ple, and the money which is being appropriated for public education is not getting down to Johnny.

Senator MONDALE. Do you have figures on what amount is being spent in the central pentagon and how much is being spent at the classroom teaching level?

Mr. HOBSON. I have some calculations, which I gave you which I will caution you about. I did not bring them with me.

Senator MONDALE. Just give me your observations, now.

65 PERCENT FOR ADMINISTRATION

Mr. HOBSON. I have an astronomical percentage which show that 65 percent of the money appropriated for education goes for administrative expenses in the District of Columbia public schools.

Senator MONDALE. How do you define it? Would that

Mr. HOBSON. That is broadly defined. That includes principals' salaries, everybody from a principal and up. It includes rent and it includes all those people who are chauffeured around out there, and secretaries and the whole administrative staff of the District of Columbia public schools. Most of the money goes for that. It does not go for teachers' salaries and it does not go to the children.

Senator MONDALE. How many professional people are there in the school system of the District who are not teaching but who are in an administrative or some such capacity?

Mr. HOBSON. I don't know that figure.

Senator MONDALE. What would you guess?

Mr. HOBSON. Oh, gee. I would be afraid to make a guess because it could be anywhere from 500 or so. I have not calculated that so I'm unable to say.

Senator MONDALE. Well

Mr. HOBSON. Let me just say, there's a problem with definition here. I'll define administration. What I'll do is get a Government publication from, say the Government Accounting Oflice. They have a definition of administration, administrators, administrative expenses. And as a kind of standard definition, I'll take that standard definition and on the basis of that standard definition of administrative expenses, I'll figure out the administrative expenses of the District of Columbia public schools.

Now, if I take out the principals, then of course, the teachers take most of the money, but if you leave in the principals the teachers get less.

Senator MONDALE. I have some sympathy for the need of a principal in the school system. I'm trying to figure out the amount of needless waste in overhead that accumulates in these central cities.

I think I'm correct that the superintendent of San Francisco is fairly new-has been there for about a year. In his first conference after he had been there for a couple of days he said, "I can't imagine what I'll do with all these people." And he told them all, "Go out and teach," and they had a huge rally demanding that not be done, so he sent a lot of them out to meet the kids, again.

Now, it seems to me that the public is not going to support these schools unless it has confidence in them and when you read stories-I think I read they had 34 chauffeured cars in the District school system. How does that contribute to confidence?

CHAUFFEUR-DRIVEN BOARD OFFICIALS

Mr. HOBSON. More than any other city in the United States. I think the article said that we have more chauffeur-driven officials in this town than any other town in the country, but in schools, I don't know, about 34, they had some 24 when I was on the Board of Education. I was offered the services of a driver, which I never used. I felt foolish, as a two-bit Board member, being driven around.

Senator MONDALE. It seems to me the incentives often go this way: that the lowest level of school enterprise is schoolroom teaching-that's sort of a buck private job-and that the real status is to be found when you arrive in that central headquarters with a supervisory, administrative job; then someday, with a higher salary and someday with a car. That's incentive to get on up there where you have status; is that accurate?

Mr. HOBSON. That's very accurate about the District of Columbia public schools. The whole idea is get away from teaching into administration.

Senator MONDALE. And because of that your best teachers are spotted and end up in the central system.

Mr. HOBSON. We lost one that way-Mr. Rose, who was a very good principal and had a reputation for running a good ship. He has resigned, now, but he was in the school administration. He moved from teaching out of contact with the children.

I think that the schools exist for the benefit of the children. There is one other point on public education you can make, which reflects the educators' attitudes toward the children. That is that education is the only industry in the history of this free enterprise system that hold the consumer-the child-responsible for the quality of the product. "He's black, he's a bastard child, he doesn't know who his father is, he lives in a room with six people, he has never been to a library, so therefore, he can't learn," thus the teachers and school administrators are able to escape evaluation.

I worked in the Government for 25 years as a statistician, and every 6 months I was evaluated and expected to be. Teachers are fighting the attempt to evaluate them in terms of Johnny's ability to read, and Johnny's ability to read is their product. People working in a $150 million corporation with 18,000 employees and over 200 buildings, need to be held accountable.

MALADMINISTRATION IN DISTRICT OF COLUMBIA

The District of Columbia school administration is guilty of bungling and maladministration and misuse of money. I'm not saying anybody is stealing, but stupidity does reign supreme in the District of Columbia public school administration.

I have a chart which I obtained from the public schools showing public projects in special schools using funds from all sources. We are spending something like $36 million a year on special projects, most of which have never been evaluated.

For example, a reading program put in in 1968 and still going has no measure in effectiveness in terms of how Johnny is reading. Well, I want to thank you for the opportunity to testify

Senator MONDALE. Thank you very much for your contribution. I think this is unique testimony in that it gives us insight into the interDistrict distribution of funds. Your testimony with the charts as well as the two documents you submitted will be made a part of the official record. Thank you very, very much.

Mr. HOBSON. Here is a copy of "The Damned Information."

Senator MONDALE. That's what we want. Thank you very much.

Our next witness is Dr. Charles Benson, who is with the University of California, and also staff director of the New York State Commission on Quality Cost, and Financing of Elementary and Secondary Education, and one of the outstanding school economists in the country.

We are delighted to have you here this morning.

STATEMENT OF CHARLES S. BENSON, PROFESSOR, DEPARTMENT OF EDUCATION, UNIVERSITY OF CALIFORNIA, BERKELEY, AND STAFF DIRECTOR, NEW YORK STATE COMMISSION ON QUALITY, COST, AND FINANCING OF ELEMENTARY AND SECONDARY EDUCATION

Mr. BENSON. Thank you, Mr. Chairman. My name is Charles Benson, and I'm a professor in the Department of Education, University of California, Berkeley, and staff director of the New York State Commission on Quality, Cost, and Financing of Elementary and Secondary Education. I think that's a commission with, perhaps, the longest title of any current. I believe there are 83 letters in the name.

Sir, there are three topics on which I ask your permission to speak. One is problems that exist in the present system of finance; the second topic is what States might do to substantially improve their financing of the public schools, and I think there are two main options— what is called district power equalizing and full State assumption; the latter being much my preference, and third, if I may, I would like to make comments about what the Federal Government might do to aid this process of transition to a new system.

FINANCIAL SYSTEM INEQUITABLE

On the first topic, the problems in our present arrangements, as the Serrano case so clearly indicated, the education finance system is inequitable. Some poor districts pay high tax rates for meager programs and some rich districts pay taxes locally at low rates to provide themselves with very handsome programs.

This is true in California; this is true in New York; it's true at points in between.

For half a century the States have tried to produce an equitable system of finance but their efforts to date appear inadequate, as in the past. Some of the reasons for the present arrangements producing this rather strange result that under a system of State equalization grants you still have gross inequalities, these are stated in the document I submitted to you, sir, and I would rather, if I may, move to some additional material.

*See Part 16D, Appendix 3.

68-412-71-pt. 16A-8

Senator MONDALE. What we'll do is to put your statement in the record* as though read and you can emphasize those points you wish today. I have read your statement.

Mr. BENSON. Thank you. What I would like to do is to read a few paragraphs about the situation in New York State. Now, this is material that has been completed after the statement to you was itself written. May I read?

Senator MONDALE. By all means.

Mr. BENSON. Now, this says, let us look in detail at the situation in New York. Consider Long Island, the second largest-next to New York City-region of the State in terms of public enrollment.

In 1968-69, there were 615,494 persons enrolled in the public elementary and secondary schools of Long Island's two counties, Nassau and Suffolk. This enrollment represented 18.1 percent of the State's total. Along with the Island's large number of students goes a large number of school districts. Though Long Island is not a large geographic area and though much of it is densely populated, it had 131 school districts in various classifications in 1968-69. Ninety-two of these had enrollment in both elementary and secondary grades.

What of revenue differences among these 92 local authorities? Great Neck had revenues 57.32 percent above regional average and Massapequa had revenues 18.14 percent below regional average. By regional standards, both of these two districts are large in enrollment. Now, the absolute dollar difference per student between Great Neck and Massapequa was $996.53 of our $1,000 per student.

Senator MONDALE. What was the per capita expenditure in the one versus the other?

Mr. BENSON. The per capita?
Senator MONDALE. Per pupil.

Mr. BENSON. Per pupil, yes. In Great Neck it's approximately-I don't have a precise figure-but it's approximately $2,000, and in Massapequa, approximately $1,000 per student per year. Those are close, but not exact.

Now, this difference between these two divisions, then-between these two districts, is approximately $20,000 a classroom. There is no clear reason to expect that students in these two districts have such different interests and ability that a $20,000 per classroom disadvantage for Massapequa youth can be justified in educational terms. Granted, these differences are rather extreme on the Island.

OPPORTUNITES UNEVEN

The fact remains that educational opportunities there are markedly uneven. Furthermore, the area of Long Island is sufficiently small that one would not expect revenue differences to be offset by differences in costs; that is, in prices of educational services.

For example, the salaries that Great Neck and Massapequa would need to offer in order to hire teachers of a given standard of proficiency would be approximately the same. Probably whatever differences exist to the favor of Great Neck because of its reputation as an outstanding school district.

*See prepared statement of Mr. Benson, p. 6709.

So, what I am saying up to now, sir, is within a small bounded geographic area there are roughly 2 to 1 expenditure differences that one finds hard to defend; either on the basis of the learning requirements of students or on the basis of the differences in prices for educational services, at least, that these two places would have to pay.

The next step is to see what the expenditure differences, to what they are chiefly related. The analysis is based upon the standard of 1 to 1 relation between local tax rates on true value of property and revenues per student. A purist-that is, a public finance purist-might maintain the following: If the local tax rate in district X is 10 percent higher than the rate in district Y, then and only then should revenues per student in district X be 10 percent higher than in district Y.

It is one of the fundamental ideas in our American educational practice that the residents of a given local district may choose the quality of educational program that is to exist in that district, but another idea that I think is fundamental to the way we try to order our lives in this country, is that you are supposed to pay for what you get, and so we are taking this attitude in this Long Island case. We assume that districts should pay for what they get as expressed in a local tax rate and we then ask what conclusions follow from this.

Now, we make an index of tax rates in Long Island and we simply see the percentage by which tax rates in different districts vary from regional average tax rates. Then, sir, we compute a set of presumptive revenues, which is school revenues per student per year, that would be tied to this index of tax rates.

For example, we have a tax rate in a place called Baldwin that is 7 percent above the Long Island average. We then say that the presumptive educational revenues should be 7 percent above Long Island's average. We multiply the Long Island average of $1,320 by 1.07 and we get a presumptive revenue figure $1,413.

Now, we compare these presumptive revenue figures with the actual revenues, which reflect locally raised money and State aid. We then divide the school districts of Nassau, separate it into winners and losers, and the winners are people who have more actual revenues than their type of tax rate would allow you to say they should have if you assume that there is this one-to-one relation between tax rates and spending per student.

DISCRIMINATION AGAINST SMALL POOR DISTRICTS

Now, the winners and losers may profitably be examined against enrollments and against true value of assessed property per student. Almost without exception, winners are districts of high assessed valuation-Garden City, Great Neck, Hempstead, Lawrence, Port Washington, or are both small and rich like Oyster Bay, Sea Cliff, Hampton Bays those are winner types, rich, or even better, small and rich. Similarly, almost without exception, the losers are districts of low assessed valuation per student-Island Trees, Roosevelt-which is almost a completely black district-Seaford, Bellport, Wyandanch-which is almost a completely black district, or districts which have valuations per student ranging up to moderate levels, but which are large in enrollments-Hicksville, Levittown, Brentwood, Commack and Lindenhurst.