bill passed many of these local drives, which are well planned, in some places extraordinarily well planned, will succeed.

    Mr. LEWIS. I do not mean to dwell or sound repetitive, but is it not fair to say that the House-passed bill supports additional assistance for child literacy issues, but provides the assistance somewhat differently than that proposed by the administration. In other words, the world works differently——

    Mr. WOFFORD. Certainly. There is an overlapping between the original bill and the House bill.

    Mr. LEWIS. Many, many a good idea is developed at the local community level that sometimes is taken to the Federal level and has a different kind of face.

    Mr. WOFFORD. Let me answer the other side of your question, as to what the difference is between the original proposal and the House bill. The largest difference is a greater emphasis on teacher training and training in the most proven, demonstrably research-backed methods of seeing that children read. The House bill would provide very substantial resources to the Education Department, to get to the States for that purpose. It also includes support for programs like Even Start that Congressman Goodling initiated which are in fact, in most cases in the non-regular teaching school system. They reflect the fact that the teachers need help.
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    There is no group in this country that more urgently wants the addition of after-school programs for the hours where so many kids are latchkey kids. In some cases, AmeriCorps members work in the schools themselves on a one-to-one basis in classrooms where a teacher cannot move ahead because there are one or more children that are just not speaking or not reading. Some of the best national service programs, including our Foster Grandparents program and the senior programs in the other committee, are with the teachers in the classrooms, helping them. Teachers have said to me, ''I had a block that was stopping our whole class and your Foster Grandparent has enabled us to work with that student and let the class proceed.''

    The after-school programs, the weekend programs, the summer programs are needed. I think the education community by and large believes this. Every teacher that I have talked to in elementary teaching says, we need help. The House bill does not, to the degree that the President's bill did, support those non-school-hour efforts.

    When Houston Reads planned this, the school teachers, the unions, the administrators were there saying, what we need in order to get our kids to learn to read is your help in organizing these volunteer tutoring programs so that they are well-trained and well-organized. That is where the AmeriCorps members' energies are now going; to organize and assist in the mobilizing of those non-school-hour programs.

    Mr. LEWIS. I clearly hear what you are saying, but I want to make sure that you hear what I am saying, as well. The House-passed bill, I know that you are aware, but it is important to say for the record, does not tie the Corporation and the Department of Education together as proposed by the America Reads initiative. In support of child literacy efforts, the 1998 Labor-HHS Act provided $210 million for literacy, contingent upon the program being authorized by July 1, 1998. If such legislation is not enacted by that date, the funds are transferred to the special education account. That appropriation funds programs for children with disabilities.
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    What is your reading on the outlook of the non-Senate passage and then enactment of the child literacy legislation prior to July 1, 1998?

    Mr. WOFFORD. I do not know whether my expertise in the Senate is at this point as good as yours, Mr. Chairman.

    Mr. LEWIS. My guess is it is way beyond mine.

    Mr. WOFFORD. That is an early deadline and it is an interesting, you might say, triage example in which one very good object, the special education needs, is put up against another very, very important goal. I cannot predict what the Congress will do either with the deadline or with the bill.

    But to repeat myself, America Reads is going on all around this country. The appropriation that we are requesting is to enable us to build on the work we have been doing in the last three, four years in children's literacy and the collaboration that is underway full speed is our collaboration with local schools, local universities, and local reading programs. We need your support, we need the extra resources, and we will produce the testimony from the people around the country that want them. That is what we are here asking for today.

    Mr. LEWIS. I will return to the combination of the Department of Education and the Corporation's knowledge and expertise in a moment, but in the meantime, I do not want to abuse my colleague, Mr. Stokes. Mr. Stokes?

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    Mr. STOKES. Thank you, Mr. Chairman.

    Senator Wofford, let me start by noting that there are a number of people seated behind you who, I assume, are associated with the Corporation.


    Mr. WOFFORD. Some are and some are not. I would have to do a body and soul count. I think those that are not by body on our staff are interested in one way or the other or they would not be here. I have a number of my senior colleagues here. I can introduce them, but you were making another point.

    Mr. STOKES. I do not want you to introduce them individually, but I am a little concerned that I do not see much diversity in terms of the persons who are with you as being reflective of this agency.

    Mr. WOFFORD. Well, I have not looked around, but my Chief Operating Officer, Louis Caldera is here. He has roots in a—it is still a minority group in the country, though it is fast growing, the Hispanic community. General Chambers, who is head of one of the major units that we are asking support for, to the right, is an outstanding African American. Bill Bentley is the head of one of our most important new departments, the Departments of Evaluation and Effective Practices. He was Executive Director of the Florida State Commission, as Representative Meek knows, he had outstanding success there. These are three key members of my senior management team who do represent diversity.

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    The Director of AmeriCorps, Deb Jospin, in a sense is a representative of the degree to which women on a large scale are in the leadership of this Corporation. She points out to me that of the professional staff of AmeriCorps, the new program, there are 15 white persons, seven black, three Hispanic, and one Asian.

    Mr. STOKES. Which part of the Corporation is that?

    Mr. WOFFORD. That is AmeriCorps, State and national. That is not VISTA, which would in another committee have its own, I think, good story to tell. But that is the State and national AmeriCorps. That is not including the direct administration of the National Civilian Community Corps, which is the one thing that we run under General Chambers. He not only has a number of outstanding former military people but a very significant proportion of African Americans in the leadership of the National Civilian Community Corps.

    Mr. STOKES. Are you satisfied that throughout the entire Corporation, all aspects of it, that you are meeting minority goals and that your agency is reflective of a diversified nation that looks like America?

    Mr. WOFFORD. I think we have a good record. Am I satisfied?

    Mr. STOKES. Right.

    Mr. WOFFORD. There is hardly any front of importance on which I am satisfied, but I think we have a good record. I think we are doing better but I do not doubt that there may be significant pockets where we need more diversity. But the overall breakdown of our total staff, I think you have, and I think it is well above par for Federal agencies in terms of diversity.
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    Mr. STOKES. I would appreciate it if you would expand upon that in the record for me with charts and the coterie of things.

    Mr. WOFFORD. Yes, sir.

    Mr. STOKES. I would like to ask you to give us some details on your proposed 1999 program. How much of the $93 million do you envision would go toward the AmeriCorps grants, how much for the National Civilian Community Corps, and how much for assistance activities, evaluation, and so forth?


    Mr. WOFFORD. The National Civilian Community Corps has been operating at $18 million. Because of the extraordinary needs that we have in the District of Columbia, we developed a campus here. It is 100 strong now, or a little bit above that.

    We had asked for flexibility to be able to move beyond the cap, to use other funds given to us for AmeriCorps for that purpose because it is such a demonstrated success and it is such a powerful agent of national service. We did not get that, to our great disappointment, last year.

    We are asking your help, as my written testimony says, so that we may have—in this case, the $21 million that will enable that program to go forward. We would like very much to work with you to show you why that is a good investment. General Chambers and I would like to see you and others to show why that is so important.
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    The AmeriCorps grants program enacted last year was $227 million. We are asking for it to go to $256 million.

    Mr. STOKES. All right.

    Mr. WOFFORD. In Evaluation and Effective Practices, we have $5 million enacted last year. We are asking another $500,000 for Mr. Bentley's department. The field is very much looking forward to the strengthening of our effective practices approach that Mr. Bentley has introduced.

    Mr. STOKES. Let me ask you about the National Service Trust. The conference report on last year's appropriations act asked the Corporation to provide a report to the committee by June 30 on the feasibility of privately funding the Trust. The report is to address the cost of such action and include recommendations on how the private funding goal could be implemented. Tell us what actions you have taken thus far to determine the possibility of the Trust operating without Federal funding and what is the status of this report.

    Mr. WOFFORD. As I understand it the Committee was not just interested in seeing that the trust itself be funded outside—that is an area of tremendous interest to all of us, but whether the administration of the Trust, which has been a problem or a challenge for us and is central to our auditability challenge—whether that function—would be better performed outsourced to either a private entity or to some other Federal entity. So it is privatization and outsourcing.

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    We have the statement of work for that study. We know there are prospects, very good prospects for the right people to go forward with it. We think it can meet the deadline set by the Congress and we will have that report to you.

    I should add that I personally, from my confirmation testimony and even more today remain interested in outsourcing where it can be done. We did it with the new high school scholarships. I am also interested in getting our administration to be as small and as lean as possible to still produce effective results. I am looking forward to the results of that study and to working with you when we have brought it to you.

    Mr. STOKES. Also, the Corporation has contracted with the National Academy of Public Administration, NAPA, to study the structure, organization, and management of the Corporation. According to the NAPA project description, the study focuses on several core areas, including program service delivery, grant award and administration, funding, sustainability, and human resources management. We understand that you received a draft of the NAPA study.

    Mr. WOFFORD. Yes.

    Mr. STOKES. When will the study be finished and made available to Congress?


    Mr. WOFFORD. I hope it will be finished on the deadline set, which was the end of March. We had an excellent session when they gave us the first draft. Then we had another session to go over a number of questions. They range from questions of fact as well as some further discussion with them on some major proposals they are making. It is going to be a very useful study. We are expecting it will be finished by the end of March. They are in the final stages of completing the draft, and as soon as that is finished, we will be submitting it to you.
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    Mr. STOKES. Are there any of the significant findings that you would share with us at this time, or would you prefer to——

    Mr. WOFFORD. Mr. Chairman, I would much prefer to let us find out what their findings are going to be. We have the rough draft. They are reviewing some important questions. I realize that this is a good time, but it is a bad time in terms of fairness to them since I do not know what they will finally propose.

    Mr. STOKES. Mr. Chairman, that would be fine with us.

    In the past, Senator, the AmeriCorps program has frequently been criticized for being too costly. In 1996, the Corporation committed to reducing the average for AmeriCorps members as follows: $17,000 in 1997, $16,000 in 1998, $15,000 in 1999. What is the current average cost per AmeriCorps member?


    Mr. WOFFORD. It will be $16,000 per member for this year, and in 1999, as part of my agreement with Senator Grassley, it will be $15,000 per member. The GAO in its September 1997 report on our reforms, including the cost-cutting reforms, noted that we had taken steps to decrease the grant funds per participant, that we have limited the funds per participant to $13,800 in 1996 and $11,750 in 1997. We have increased the non-corporation match requirement from 25 to 33 percent. The grant funds per participant in 1995 to 1997 decreased by about six percent and the average grant funds per participant from 1994 to 1997 have decreased by a 20 percent decrease.
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    We are on track. It has been with the cooperation of the State commissions, who have had their own ceiling to bring budgeted costs down to $15,000. We are going to make it.

    Mr. STOKES. So you are on track?

    Mr. WOFFORD. Yes.

    Mr. STOKES. That is good.

    Senator, during yesterday's hearing with the Federal Emergency Management Agency, FEMA, Director James Lee Witt indicated that AmeriCorps members have been of assistance in responding to various disasters and emergencies around the country. Can you tell us more about the mechanics of this, including, one, whether such assistance has been limited to members of the National Civilian Community Corps, and two, if AmeriCorps members must wait to be asked for assistance from State and local governments, and then three, if AmeriCorps participants receive any special training to qualify for disaster response activities.


    Mr. WOFFORD. I think yes to all of your points. Let me say, first, there is a memorandum of agreement with FEMA. We have had an extraordinary in depth partnership between our two staffs, both with them and around the country. They do substantial training for AmeriCorps members beyond the NCCC. The NCCC gives high priority to this and a high proportion of its members are involved and are ready to be part of teams. Some have become highly trained so that when an NCCC's team moves in, as it did in Harrisburg in the flood, in Florida and elsewhere, they come fast, they know what to do, they stay to the end, they work night and day. They generally have a major role in organizing the unpaid volunteers that flow in but have to be organized.
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    We have a very successful project with the American Red Cross the rapid response AmeriCorps-Red Cross program. It began in Los Angeles. It is now in a number of other cities. They do intense training. They do remedial education for preparations for disasters and make communities disaster-proof between disasters. The Red Cross has said to me that it is just the kind of support they need, people that are trained, are ready, that can move in and know what to do on the ground. I think it is one of the most important fronts of AmeriCorps.

    Many of our projects engage in disaster relief, whether it is in New England recently or in many other occasions. Then NCCC works nationally and when FEMA calls for special help we target it. But in most of these States, the State emergency management agencies call on AmeriCorps projects in those States on a large scale. We found that in Pennsylvania, far more people from other AmeriCorps projects were working along the Susquehanna than NCCC teams.

    Mr. STOKES. Mr. Chairman, I have a number of other questions, but I will wait until the next round.

    Mr. LEWIS. Thank you, Mr. Stokes.

    Mr. Walsh.

    Mr. WALSH. Thank you, Mr. Chairman.

    Mr. WOFFORD. Mr. Walsh, good to see you.

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    Mr. WALSH. It is good to see you, too. I have some questions that I would like to ask about the America Reads program. In your testimony, you said that you were going to hire an additional 3,000 new volunteers. Could you tell me what qualities you are looking for in those volunteers?

    Mr. WOFFORD. If I can correct a former Peace Corps member——


    Mr. WALSH. Members, I am sorry. AmeriCorps members.

    Mr. WOFFORD. No, it was the hire. We did not hire Peace Corps volunteers. We recruited them and enlisted them.

    Mr. WALSH. I stand corrected.

    Mr. WOFFORD. But there is another basic change from the Peace Corps.

    Mr. LEWIS. I would not hire them, either. [Laughter.]

    Mr. WALSH. You do not have any choice.

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    Mr. WOFFORD. There is another basic change. The Peace Corps recruited, selected, trained, deployed, administered and ran programs. Today some now 7,000 Peace Corps volunteers are around the world administered with an outstanding staff that it a little larger than ours. We now have 40,000 members and we do not except for the NCCC, select them ourselves. With VISTA, we have a program of training that we organize, a very brief one, but by and large, selection and training are done by the local programs.

    Most of the people involved in literacy are working in three categories, either local literacy programs that win a competitive grant from the State commission, community-based literacy programs; universities, who have a partnership with the school system and run programs; or in some cases, school systems themselves. In each of those cases, they set their standards.

    Notre Dame has elementary teaching corps programs in seven or eight Southern States, called The Alliance for Catholic Education. They seek outstanding college graduates. Last year 15 percent of the graduating class applied for that project. They had five applications for every one spot. They had a high ratio of their summa cum laudes and the rest. They then give an intensive teacher training in the summer before they deploy these teachers for two-year teaching slots in elementary and higher education, I mean, secondary education, in Catholic schools, in the most hard-pressed schools in the South, generally serving minority populations.

    That is a very high standard of both training and recruitment. In other cases, the program involves training English teachers in the high schools to teach their 11th and 12th graders to become tutors of second graders. I am trying to convey the diversity of training that is going on.
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    The university, San Francisco State, has a major literacy component of America Reads and they do the training through their education department.

    Mr. WALSH. I think it anticipated the direction I wanted to go. What I am trying to get at is, are these hires or volunteers or whatever we are going to call them qualified to teach literacy?

    Mr. WOFFORD. The literacy programs that seek them, they set the standards and many of them are setting very high standards. They also are responsible for the training. So if we found that there was a program that, and our State commissions found, was getting unqualified people and not training them adequately, we would be greatly concerned and they would not fare well. They would not get renewed when they come up for the competitive renewals.

    Mr. WALSH. So once they begin their service, they undergo a teacher training of some sort determined by the hiring agency to give them the skills that they need to impart this knowledge to these kids?

    Mr. WOFFORD. Congressman Walsh, the literacy programs that we have been in over the last three years, before America Reads came along, had AmeriCorps members primarily doing the direct tutoring, and the successful ones had a very high standard of training. The ones that are not successful—of course, I may not hear about them that much, but they do not fare well the next time.

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    The proposal for the campaign for America Reads is that a major part of AmeriCorps members' assignment is not the actual tutoring but the organizing of tutoring programs, the recruiting of volunteers, running the program. Two VISTA AmeriCorps members are the two key organizers of Philadelphia Reads and they are trying to get hundreds of college students on work-study to tutor. A lot of AmeriCorps consists of how the full-time AmeriCorps person is used to generate traditional volunteers.

    So in many cases, AmeriCorps members will do neither the tutoring nor the training but will——

    Mr. WALSH. So the AmeriCorps volunteer will coordinate the volunteers who provide the literacy training. Obviously, the issue of quality is real important. We are talking about a system now that we all agree, for whatever reason, has failed these kids. They do not know how to read at the levels that they should. So we are trying to fix that.

    But the people who are responsible in the first instance for providing that skill, that reading skill, were trained professionals. We are going to supplement those trained professionals with volunteers who will coordinate people of lesser skill—maybe that is not the right terminology, but they are going to coordinate other volunteers who are not trained to teach, is that——

    Mr. WOFFORD. Not necessarily. We are actively recruiting retired teachers, retired principals——

    Mr. WALSH. But you are talking about hundreds or thousands of high school and college students also, are you not?
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    Mr. WOFFORD. The college students, yes. The President, with the backing of the higher education organizations and a committee of 21 university and college presidents, is seeking 100,000 college work-study students for tutoring. The AmeriCorps assignment might well be to work with a service learning center on X university to help recruit those college students, assign them to the best literacy programs in the community——

    Mr. WALSH. So say you have 100,000 college students. How many former teachers might you have?

    Mr. WOFFORD. I have been to maybe a half-a-dozen cities that are organizing metropolitan-wide literacy programs. It is going to vary in every place. Where they have——

    Mr. WALSH. So the quality will vary in every place, too?

    Mr. WOFFORD. The quality is certainly going to vary. These are community-run programs, and in some cases, there are individual programs where there is not even a community-wide program. But we—both our State commissions that make the decisions for two-thirds of AmeriCorps and we in our national direct competitive review—are looking at the quality of these programs. I gave a list of one children's literacy program that we are in in every State, and in your State, there are many.

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    Mr. WALSH. I know there are. In Syracuse, there are two literacy organizations that were founded in Syracuse and they are very successful at what they do, but that is all they do and they have a tradition and they have a system and a process and they have quality control and I am not convinced that that is all within this plan. I think it is an idea whose goal everyone supports, but the way it is laid on is sort of ad hoc, town by town, city by city, program by program.

    My concern is that we are trying to supplement the teaching of our kids by professionals with non-professionals. How are we going to improve reading skills with people of lesser ability providing the teaching? There are other very fundamental questions, like what is the second graders' day going to be like? Where are they going to get this supplemental teaching when some of the schools—most schools—are just jammed chock-a-block with things going on and no room.

    I know when I have tried to work with school buildings within my constituency for extracurricular sorts of things, you have to pay the maintenance guy triple-time just to keep the building open. Is that accounted for? What if that college teacher goes home for the summer? What if they go home for Christmas? It is just so difficult to maintain quality and then to assess a program like this. It is the old idea of the road to hell is paved with good intentions.


    Mr. WOFFORD. Congressman Walsh, if I could just for the moment put aside the question of the proposed bill for America Reads, which, as the Chairman has pointed out, as passed by the House does not call for AmeriCorps participation but is focused on teacher training which no one could be against. It also includes the initiative of Congressman Goodling, Even Start, which works with preschool students and with parents at the same time to get parents to become good first teachers of reading.
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    We have AmeriCorps people involved in that program, but that program would pick the AmeriCorps people. The one I visited happened to have an NCCC team in San Diego.

    Secondly, the biggest challenge, if you ask teachers, as I have, around the country, how can we help? What will be the best help you could get? I find most of them say: get somebody to have an after-school program for these latchkey kids that leave school and go into the streets or go home to no parents, and——

    Mr. WALSH. But the idea there is to keep the kids out of trouble. It is not to teach them how to read.

    Mr. WOFFORD. The best programs that I know in this country that are supplementing classroom teaching are after-school literacy programs. A great number of these projects—the Hands On Atlanta, Senator Nunn's daughter runs it, has been going for three or four years. It has won all kinds of kudos from the school system. Atlanta considers it incredibly valuable. It runs after-school programs. In that case, it runs them in the schools. They have solved the school building problem. The school system is pleading for more AmeriCorps people to help run intensive tutoring in the after-school hours.

    The examples you gave from Syracuse—the way the system now works, those programs would ask for a VISTA or for another AmeriCorps member. They would then select them, and whether they got one or two or they had a project for ten. They only get those resources allocated to them through a competitive process, where quality is very crucial.

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    Mr. WALSH. I, as you know, am a supporter of AmeriCorps, and based on my own experience as a volunteer, what works in the Peace Corps is you take an existing structure, a disciplined, organized structure, and you fill in the blanks with Peace Corps volunteers. I was in an agricultural extension program and they had a couple districts where they needed additional extension agents, so I would be plugged in here, a Nepali guy would be plugged in here, and so forth, and we all did the same job and we were all measured by the same statistics.

    And I have seen that work in Cayuga County in my district, where you have a similar situation, actually. You have a soil conservation program that literally needs hands and arms and legs and backs, people to work with skilled management and supervision, people working with them every day providing the direction and so forth.

    What this program, as I understand it, would do is in order to supplement our teachers, we would hire or we would provide AmeriCorps volunteers who would then manage other volunteers to provide this supplemental training. It just strikes me that quality control would be almost impossible to maintain. Measurement of the programs would be very difficult to maintain and determine and——


    Mr. WOFFORD. Congressman, the bill that we are living under, which I think is a great bill, and we want its reauthorization with some improvements, calls for an extraordinary, unprecedented decentralization. It is devolution not only to the State commissions appointed by governors that control two-thirds of the AmeriCorps assignments, but also devolution to local nonprofits, and in some cases national nonprofits and organizations.
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    I think you were here when I was giving the example of the Alliance for Catholic Education at Notre Dame. Were you here for that?

    Mr. WALSH. Unless you just referred to it, I missed it.

    Mr. WOFFORD. They, backed by the U.S. Conference of Bishops, asked for an AmeriCorps project, which now is 130 or so strong, teaching in the most hard-pressed Southern schools, many of them elementary schools. Last year 15 percent of their graduating class at Notre Dame applied for a two year stint teaching on AmeriCorps terms in the hardest-pressed Southern schools. Notre Dame gives an intense teacher training.

    Mr. WALSH. Those AmeriCorps members are actually doing the——

    Mr. WOFFORD. They do the teaching.

    Mr. WALSH. And they were determined based on their skills to teach?

    Mr. WOFFORD. Notre Dame went out for the most outstanding liberal arts graduates. They got a high proportion of cum laudes, summa cum laudes——

    Mr. WALSH. That is great.

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    Mr. WOFFORD [continuing]. And they then get a master's in teaching at the end of their two-year teaching.

    Mr. WALSH. You would like to have all your programs measured by that one, but they are not going to be. You are going to have a lot of young people brimming with idealism, thank God, and you are going to try to put that to work. I think that is what is great about America and that is why it is so important. My concern is that they are going to be asked to do things that they cannot do. That idealism is going to go away and tax dollars are going to be wasted.


    Mr. WOFFORD. That would happen if we assign AmeriCorps slots to programs that do not select well and do not train well and do not administer well. That is one reason Mr. Bentley's department is so important, to find the programs that do not work. If I may, I want to clarify and maybe try to persuade you that the high school example I gave is not to be misunderstood.

    In many places, students have to do service learning to graduate from high school. There is a service requirement. In Philadelphia, a principal of a high school was so enthusiastic about how older young people could help elementary kids that this became his cause in life. This literacy corps is now in seven States, through AmeriCorps.

    They trained the English teachers in 22 schools in Philadelphia to know how to train their 11th and 12th graders to be after school one-on-one reading tutors of second graders. The kids go through a remarkable training period. They get reading specialists in to help the English teachers do it. I spent a lot of time on this project. It works. It is one of the pilots that ought to ignite the whole.
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    The effect on those kids that teach in the afternoon is just extraordinary. First, they increase their own reading level by becoming teachers. Second, they get a sense of responsibility. One senior high school teacher said to a student, ''You had the worst luck of the draw. You got a kid that has never spoken in my class. If you can get him to talk, it will be a miracle.'' The tutor said, ''I would lie awake at night figuring out, how do I reach that kid? I had figured I was boring and I better learn to read better.'' They have a structured tutoring program and they have chosen one that seems to work.

    The second grade teachers with whom I have met say these two-hour sessions three days a week in the school with these senior kids coming down has had enormous impact on the second graders. If it did not work, we should not continue it, but it has been proved in many places that older young people, including college students, can be terrific tutors.

    Mr. LEWIS. Senator, I think we have to interrupt you at this point because other colleagues will ebb and flow here and I know we are going to continue a similar line. I think you probably can sense that my colleague who was just asking these questions is not exactly right of center in the full House when we look at either side of the aisle on issues like this. But he does remind me, Mrs. Meek, of my second extended trip to India.

    In 1965, I spent the summer there for the second time and the Peace Corps had besieged India at that point. I met some of these Peace Corps volunteers in the south, and after talking with them for an extended time, I invited them out for refreshments at a local establishment. I was just amazed that they would not let me buy any of these refreshments because that was not like Peace Corps volunteers. But they had been in the business of teaching villagers about the potential of raising chickens, and it was not very long before these very outstanding liberal arts graduates understood the economics that was involved in eggs and chickens. They absolutely did not know what to do with all the money they were making on these eggs, so they were buying me refreshments. [Laughter.]
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    It is a very interesting passway that sometimes develops in these things as we train each other.

    Mrs. Meek.

    Mrs. MEEK. Thank you very much, Mr. Chairman.

    It is a pleasure seeing you again, Senator Wofford. I think that you have done what I would call a reasonably good job with the funds which the Congress has allocated to you. I notice you have stabilized your staff. That was one of the criticisms that you received, I think, in your last hearing before this committee. But when I look at your budget request, in 1997, you increased your staff by 29 people, but now you seem to have stabilized at the 227 level. I guess you feel comfortable that that is a sufficient staff to do the job that you have explained to date.

    My questions have to do with the Corporation for National Service. You are now in your fourth year. You have several models for service delivery, including VISTA, local programs, and the national residential programs, among others. Which model has proven most effective in terms of productivity, cost per member, staff-to-member ratio? The staff ratio and cost, I am sure, should include non-program staff at Federal and State levels which oversee this program.


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    Mr. WOFFORD. Very good questions. I will resist a parent's feeling that you know what ''all men are created equal'' means when you know that you love your children equally even though they are very different.

    Mrs. MEEK. Yes.

    Mr. WOFFORD. I have a special involvement in the National Civilian Community Corps because, from the days of the Peace Corps on, many of us have imagined a full-time residential corps as something of tremendous promise and power and impact that always costs more than a non-residential program because somebody has to pay for the residence. If people go home at night to their own homes or parents, it does not have the power and impact that you get of the experience of being in a corps like the National Civilian Community Corps.

    When I was in the Senate, along with a number of Republican leaders, like Senators Dole and McCain we put through the National Civilian Community Corps before AmeriCorps came along. We are making a special case for the strengthening of the National Civilian Community Corps and for the District of Columbia campus that we have opened.

    Secondly, VISTA. I was in the planning of VISTA 30-some years ago. I think it has proved itself. I was very interested that Senator Bond, who had criticized AmeriCorps, not noting that VISTA is now a key part of AmeriCorps, said, ''I recognize the need of full-time capacity builders, generators of volunteers. That is why I like VISTA.'' I like VISTA, too. It is focused on capacity building.

    It is a very simple model. VISTA members gets the poverty-level $8,400 now to live on for a year. They get the education award. We generally do not give any administrative or program support. I would like to see it grow along with the National Civilian Community Corps.
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    And then the rest of AmeriCorps, you might say has three rings to it. The newest ring is the least expensive. It drastically reduces the cost per member and that is the education-only award. We need to watch carefully to see quality in those programs. But the first year and a half of that program appears to be an extraordinary success.

    The President challenged the faith-based organizations and the great nonprofit organizations to take the lead in providing the resources and leadership for the living allowance, the support, and the administration. The only Federal contribution, aside from a small fixed amount that we may have of maybe $500 for some of the costs we impose on them, would be the education award of $4,725 a year for full-time service.

    We now have 14,000 positions that have been approved, and probably half of them have already been filled. They include many of the major denominations. The Methodists and the Catholics have more than 1,000 each of these education-only awards. The National Council of Churches, which coordinates that, altogether has more than 5,000 in this category. The next largest is the Boys and Girls Club.

    Mrs. MEEK. Senator, if I may intervene——

    Mr. WOFFORD. Yes.

    Mrs. MEEK. I guess I need a little bit more specific answer as to which one is most effective in terms of—

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    Mr. WOFFORD. Well, I would have to tell you that if you want to say which—if you take the manpower and womanpower of the team of the NCCC and see what it does in disasters and others, you would say that night and day team has more power than a part-time person in the education-only award. But if you ask me about costs, the education-only award is $5,000 per person and the National Civilian Community Corps is effective. I am not sure whether I will hit the target right——

    Mrs. MEEK. I do not want you to try to think of it now. What I do want you to think of are the variables that I have asked you about in terms of the effectiveness of each one of these programs, staff to member, in terms of whether it is VISTA or whether it is some of your other programs or whether it is cost per member, that kind of thing. I am sure you cannot just say that now, but I think these are some of the variables that you have to think of as the person over the program when you look at the accountability, so when you come before this committee you can say, of all the programs that I have, according to these variables, whatever you select, these are the most effective ones. This is not a loaded question, Senator.

    Mr. WOFFORD. No, I——

    Mrs. MEEK. It is one that I think has some validity in terms of what we look at on this committee. I think what I am hearing, and I heard it from Mr. Walsh, as well, that there seems to be a lack of infrastructure, that is, a delivery system that has measurable goals and objectives. I used to have a little statistics teacher. He did not teach me very much, but he did teach me that anything in existence, any amount can be measured.

    So I am fairly sure that, and I do not mean any of this academic stuff you hear, but I just want you to be able to measure your programs that you are using by whatever variables, by whatever means of measurement, because when you come before us, we will ask you a lot of different questions. But you will have your little list there to say that, by these measures, and therefore, it does not give us—because we are not out there in the field like you are—it does not give us the ability to question you regarding how well your programs are doing. Being an old education professor, I know which lines you are going on. So I am just giving you something that will help when you come in this committee in terms of validity.
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    I know this. I worked in literacy programs for many, many years. There are so many programs out there, helping children and adults learn to read. Mrs. Bush did perhaps the best job in the world on literacy. I am sure she must have left some kind of institutional legacy as to what works in literacy and those variables, those kinds of things can be used to measure some of the viability of our programs.

    So I am just saying that I would like to see more of that, and hopefully you can provide that. Maybe you cannot——

    Mr. WOFFORD. We can. We can.

    Mrs. MEEK [continuing]. But if not, I think you should be reaching for that goal.

    Mr. WOFFORD. We can, indeed. Mrs. Bush, by the way, is the leader, you might say, of the Houston Reads literacy program that we are involved with and we have worked very closely with her and her foundation in how we support what they are doing locally.

    The reason we established and are expanding the Department of Evaluation and Effective Practices led by Bill Bentley from Florida is to achieve all the things you just mentioned. From the beginning this program has distinguished itself in requiring every project to have performance objectives and measurable goals as part of their competition to get the AmeriCorps assignments. We have had an increasingly significant range of evaluations for our programs through the Department of Evaluation and Effective Practices.
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    We have a performance review under the GPRA, the Performance and Results Act. We specified very specific targets for each of our programs in our annual performance plan. The yellow budget submission that came up to you discusses many of the items that you are asking about. Each of our programs is reported in terms of cost, staff, and those items. I would, either here today or in submission, be able to respond to you on every one of these fronts.

    Mrs. MEEK. Thank you, Senator.

    My last question, I know that you are asking for more than $1.7 million more for recruitment in fiscal year 1999, for a total of $3.3 million. How are you going to use that increase, Senator?


    Mr. WOFFORD. We have analyzed the recruiting efforts of our own programs and of others like the Peace Corps and we find that the investment in recruiting has been inadequate. In the Corporation have gotten by with extraordinary membership in part because the idea has drawn people rather than our own recruiting efforts.

    We have an outstanding new head of a consolidated Department of Recruiting which the Congress had called for. The budget for recruiting is in the yellow book. We have far, far fewer recruiters in the Corporation and a much lower recruiting budget than the Peace Corps, which I admire and know a good bit about. One of my interests has been in strengthening and improving our recruiting efforts.
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    The decentralization is important for you to recognize. Most of the selection outside of the NCCC is done by the local groups. They recruit and select, but they badly want an 800 number that is efficient and a national media effort that lets people understand it so that they have the largest pool of people to pick from.

    Mrs. MEEK. Thank you, Senator.

    Mr. LEWIS. Thank you, Mrs. Meek.

    Mr. WOFFORD. About your very first point on staff, the 227, I think you cited. That item is itself not an increase in staff. It is the same staff being shifted from the VISTA appropriation to this to more accurately represent what they are doing. I think one of the challenges for us is that we are about the same size in total staff or maybe a little less right now, than when I started in October 1995. Yet the number of AmeriCorps members has grown. So we are very, very hard-pressed with a very lean staff.

    If you then note the staff numbers that we inherited from the former VISTA and senior programs—the ACTION agency—and think of the additional staff, it is an extraordinarily small number, in my opinion, for the size of the programs we are administering at the moment. We are going to carefully look at all our human resources to see that we meet the auditability challenges and to follow the evaluation challenge that you very well put to us here.

    Mrs. MEEK. I asked you that question because I wanted to know if you were comfortable with the staff that you——
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    Mr. WOFFORD. I am not comfortable, but I think our new Chief Operating Officer, Louis Caldera, is in the midst of a very hard-hitting analysis to see how we can better use the resources we have and to see what the gaps are, and we will report to you. We need those extra administrative funds primarily for the auditability and management issues, but for these other concerns that you are reflecting.

    Mrs. MEEK. Thank you.

    Mr. WOFFORD. Thank you.

    Mr. LEWIS. I am going to get to some of those issues in just a moment, and maybe Mrs. Meek would like to follow up then when I start to ask those questions, but I appreciate very much, Mrs. Meek, your participation.

    Senator, one of my very, very early recollections, and I am not sure if I was on my mother's knee or not, but that she was heard to say that beauty lies in the eyes of the genuflector, and I have been trying to figure out what that meant ever since.

    Mr. WOFFORD. I am ready to genuflect.

    Mr. LEWIS. Well, I am going to be asking you to, as a matter of fact.

    Mr. WOFFORD. Yes, sir. [Laughter.]
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    Mr. LEWIS. In response to a question that was submitted for the record in which we asked about the importance of cooperation of various people who might be involved in some of these programs, among other things, you concluded in a paragraph, ''The success of this initiative depends upon the unique combination of the Education Department's knowledge and expertise with reading programs and the Corporation's demonstrated success in developing and coordinating effective tutoring and volunteer programs.''

    I assume that you do agree with that statement which was submitted for the record as a result of our hearings last year?

    Mr. WOFFORD. I certainly stand by what I said, but I have to make it clear what I meant by what I said.

    Mr. LEWIS. Okay.


    Mr. WOFFORD. The success of the campaign proposed by the President depended on a collaboration between the Department of Education and reading specialists and the resources they represent and our resources. But the campaign, whether it is from the President's summit and General Powell or whether it is the general or local initiatives, to see that children read by the end of grade three is going to be measured city by city, community by community, and there will be many, many successes. Even if we do not do anything, some cities are finding a way to meet the needs of the teachers.
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    Mr. LEWIS. Exactly.

    Mr. WOFFORD. We have been helping to find them. So our success, the success of Houston Reads in using AmeriCorps is not dependent on whether the overall campaign gets the passage of the kind of bill that I was supporting when I said that. I am certainly not implying that individual programs are not going to succeed in the places that are launching them.

    Mr. LEWIS. I am just attempting to make sure that both you and also your support staff understand the position that the Committee is in in dealing with many of these issues. I want to share with you a letter that was written on September 24 to the Committee by and signed by Congressman Goodling. It said, ''I made it very clear to the President in a 45-minute meeting discussing education that there would be no money, I repeat, no money to fund expensive so-called 'volunteers' in any 'America Reads' program. I made it clear that the volunteers that we include in the program would be college work-study students. This serves many purposes. First, it allows for the reduction of debt that has accumulated. Second, it gives students the opportunity to do important community service work,'' and then he concludes briefly.

    The following day, on September 25, I received a letter that essentially, in different ways, reemphasized the same thing that was signed by Chairman Goodling but also signed by Peter Hoekstra, who was the Chairman of the Subcommittee on Oversight and Investigations, Buck McKeon, the Chairman of the Subcommittee on Postsecondary Education, and Frank Riggs, Chairman of the Subcommittee on Early Childhood Education, a pretty strong expression by the authorizing committee that deals with education relative to how we should consider their concerns.
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    In view of that and the general environment in which we operate, how successful will your efforts be without any authorizing legislation in the America Reads program?

    Mr. WOFFORD. I think the programs that we will select to have our AmeriCorps people work in have been, are being, and will be successful. We have been in the forefront, as Congressman Goodling knows, of the effort to get college work-study students involved in children's literacy in America Reads programs around the country. I helped organize the college committee of 21 university and college presidents to ask for 100,000 college work-study students for America Reads. We have been the organizing agency to the largest extent of that effort.

    I enthusiastically agree with Congressman Goodling that the million work-study students, approximately, would serve on an average of maybe ten hours a week, more or less, five to 15 hours. It could be an enormous contribution. I would join in any effort to increase that and increase the persuasion or the requirements of colleges to use that work-study money, as Congress originally intended most of it—for service in the community. So Congressman Goodling and I are in agreement on this.

    Mr. LEWIS. On part of that.

    Mr. WOFFORD. You, after those two letters, made the distinction, rightly last year, between whatever happened on the America Reads bill, whether we are in it or out of it—and there is some simplicity in our being out of it. I think you could make a case that instead of a new amalgam, we have a very simple way of delivering our resources to local initiatives.
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    But you made the distinction last year that we should get extra resources for children's literacy under the general rubric of America Reads in the budget agreement. We appreciate those resources and we are seeking a significant strengthening of those resources this year.

    Mr. LEWIS. As you know, and I have repeated it in different ways, the work of this subcommittee involves a lot of overlapping and very important people kinds of concerns. And the work that we do especially when we end up on the edges of authorizing responsibility, we do get a good deal of scrutiny. And I would suggest to you that the scrutiny has not been light.

    But nonetheless, in view of that which we have been discussing, and presuming that an authorization bill does not get through and signed by the President, why should we fund the Corporation's part of America Reads until the Department of Education part of the program is authorized?

    Mr. WOFFORD. Mr. Chairman, the reason we want to engage in America Reads is not to expand AmeriCorps. The reason is because I do not think there is any goal in country that I would say is more important. There is a greater need than ever to see that whatever resources can be brought to bear, are brought to bear in seeing that children learn by the end of grade three to read.

    Our authorizing legislation calls for us to help meet the critical needs of this Nation in education very specifically. We have a track record of how we can help. We have teachers, educators, school administrators all over this country asking for more AmeriCorps participation, and I think it would be a tragic consequence if inability to agree on the details of the President's proposal for America Reads should then be used as a reason for the AmeriCorps resources not to go on doing what they have done so well, and what people want so badly.
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    Mr. LEWIS. I understand exactly the emotion of your response. I think you sense both Mr. Walsh and the Chairman and others have empathy for what you are about. But I go back to the genuflector, beauty does lie.

    I have other questions related to that specific——

    Mr. WOFFORD. I look forward to talking more with Congressman Goodling because I do not think he does not want the AmeriCorps participation in Even Start. I think what he is against, and Congressman Walsh is skeptical about, what may have sounded grandiose—is the proposal of 1 million volunteer tutors. I think, as I said in the beginning, that has misled people into thinking this is some new Federal teaching volunteer corps.

    The very way that Congressman Goodling wants work study students to be used by local literacy programs in schools is exactly the way we want them to be used, and the way that AmeriCorps members are used.

    Mr. LEWIS. I read Mr. Walsh's concerns much more one of, in a very real and meaningful and practical way, measuring the results that you get in individual programs as they are applied out there. That causes me to ask one other question that is not a part of this section but relates to another piece of my work.

    I am very concerned with the amount of money that has been flowing to urban centers for public housing programs where in many of those centers there has been almost zip done in terms of public housing, especially new public housing, in recent years. That is a results oriented kind of concern. I have considerably increased and am proposing to further increase HUD's Inspector General's ability to help me evaluate independently those questions.
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    I will be interested over time in discussing with you the role of your Inspector General. I have not actually had a chance to look at the Inspector General's product in depth yet. With this section of our bill I intend to do that. But some objective analysis of results and that orientation that is stressed by Mr. Walsh so well is important in all of this, because as you know, there is more than one committee that is looking at AmeriCorps and the Corporation.

    To say the least, Mr. Goodling is not just a former school superintendent. He is committed to these programs and does want to see that which we are about work in the final analysis. I would really encourage extended discussions there as we go forward and we go to conference and deal with these questions.

    Mr. WOFFORD. I am an admirer of his and will look forward to doing——

    Mr. LEWIS. I am a great admirer of his as well. And he and I do not agree on everything either.

    Mr. WOFFORD. Could I just make one point?

    Mr. LEWIS. Sure.

    Mr. WOFFORD. If I did not make it clear, we do not need an authorization, AmeriCorps, the Corporation, our senior programs, foster grandparents, do not need an authorization——
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    Mr. LEWIS. Of the education portion.

    Mr. WOFFORD [continuing]. To engage in education or in literacy. It has been a proud area of our work from the beginning. It is specified in the bill. Some of the examples of what we should be in are related to that. So we are not dependent on any authorization for——

    Mr. LEWIS. I must say that part of that was a reflection of your response for the record in which you suggested how important it was that we have this coordination of the Education Department's expertise, et cetera.

    Mr. WOFFORD. I was supporting what seemed like a very good bill.

    Mr. LEWIS. Seemed very logical to me, too. I might have supported that way as well, but I am not sure I would have put it in writing. [Laughter.]

    Moving on just a bit. Last year, Senator, you said your top priority, shared fully by the Corporation's board of directors, was getting your financial house in order. You have repeated that today.

    In this year's statement you indicated that it is your number one priority. What caused you to fall short of your goals for improving the Corporation's financial management system?
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    Mr. WOFFORD. It was not our determination, or our priority, or our commitment to achieving that goal. It was our understanding of what the depth of the problems were, both historically and currently. The Trust is an example of a challenge that our chief financial officer confronted when she came. Based on everything she and I were able to understand and were informed about—and she came from three clean audits at the RTC—we had reason to believe that a separate audit of the Trust would find that it was in very good shape; that we had remedied the things that needed to be remedied.

    Therefore, we asked for a separate audit of the Trust, which we did not have to do. And we found that it was not in good enough shape. That though the results were a conservative estimate that did not increase our risk we have to have an opinion that we have accurately and fairly assessed our problems. There are now 92,000 enrollments in the Trust and going up by another 20,000 this year. This is an extraordinary amount of paperwork. When the auditors looked for some of the paperwork they couldn't find it. But it is somewhere, misfiled. It was not well cared for, and the antiquated system of reporting was inadequate.

    The digital imaging system which will image the actual documents for enrollment and the record of the AmeriCorps member's service is going to be a major breakthrough for us. We underestimated what a problem managing this paper would be.

    Knowing that we had still a substantial way to go, that our auditors for the 1997 balance sheet were coming in a month or so to begin their work the chief operating officer and I went over to Ed DeSeve, the Deputy Director for management at OMB to say we would like their top talent to review the actions we have taken; to help us see where we still have to go, and to join with us to see that we will see this through and complete it. He assigned Norwood Jackson, Woody Jackson, who is considered their top man in dealing with problems like this. He has dealt with many agencies that have not got audits either. He has been intensely working with us. He is going to see this through. He has said to members of your staffs that——
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    Mr. LEWIS. Yes, we are going to be having some communication, that is right.

    Mr. WOFFORD. As late as 8:30 last night he was saying, we are going to be in this together until we succeed, and we are going to succeed. It is unacceptable that we do not solve these problems. And he has given me renewed confidence that the light at the end of the tunnel is there and that we are moving through to it.

    Mr. LEWIS. Last year you indicated that you expected to have 97 of the 99 items completed and addressed by the time the Inspector General conducted her review in the spring and early summer of 1997. When do you now estimate that the remaining 21 material weaknesses or reportable conditions of the 99 items cited in the Corporation's 1996 auditability study will be completed and address?

    Mr. WOFFORD. The draft action plan soon to be reviewed by the Inspector General and other OMB people, will specify exactly what we see as our timetable for each of them. The draft includes each of the remaining items, a number of which we have already, we believe, successfully resolved. That action plan, which you will have by March 18th, will specify timetable for each of those items.

    Mr. LEWIS. I am going to be looking to the record for that material and your submitting the record will assist us. You have already addressed the new financial management plan which you say will be completed by March 18th; is that right, or was it March 31st? Last year you indicated that you expected to have a new financial management system operating during the fiscal year.
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    Mr. WOFFORD. We have identified the suppliers of the financial management system. There is one major Federal agency that seems to be the prime source and we are in the process of choosing which of the systems that they offer can be put in place. We are moving full speed ahead on that. It will be on line and in place and 2000 year compatible in fiscal year 1999.

    We got your help, but we asked for reprogramming money to cover both that and the digital system, and it took quite a few months before we got the ability to reprogram. We are in the process of employing the leader of that project to manage it and select the system.

    Mr. LEWIS. We are attempting to get a handle on when all this will pull together in a way that is acceptable. Will your 1998 financial statements be auditable?

    Mr. WOFFORD. I began my testimony saying that that is our determination. It is a determination backed by Mr. Jackson and OMB. I have already worked harder on this than I ever worked as a senator. I think even harder work is ahead but we are determined to reach that objective.

    Mr. LEWIS. You and I who are solving the world's problems just hate to get involved in those details. [Laughter.]

    Mr. WOFFORD. I have been doing it since October 1995 when the auditability studies started to come in with the 99 findings and recommendations. The first week I arrived they were just beginning to do their studies, and over the next months while the Government closed for a while, I was getting the news from the auditability study and we were getting to work on it.
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    Mr. LEWIS. When I found out around here that some people can expect me to pay attention to details, I married the person who handled them well.

    Mr. WOFFORD. I did too and I have lost her. My fate has been, and it is a proud fate, to try to deal with this while seeing that the growth of national service is successful and high quality.

    Mr. LEWIS. I know that you have your chief financial officer with you.

    Mr. WOFFORD. Donna Cunninghame.

    Mr. LEWIS. Would you like to add anything to this discussion, Ms. Cunninghame?

    Ms. CUNNINGHAME. I think Harris has portrayed it very well, except for the fact that I can assure you we have worked very hard. We have made a lot of progress in a lot of areas. We have been surprised time and time again by things that you normally would assume had been done that we found out had not been done. We have spent a great deal of time playing catch-up.

    It will be a very welcome relief when we are caught up and we can move forward and strengthen our system and strengthen our procedures on looking forward and being proactive instead of being reactive. The last year we have been very reactive, but we have made progress. Not necessarily just related to the 99 auditability issues but in other areas that we have uncovered that were not specified in the auditability survey.
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    Mr. LEWIS. Your inspector general is Ms. Luise Jordan, right? Would you like to add anything? Ms. Jordan, do you believe the Corporation's current plans to improve the financial management system including the timeframes involved are realistic?

    Ms. JORDAN. I have not seen those plans yet. I have not been a party to any of those discussions. So it is very difficult to assess from this point of view. From the standpoint that my office, should be proactive and help the Corporation and work toward them, I am more than willing to work toward the goal that the Corporation will be fully auditable in 1998. But I have not seen the plans.

    What I would like to address, on the other hand, is your statement earlier about the inspector general being involved in assessing the effectiveness of the Corporation's programs and operations. That is exactly where we are hoping to go under our five-year performance plan. And if there are any insights from your committee or any other Congressional member or staff member that will help us direct our efforts to projects you are interested in, you are singing my song and I would very much like to have your insights. I have submitted my five-year strategic plan and hopefully we will get some comment back on that.

    But as to the auditability, to go back to that subject, we have begun the assessment of the remaining 21 items plus those items remaining from the Trust Fund audit. We expect at this time to be able to give Congress a report on follow-up on those items and the effectiveness of the corrections in June or July of this fiscal year. At this point I am not sure that all of the balances on the end of fiscal 1997 are auditable and that will impact the auditability of 1998.
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    The Corporation's plan, as it has been described to me—again, I have not seen it—deals with correcting some of those balances. It is a laudable effort. I will help them in any way that I can. But as an auditor, I have to hold my opinion until the end of our effort, which will be at the end of the audit of fiscal 1998.

    Mr. LEWIS. I appreciate that.

    Mr. WOFFORD. Mr. Chairman, she will very promptly get a draft plan. The reason we have March 18th as the date is, as I said, for both OMB carefully to review its practicality and realism, and secondly, to work with the Inspector General who has been very helpful to us in analyzing the problems and urging us along the way.

    Mr. LEWIS. Let me mention this for all who would but listen. I really did not focus on Inspectors General at all before I suddenly and surprisingly had this responsibility. Since then I have found just many a very, very capable leader in a variety of our agencies seeming constantly looking over their shoulder at a thing called Inspectors General.

    And I have found those people to be extremely valuable tools, not just in terms of the accounting procedures, but one of the crazy things about them is that sometimes they seem to be idealists, too. But they come from a different perspective than maybe the person who is in charge of housing, let us say, or subsidized rental programs, et cetera. And they look at success and measuring and so on in different ways that can be extremely helpful to us. Because of that I have begun to look with interest at it.

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    Mr. WOFFORD. I agree with that. The Inspectors General Act invites them to be of constructive use throughout. The Inspector General has been very helpful, and we hope for even more for the future.

    Mr. LEWIS. I have been going on here for a while. Are you ready?

    Mr. WALSH. That is all right though, you are the Chairman.

    Mr. LEWIS. Mr. Walsh.

    Mr. WALSH. I would just like to make a point that——

    Mr. LEWIS. I am going to let you talk for a while while I vote.

    Mr. WALSH. I am not going to talk that long; just take five minutes.

    Mr. LEWIS. There is only nine minutes left on the vote.

    Mr. WALSH. The point is, I do not want to sound overly critical. I am not overly critical. I am a supporter of what AmeriCorps does, what it stands for. I think it is important. I have always felt that it is important that we provide young people an option to use that idealism that we are all born with and put it to work. My concern on America Reads is the effectiveness of the program, not the motivation or the intent of the volunteers.
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    I want to make sure that a volunteer comes out with the same measure of idealism that they went in with, because you can go sour in a spot. You go and you want to change the world, and you get there and you realize there is no structure, there is no job, or there is no direction. The frustration in trying to change the world is one thing, but frustration with the organization that is in place is another.

    So as far as what your goal is, I support it. And this idea that this reauthorization bill, National Community Service Act Amendment Act of 1998, I think is a good step in the right direction. I agree with Chris Shays and the others who co-sponsored the authorization bill.

    I guess the Chairman has gone to vote. I really did not have any other questions, but you can feel free to comment and fill up time before he comes back. I just wanted to make that point.


    Mr. WOFFORD. Congressman, I greatly appreciate your past, your present, your future support and your interest. My response was not sensing that you were critical. You are critical in the right way, and we need to be on the America Reads program. There is no legislated America Reads program yet. We do not need authorization for AmeriCorps to do better or do more of what has been one of the main features of AmeriCorps from the beginning, which is children's literacy work.

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    For the moment there is not a program that is organized. There is a House bill and there are some pending proposals in the Senate. But meanwhile, already two-thirds of AmeriCorps is involved in working with children and youth, and thousands of them are involved in children's literacy.

    I agree with you, that the quality of these programs has to be good. That is what Mr. Bentley and the Department of Evaluation and Effective Practices is trying to do, to see which of the programs work and which do not, and to weed out those that do not work. But remember the first weeding out is done by these State commissions. There is a competitive review.

    Take Syracuse and instead of thinking of some national program ask: Are there ways in which VISTA or our senior RSVP program, or the other parts of AmeriCorps, can help the literacy efforts? If you can think of ways they would help them or if those organizations that you respect can think of whether they need a VISTA or they need a team of AmeriCorps people, that is what we respond to, and what the State commission in New York responds to. Then it is a competitive selection. And I would count on you to tell us if a project was not of good quality.

    Mr. WALSH. We have had some good experiences and some not so good experiences. A lot has to do with management, organization.

    Mr. WOFFORD. Absolutely.

    Mr. WALSH. There is certainly no question, at least in 99.9 percent of the cases, in the motivation of the young people. They want to do something positive, and this organization gives them that opportunity.
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    Mr. WOFFORD. Did you look, Mr. Walsh, at the educational attainment by AmeriCorps members? It is attached to my written testimony. If you will notice, 19 percent of AmeriCorps State and national members have graduate degrees, many of them in education; 25 percent have bachelor's degrees, and some have had some graduate school work. We have another 25 percent that have had some college or may have a two-year degree; 9 percent are dropouts.

    So our programs range from Youthbuild which consists largely of high school dropouts—an intense program in which they do something for the community, build low income housing and learn a skill and get a GED—to people with Ph.D.s, lawyers, teachers. So it is an extraordinary spread.

    And the only thing that is going to make this work is if those State commissions that are appointed by governors and our State offices effectively work together to give the best on-the-scene determination of the competitive process in the selection of programs. We also have an effective evaluation going on so that the best practices are spread.

    Mr. WALSH. That is important. I am going to run up and vote. So I would ask you to hold and be in recess until the Chairman comes back, and I am sure you will be on your way quickly.

    Mr. WOFFORD. Look forward to seeing and talking to you more on the reading initiative.

    Mr. WALSH. Fine, I would like to.
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    Mr. LEWIS. Senator, we have a number of questions that are specific and detailed questions that we will be submitting for the record. We would appreciate your responding. I hope that you understand that the conflicts with members, other members and their subcommittees and so on, creates ebb and flow, et cetera.

    I have one other additional area of questioning that is somewhat limited, but then from there we will ask you to submit the balance for the record. Last year there was a discussion of 1996 independent evaluation of the AmeriCorps program by Aguirre International. I understand there has been an update of that evaluation. What were the most significant findings in that evaluation?


    Mr. WOFFORD. I think I know, but if you would not mind if Mr. Bentley, who is up to date——

    Mr. BENTLEY. Mr. Chairman, are you speaking of the Aguirre study?

    Mr. LEWIS. The Geary study.

    Mr. BENTLEY. The Aguirre report looked at the AmeriCorps——
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    Mr. LEWIS. Is this Mr. Bentley?

    Mr. WOFFORD. Mr. Bill Bentley, the head of the Department of Evaluation and Effective Practices.

    Mr. BENTLEY. They have not finished their most recent report of the AmeriCorps program, but they do an annual report on the progress and we do have some preliminary data that is being gathered.

    Mr. LEWIS. Do you want to give us just off the top your evaluation of their last updating.

    Mr. BENTLEY. The last update essentially says that we are, to use their terms, ''we are getting things done''. I think we feel pretty positive about the results that we are seeing so far.

    Mr. LEWIS. Could you give me an idea from your perspective what are the most significant findings of their evaluation to date?

    Mr. BENTLEY. Not at this moment, because I have not read the details of their final report.

    Mr. WOFFORD. I think the list on page 9 of my written statement, I believe that comes primarily from the last Aguirre report. They also have an estimate of how the investment is a very good payoff per Federal dollar. I do not want to give it out of my head but I believe it is in the written testimony.
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    Mr. LEWIS. I will look at this more closely, and let us have some communication about that as well, if you will.

    Mr. WOFFORD. We will.

    Mr. LEWIS. Have there been other independent evaluations of AmeriCorps program in the past year? If so, what were the significant findings? Do you know if there are other such——

    Mr. BENTLEY. We have a number of reports going on right now but they are not complete.

    Mr. LEWIS. If you would, as you gather that material if you would provide that for the record. We are interested as well.

    [A list of completed Program Evaluations and the current plan follow:]
    "The Official Committee record contains additional material here."

    Mr. LEWIS. Senator Wofford, your statement indicates that the Corporation's reauthorization proposal will be transmitted pretty soon?

    Mr. WOFFORD. Yes.

    Mr. LEWIS. You were working on that proposal last year. Why has it taken so long to prepare your reauthorization proposal?
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    Mr. WOFFORD. You and Congress and the President and we have had quite a busy agenda, and we are pressing to get it up here as soon as possible.

    Mr. LEWIS. That is an interesting response. [Laughter.]

    Would you like to respond further?

    Mr. WOFFORD. We want it to be right.

    Mr. LEWIS. Did you hear my question, Mr. Stokes?

    Mr. STOKES. I did not.

    Mr. LEWIS. I said, why has it taken so long to prepare your reauthorization proposal, and his response was, you and we and everybody has been very busy so it has taken a while. I asked him if he wanted to elaborate further——


    Mr. WOFFORD. Let me elaborate a little more. Mr. Chairman, we have had a draft the main points of which have been distributed and discussed in far-ranging consultations with our State commissions and the whole network of State commissions, with our State offices, with our grantees, with the Administration, with members of Congress.

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    We have been satisfied with the draft for some months. The timing of when Congress would be best ready to act and the Administration to move has been a matter not totally within my control. I think within the next two weeks you will have the draft. We have felt good about it for some months.

    I also want to stress that we really want your collaboration on any ways you think we can improve the act. We are very open. It is a start of the process. It is not a take-it-or-leave-it proposal.

    Mr. LEWIS. Let me ask a couple more questions then for the record, get to the edges of this, I would ask you to respond to the balance of my questions for the formal record.

    In 1998, the Corporation requested $29 million for program administration. The amount was estimated to support 103 FTE. The Congress provided $2 million less than requested, yet this year's estimated FTE level for 1998 increases by 14 to 117. How do you account for a reduction in funding then being able to support a higher than requested FTE level for 1998?


    Mr. WOFFORD. Mr. Chairman, sometimes I can say yes, sometimes I can say no, and sometimes I have to say I do not understand. I am not sure which FTE you are——

    Mr. LEWIS. You asked for $29 million for program administration.
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    Mr. WOFFORD. I well know that we fell short by $2 million. However, 40 percent of that goes to State commissions.

    Mr. LEWIS. Let me be specific. The amount was estimated to be 103 FTE for administration. We gave you $2 million less, and yet this year's FTE level for administration for 1998 increases by 14 to 117.

    Mr. WOFFORD. I did not follow you well.

    Mr. LEWIS. I did not exactly write this question and it was kind of difficult for me to figure out, too, so I understand.

    Mr. WOFFORD. I think my colleague, the Chief Operating Officer, may want to comment on it. But the administrative funds relate to some vital matters beyond the FTE level.

    Mr. LEWIS. So since they amount to things beyond the FTE level and we are increasing the FTE with less money, maybe he should respond.

    Mr. CALDERA. Thank you, Mr. Chairman. Louis Caldera, Chief Operating Officer. The administrative funds also cover travel, other expenses, and they also cover contract employees.

    Mr. LEWIS. I will be interested in that for the record too, as we look at those transfers.
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    Senator, in your statement you mentioned the need for flexibility to transfer funds between activities; not far from Mr. Caldera's response. The way the appropriations has been structured for a number of years, it would take an act of Congress to permit the transfer of funds between activities. What is the real concern here, the ability to transfer additional funds to program administration?

    Mr. WOFFORD. Do you want Louis Caldera to continue on that one?

    Mr. CALDERA. Again, the way the bill is written, it is a series of caps which total the total appropriations. So rather than being capped, it is sort of a direction to spend this much on this particular program. In part there is a lack of programmatic flexibility so, for example, if we thought that it would be better to spend $21 million on NCCC, $3 million more on NCCC and $3 million less on grants, with both of those going to covering AmeriCorps members, we would not have that discretion programmatically. That is just one of the issues.

    The other issue related to program administration is that we think that based on the plan there are some one-time costs related to putting some of these auditability issues behind us. For example, clearing up historical documentation problems related to the trust. And we can quantify the costs of that one-time plan, and we would like to be able to come back to the committee and say, our timeline for resolving these problems is this, but we can do it faster if we can devote more resources to it.

    Clearly, we need to show that we are putting our current resources to the best use. Beyond that, those kinds of instances are where additional resources will make the difference.
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    Mr. LEWIS. I know that Senator Wofford will understand this very well. I am not sure that you all will, but let me try. There are some of us on the Appropriations Committee, including me, who think that the Budget Committee ought to be eliminated. They have the audacity to suggest that within our 602(b) allocation that indeed there only will be a lid of $254 billion for defense, that that lid ought to apply even if some people want to take away from my committee, from housing programs and put it in defense. They actually think that there ought to be those kinds of limitations on our flexibility to move between accounts. I think maybe my point is clear.

    I still have serious questions about the Budget Committee, and I think the Appropriations Committee administers its funds very well. But the point is nonetheless before us.

    Mr. Stokes.

    Mr. STOKES. Thank you, Mr. Chairman. I have a couple of questions here. I hope during my absence these questions were not redundant.

    Senator Wofford, the Points of Light Foundation is slated to receive $6 million in the 1999 budget submission, an increase of about $500,000 above the amounts made available in 1997 and 1998. During the past five to six years the foundation has received a not insignificant amount of funding from the Corporation. First of all, is all of the Corporation's funding for the foundation provided solely for grants, or is any of it used for administrative purposes?

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    Mr. WOFFORD. Mr. Stokes, the Points of Light part of this bill has been in it from the beginning as an amount specified by Congress. It is matched by more than that amount by private contributions to the Points of Light Foundation. It has been a major partner in national service. The 1995 joint committee actually urged the Corporation on to a major partnership with the Points of Light Foundation.

    We make a grant to the whole of the Points of Light Foundation for its operations, specified by Congress in amount. We asked for an increase this year of $500,000 because of two things. One, the Volunteer Center networks of the Points of Light Foundation in almost every major community in the United States have pledged to play a major role in children's literacy. They have this network. It is growing in strength and in quality. We are giving priority to AmeriCorps assignments and VISTA assignments to help Volunteer Centers that are in children literacy.

    A major reason for the increased $500,000 is for the children's literacy effort in the Points of Light Foundation. And the other is that they were the chief partner with the Corporation in helping the Presidents, including President Clinton and President Bush who launched it, and General Powell, to carry out the summit at Philadelphia and the post-summit follow-up which is in scores and soon in hundreds of cities and States.

    Our network and the Points of Light Network are key colleagues of General Powell's America's Promise campaign, which has as one of its goals, effective education for every young person. That is goal four. So we think they can make a really significant contribution and that this would be a very good investment.
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    Mr. STOKES. Now does anyone perform any assessment or review of the foundation's activities?

    Mr. WOFFORD. We work very closely with them. We have not had an evaluation study done of the work of the foundation. They have their own studies. I attend their board meetings and they have a very effective board that is very serious about their own evaluation of their programs.

    We have been a part of the evaluation of their Volunteer Action Centers. They did a major study of how those centers could be more effective, and they have had a lot of follow-up to that and there is a lot of progress being made by the volunteer centers.

    Mr. STOKES. We noticed in your justification materials that were submitted with your budget that after the President's summit on volunteerism last summer, for which the Corporation and the Foundation met, as you have indicated here during the summit, to support post-summit initiatives underway across the country and to direct both organizations, undertake joint programs that bring together national service and community volunteers to help solve serious problems.

    Can you give us some idea, some examples of actions undertaken by the Corporation and/or the foundation in this vein after the summit?

    Mr. WOFFORD. In addition to this proposed increased investment in the Points of Light Foundation, we have made available up to $20,000 to every one of our State commissions for expenses related to summit follow-ups. We have been adding and adding and adding challenges to the State commissions and they need some additional resources. So we have put up to $1 million into that effort.
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    The board of the Corporation for National Service, before there was any summit, resolved that children and youth and their problems should be the primary emphasis of the AmeriCorps programs. The summit took five goals as five fundamentals. We are resolved to achieve for every child that has been left behind, a mentor, a tutor, a coach, after-school programs; second, safe places for non-school hours; Healthy Start and access to health care; fourth, effective education, literacy and marketable skills; and fifth, asking young people themselves, to serve not just be served.

    We have been asked to be the lead agent for General Powell in the achieving of goal five of asking all young people to serve. I would like to submit for the record the progress report of the many, many things we have done since the summit to make that a reality.

    One of them is in the District of Columbia, where they require service by students as a condition for graduation. We now have a VISTA in every high school in the District of Columbia——


    Mr. LEWIS. Excuse me, just a second. You say that Washington, D.C. now has a requirement for service before anybody graduates from high school?

    Mr. WOFFORD. Yes.

    Mr. LEWIS. Do they require anything else? [Laughter.]
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    I am not being overly critical of the shining city of the Hill, but I live here and it concerns me a lot.

    Mr. WOFFORD. We have two initiatives in the school system. One is in elementary schools where we have a person helping to organize the literacy work in 16 elementary schools. We have intense involvement in one such school as a Corporation. We volunteer there. We are at Garrison, and I would like to submit a report on our District of Columbia work.

    [The information follows:]
    "The Official Committee record contains additional material here."

    Mr. WOFFORD. We have a major research study by Brandeis University, an institute there did it, showing that the effect of service by young people—service learning—is to increase their academic motivation, lower their dropout rate, and increase their curiosity and stimulation about courses.

    Mr. LEWIS. I was actually talking about D.C.

    Mr. WOFFORD. I am talking about D.C., too. The NCCC came in at a critical point to help with repairs and renovation of D.C. schools and the campus. The decision to open a fifth campus was also related to the contribution that we were able to make to the physical school problems. We want to make an effective contribution to the problems that you are referring to.

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    Mr. STOKES. I think at the point, where the chairman intervened you were about to mention VISTA.

    Mr. WOFFORD. Right here in the District of Columbia, VISIA is enabling organizations that are skilled in service learning to recruit and select VISTAs to be service learning coordinators. We believe the effect of these 16 service learning coordinators in the District schools, as in other places where they work, is to make that program much more successful. Without somebody skilled in service learning it becomes an hour count.

    There is a whole way of doing service learning. We have had experience in many, many parts of this country, and we want to make that experience available to school districts that make this a requirement.

    Maryland is the one State that requires all students to do some student service. Service learning is a condition for graduation. Their legislature approved this. We have many programs helping them see that this is done well, and we moved a lot of lessons from Maryland moving so fast on such a big scale.

    Chicago is now in the process of developing their plan for it and we are working actively with the school system there to give them our experience. We brought their key planners to Maryland to see what their experience was. AmeriCorps members will be working with schools that either make it a commitment in their curriculum or have a requirement in terms of hours.

    Mr. STOKES. Thank you very much, Senator Wofford.
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    Thank you, Mr. Chairman.

    Mr. LEWIS. Thank you, Mr. Stokes.

    Mr. Price, you may have wandered in from the Budget Committee hearing as I was making those wry remarks.

    Mr. PRICE. I caught that, Mr. Chairman. That Budget Committee to which you referred is where I have been. Alan Greenspan was our witness this morning. We had a long morning of testimony.

    Senator, welcome to you.

    Mr. WOFFORD. Good to see you, Mr. Price.

    Mr. PRICE. I apologize for my late arrival. I am glad I can squeeze in a couple of quick questions here before we adjourn. I do think that the work you are doing is most worthwhile. We talk a lot about the touchstone values of opportunity and responsibility and community, and has always seemed to me that national service, more than most things that we fund around here, embodies all three values including the responsibility element, encouraging young people to give something back to the community.

    In North Carolina a couple years ago, I learned that we led the Nation in per capita participation in AmeriCorps. I do not know if that is still true or not. I hope it is.
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    Mr. WOFFORD. If you want to know, I will find it out. You may want to continue to be able to say that. And I hope it is true. I just came back from the North Carolina summit that Governor Hunt convened, so I hope it is true.

    Mr. PRICE. I will accept a reality check on that. But I know we are near the top and at last check we did have 530 volunteers working in our State. Nationwide, the figures are impressive. Learn and Serve America, 28,000 participants; the number of National Senior Service Corps Volunteers now nearly 10,000. So these are impressive numbers.

    I have a quote from Rachel Stevens, a Learn and Serve high school student in Durham who summed up her experience with AmeriCorps when she said, ''I like being a role model. I like being there to help so they can look back and say there was someone who made a big impact on their lives.'' That is very encouraging to hear from young people.

    I understand you have not had an extensive discussion this morning of the Learn and Serve program, and I just wonder if you briefly could give a thumbnail sketch of how that program works and then maybe a little more for the record, an update on how that program in particular is coming.

    [The information follows:]
    "The Official Committee record contains additional material here."


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    Mr. WOFFORD. I would like to very much. In reviewing my own testimony I realized I wanted to say a lot more about Learn and Serve than we did in the written testimony, so I welcome to say some of it.

    Mr. PRICE. Why do you not speak briefly to the character of the program and then submit something longer for the record?

    Mr. WOFFORD. Learn and Serve was a special interest of Senator Kassebaum and Senator Kennedy before there was an idea of AmeriCorps. Service learning has been developing and percolating up. North Carolina, as I said, has many examples of it. And there is a state of the art on how you both integrate service into the curriculum and you do effective non-curricular service.

    Learn and Serve operates through grants to State education agencies who commit themselves to advancing service learning in the schools. There is a formula grant that goes to the State education departments. They then, usually by a competitive system, give relatively small amounts to local schools that are trying to do service learning in the curriculum.

    Those State education agency service learning State representatives have a network. We have brought them together. Bill Bentley's evaluation and effective practices unit and our outside evaluators are helping to show the projects that most successfully work.

    The second way Learn and Serve works is through the community-based organizations that use students in service. We have worked with Big Brothers, Big Sisters where service learning funds assisted them to get high school, and in some cases, college students, to become Big Brothers and Big Sisters. Organizing that, and adding service learning to the component, is important.
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    One of the big fields of promise is the way in which older young people can tutor other young people. A service learning grant enabled the literacy corps started by a Philadelphia principal to spread from a few schools, to 22 Philadelphia high schools, to seven States. Teachers are taught—11th and 12th grade English teachers—are taught how to train their students to do afternoon tutoring of second-graders three afternoons a week. It is an extraordinary success story and costs very little money.

    The Alliance for Catholic Education that I was referring to—we will get you the report on that for the committee.

    [The information follows:]
    "The Official Committee record contains additional material here."

    Mr. WOFFORD. Notre Dame president Monk Malloy just sent me their report on it. It began with this idea of recruiting outstanding college graduates to teach in the most difficult parochial schools in the south. It began with a service learning grant that helped them do the teacher training the first summer.

    They now have a program that has been endowed, has major support from their donors, that does not require many funds from us. We give the education award and they have 150 teachers teaching in schools in the south. All of our AmeriCorps teachers are asked to be agents of service learning in those schools. That was the third category, namely, higher education grants which we make directly from our office here.

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    Mr. PRICE. I am aware that AmeriCorps members are involved in a wide range of projects, helping with some of the homebuilding and Habitat for Humanity, repairing environmental damage in our State after Hurricane Fran; a lot of AmeriCorps people involved in that providing tutorial services. We had at UNC-Chapel Hill one of the pioneer tutoring programs which then became part of AmeriCorps.

    So we feel like it has been of great benefit. I know there have been some concerns about the costs involved, and that would be my final question. I understand you spoke to that briefly earlier. But some of those costs were pretty high for the training and support of AmeriCorps members in the first few years. I am sure there were startup costs that might have skewed those numbers.

    Now the program has been up and running for three years. Have those costs in fact been reduced, those per capita costs? What have you done to bring them down? And to what extent have you been able to augment your Federal funding with funding from non-Federal sources, and non-governmental sources?

    Mr. WOFFORD. We have made very great progress and a major breakthrough this year on the cost front. One of the things that was skewed was the reporting of our costs. If I may just say so, so you know what our baseline was. There have been talks of it being $27,000 per member and some have even taken projects where they think the figures show more than that per member.

    Those are not the Corporation's costs per member. There were a few projects where the cost per member was over $20,000. But the estimate by the Corporation of the average cost in the first two years was something over $18,000 per member including the $5,000—$4,725 education award. Then for the normal AmeriCorps grant, about $8,000 living allowance. So it was a very lean program.
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    The GAO in its study from which people drew the $27,000 figure, because they included the contributions you are asking about. They included private contributions to a program such as the Notre Dame program I described. Now they have had several million dollars contributed to help pay for this program and endow it.

    The answer GAO gave that led to the $27,000 figure was what total resources are used in a particular project. The GAO estimated that our average was under $18,000. We have taken the $18,000 as the baseline and we agreed to bring our average costs down to $15,000 per member. We are going to do that by next fiscal year, and we are on track. We are down at approximately $16,000 per member for the year coming now.

    Mr. PRICE. And both cases you are talking about the Federal costs?

    Mr. WOFFORD. I am talking about the Corporation's costs, which includes $4,725 for the educational GI bill voucher.

    Mr. PRICE. It includes the education amount?

    Mr. WOFFORD. And it includes whatever living allowance they get.

    Now the great breakthrough is this education-only award program. Senator Grassley wrote the President a letter saying he had heard about this and it sounded like a very promising effort. He said he would like to see more of it. I was enthusiastically behind that. Part of our agreement with Senator Grassley on cost-cutting is that we would try to expand the model of education-only awards where all we put in, would be the $4,725 plus maybe $500 for system administrative costs. All the other costs would be borne by the local program.
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    The President at the summit in Philadelphia challenged faith-based organizations and non-profits to respond and to take the lead. We are the very minor partner in that. By definition that program means that most of the costs of the program, aside from that educational GI bill, are raised by the local agency.

    We have now 14,000 AmeriCorps people getting only an education award. It is the main source for our expansion last year. I think it has enormous promise. Some 6,000 slots have been assigned to religious organizations that rose to the President's challenge, led by the National Council of Churches but including the Catholic Volunteer Network. You might be interested and I am submitting for the record the different AmeriCorps spots by denominations. The Methodists and the Catholics, each have more than 1,000 AmeriCorps positions.

    [The information follows:]
    "The Official Committee record contains additional material here."

    Mr. WOFFORD. The second largest of this education-only award is the Boys and Girls Clubs. They have 900 in this position. I see a great future for this education-only award and that, again by definition, brings our corporation costs drastically down.

    Mr. PRICE. I know in our State from the very beginning your strategy has been to partner with existing organizations which did draw on all kinds of sources of support, from Habitat to the literacy program on the university campuses, to public allies, to a number of other partners who AmeriCorps then enabled to extend their work. That does seem to be a sound way of operating both fiscally and otherwise.
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    Mr. WOFFORD. Except for the National Civilian Community Corps, we did not run the programs. We, in all cases other than NCCC, are providing AmeriCorps slots for local non-profit educational or other programs.

    Mr. PRICE. Thank you.

    Thank you, Mr. Chairman.

    Mr. LEWIS. Thank you, Mr. Price.

    Senator Wofford, I had submitted within my questions for the record an item that related to some of the cost questions that Mr. Price was pursuing. There is nothing wrong with the education-only grants and I can understand the impact they have on relative costs and so on. But I would appreciate your focusing upon that, taking in mind Mr. Price's questions, elaborate on it for the record for me, and we will communicate, as it were.

    Mr. WOFFORD. We will.

    Mr. LEWIS. Mr. Stokes, one of our colleague who has made a similar decision to the one that you have made; that is, he is not going to run for reelection, says that he just cannot help but be impressed by the numbers of groups at home who suddenly are aware of the great work he has been doing over the years. [Laughter.]

    It seems they want to have meetings and gatherings and otherwise to tell him about the fact that they had always recognized how great he was.
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    I am sure there are many, but should there be such an organization that is exercising itself about the time that you have a groundbreaking relative to the House of Congress bill, should it fit in with our mutual schedules, we might get some AmeriCorps volunteers to even be there. Just keep that in mind.

    Mr. STOKES. Sounds like something that I should think about.

    Mr. LEWIS. Thank you very much, Senator Wofford, and all of your colleagues who are with you. We appreciate both your responsiveness, the difficulty of your work, kind of the glass bowl, it is a special bowl that you have been put in by members of Congress, individually and sometimes collectively. But in the meantime, as my mother genuflects, you are about the Lord's work, so sometimes these things can be a lot of fun while they are difficult.

    Mr. WOFFORD. Indeed.

    Mr. LEWIS. Thank you very much.

    Mr. WOFFORD. Thank you very much.

    Mr. LEWIS. The meeting is adjourned.
    "The Official Committee record contains additional material here."