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Appropriations for categorical programs should be sufficient to provide for federal program outcomes expected from parents and Sufficiency requires that all program costs be funded

taxpayers.

if the program is intended to meet the categorical objectives of congress and federal agencies. When school districts and states are required to provide "matching funds" either on a direct or indirect cost basis, the economically disadvantaged school districts and states cannot participate the poor get poorer and

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the rich get richer.

There is great need for program consideration.

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For example, look

140,000 pupils,

Last year, under 18

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with

at the school district of Memphis, Tennessee 5,500 teachers, and 4,500 other personnel. mind you 18 different Public Laws, and 37 Titles therein, the system operated 95 different Federally Funded Projects approximately $19.5 million. The dollars were indeed great to have as a supplement but it cost Memphis to spend the federal dollar!! What do I mean by that statement? There is no way, within the current, overly restrictive federal regulations and state guidelines that a school district can plan for and cover and claim all costs incident to the administration of current

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multi-categorical federally funded programs. Small school districts tend to be in an even more difficult position in recovering full costs.

Narrowly conceived categorical programs should not continue

indefinitely.

A program should have specific objectives with

measurable outcomes.

When these outcomes are met, the program

should be discontinued and, as necessary, new ones initiated. On the other hand, federal revenues are required for more broadly conceived programs and for general operations.

Sharing revenues of the United States with the state and local educational agencies is essential to a sound fiscal policy for education. Regressive sales and property taxes cannot continue to be the major source of revenue for the education of the elementary and secondary school students in America. The inequities in application of the property tax has led to an estimated 52 suits in state and federal courts in 31 states, and since August, 1971, federal state courts in California, Texas, Wyoming, Michigan, Minnesota, Kansas, Arizona, as well as New Jersey, struck down the property tax for school financing. The federal income tax is yielding such a large share of tax receipts of all types in the United States that it provides the only practical source of revenue for education if local regressive taxes are to be reduced as they should be in most

states.

Now, where are we? We are at the crossroads of either supporting continued prolification of categorical aid to education or consolidating programs into a "service delivery vehicle" like "The Better Schools Aid Act", followed by a strong effort to achieve adequate levels of funding.

Thank you.

Senator PELL. Our next witness is Mr. Alfred McElroy, chairman, National Advisory Council on the Education of Disadvantaged Children.

Senator JAVITS. Before Mr. McElroy starts, let me say that he has a very distinguished board, of whom some of the members are well known to me, notably Maurice Rosenfeld, chairman of the board of Equitable Bag Co., of New York, and of course, Dr. DeMarco, who is a very well-known New Yorker, of Finch College. I just thought the committee should note that in terms of the background of the organization for which Mr. McElroy speaks.

STATEMENT OF ALFRED Z. MCELROY, CHAIRMAN, NATIONAL ADVISORY COUNCIL ON THE EDUCATION OF DISADVANTAGED CHILDREN

Mr. MCELROY. Thank you, Senator Javits, and thank you, Mr. Chairman.

Mr. Chairman, my name is Alfred Z. McElroy, and I am chairman of the (President's) National Advisory Council on the Education of Disadvantaged Children.

The NACEDC is the statutory, presidentially appointed council charged with the review and evaluation of programs until title I ESEA and other federally funded programs serving disadvantaged children, including the poor, handicapped, delinquent, migrant and other children found to be educationally deprived. Our Council budget is drawn from title I ESEA funds and our 15 members include educational professionals from every level of the education process, a juvenile court judge, civic leaders, businessmen, five women and significant representation from black, Spanish speaking, appalachian, oriental, and other minority and ethnic communities across America. In the interest of conserving time, I have attached to my testimony a list of the NACEDC membership, including their occupational and geographic backgrounds and terms of service.

The Federal Advisory Committee Act of 1972 has greatly strengthened the existing 21 Presidential councils, by guaranteeing staff and financial support as well as statutory independence. In addition, Public Law 91-230, the General Education Provisions Act required our members to have staggered 3-year terms. Therefore, at this time, due to applicable legislations, our Council enjoys a national perspective of professional educators and interested laymen with the guaranteed protection of terms of office and a statutory obligation.

This is important to note at this time, because our testimony which follows is a positive statement about concepts and contents of the Better Schools Act. Our Council has always taken a constructive role with regard to pending legislative and regulatory alternatives for compensatory education.

We have determined through experience what we feel the minimum role of the Federal Government to be with regard to the educationally disadvantaged, and we reported those findings in our 1973 annual report. The folder we have provided to you contains our reports, and a study of the Better Schools Act which we prepared for Secretary Weinberger for a June meeting this year. We have made this full package available to your staff on a periodic basis, including the minutes of our frequent meetings.

There is a wide range of legislative alternatives in the House and Senate at this time, and the Council is comparing its minimum mandates with each individual piece of legislation. You have asked us here to express our views on the administration's Better School Act, S. 1319, and Senator Javits' bill, State Education Finance Assistance Act of 1973, S. 1900.

In February the Council testified in depth before the General Education Subcommittee of the House on H.R. 69, an extension of the ESEA until 1978, and introduced the Council's minimum mandates at that time.

The Council spent its report year visiting with parents, professionals, local and State administrators and Federal officials learning what they thought to be the minimum components of a good compensatory education effort. Using this information as the Council made its site visits, the Council developed a list of requirements which they would use in order to evaluate the pending legislative alternatives. For your convenience, I will list them at this time:

The NACEDC recommends that any compensatory education effort contain

1. A comparability of services requirement, to insure that local moneys are not supplanted by Federal funds.

2. Districtwide parent advisory councils, to insure local accountability among the parents of the children to be served.

3. Public information access, in order to provide appropriate data to the public to properly evaluate the success of the program, so long as individual student privacy is respected with regard to specific information.

4. A nonpublic school bypass, to provide relief in cases where the Assistant Secretary determines that a district has failed to provide comparable services to children enrolled in the private schools, or where State laws prohibit such service.

5. Migrant program guarantees, to provide the nearly 500,000 migrant children equal educational opportunity through maximum use of the uniform migrant record transfer system.

6. Enforcement procedures, to provide services to children when there is a breakdown in the State-Federal delivery system, and to provide compensation to the Federal Government for misspent funds.

7. Fiscal audits and maintenance of effort, to monitor the accurate expenditure of funds according to the law, and to insure the supplementing, and not supplanting of local funds with Federal resources. 8. Concentration of funds, to maximize the use of the limited dollars available so that significant gains in performance of the children is noted.

9. Maintenance of local initiative, to develop programs which meet the specific educational needs of educationally deprived children, as long as parents of affected children have been actively involved in the needs assessment and the operation and evaluation of the program. 10. Desegregation guidelines, so that school districts which are engaged in the administration of desegregation plans can serve the participating children without unnecessary resegregation.

11. Program reviews, which provide technical assistance and expertise to the local administrators and States, while ensuring that audits properly reflect legislated intent.

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