[Budget of the United States Government]
[VI. Investing in the Common Good: Program Performance in Federal Functions]
[21. Education, Training, Employment, and Social Services]
[From the U.S. Government Publishing Office, www.gpo.gov]


 
        21.  EDUCATION, TRAINING, EMPLOYMENT, AND SOCIAL SERVICES

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        Table 21-1.  FEDERAL RESOURCES IN SUPPORT OF EDUCATION, TRAINING, EMPLOYMENT, AND SOCIAL SERVICES       
                                            (In millions of dollars)                                            
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                                                                               Estimate                         
               Function 500                   1997   -----------------------------------------------------------
                                             Actual     1998      1999      2000      2001      2002      2003  
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Spending:                                                                                                       
  Discretionary Budget Authority..........    42,488    46,365    48,608    49,139    49,420    49,297    48,883
  Mandatory Outlays:                                                                                            
    Existing law..........................    13,690    13,126    12,090    11,157    10,867    10,067    12,085
    Proposed legislation..................  ........      -158     1,789     2,877     3,490     3,968     4,442
Credit Activity:                                                                                                
  Direct loan disbursements...............    10,286    13,338    13,671    14,483    15,280    16,093    16,951
  Guaranteed loans........................    19,542    25,052    25,690    27,301    28,841    30,402    32,035
Tax Expenditures:                                                                                               
  Existing law............................    27,430    33,755    57,295    59,510    61,140    62,905    64,625
  Proposed legislation....................  ........        15     1,010     2,859     3,205     2,839     2,738
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  ----------------------------------------------------------------------
  The Federal Government helps States and localities educate young 
people, helps the low-skilled and jobless train for and find jobs, helps 
youth and adults of all ages overcome financial barriers to 
postsecondary education and training, helps employers and employees 
maintain safe and stable workplaces, and helps provide social services 
for the needy.
  The Government spends over $62 billion a year on grants to States and 
localities; on grants, loans, and scholarships to individuals; on direct 
Federal program administration; and on subsidies leveraging nearly $40 
billion in loans to individuals. It also allocates about $58 billion a 
year in tax incentives for individuals.

Education

  Education is the principal means of upward mobility for Americans who 
want better lives for themselves and their families. While education is 
mainly the province of State and local governments, and of families and 
individuals, the Federal government plays an essential role.
  The Federal role is focused in the following areas.

  Pre-School: Head Start gives low-income children a comprehensive 
approach to child development, stressing language and cognitive 
development, health, nutrition, and social competency.
   In 1999, Head Start will serve an additional 30,000 to 36,000 
          children, for a total of 860,000 to 866,000 children, 
          continuing progress toward the Administration's goal of one 
          million children served in 2002.
   Within the overall total of children served, in 1999 an 
          additional 10,000 children under age three will participate in 
          the Early Head Start component, for a total of nearly 50,000--
          the first step toward the Administration's goal of doubling 
          Early Head Start participation from its 1998 level of nearly 
          40,000 to 80,000 by 2002.

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  National evaluation studies of both the regular Head Start program and 
the Early Head Start component are under way, for which preliminary 
results are expected in the spring and summer of 1998.

  Elementary and Secondary Education: Federal spending for elementary 
and secondary education targets important national needs, such as equal 
opportunity and higher academic standards to improve student 
achievement. For example, most low-performing children in low-income 
schools get extra educational assistance through the Title I-Education 
for the Disadvantaged program. Other programs provide related support 
for children with disabilities and limited English proficient children; 
support teacher and administrator training; help finance and encourage 
State, school, and system reforms; and support research and technical 
assistance.
  The Administration's long-term goal is to help all children, and 
especially low-income and minority children, make steady gains over 
time. Federal programs make a significant contribution to improved 
learning results.
   Citing Title I, as well as Head Start and child nutrition 
          programs, a 1994 RAND study found that ``the most plausible'' 
          way to explain big education gains of low-income and minority 
          children in the past 30 years is ``some combination of 
          increased public investment in education and social programs 
          and changed social policies aimed at equalizing educational 
          opportunities.''
   Minority students have made substantial gains in science, 
          math, and reading since the 1970s, narrowing the gap between 
          minority and Caucasian student achievement by about a third.
  The Federal focus began to change in 1994 from supporting individual 
programs to emphasizing school-wide and school system reforms, through 
the President's Goals 2000 Educate America Act and his Improving 
America's Schools Act. These laws support State and local standards-
based reform efforts and speed the use of technology in education to 
help raise learning gains. Overall, these new approaches freed States 
and schools from Federal restrictions, providing greater flexibility 
while requiring more accountability for results. Early results show that 
the new approaches are having a significant impact:
   A 1997 review of State plans showed that 44 had content 
          standards in at least reading and math, and 26 States had 
          performance standards.
   All States have established school support teams that provide 
          high-quality guidance to Title I schools.
   All States now have plans to ensure that (1) classrooms are 
          equipped with modern computers and connected to the Internet, 
          (2) software is an integral part of the curriculum, and (3) 
          teachers are ready to use and teach with technology.
   Business-school partnerships are developing new software and 
          new ways to use technology to raise student achievement.
   By the end of the 1998-1999 school year, nearly all States 
          will have challenging content and performance standards in 
          place for two or more core subjects, and by 2001 nearly all 
          States will have assessments aligned to the standards. Before 
          Goals 2000, almost no States had challenging academic 
          standards in place.
   In 1999, Title I grants to school districts will provide 
          educational services to over 10 million students in high 
          poverty communities, over half a million more children than in 
          1998.
   Each year, the National Assessment of Education Progress 
          (NAEP) will help measure progress toward achieving the goal 
          that rising percentages of all students will meet or exceed 
          basic, proficient, and advanced performance levels in national 
          and State assessments of reading, math, and other core 
          subjects, and the goal that students in high-poverty schools 
          will show improvement gains comparable to those for all 
          students.

  Title VI Education Block Grant: This program provides general 
resources for education. It does not have clear, measurable goals and is 
not designed in law to produce specific results in terms of student 
achievement gains. Evaluations of the program show that school

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districts generally use the funds for routine activities that do not 
improve teaching and learning. As a result, the budget eliminates 
funding for this program in order to support other programs, such as 
Title I, for which there are strong indicators of results in terms of 
student achievement gains.
  Individuals with Disabilities: Under the Individuals with Disabilities 
Education Act, the Education Department works with States to ensure that 
children with disabilities benefit from the Act's requirement for a 
``free appropriate public education'' and are part of all accountability 
systems. The Education Department and the States actively work to 
monitor and improve the performance of those students. In 1998, all 
States will have performance goals and strategies in place for children 
with disabilities aged three to 21, and will begin to report their 
progress toward meeting those goals.
   In 1999, all States will participate in regular assessments 
          of children with disabilities and in reporting the results.

  Limited English-Proficient Children: With regard to the growing 
population of children with limited English proficiency, the 
Administration proposes that rising percentages of teachers and other 
staff have the skills needed to enable these students to meet 
challenging standards.
   In 1999, the Administration will help States hire and train 
          4,000 new teachers for children with limited English 
          proficiency.

  Reading: A student's most basic skill to master is reading. Although 
reading problems are particularly severe for disadvantaged students, 
students with reading difficulties represent a cross-section of American 
children. In 1994, only 30 percent of 4th graders scored at the 
proficient level in reading on NAEP, while 40 percent scored below the 
basic level. In 1998, the President launched the America Reads Challenge 
to provide extra help to meet the goal that every child will read well 
and independently by the end of the third grade.
   In 1999, America Reads will continue to help increase the 
          percentages of fourth-graders that meet basic, proficient, and 
          advanced levels in reading on the 4th grade NAEP (administered 
          in 1998 and every two years thereafter).

  Public School Choice: Charter schools introduce innovation and choice 
into public schools. In 1997, about 700 charter schools were operating 
around the Nation, of which about 420 received Federal funding. In 1999, 
at least 1,500 charter schools will be operating, continuing progress 
toward the President's goal of 3,000 charter schools by 2001.
  Voluntary National Tests: The Administration's proposed voluntary 
national 4th grade reading and 8th grade mathematics tests for students 
will help students and their parents and teachers know, for the first 
time, how well students perform compared to other students nationally 
and internationally. They will also provide important information about 
how well education reform efforts are working.
  Postsecondary Education: The economic returns to a college education 
are dramatic. Full-time male workers over 25 years old with at least a 
bachelor's degree earned 89 percent more in 1993 than comparable workers 
with just a high school degree. Moreover, the benefits of college extend 
beyond the college graduates themselves. The resulting higher 
socioeconomic status of parents with college degrees leads to greater 
educational achievement by their children.
   Since the 1960s, the Federal Government has played a growing role in 
helping Americans go to college. Federal programs finance two-thirds of 
all direct student aid (i.e., excluding general State and local support 
for public higher education). From 1964 to 1993, these programs have 
helped nearly triple college enrollment, increasing by a third the share 
of high school graduates who attended college, and raise college 
enrollment rates for minority high school graduates by nearly two-
thirds.
   In 1999, the Education Department will help an estimated 8.8 
          million students under its student aid programs.
   In 1999, an estimated 12.6 million students will receive 
          college tax credits.

  Scholarships for Low-Income Students: Research shows that, at the 
levels of median income and below, Pell Grant recipients are

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twice as likely to earn a bachelor's degree as are non-recipients. The 
President has proposed, and Congress has enacted, increases in the 
maximum Pell Grant award from $2,300 in 1993 to $3,000 in 1998. In 1998, 
an estimated 3.9 million needy students will receive Pell Grants to 
finance their college educations.
   In 1999, the Pell Grant maximum award will total $3,100 and 
          3.9 million students will receive Pell grants.

  Easing Loan Repayment: The President proposed, and Congress enacted, 
the 1993 Student Loan Reform Amendments that created the Income 
Contingent Repayment (ICR) option for loans. With ICR, students who have 
significant debt burdens and who want to take lower-paying community 
service jobs can make their payments affordable through ICR. In 
addition, students who have trouble repaying loans under other schedules 
can switch to ICR. By the end of calendar 1997, the third year ICR was 
available, 65,000 borrowers had already signed up for this repayment 
option.
   In 1999, ICR will continue to be available to as many 
          students who want it.

  Modernization of the Student Aid Delivery System: The Education 
Department manages the delivery of student aid benefits to over seven 
million students in nearly 7,000 postsecondary schools, and oversees the 
direct and guaranteed loan systems affecting 37 million individuals, 
4,800 lenders, and 36 guarantee agencies. The Department has made 
modernization of student financial aid management one of its highest 
priorities. Major parts of the effort include improving customer service 
at lower cost through better contracting practices and using new 
information technology. For example, students can now apply for student 
financial aid electronically and access their direct student loan 
information over the Internet.
  In 1999, the Department expects to continue to make progress toward 
the goals it has set for 2000, including to:
   increase, to three million, the annual number of students 
          applying for Federal aid electronically;
   enable students and families applying for Federal aid 
          electronically to have their eligibility determined in four 
          days, cutting in half the current processing time;
   make the Department's website the most comprehensive and 
          efficient source of information on Federal student aid and 
          program requirements, reducing hard copies of materials that 
          now must be printed and mailed by at least a third;
  test a multi-year promissory note for student loans to 
          streamline application procedures, minimize delays in 
          receiving funds, and provide better consumer information for 
          borrowers; and
   establish, with its partners in the financial aid community, 
          mutually agreed upon industry-wide standards for data 
          exchanges needed in administering student aid.

  Student Loan Defaults: In recent years, the Education Department has 
made great progress in reducing defaults and increasing collections from 
defaulters. The national student loan cohort default rate used for 
institutional eligibility dropped for the fifth straight year to 10.4 
percent for 1995, down from 10.7 percent for 1994. The 1995 rate 
represents the group of borrowers whose first loan repayments came due 
in 1995 and who defaulted before October 1, 1996.
  Over the most recent five-year period, the default rate has fallen by 
over half, from 22.4 percent in 1990. This dramatic reduction is due, in 
large part, to the Education Department's improved institutional 
oversight that has, in turn, led to the removal of 875 schools, 
including 672 schools from all student aid programs and 203 schools from 
the Federal loan programs. In addition, the department has implemented 
rigorous recertification standards for institutions to participate in 
the student aid programs. As a result, it has rejected about a third of 
initial applications to participate in the student aid programs over the 
last three years--twice the rate in 1990.
   In 1999, the default rate will continue to decline toward the 
          goal of 10 percent or less by 2002.

  Direct Loan Consolidations: By relying more on performance-based 
contracting, the Education Department is ensuring the smooth

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running of the loan consolidation contract. The Department is also 
improving the loan consolidation process by improving the accuracy of 
its data, strengthening managerial controls through better tracking and 
reporting, increasing the number and expertise of consolidation 
contractor staff, and speeding up the loan certification process. As a 
result of new procedures in 1998, the department will average no more 
than 60 to 90 days to complete a loan consolidation application.
   In 1999, average time to complete a loan consolidation 
          application will continue to decline.
   In 1999, surveys of borrowers will show that applicants for 
          loan consolidation are highly satisfied with the timeliness 
          and accuracy of the loan consolidation process.

  Education Department Year 2000 Compliance: The Department has launched 
a major effort to ensure that its systems are not adversely affected by 
the year 2000 date change.
   In March 1999, all of the Education Department's mission-
          critical and mission-important systems will be verified as 
          year 2000 compliant.

Labor

  Elementary, secondary, and postsecondary investments enable Americans 
to acquire the skills to get good jobs in an increasingly competitive 
global economy. In addition, most workers acquire more skills on the job 
or through billions of dollars that employers spend to enhance worker 
skills and productivity.
  Some workers however, also benefit from special, targeted assistance. 
In addition to Pell Grants, student loans, and tax credits, the Federal 
Government spends nearly $7 billion a year through Department of Labor 
(DOL) programs that finance job training. In addition, workers who want 
to learn about job openings can tap into the State Employment Service 
and One-Stop Career Center System, a labor exchange that's universally 
available through DOL's popular America's Job Bank (AJB) website, which 
lists over 750,000 job vacancies every day and receives 40 to 45 million 
``hits'' a month.
  DOL has launched several longitudinal evaluations of its job training 
programs over the past two decades, including major impact evaluations 
of the Job Corps and Dislocated Worker Assistance programs. Past studies 
have found mixed, but generally positive, results for the DOL job 
training programs.
  While impact evaluations are the best measure of program 
effectiveness, DOL also sets annual performance goals for its major job 
training programs. Performance goals for 1999 will continue to emphasize 
job placement, employment retention, and earnings levels.

  The Job Training Partnership Act's (JTPA) Dislocated Worker 
Assistance: This program provides training and employment services to 
about 685,000 displaced workers a year.
   In 1999, about 76 percent of those who receive services will 
          be working three months after leaving the program, earning an 
          average hourly wage that represents 97 percent of the wage in 
          their previous job.

  JTPA's Adult Training Grants: This program helps over 400,000 low-
income individuals get training, support services, and job placement 
assistance.
   In 1999, about 60 percent of those who receive services will 
          be working three months after leaving the program, with weekly 
          earnings averaging $270.

  Job Corps: The Corps provides skill training, academic and social 
education, and support services in a structured, residential setting to 
nearly 70,000 very disadvantaged youth a year at 118 centers.
   In 1999, about 75 percent of those who leave the program will 
          get jobs or pursue further education, while those beginning 
          work will start at an average hourly wage of $6.25.

  Employment Service/One-Stop Career Centers: The Employment Service 
provides a free labor exchange for all workers and job seekers, and is 
growing more and more effective by expanding its implementation of One-
Stop Career Centers.

[[Page 210]]

   In 1999, DOL will continue to expand the One-Stop Career 
          Center System to include 40 percent of all local employment 
          service and JTPA offices, compared to 16 percent in 1997, and 
          increase the number of employers listing jobs with the AJB 
          website by 20 percent over the 1997 level.

  School-to-Work: All States are implementing school-to-work systems, 
using the five-year Federal ``venture capital'' grants to devise new 
collaborations between schools and the private sector. In 1996, the 
program, which began in 1994, was serving one million youth and 23 
percent of schools.
   In 1999, 1.5 million youth will be actively engaged in 
          school-to-work activities, and 25 percent of high schools will 
          offer key school-to-work components.

Workplace Protections

  DOL regulates compliance with various laws that give workers certain 
workplace protections--a minimum wage for virtually all workers, 
prevailing wages and equal employment opportunity for workers on 
government contracts, overtime pay, restrictions on child labor, and 
time off for family illness or childbirth. In these areas, the Federal 
Government is working to increase industry's compliance with labor 
protections through voluntary compliance initiatives (coupled with 
continued strong enforcement), outreach to new and small business, and 
targeted enforcement in specific industries, with specific measurable 
goals.
   In 1999, compared to 1997, labor law compliance will increase 
          by five percentage points in such industries as domestic 
          garments in certain targeted cities, and in poultry 
          processing.

National Service

   The Corporation for National and Community Service supports programs 
providing service opportunities Nation-wide for Americans of all ages 
and backgrounds. Through Corporation-supported projects, over 1.5 
million participants work to address the Nation's unmet, critical needs. 
The Corporation organizes its programs into three streams of service, 
with various annual performance goals.

  AmeriCorps: AmeriCorps will engage 56,000 Americans of all ages and 
backgrounds in community service, and provide education awards in return 
for such service.
   In 1999, AmeriCorps VISTA members will generate cash and in-
          kind resources for their sponsoring organizations at a rate of 
          $2.50 for every $1 of Federal funds.

  Learn and Serve America: This program provides opportunities for one 
million students to improve their academic learning while participating 
in service-learning projects in schools, universities, and communities.
   In 1999, 200,000 high school and college students in Learn 
          and Serve projects will provide literacy tutoring to children 
          in grades K-3.

  National Senior Service Corps: The Corps, comprising over 500,000 
people age 55 and older, encourages seniors to use their experience, 
skills and talents while serving as Foster Grandparents, Senior 
Companions, and the Retired and Senior Volunteers.
   In 1999, the program will serve 150,000 special needs youth 
          and frail elderly.

Social Services

  Vocational Rehabilitation Services: The Vocational Rehabilitation 
program provides funds to States to help about 750,000 individuals with 
disabilities prepare for independent living or gainful employment each 
year. In 1997, the program helped to rehabilitate 217,500 individuals 
with disabilities. The program has not had consistent performance goals 
and measures of progress.
   In 1999, under proposed legislation, all States will develop 
          challenging State-specific goals based on a comprehensive 
          assessment of the vocational rehabilitation needs of 
          individuals with disabilities in the State, describe the 
          strategies it will use to address those needs, and report on 
          progress made towards those goals.

  Social Services Block Grant: The budget targets funding to programs 
that can better demonstrate positive performance. The Social Services 
Block Grant supports a broad range of social service programs, but 
without statutory performance goals or measures of prog

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ress. As a result, the budget reduces funding for this program in order 
to help provide funding for other higher priority programs with greater 
demonstrated outcomes, such as Head Start and child care.

Tax Incentives

  The Federal Government helps individuals, families, and employers (on 
behalf of their employees) plan for and buy education and training 
through numerous tax benefits, which will cost an estimated $57.3 
billion in 1999. Along with the new Hope and Lifetime Learning tax 
credits for college costs, the tax code provides other ways to pay for 
education and training. State and local governments, for instance, can 
issue tax-exempt debt to finance student loans or to build the 
facilities of non-profit educational institutions. Interest from certain 
U.S. Savings Bonds is tax-free if the bonds go solely to pay for 
education. Many employers provide employee benefits that do not count as 
income. Starting in 1998, many taxpayers can deduct the interest on 
student loans. Finally, the tax code gives employers a Work Opportunity 
Tax Credit and a Welfare-to-Work Tax Credit, letting them claim a tax 
credit for part of the wages they pay to certain hard-to-employ people 
who work for them for a minimum period.