[Senate Hearing 109-152]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 109-152
 
                    LIFELONG EDUCATION OPPORTUNITIES

=======================================================================

                                HEARING

                                 OF THE

          COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS

                          UNITED STATES SENATE

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                                   ON

  EXAMINING LIFELONG EDUCATION OPPORTUNITIES, FOCUSING ON S. 694, TO 
    AMEND THE WORKFORCE INVESTMENT ACT OF 1998 TO PROVIDE FOR A JOB 
                      TRAINING GRANT PILOT PROGRAM

                               __________

                             APRIL 14, 2005

                               __________

 Printed for the use of the Committee on Health, Education, Labor, and 
                                Pensions


                    U.S. GOVERNMENT PRINTING OFFICE
20-732                      WASHINGTON : 2005
_____________________________________________________________________________
For Sale by the Superintendent of Documents, U.S. Government Printing Office
Internet: bookstore.gpo.gov  Phone: toll free (866) 512-1800; (202) 512ï¿½091800  
Fax: (202) 512ï¿½092250 Mail: Stop SSOP, Washington, DC 20402ï¿½090001


          COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS

                   MICHAEL B. ENZI, Wyoming, Chairman

JUDD GREGG, New Hampshire            EDWARD M. KENNEDY, Massachusetts
WILLIAM H. FRIST, Tennessee          CHRISTOPHER J. DODD, Connecticut
LAMAR ALEXANDER, Tennessee           TOM HARKIN, Iowa
RICHARD BURR, North Carolina         BARBARA A. MIKULSKI, Maryland
JOHNNY ISAKSON, Georgia              JAMES M. JEFFORDS, Vermont
MIKE DeWINE, Ohio                    JEFF BINGAMAN, New Mexico
JOHN ENSIGN, Nevada                  PATTY MURRAY, Washington
ORRIN G. HATCH, Utah                 JACK REED, Rhode Island
JEFF SESSIONS, Alabama               HILLARY RODHAM CLINTON, New York
PAT ROBERTS, Kansas

               Katherine Brunett McGuire, Staff Director
      J. Michael Myers, Minority Staff Director and Chief Counsel


                            C O N T E N T S

                              ----------                              

                               STATEMENTS

                        THURSDAY, APRIL 14, 2005

                                                                   Page

Enzi, Hon. Michael B., Chairman, Committee on Health, Education, 
  Labor, and Pensions, opening statement.........................     1
Chao, Hon. Elaine L., Secretary of Labor, U.S. Department of 
  Labor..........................................................     4
    Prepared statement...........................................     5
Spellings, Hon. Margaret, Secretary of Education, U.S. Department 
  of 
  Education......................................................     9
    Prepared statement...........................................    13
Alexander, Hon. Lamar, a U.S. Senator from the State of Tennessee    19
Sebelius, Hon. Kathleen, Governor, State of Kansas; Chair, NGA 
  Education, Early Childhood and Workforce Committee, on behalf 
  of the National 
  Governors Association..........................................    26
    Prepared statement...........................................    28
Fletcher, Hon. Ernie, Governor, State of Kentucky, on behalf of 
  the National Governors Association.............................    42
    Prepared statement...........................................    44
Gunderson, Steve, Director, Washington Office, the Greystone 
  Group..........................................................    48
    Prepared statement...........................................    49
Fitzgerald, Brian K., Executive Director, The Business-Higher 
  Education Forum................................................    54
    Prepared statement...........................................    56
Boisvert, Ms. Pamela, Vice President, Worcester Consortium.......    59
    Prepared statement...........................................    61

                          Additional Material

Statements, articles, publications, letters, etc.:
    Response to questions of Senator DeWine by Margaret Spellings    75


                    LIFELONG EDUCATION OPPORTUNITIES

                              ----------                              


                        THURSDAY, APRIL 14, 2005

                      United States Senate,
       Committee on Health, Education, Labor, and Pensions,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:02 a.m., in 
room SD-430, Dirksen Senate Office Building, Senator Mike Enzi, 
(Chairman of the Committee), presiding.
    Present: Senators Enzi, Alexander, Burr, and Isakson.

                   Opening Statement of Chairman Enzi

    The Chairman. Good morning, and welcome to today's hearing 
on ``Lifelong Education Opportunities.''
    I am honored to have the Secretary of Education, Margaret 
Spellings, and the Secretary of Labor, Elaine Chao, here today 
to talk on an issue that is critical to our Nation's future. I 
am also pleased to have a second panel of five individuals who 
will extend our understanding of the impact of these issues in 
the States and in business and education.
    I am also pleased that in the audience we have 15 
legislators from Wyoming. I would guess that this is one of the 
few times that Wyoming will have a larger percentage of people 
than any State in the Nation.
    [Laughter.]
    We are very pleased to have them here. They are extremely 
interested in education and have an outstanding system.
    I would also like to thank the Governors and witnesses on 
the second panel for rearranging their schedules to be here. I 
had previously decided not to have a second panel so that we 
could fully utilize the time of the Secretaries. We decided to 
go longer at the insistence of Senator Roberts who wanted to be 
sure that his Governor could present some information on behalf 
of the National Governors Association that is absolutely 
critical to our work.
    Lifelong education opportunities are vital to ensuring that 
America retains its competitive edge in the global economy, and 
that every American can participate in our Nation's success. In 
our technology-driven economy, school can never be out. It is 
estimated that 60 percent of tomorrow's jobs will require 
skills that only 20 percent of today's workers possess. It is 
also estimated that the average person leaving college will 
change careers 14 times, and 10 of those have not even been 
invented yet. Without a lifetime of education, training and 
retraining opportunities for everyone, we will not be able to 
meet 21st century challenges. As new technology emerges and 
workers change careers, they will need to learn new skills or 
apply their old skills in new ways.
    Earlier this year, I introduced S. 9, the Lifelong 
Education Opportunities Act of 2005. It has four stated 
purposes: to set high expectations and raise achievement levels 
for all students regardless of their backgrounds; to improve 
accountability for results; to provide flexibility to the 
States to manage Federal program dollars effectively; and to 
support a lifetime of learning opportunities for students and 
adults at all stages of life.
    If our students and workers are to have the best chance to 
succeed in life, we need to focus on all our Federal education 
and training programs from pre-kindergarten through 
postsecondary education to on-the-job and continuing education, 
everything from birth to retirement. We must ensure that 
everyone has an opportunity to achieve academically and obtain 
skills that they need to succeed regardless of their 
background.
    On March 21st, I visited a classroom in Hudson, Wyoming. 
The town has 207 residents, and boasts of two world-famous 
restaurants. But its children are taught in a single classroom 
in an elementary school. There are 2 teachers and 17 children. 
There are 5 kindergartners, 5 first graders, 5 second graders 
and 2 third graders in one classroom. They have almost as many 
classroom pets as they have kids. But it is a learning 
environment that is critical to Wyoming.
    Most recently the Governors held an education summit that 
provided an action agenda for improving America's high schools. 
For years institutions of higher education and employers have 
expressed their dissatisfaction about the need our high school 
graduates have for remediation in order to do college work or 
to participate in the workforce. Each year, taxpayers pay an 
estimated $1 to $2 billion to provide remedial education to 
students at our public universities and community colleges. 
Businesses report spending even more to address the lack of 
literacy and basic skills of their entry-level workers.
    Let me share a few facts that speak to the seriousness of 
this issue.
    American 15-year-olds performed below international average 
in mathematics, literacy and problem-solving, according to the 
2003 Program for International Student Assessment.
    Reading proficiency among 12th graders has declined to the 
point where just over one-third of them are even considered 
proficient readers.
    Only 68 of every 100 ninth grade students graduate on time; 
in other words, within 4 years. America's high school 
graduation rate is among the lowest in the industrialized 
world, and the impact on our minority students has been 
especially severe.
    Nearly one-third of entering college freshmen need at least 
one remedial course.
    The United States has one of the highest college enrollment 
rates, but a college completion rate average to below average 
among developed countries in the world.
    In this decade 40 percent of job growth will be in jobs 
requiring postsecondary education, those jobs requiring 
associate degrees growing the fastest.
    Four out of every 5 jobs will require postsecondary 
education or the equivalent, yet only 52 percent of Americans 
over the age of 25 have achieved that level of education.
    Seventy-five percent of today's workforce will need to be 
retrained just to keep their current jobs.
    Median earnings of a high school graduate are 43 percent 
higher than those of a non-graduate, and those of a college 
graduate are 62 percent higher than those of a high school 
graduate.
    Two-thirds of the 7 million worker gap in 2010 will be a 
skilled worker shortage.
    What does this mean? What do we know? To begin with, we 
know that we must improve high school completion rates. 
Education beyond high school and lifelong learning 
opportunities are essential for everyone to assure individual 
success, as well as our Nation's future prosperity. We need to 
provide better preparation at every level of education and 
strengthen the connections between secondary and postsecondary 
education. In this global economy learning is never over and 
school is never out. Technology is demanding that everyone 
continue to learn and gain skills to remain competitive in the 
workplace. The labor force participation rate for individuals 
over the age of 16 who are willing and able to work was 68.8 
percent in January 2005, the lowest in over 15 years, as more 
Americans conclude that they cannot meet the skill demands of 
today's workplace and they choose to no longer participate in 
the workforce.
    For these reasons and many others, I am looking forward to 
the testimony of our witnesses today. We are facing a 
significant challenge, one that I prefer to think of as an 
opportunity.
    With most of our Federal policies that deal with training 
and the workforce needing reauthorization, we have an 
opportunity to provide the clear message that we can no longer 
accept the status quo or business as usual. We need to take a 
fresh look now at how we can restructure our education and 
training programs to better meet the needs of our economy, and 
at the same time ensure every person has the opportunity they 
need to obtain the academic and technical skills they need to 
succeed today, tomorrow and for years to come.
    Again, I welcome everyone. When Senator Kennedy gets here, 
we will give him an opportunity for a statement.
    I will introduce the first panel of witnesses, and we 
appreciate your being here, two representatives from the 
Administration to talk about lifelong education opportunities. 
None better than these two distinguished witnesses we have 
today, the Secretary of Labor, Elaine Chao, and the Secretary 
of Education, Margaret Spellings.
    Secretary Chao has been the Secretary of Labor since 2001. 
Previously she was the Deputy Secretary at the U.S. Department 
of Transportation, and was Chair of the Federal Maritime 
Commission. She has worked in the private sector, a fellow with 
the Heritage Foundation, and as a White House Fellow. She has 
been a strong advocate for fulfilling our Nation's technical 
and skilled training needs.
    Secretary Spellings was confirmed by the Senate on January 
20th this year, which was my first order of business as 
Chairman of this committee. She previously served as the 
Assistant to the President of Domestic Policy, where she helped 
craft the No Child Left Behind Act. She worked for 6 years as 
Governor Bush's Senior Adviser, developing and implementing the 
Governor's education policies. Like Secretary Chao, she has 
been a strong advocate for her areas of responsibility as 
evidenced by her involvement on the No Child Left Behind and 
other education issues.
    We welcome you both.
    Secretary Chao.

STATEMENT OF THE HON. ELAINE L. CHAO, SECRETARY OF LABOR, U.S. 
                      DEPARTMENT OF LABOR

    Secretary Chao. Thank you. Mr. Chairman and members of the 
committee, I am very pleased to have the opportunity to testify 
before you today with my distinguished colleague, Secretary of 
Education, Margaret Spellings.
    Mr. Chairman, you are absolutely right, America has always 
been a Nation of innovators, entrepreneurs and opportunity, and 
the engine of our growth in our country remains strong. The 
United States has one of the highest growth rates of any 
industrialized Nation, growing at an annualized rate of about 4 
percent in 2004 and creating about 3.1 million new jobs since 
June of 2003.
    But progress also means challenges, and therefore, we have 
just got to ensure that gains in our economy are indeed shared 
by all, and that is why it is really critical that workers have 
the opportunity to gain the skills that they need to succeed in 
the 21st century workforce.
    This Administration is addressing the core issues of 
skills, competency through the most significant education 
reform in 50 years, and I will leave that to my colleagues to 
address.
    Today, as you mentioned, a high school education is only 
the beginning. The average American worker will hold an average 
of 9 jobs before the age of 32. That means that learning has 
got to be a lifelong pursuit, and reforming our Nation's job 
training system is absolutely critical to providing workers 
with opportunities to continuously upgrade their skill levels.
    In many respects our current kind of stovepipe approach, 
our silo approach to workforce investment still reflects an 
economy of over 50 years ago. Today we have just got to do more 
than just simply fill job orders or slots in predetermined 
training classes. We have to improve the outcomes for workers 
by updating the design of the current system. We know that a 
workforce investment system with over a dozen different funding 
streams, each with its own separate rules and reports and 
definition is not very effective in meeting the individual 
needs of workers today.
    I am also sorry to say that the current system is 
structured so that it is too focused on bureaucracy and 
processes. It should really be much more worker-oriented, 
client-oriented, and be much more focused on better outcomes 
for the people that it serves.
    This Administration believes that the solution is a 
flexible integrated system, and the keys to success are: (1) 
strong State leadership; (2) effective execution at the local 
level; and (3) the ability to customize solutions to meet the 
needs of local communities, workers and also employers.
    That is why the President has put his job training reform 
proposal on the table. The principles underlying these reforms 
reflect a new vision and a new approach to the workforce 
investment system that is going to bring the system into the 
21st century and better serve our workers and our country.
    So the first principle is to give State and local 
communities maximum flexibility to custom design a workforce 
system that best meets their needs.
    And second, in exchange for this greater flexibility, the 
Administration will require greater accountability, and that 
means that we are going to ask States to set increasingly 
rigorous annual performance milestones, and the long-term goal 
to be achieved over a period of 10 years will be to place every 
person who receives federally-funded training in a job.
    Third, the multiple layers of bureaucracy that we are 
seeing in the system eats up just too much of its valuable and 
available resources, and people within the system acknowledge 
this as well, so this Administration proposes to spend more on 
actual worker training in the workforce investment system.
    Fourth, this Administration proposes to create a more 
effective governance structure by enhancing governance 
structure by enhancing the role of the State and local 
officials. The Workforce Investment System is currently 
administered with much, much, too much micro-management by the 
Federal level.
    Fifth, this Administration proposes to strengthen the One-
Stop Career Center System. You know, we have 3,800 One-Stop 
Career Centers throughout the whole country. They are a 
wonderful resource, and these centers are the foundations of 
the workforce investment system. But the funding for the 
operation of these One-Stop Centers is uncertain in many local 
areas, and we have to address that.
    Finally, this Administration proposes to enhance individual 
choice through what is called Innovation Training Accounts. 
These accounts will allow individual workers to custom make and 
create their own individual training program that fits and 
meets their needs, using again a broad array of public and 
private training resources.
    Mr. Chairman, this Administration believes that these 
reforms will really help transform the public workforce 
investment system into a worker-centered powerhouse that will 
help people succeed, workers succeed in the 21st century 
workforce. It is going to create a workforce investment system 
that is responsive to individual communities' workers. It will 
adapt quickly to local economic conditions, and most of all, it 
will do an even better job of serving workers.
    With that, thank you so much for having me here. I have a 
longer testimony which I will submit for the record, and I will 
be more than glad to answer any questions that you may have.
    [The prepared statement of Secretary Chao follows:]
               Prepared Statement of Hon. Elaine L. Chao
    Chairman Enzi and members of the committee, I am pleased to have 
the opportunity to testify before you today with my distinguished 
colleague, Secretary of Education, Margaret Spellings, and discuss the 
President's proposals to enhance the Nation's workforce investment 
system.
    Today, our country finds itself in a situation unlike any we have 
experienced in our history. Advances in the fields of communication, 
technology and travel have effectively removed national borders as 
barriers to global commerce. Competition now comes from the company 
across the ocean as well as the company across the street.
    The United States has been known as the leader in technological 
innovation. We invented computer operating systems, the Internet and 
the Global Positioning System. However, there are signs that we are 
facing more serious competitive challenges from new centers of 
innovation. For example:

     Foreign-owned companies and foreign-born individuals 
account for nearly half of all U.S. patents.
     In 2003, China overtook the United States as the world's 
leading destination for direct foreign investment.
     And today, Asian countries now spend as much on 
nanotechnology as the United States.

    To ensure that we remain the world leaders in the 21st century 
innovation economy, we must face these challenges. We must look at the 
systems and structures that support and feed our economy and ask if 
they are equipped to handle the demands of the global economy.
    Throughout history, the driving force of the American economy has 
been the ability to nurture new ideas that result in job creation and 
prosperity. In this generation, as in the past, American entrepreneurs 
and innovators have drawn on our well-educated workforce, our large and 
diverse economy, our technological capability and our financial 
sophistication to create the new industries and jobs that make America 
grow and prosper.
    The economy is healthy and growing, as evidenced by the 3.1 million 
new jobs that have been created since May 2003. As the economy grows, 
jobs emerge that demand higher skills than ever before. How can we get 
ready to meet the workforce needs of the future to ensure that we 
maintain our competitive advantage in the global economy?
    We maintain our competitive advantage by increasing the skill 
levels of Americans. The needs of the 21st century economy are very 
different than those we have encountered in the past. Today's changing 
workforce needs reflect the economy's significant transformation. 
Industries such as manufacturing and retail now need workers who 
understand computers and robotics and supply chain management. Fields 
such as health care and construction need more technical and skilled 
labor than ever before. Newer industries--for example, biotechnology 
and geospatial technology--have emerged, and others that are today just 
the gleam in the eye of some entrepreneur will soon emerge. The fastest 
growing jobs of the future will need to be filled by ``knowledge 
workers,'' who have specialized skills and training. In fact, the 
demand for knowledge workers is already growing at an astonishing pace.
    As the demand for workers with specialized skills and training 
grows, some economists fear that we are facing a ``skills gap,'' a 
situation in which the demand by employers for skilled workers would 
outpace the supply. We already have heard from companies that are 
having difficulty filling jobs with workers who have the skills they 
require. Fields like health care, information technology, and advanced 
manufacturing have jobs and solid career paths left untaken due to a 
lack of people qualified to fill them.
    The growing need for knowledge workers comes at a time when the 
labor pool as a whole is growing much more slowly as a result of the 
aging and retirement of the baby boom generation in combination with 
other demographic changes. In fact, given current retirement trends, 
combined with lower birth rates in recent years, the aging and 
retirement of the baby boom generation will likely result in labor 
shortages in some industries and geographic areas. Furthermore, 
employers are losing their most experienced workers just as labor force 
growth is slowing, with the result that shortages of workers with the 
right skills needed by employers could become common.
    In a knowledge-based economy like ours, a top priority for all of 
us must be to ensure that we have the skilled workforce we need to spur 
economic growth and productivity. The success of workers today depends 
on opportunities for a continuum of education and training. It starts 
with a solid foundation in math, science, and communication skills 
learned in school. Our children must have a solid foundation in the 
basics if they are to succeed in the 21st century workforce. The No 
Child Left Behind Act should help enormously, but more needs to be 
done, particularly at the high school level. President Bush has 
proposed an initiative to raise student achievement and narrow 
achievement gaps in our Nation's high schools, expanding on the success 
of the No Child Left Behind Act. We know that when schools and teachers 
are held accountable for results, the performance of their students 
improves. It is now time to extend this principle beyond grade schools 
to our Nation's high schools.
    Gaining a strong educational foundation in school is critical, but 
we also know that it takes more than a high school education to succeed 
in the new economy. In fact, the fastest growing jobs, on average, 
require a postsecondary credential, that is a vocational certificate or 
other credential or an associate or higher degree. These are the jobs 
that will drive innovation in the world economy and determine which 
countries will lead that economy. Competency in a single skill will no 
longer last a lifetime. Workers today must commit themselves to 
lifelong learning and to continually upgrading their skills. Our 
postsecondary education and training systems must provide them with 
opportunities to do so.
    Our postsecondary education and training institutions need to 
ensure they are providing students with relevant, marketable skills. We 
need a wide variety of choices to provide these skills--not only 2-year 
and 4-year degree programs, but apprenticeship programs in the skilled 
trades and other professions, and job training leading to an industry-
recognized credential or certification. Additional support for lifelong 
learning will be available through the President's proposals to 
strengthen the Pell grant program and a new Loans for Short-Term 
Training program, which the Departments of Education and Labor would 
jointly administer and which would help dislocated, unemployed, 
transitioning, and older workers, among others, obtain the skills 
needed to succeed in our knowledge-based economy.
    The private sector makes an enormous investment both in training 
new workers as well as keeping current the skills of those already on 
the job. The investment of the private sector in employee education and 
training reflects its understanding that the investments made in 
improving the skills of the workforce translate into a competitive 
advantage for the Nation.
    The workforce investment system also plays an important role in 
preparing a skilled workforce. The Workforce Investment Act of 1998 
(WIA) was groundbreaking legislation that promoted important 
improvements in the delivery of employment and training services 
nationwide through its One-Stop delivery system. Now our challenge is 
to take those reforms a significant step further to promote further 
innovation, to strengthen the One-Stop Career Center system to better 
serve workers and businesses, and to make the system even more 
responsive to the needs of local labor markets.
    In many respects, our current ``stovepipe'' approach to workforce 
investment is still reflective of its social program roots of 50 years 
ago, but today's economy requires more than simply filling job orders. 
Like the education system, the workforce investment system must 
continuously adapt to the changing economy.
    Many of the problems in the current system lie with the design of 
the system itself. We know that a workforce investment system with over 
a dozen different funding streams, each with separate rules, reports, 
and definitions cannot be effective in meeting the demands of the 
worldwide economy. Such a system will always be focused on the barriers 
to workforce solutions rather than the solutions themselves. And, such 
a system will always be more concerned about how much each program 
funding stream is contributing and who is serving what group of the 
population, than about solving the Nation's workforce challenges. 
Employers will never participate fully, or enthusiastically, in such a 
system.
    So what is the solution? It is a flexible, integrated system with 
strong State leadership and effective local execution and 
customization. It is a system where States can move resources to 
address regional needs and local officials can work with employers to 
preserve jobs. Finally, it is a system with the leadership and vision 
to act as a catalyst for economic development.
    Although we often speak of the American economy as a whole, the 
Nation is made up of local labor markets that are unique. The local 
economy in New York City looks quite different than that of a rural 
area in Tennessee. We must design a flexible workforce investment 
system that empowers State and local officials to create workforce 
solutions customized to that area's workers and employers. We must make 
certain that outstanding plans for innovative strategies are not 
thwarted by the maze of conflicting funding streams, program 
eligibility requirements, reporting systems and performance measures.
    This approach to workforce investment is at the heart of the 
President's High Growth Job Training Initiative, launched by the 
Department of Labor in 2002. The High Growth Job Training Initiative 
identifies high-growth businesses and industries, evaluates their skill 
needs, and ensures that workers are being trained with the skills these 
rapidly expanding businesses require. Under this initiative, the 
Department has awarded $164.8 million in 88 grants for innovative 
training programs in high growth industries such as health care, 
biotechnology, energy, information technology, and advanced 
manufacturing. Grants are given to partnerships that include the 
workforce investment system, business and industry, community colleges 
and other education and training providers, and economic development 
entities working collaboratively to develop industry-specific workforce 
solutions. The results, products, and knowledge gained from these 
demonstration projects are disseminated widely to the workforce system 
and our strategic partners in business, industry, and education. By 
training workers with skills that are in demand, more workers will be 
able to obtain quality jobs with higher wages and enhanced career 
opportunities. At the same time, employers will be able to fill 
critical workforce needs.
    The President's Community College Initiative, which provides for 
Community-Based Job Training Grants, builds on the High Growth Job 
Training initiative. Through these competitive grants, the workforce 
investment system will partner with community colleges to provide an 
innovative approach to workforce investment that responds to the 
changing 21st century economy. For fiscal year 2005, the Congress 
approved and financed this new initiative, and the first grants will be 
awarded beginning in the summer of 2005. This Community College 
Initiative will help fully utilize the expertise of America's community 
colleges to better train workers for jobs in high growth sectors in 
local communities.
    The flexibility, partnerships, and demand-driven focus of these 
initiatives are also at the heart of President Bush's proposal for 
comprehensive reform of our Nation's job training system. The 
principles underlying these reforms reflect a new vision and new 
approach to workforce investment that will bring the system into the 
21st century.
    First, we must give States and local communities maximum 
flexibility and authority to design a workforce system that meets their 
needs. The centerpiece of the President's proposal for job training 
reform is the consolidation of the WIA Adult, Dislocated Worker, and 
Youth and the Employment Service funding streams into a single grant to 
States. Governors would have the option of including the State's 
resources from an additional five programs into that single grant. 
These programs are the Veterans' Employment and the Trade Adjustment 
Assistance training programs, administered by the Department of Labor; 
the Vocational Rehabilitation and the Adult Education programs, 
administered by the Department of Education; and the Food Stamp 
Employment and Training program, administered by the Department of 
Agriculture. Together, they represent over $7.5 billion in Federal 
resources. The consolidated grant would have a single State Integration 
Plan and a single performance and reporting system, thereby simplifying 
planning and reporting requirements. While program-specific 
requirements will be minimized, States will not be permitted to reduce 
participant levels for targeted populations such as veterans and 
individuals with disabilities.
    One practical indicator of the need for reform and greater 
flexibility of which I have been aware is in the overwhelming number of 
requests for WIA waiver authority. Forty-one States have requested 162 
waivers to create a workforce investment system that is responsive to 
the needs of their economies. Under current law, in order for States to 
implement a workforce training program that better meets the needs of 
their citizens, they have to ask the Federal Government for permission, 
through the waiver process. That is not an effective strategy for 
remaining relevant in the new economy. The consolidation of Federal job 
training programs will remedy this. It will also empower States to 
train more workers, reduce administrative overhead, achieve better 
results, and design workforce investment systems that train workers for 
jobs in the 21st century economy.
    Accountability is a second principle of the President's job 
training reform proposal. In exchange for greater flexibility for 
States and local officials, we will demand greater accountability. The 
performance measures that were begun under WIA will be simplified and 
improved and the incentives and sanctions will be strengthened. States 
will be held accountable for performance on three primary outcome 
measures--entered employment, retention in employment, and earnings 
gains. States will set increasingly rigorous annual performance 
milestones towards the goal of, within 10 years, placing every person 
who receives federally-funded training in a job. This is an ambitious 
goal, but it also reflects what the workforce investment system should 
aspire to--that all workers receive the job training and other services 
that they need to find and retain a job.
    Third, the overhead costs of the system must be reduced. Layers of 
bureaucracy and regulatory loopholes have resulted in a system that 
focuses too much money on infrastructure overhead, and trains too few 
workers. We need to more accurately define what are acceptable 
administrative costs, and put a greater emphasis on training. By 
eliminating unnecessary overhead and simplifying administration through 
the consolidation of job training programs, we can achieve $300 million 
in savings that can be used to train an additional 100,000 workers.
    Fourth, we must create a more effective governance structure by 
enhancing the role of State and local officials. The workforce 
investment system is currently administered with too much micro-
management at the Federal level. What looks good on paper in 
Washington, DC, does not always play out well in the communities across 
the country.
    One key reform in this area is streamlining the membership 
requirements of State and Local Workforce Investment Boards. One-Stop 
partner programs would assume a stronger role on the State Board to 
ensure their investment in and commitment to an integrated system. 
Local Board membership would be streamlined to provide an increased 
voice for business representatives, community groups and worker 
advocates. These changes will create State and Local Boards that are 
able to more effectively make the policy and planning decisions that 
shape the Nation's workforce investment system.
    Fifth, we must take steps to strengthen the One-Stop Career Center 
System. The One-Stop Career Centers are the foundation of the workforce 
investment system, but the funding for the operation of those centers 
is uncertain in many local areas. Dedicated One-Stop infrastructure 
funding from the One-Stop partners determined at the State level would 
alleviate a great deal of the current local negotiation issues around 
operations and allow local areas to focus on what is most important--
meeting the service needs of workers and employers.
    Also, the One-Stop system must be able to provide all the services 
that individuals need to find jobs and upgrade their skills, and to 
serve all populations, including those with the greatest barriers to 
employment. One-Stop Career Centers should be authorized to offer a 
wider range of services for low-wage workers and directed to remove 
barriers to serving targeted populations, including older workers and 
individuals with disabilities. In addition, we must remove the 
obstacles to serving incumbent workers, as the 21st century economy 
requires American workers to continually upgrade their skills.
    Finally, individual choice should be enhanced in the workforce 
investment system through the use of Innovation Training Accounts. 
These accounts will allow individuals to combine a broad range of 
public and private training resources through a single, self-managed 
account. Individuals will be able to choose the training that best 
meets their needs, including longer-term training that is necessary for 
today's high skilled jobs. Innovation Training Accounts provide workers 
with ownership over the education and training they pursue, so that 
they can take advantage of the opportunities that the 21st century 
economy has to offer.
    Another important vehicle for providing individual choice for 
American workers is Personal Reemployment Accounts (PRAs). PRAs are a 
flexible approach to provide unemployed job seekers with more control 
over their access to training and services and help them return to work 
quickly. The Department of Labor is currently administering PRAs on a 
small scale through a demonstration project in seven States and 
proposes that this be a service option in WIA when it is reauthorized. 
PRAs provide unemployed individuals with up to $3,000 to purchase 
intensive career, job training and supportive services from One-Stop 
Career Centers, the marketplace, or a combination of the two. Workers 
who find new jobs quickly and retain those jobs for 6 months will 
receive a reemployment bonus.
    These key reforms will produce a workforce investment system that 
is responsive and agile enough to anticipate and respond to the 
opportunities presented by the 21st century economy, thereby promoting 
the success of both American workers and businesses. Thank you for this 
opportunity to discuss with you the President's proposal for 
reauthorization of the Workforce Investment Act of 1998. I would be 
happy to respond to any questions that members of the committee may 
have.

    The Chairman. Any statements that members of the committee 
have and the full statements of all people who testify will be 
a part of the record.
    I appreciate your condensing that so that we have more time 
for the questions and the other panel, and appreciate your 
testimony.
    Secretary Spellings.
    I do not think your microphone is on.

 STATEMENT OF HON. MARGARET SPELLINGS, SECRETARY OF EDUCATION, 
                  U.S. DEPARTMENT OF EDUCATION

    Secretary Spellings. I am new.
    [Laughter.]
    Thank you very much for your interest in this very 
important topic. I am delighted to be here with my colleague, 
Secretary Chao, whom I have worked with on this issue for more 
than 4 years, and to great effect, and I am really happy to be 
in this role and partnering with her from a new vantage point 
as well.
    As Secretary Chao pointed out, we live in a very different 
world today than the one our parents and grandparents knew. In 
that world a single occupation could last a lifetime from 
graduation day to retirement, a single skill could ensure a 
worker a comfortable living for his or her family. Today, 
guarantees of stability and security are fewer, but 
opportunities are far more numerous if we are prepared to seize 
them.
    The question is: are we prepared? Are our children 
receiving a quality education? Do young adults have the skills 
they need to succeed in this world?
    To answer these questions we must first look in the mirror. 
In Texas we say: ``If all you ever do is all you've ever done, 
then all you'll ever get is all you've ever got.''
    [Laughter.]
    And we have to change that system, along with that old 
adage. The old Government model of top-down structures, process 
over results, multiple funding streams with limited 
flexibility, is simply not adequate for this time. We need to 
have the courage to change the way we do business. This change 
starts with public education and preparedness. No Government 
program available at age 20 can make up for a poor education 
from ages 5 to 18.
    A little over 3 years ago, Congress joined President Bush 
to tackle the educational status quo, and the result was the No 
Child Left Behind Act. Its focus on accountability, high 
standards, local control and research-based instruction is 
showing real results. Nearly every State now reports improved 
academic performance, and students at greatest risk of being 
left behind, such as those in large urban school districts, are 
leading the way.
    The President's 2006 budget provides a $603 million 
increase for core Title I grants to local educational agencies 
to keep this progress going strong, and now we must take the 
next step.
    Earlier this year, Bill Gates told the Nation's Governors 
that training the workforce of tomorrow with the high schools 
of today is like trying to teach kids about today's computers 
on a 50-year-old mainframe. That may have been an exaggeration, 
but not by much. The old high school model is not serving us as 
well as it can or should. Forty percent of schools offer no 
advanced placement courses. Fewer than half of the students 
require at least 3 years of math or science to graduate, fewer 
than half the States. And we still measure performance by the 
amount of time students sit in classrooms, not by what they 
know and are able to do.
    So it comes as no shock that nearly one-third of incoming 
9th graders do not make it to graduation day within 4 years, as 
you pointed out, Senator Enzi, or that those who do, less than 
one-third are fully prepared for college, according to the 
Manhattan Institute, or that our college dropout rate is 6 
times higher than Japan's.
    I believe Governor Mark Warner, with whom I traveled a few 
weeks ago, the Democratic Chair of the National Governors 
Association, speaks for all of us when he says, ``It is 
imperative that we make reform of the American high school a 
national priority.'' I believe it is time to apply the 
bipartisan principles of No Child Left Behind to grades 9 
through 12.
    President Bush's 2006 budget would provide $1.5 billion for 
a high school initiative to improve the academic achievement of 
at-risk students and measure performance annually to ensure all 
students get the help they need.
    The budget also contains unprecedented financial support 
for students taking advanced placement classes, new enhanced 
Pell grants to encourage more challenging course work, and 
community college access grants to let students earn college 
level credit in high school for both academic and technical 
courses.
    The key to success, of course, is a highly qualified 
teacher in every classroom, and the President's budget would 
make permanent the increase on loan forgiveness from $5,000 to 
$17,500 for highly qualified math, science and special 
education teachers serving low-income communities, as you have 
done in your legislation, Senator. And the President's Adjunct 
Teaching Program will bring outside professionals with the kind 
of expertise we need into the classroom, answering the 
question, why not have a NASA scientist teach physics in our 
public schools?
    This attitude of change extends to higher education. The 
President, as you know, is seeking the reauthorization of the 
Higher Education Act, but we want to improve it as well. For 
the first time, Pell grants would be made available year round 
to allow students to learn on their own timetable, and the 
maximum award would be increased by $100 each of the next 5 
years. An estimated 5\1/2\ million students would benefit.
    Our Jobs for the 21st Century Initiative will help 
community colleges identify and meet the needs of local job 
providers. It is a bold partnership between the Department of 
Education and the Department of Labor. As a former Austin 
Community College employee myself, I know how hard these 
institutions work to be responsive to their diverse students 
and to the community they serve. Portland Community College's 
Gateway to College Program, for instance, helps former dropouts 
earn a high school diploma, then continue on to a certificate 
or a degree program in their academic or technical field. They 
understand that you do not have to have a 4-year bachelor's or 
master's degree to enjoy a successful career and life.
    Finally, our reform of the Perkins Vocational Program will 
ensure that the people it was designed to help have the 
rigorous background in math and science, as well as the 
technical skills to succeed in the modern workplace.
    The data that we know and the fact that you have just heard 
tell us that the status quo is not working. As President Bush 
has said, if we do not adjust quickly and if we do not do smart 
things with the taxpayers' money we are going to have a 
shortage of skilled workers, and we are no longer going to be 
on the leading edge of change. In other words, we cannot pour 
new funds into old Federal models. We need to anticipate needs 
and take steps to meet them.
    One of the best ways is through technology. As part of our 
Adult Education National Plan, we are establishing a web-based 
system to inform adults of programs and activities that help 
them learn English and math, and will offer access to software 
so that they can learn these skills from any computer at any 
time.
    Technology is changing the world faster than our 
imagination can predict. Our high schools may be different 
places a decade or two from now. The old regimented factory-
type model based on time spent in classrooms may give way to a 
new competency-based model that measures progress according to 
what kids have learned, not the date on the calendar. Such a 
model would take full advantage of community resources, private 
sector initiatives and the advanced interactive technologies 
kids and teachers use at home and at school.
    We already see it in the movement to create digital high 
schools and the explosive growth of distance learning. It is a 
smarter, faster and more student-centric model of learning. I 
compare it to tax season, which we are all thinking about right 
now. In the past you would see lines of cars stretching to the 
post office at midnight on April 15th. That was the old model. 
Now sophisticated computer programs and electronic filing allow 
us to get the job done faster and better.
    I have traveled to elementary and secondary schools across 
the country from Ohio to California, and closer to home in 
Annapolis and Richmond. I have spoken with parents, teachers, 
principals and administrators, and I have not heard many 
questions about specific Federal programs. I have heard 
questions about how well we are preparing young adults to 
succeed in higher education and the workforce. They understand, 
as you said, that we live in a world in which 80 percent of the 
fastest-growing jobs will require a postsecondary education. 
Reform cannot wait.
    According to the President's Council of Advisers on Science 
and Technology, our students lose interest in math and science 
the further they advance through the educational system. 
Meanwhile, Craig Barrett, CEO of Intel, reports that China and 
India are expanding their university level math, science and 
engineering programs at a pace comparable to the United States 
after World War II. He adds, ``If the world's best engineers 
are produced in India or Singapore, that is where our companies 
will go.''
    In 2001, India graduated nearly 1 million more students 
from college than the United States. China has 6 times as many 
graduates majoring in engineering. Both are now members of the 
World Trade Organization. If only 10 percent of their 
population is well educated, that means 230 million new 
competitors. Clearly, we are no longer the only economic kid on 
the block.
    This is a time of change and opportunity, but we can take 
advantage only if we change as well. We must stop being 
captives of the past and start thinking like competitors and 
consumers. President Bush's proposals will help create a 
seamless educational continuum from K-12 through college and 
beyond, to serve young students and adults seeking to adapt to 
the ever-changing economy.
    All Americans need a strong foundation of academic skills 
in order to fulfill their roles as workers, parents and 
citizens. We look forward to working with you and the committee 
and the rest of the Congress to help make that happen.
    I would be glad to answer any questions you might have, and 
I thank you very much.
    [The prepared statement of Secretary Spellings follows:]

             Prepared Statement of Hon. Margaret Spellings

    Mr. Chairman and members of the committee, thank you for this 
opportunity to testify on the importance of lifelong learning, an 
approach to education that I believe has become increasingly critical 
for both individual and national success in our ever-changing, 
technology-based, globally competitive economy.
    Little more than a generation ago, a single skill or occupation 
could last a lifetime, comfortably supporting a worker through young 
adulthood, the family years, a college education for the children, and 
on into retirement. Things are different today, and more than any 
particular skill or body of knowledge, education must be about learning 
to learn, about gaining the skills to learn and adapt throughout a 
lifetime of change. Our schools and colleges, and the kinds of programs 
and services they provide, must reflect changes not only in the skills 
and knowledge that students need to obtain, but in the new ways in 
which today's and tomorrow's students are going to learn. This is what 
we are trying to encourage at the Department of Education, leveraging a 
relatively small Federal investment into creating a new kind of 
education system, one based on accountability, choice, and a continuum 
of opportunity stretching from early childhood to middle age and 
beyond.

            READING: THE PREREQUISITE FOR LIFELONG LEARNING

    No Child Left Behind has been President Bush's signature education 
reform initiative. It incorporates what I believe should be the core 
elements of any system of lifelong learning: expanded student and 
parental options and choice, a focus on what works rather than on what 
is the latest fad, clear accountability for results, and freedom for 
educators to use Federal funds for the programs and activities they 
believe are needed in their local schools, rather than on how people in 
Washington decide they should spend the money.
    Better instruction in reading is at the heart of No Child Left 
Behind. The President recognized long before he came to Washington--
with a little help from his wife, Laura--that reading was the place to 
start if we truly want to ensure that no American--child, teenager, or 
adult--is left behind by our education system.
    Thanks to programs like Reading First, which draws on scientific 
research to help ensure that all children can read well by the end of 
the 3rd grade, we are making progress in improving reading skills. But 
we have a long way to go. According to the National Assessment of 
Educational Progress, more than one-third of all 4th graders continued 
to read below the basic level in 2003, while more than half of African-
American and Hispanic students fell below that level.
    By 8th grade, reading scores on the NAEP are better, with three-
quarters of all students at or above the basic level, but nearly half 
of African-American and Hispanic students continue to read below the 
basic level. These numbers really hurt, because by the end of 8th 
grade, students tend to find themselves at a crossroads, with one path 
leading to high school graduation and postsecondary education, and the 
other path--far too often--leading to growing frustration with school 
and ultimately to dropping out altogether. I don't think I have to 
remind the members of this committee what this latter path means for 
both lifelong learning and lifelong earnings.
    In light of the NAEP data, it also should come as no surprise that 
a great many of those students who do graduate from high school need 
remedial classes in reading at the postsecondary level. For example, a 
recent RAND study noted that almost half of the students in the 
California State University system--which typically enrolls students 
graduating in the top third of their high school class--require 
remediation in English. And, of course, students who are unprepared for 
college-level work tend to graduate at lower rates than those who are 
prepared.
    The message here is that it's very hard to overestimate the impact 
of reading skills--or the lack of those skills--on lifelong learning 
opportunities. That's why improving reading skills has been such a 
critical part of all of our major education initiatives, and why I hope 
the strong connection between reading and lifelong learning will be a 
key principle that members take away from this hearing.

             THE STRONG FOUNDATION OF NO CHILD LEFT BEHIND

    No Child Left Behind remains the linchpin of our educational 
improvement strategy, and the key foundation for ensuring that all 
Americans are prepared to take full advantage of lifelong learning 
opportunities. The law emphasizes the early grades; demands that all 
students, regardless of background, are on grade level in core academic 
subjects like reading, mathematics, and science; insists on annual 
testing to help parents, principals, and teachers identify weaknesses 
in time to do something about them; and ultimately will ensure that all 
students are proficient in reading and math and thus prepared for 
further education and training throughout their lives.
    And we believe the law is beginning to work as intended. States and 
school districts are reporting high scores, achievement gaps are 
narrowing, more schools are making adequate yearly progress, and 
districts are focusing as never before on improvement strategies 
involving groups of students previously ignored and left behind. And 
when schools do not improve, students and their parents have new 
options, including transferring to a better-performing school or 
obtaining high-quality supplemental educational services.
    I think we are justifiably proud of the work we are doing and the 
results we are getting as we continue to implement No Child Left Behind 
in concert with our State and local partners. And we plan to stay the 
course, as reflected in the President's request of a $603 million 
increase for the core Title I Grants to Local Educational Agencies 
program for fiscal year 2006.

                       A NEW FOCUS ON HIGH SCHOOL

    At the same time, we recognize that change takes time, and while we 
are seeing progress in the early grades, our high schools are 
continuing to leave far too many students behind. This is clear from 
the high school graduation rate. According to one source, only 68 out 
of every 100 ninth-graders in public schools graduate on time with a 
regular high school diploma. American companies and universities 
currently spend an estimated $16 billion on remedial education 
annually.
    To a great extent, these data reflect the fact that high schools 
are too often doing the same thing that they have done for the last 
century. They are not, for instance, harnessing new technologies 
effectively to deliver instruction. Nor are they taking advantage of 
new ways to bring the highest-quality teachers, such as professionals 
who have up-to-date knowledge and experience, into our classrooms.
    In response, President Bush has proposed a $1.5 billion High School 
Initiative aimed at giving States, districts, and principals more 
flexible, effective tools for improving high schools than they have 
under the existing array of uncoordinated, narrow-purpose programs that 
the initiative would replace.
    The Initiative includes two major components. The first is a High 
School Intervention program, which would give States, school districts, 
and schools the flexibility to support a wide range of locally 
determined reforms aimed at increasing student achievement, eliminating 
achievement gaps, and ensuring that every student graduates with a 
meaningful high school diploma. Schools would implement targeted 
interventions designed to meet the specific needs of at-risk students, 
which would be determined by individual performance plans based on 8th-
grade assessment data and student interests. Interventions could 
include dropout prevention, integration of rigorous academic courses 
with vocational and technical training, and efforts to increase college 
awareness and preparation. They would focus, in particular, on the 
students who are most at risk of dropping out or leaving school without 
the skills and knowledge necessary for further education or employment.
    The President also is asking for $250 million for new High School 
Assessments to increase accountability for high school achievement and 
give principals and teachers new tools and data to guide instruction 
and improve student performance.
    In addition to the High School Initiative, our 2006 budget request 
contains a set of complementary proposals targeting secondary 
education. These include a $175 million expansion of the new Striving 
Readers program to improve the skills of teenage students who are 
reading below grade level, a $120 million Secondary Education 
Mathematics Initiative to train teachers to raise mathematics 
achievement for at-risk high school students, and funding to expand 
support for the Advanced Placement and State Scholars programs, which 
help strengthen high school curricula.

                    EASING THE TRANSITION TO COLLEGE

    Both the State Scholars and Advanced Placement (AP) proposals 
reinforce the idea of education as a continuum: our Enhanced Pell 
Grants for the State Scholars program would reward students for taking 
a rigorous high school curriculum by helping them pay for college, 
while increasing the availability of AP courses would make it possible 
for high school students not only to study and master college-level 
material, but also to get college credit for their efforts.
    Similarly, our new Community College Access Grants program would 
provide $125 million to support dual-enrollment programs under which 
high school students would earn both high school and postsecondary 
credit for taking college-level courses. The program also would 
encourage States to facilitate the transfer of community college 
credits to 4-year institutions.
    Each of these programs helps to ease the transition from high 
school to postsecondary education and training, both academically and 
financially. Our colleges, just like our elementary and secondary 
schools, need to meet the changing needs of their customers, the 
students. These days, many students do not fit the traditional mold of 
those who enter a 2- or 4-year college immediately out of high school 
and then work full-time toward a degree. They are, instead, folks who 
are already in the workforce. Many of them cannot take time off from 
work, and they need new ways of obtaining a higher education that fit 
in with all the demands on their time. Higher education programs that 
make effective use of technology are one way of doing that. We need to 
be taking a much closer look at these innovations as we move into the 
future.

                  PAYING FOR COLLEGE AND JOB TRAINING

    The high cost of college and other postsecondary education and 
training continues to be an obstacle to lifelong learning for many 
students, particularly for those from low-income families. Indeed, for 
too many secondary school students, doubts about their ability to pay 
for postsecondary education can be a strong disincentive to even bother 
staying in school and obtaining a high school diploma.
    This is why President Bush has placed such a high priority on 
strengthening the Pell grant program, which helps students from low-
income families pay for postsecondary education and training. The 
President's 2006 budget proposal would raise the maximum Pell grant 
award by $500 over the next 5 years, from $4,050 to $4,550, while 
restoring the financial stability of the program by eliminating the 
cumulative Pell grant funding shortfall. For new students who have 
completed a rigorous high school program of study, our enhanced Pell 
grants proposal would result in eligible students receiving an 
additional $1,000. Thus, a low-income student could qualify for a total 
of $5,050 next year and $5,150 for his or her second year in college.
    The President's proposal also would allow students attending 2- and 
4-year degree-granting institutions to receive more than one Pell grant 
in the same year, giving them more convenient and flexible options for 
completing their course requirements and obtaining their degrees.
    In order to fund the extraordinary new investment the President has 
proposed for the Pell grant program, over $19 billion over the next 10 
years, we had to take a hard look at the current student loan programs 
and identify savings. Our student loan reauthorization proposals 
include strategic reductions in subsidies to financial participants in 
the Federal Family Education Loan (FFEL) program that fully pay for our 
Pell grant enhancements and for improvements in the loan programs, 
including higher loan limits for first- and second-year students, 
better repayment terms for all students, and expanded opportunities for 
distance education.
    In addition, we are proposing a new program of Short-Term Training 
Loans, which, in fiscal year 2006, would support up to $284 million in 
loans to an estimated 377,000 students, including dislocated, 
unemployed, transitioning, or older workers. This program, which would 
be administered jointly with the Department of Labor, would help 
workers and students acquire or upgrade job-related skills through 
short-term training programs that currently are ineligible for Federal 
student assistance.

                   WORKFORCE INVESTMENT ACT PROGRAMS

    A major piece of business currently before this committee is the 
reauthorization of the Workforce Investment Act of 1998. The Department 
of Education administers programs covered by WIA in two important 
areas, Adult Education and Vocational Rehabilitation. The 
Administration fully supports the enactment of a WIA reauthorization 
bill that improves the quality, accessibility, and accountability of 
federally-funded Adult Education programs and that continues our 
Vocational Rehabilitation programs.
    The Department's Adult Education program and our reauthorization 
blueprint for that program are critical to any lifelong learning 
strategy because, while we believe the No Child Left Behind Act and our 
high school initiative will result in a much better education for 
current and future generations of school children, many current adults 
are out of school and lack the academic skills they need to succeed in 
the workforce. Some are immigrants who seek English language 
instruction in order to advance in their jobs and adapt successfully to 
life in America. States have reported improved results in Adult 
Education in recent years, but outcomes overall remain unacceptably 
low. For this reason, the Administration's blueprint for the 
reauthorization sets higher expectations for State performance and 
insists on greater State and local accountability for results, 
including consequences for States that do not meet their agreed-on 
adult education performance levels. Our proposal also promotes the 
development of State standards and curriculum frameworks to help 
instructors become more effective in the classroom. And, in order to 
give adult learners a broader array of choices, we would expand the 
number of workplace literacy programs, improve the capacity of 
community- and faith-based organizations to provide adult education, 
and promote greater use of technology to deliver services.
    In the case of the Vocational Rehabilitation programs authorized 
under the Rehabilitation Act, our focus is on improving employment 
outcomes for individuals with disabilities, particularly those with the 
most significant disabilities. While many individuals with disabilities 
are obtaining jobs and remaining employed, the unemployment rate for 
people with disabilities is still unacceptably high. Not only are 
people with disabilities much less likely to be employed than people 
without disabilities, but the more severe the disability, the less 
likely a person is to be employed. Moreover, there is wide variation 
among the States on performance, measured against the evaluation 
standards and indicators used by the Department in monitoring the 
States. Better tools are needed by the Department to strengthen 
accountability for improved results. Finally, an important component of 
the President's proposal for WIA reauthorization is the WIA Plus 
Consolidated State Grant (WIA Plus) program. In addition to the base 
consolidation of four Department of Labor programs, this proposal 
provides Governors with the option to consolidate up to five additional 
Federal employment and training funding streams, including Adult 
Education and Vocational Rehabilitation. Through increased flexibility 
and accountability, this proposal would: improve the employment 
outcomes of individuals served through the consolidated program; serve 
more individuals; improve access to a full array of educational and job 
training, employment, and supportive services available from all 
funding streams; and ensure a connection to a workforce investment 
system that is directly linked to and accessed by employers.

                               CONCLUSION

    Lifelong learning is no longer an option, but a necessity, both for 
individual success and for our continued national economic prosperity. 
President Bush, with the help of the Congress, has laid the foundation 
for a comprehensive Federal approach to both preparing our citizens for 
a lifetime of learning and encouraging our education system to 
continuously make available opportunities for education and training, 
from early childhood through middle age and even the retirement years. 
We look forward to working with the members of this committee to help 
build on that foundation.
    Thank you, and I will be happy to take any questions you may have.

    The Chairman. Thank you for your testimony.
    I appreciate all of your help, especially both of you with 
the longer testimony which helps to build the record from which 
we do the work that we do.
    I would mention that Senator Kennedy is not here because he 
is helping with the Armed Services hearing and providing a 
quorum for the Judiciary Executive Meeting, which means we are 
moving some people through as judges, and we are glad he is 
providing a quorum for that. The same applies to Senator 
Sessions. And Senator Roberts is involved with an Intelligence 
Committee situation, not a crisis, I am always supposed to 
emphasize that.
    [Laughter.]
    Of course, one of the signs of how many people show up is 
how contentious the hearing is, and this is one that we are 
working on in a very bipartisan way and making great progress 
in all of the bills that are before us. I do appreciate the 
bipartisan way that everybody is working. It shows that it is a 
concern for what happens with the kids and adults out there 
that will be affected by these programs, and it is important 
that we get them reauthorized in a timely manner so that we can 
move on to some of the other things that we have to 
reauthorize. I think we have about $68 billion worth of 
reauthorizations that are supposed to be done by the end of 
September. I think we only got two or three done during the 
last 2 years, so the other 38 will be quite a challenge for us.
    I would ask both of you if you would discuss the 
initiatives within your department that we might learn from as 
we work on the reauthorizations of the Workforce Investment 
Act, the Higher Education Act, Head Start, Perkins Career and 
Technical Education Act. How can we coordinate the provisions 
in these various acts to make sure that we provide 
opportunities for all Americans to have skills for the 21st 
century? How can the Department of Labor and the Department of 
Education work together to better prepare the workforce for the 
new economy?
    Secretary Chao.
    Secretary Chao. Thank you, Mr. Chairman. As Secretary 
Spellings mentioned, she and I have personally worked on a 
number of issues and initiatives within the workforce while she 
was at the White House, and we continue that collaborative 
effort going forward. Our two departments also work closely 
with one another.
    Most recently the Department of Labor has implemented the 
President's High Growth Job Training Initiative. This 
initiative is very important because it is providing national 
leadership for a demand-driven workforce system that ensures 
that no worker is left behind, and it prepares workers for the 
higher skill, higher wage jobs in the 21st century economy.
    Also across the country we are supporting efforts, 
partnerships with community colleges, employers and the public 
workforce system to train workers with the skills that they 
need that we have all heard about just in the recent testimony.
    And the community-based job training initiatives also 
continue the work of the President's High Growth Job Training 
initiative, by again, incorporating through these two 
initiatives a focus on high growth, high demand industries, and 
also the emphasis on partnerships with the Workforce Investment 
System.
    Secretary Spellings. Let me talk for a second about some 
specific examples of just that. In fact, just last week we co-
chaired and partnered together on a virtual summit that went 
out to about 10 community college sites all over the country 
with our staffs both leading it, and I think that shows the 
kind of cooperation that is going on here in Washington.
    One of the things we have also worked together on--and you 
can help us on this as you reauthorize these statutes as well--
is common definitions, and common performance standards, and 
common expectations. We tend to send mixed signals about what 
we want from this particular funding source versus that, and so 
to the extent that you can help reconcile some of that, that is 
very useful. We have a memorandum of understanding between 
these two departments that has been ongoing since 2001 I 
believe.
    And on the early childhood end, I would tell you that 
Secretary Levitt and I have revived an interagency process on 
those issues which we have asked Reid Lyon to help guide us, or 
translating our best research and best science into practice at 
the policy level, and we have both provided staff to that 
effort as well.
    So a number of specific examples building on Secretary 
Chao's answer.
    The Chairman. Thank you, and I appreciate and I am aware of 
the cooperative spirit and the interaction between the two 
departments, and really appreciate it. I think that does 
provide some tremendous opportunities for implementation as 
well as improvement.
    In Wyoming and many other States, we are looking at a 
severe shortage of workers within the next decade. For example, 
in Wyoming it is estimated that we are going to lose one-third 
of the State Government workforce through retirement within the 
next 5 years. What can we do to address the deficit of skills, 
abilities and knowledge in both the short and long term to 
ensure that the Nation's competitiveness is upheld?
    Secretary Chao. I think, Mr. Chairman, first of all, in the 
short term we need to understand much better what are the 
skills that are required to be competitive in today's 
environment. That starts with connecting with employers so that 
workers in declining industries can be trained for better 
paying jobs with high growth potentials in high growth 
industries. I think in the long term we need to encourage more 
high school graduates to continue their education through 
community colleges, apprenticeships and other training 
opportunities, and that is again why the President's vision for 
the comprehensive job training reform is so important because 
there is a long term and there is a short term component to all 
of this, and we look forward to working with you on all these 
issues.
    Secretary Spellings. I would agree with that completely. 
Again, the primary, prime directive, as I call it, at the 
Department of Education is that preparedness pays, to make sure 
that we have workers in the pipeline or kids in the pipelines 
that have the skills that can step into those jobs that the 
retiring workforce--although some might say that having State 
employees retire would be a good thing, but we need to make 
sure that we have kids in the pipeline that can meet those 
needs, and the only way we are going to do that, obviously, is 
ramping up the levels of rigor and the number of kids who are 
meeting those levels and those standards more rapidly and more 
effectively.
    The Chairman. Thank you.
    For Secretary Spellings, given the fact that 68 out of 100 
ninth graders will not graduate from high school on time, which 
is the lowest of any industrialized nation, what do you suggest 
we do to raise that completion rate and ensure that colleges 
and universities, as well as employers and students do not 
spend significant amounts of time and resources in remediation?
    Secretary Spellings. I think there are a couple of things 
that I want to amplify on that particular piece of data. When 
we start to look at that information in a disaggregated sort of 
way as we talk about, in other words, by student group, you 
know, minority kids are being hurt the most. That is the 
underpinning of that statistic. They are dropping out at higher 
levels than more advantaged students. So I just want to make 
sure that that point is made.
    But I think again it is putting standards in place, both in 
technical training programs that many of these students find 
attractive so that they do embed the necessary reading and math 
rigor that they are going to need to apply in the workplace and 
they are going to need in order to avoid remediation. I think 
it is the ability to use measurement, to use assessment to find 
out where kids are, what the deficiencies are and what the 
educational cure might be, if you will, so that we can get 
those kids out of high school.
    Additionally, I think--and this is embedded in the 
President's budget in a striving readers and a math 
intervention program, that requires us really to take a look at 
every 9th grader and say, ``How are we going to get you out of 
high school? What are your needs? What are your deficiencies? 
What are the necessary things for you to have in place to meet 
those standards?'' In many cases, it is a deficiency in 
reading, and we need to take what we have learned from our 
brain research and at the early grades and move those 
strategies up in middle and high schools to make sure kids have 
necessary literacy levels.
    The Chairman. Thank you. My time has expired.
    Next we will have Senator Lamar Alexander, who is the 
Subcommittee Chair for Education and Early Education.

                     Statement of Senator Alexander

    Senator Alexander. Thank you, Mike. I want to say how much 
I appreciate the Chairman's broad focus on this. This helps a 
lot, and I appreciate the way the two Secretaries are working 
together. I learned pretty early in my public career that 
better schools means better jobs, and it is just about that 
simple.
    You have also well stated, all of you, the point that while 
September 11 was a big surprise to our security, our next big 
surprise is likely to be to our pocketbook, and the major way 
to avoid that big surprise is to focus on brain power, and you 
have given some of the statistics there. We have 5 or 6 percent 
of the world's population and we produce about a third of the 
money, and the rest of the world is looking at that and saying, 
``How do they do that?'' And the way we have primarily done it 
is through science, technology and a good education system. 
That is what has produced most of our high standard of living. 
And so this is not a series of slogans we are spouting here, we 
have over the next 10 years a real challenge.
    I want to ask you to help me with a specific example. The 
old model was we were focusing on making sure that students who 
graduated from high school had a certain level of 
accomplishment, and we still should focus on that. But as the 
Chairman said, the real person we are focusing on, I think even 
more today, is the person that if I am making a commencement 
address and someone gets a diploma, the cry that goes up from 
the audience is likely to be, ``Way to go, Mom,'' because it is 
a mom who has gone back to school, either to change jobs or to 
take a new job or because she has lost a job. The question is, 
what is the appropriate and most effective thing to do from 
here to help? My experience in different levels of Government 
is to be skeptical of what can be done from here in terms of 
managing and customizing and writing big books about what 
should happen in 3,800 places or tens of thousands of places, 
so I welcome your comments about bureaucracy, management, 
consolidation and all of that.
    To get right to the bottom line then, I am going to ask you 
a question. My bias has come to be that we should focus first 
on the person changing jobs. We should focus second on giving 
that person as many individual choices as possible of options 
for education and training, and that we should focus third on 
letting the employer be as involved in the training as much as 
possible. In other words, I think the model we have got for 
higher education, where we providentially give money to the 
student and do not give it to the institution, I mean if we did 
not have it, I guarantee you we would not be competitive 10 
years from now because we would be all balled up in trying to 
figure out--we would be training people for the wrong jobs and 
putting money into bureaucracy, et cetera.
    Now, as I am listening to you and I am thinking if I am the 
single mom or dad changing jobs, you mentioned training 
accounts. There is unemployment compensation. There are Pell 
grants. There are student loans. Secretary Chao, your testimony 
mentions personal reemployment accounts. What can each of you 
say to me about the idea of focusing most of our--as much of 
our existing money as possible to individuals and most of our 
new money to individuals, rather than the idea of giving it to 
institutions and ordering them to do this, that or the other, 
or perhaps you disagree with what I have said about a bias and 
a strategy for how to spend our Federal dollars.
    Secretary Chao. Senator Alexander, you make some excellent 
points, and I agree with your assessment of the current system. 
The current Workforce Investment System has 17 mandated 
programs. If you are a person out of work and you are 
discouraged, you are kind of down, you just want assistance. 
You do not want to have to find out and go through different 
bureaucracies as to what programs you can apply for. So that is 
what the President's Workforce Investment Act reauthorization 
reform is all about. It is to make simple the access to all 
these different programs to individuals who are going through a 
lot of stress in their lifetime. And so we also want to make 
sure that they are given the options because they know what 
they want to do best, they know what interest areas they hold 
and what kind of jobs they would be interested in.
    We also need to get employers much more involved in the 
system because employers after all know where the jobs are, 
what skill sets are required, and all of these principles that 
you have outlined are indeed embodied in the President's new 
Workforce Investment reform proposal.
    I would just add two other things. We have been 
experimenting with the Personal Reemployment Accounts on a 
voluntary basis in seven States in which a worker would be able 
to have a--would be empowered with a personal reemployment 
account, which would be about $3,000. With that $3,000 the 
worker can access or buy any kind of training program that they 
want that would advance their career in a high growth industry, 
because after all, we want people to go into high growth 
industries with good earning potential as they progress in 
their career path. Based on our preliminary results the 
personal reemployment accounts have been, number one, popular; 
and number two, seemingly quite effective.
    Senator Alexander. Thank you.
    Secretary Spellings. I think from our end, Senator, we can 
do things that recognize that people are going to need to be 
educated, that single mom, in their own time and in their own 
way. So we need to find ways, particularly within Pell and our 
financial aid resources, to break down barriers, so that if 
people are taking courses through technology, they should be 
allowed to do that. If people are attending school year round 
or taking heavier course loads or some of these impediments 
that we have put up in our system. We need to remove those.
    We at the Department of Education collect through our 
postsecondary education database everything you want to know 
about a full-time, first time, non-transfer degree-seeking 
student, but that is not your mom or the mom you talked about, 
and I think we can figure out this new changing student body a 
lot better. Many of our students now are what we call non-
traditional, and I think we need to have systems that meet 
those non-traditional models as well.
    I would also highlight the High Growth Job Training 
Partnership Initiative that Secretary Chao spoke briefly about, 
which literally has the employer, you know, guarantee a job, if 
you will, for the person who is going through the training. So 
it is a partnership between the community college, between the 
employer and between the individual, and those are the sorts of 
things that we want to make sure that we are connecting 
together.
    Senator Alexander. Thank you.
    The Chairman. Thank you.
    Senator Burr.
    Senator Burr. Thank you, Mr. Chairman.
    Welcome to both Secretaries. I think it is not a mistake 
that in addition to the Chairman you have three members of the 
Senate from the Southeastern part of the United States. Not 
only have we had a job dislocation problem, it continues today. 
I think what we see and what we feel when we go home is that we 
see what was a 50-year cycle of an economic sector, textile 
manufacturing, furniture manufacturing, or a vibrant 
agricultural community, where all of a sudden that economic 
sector has been tossed upside down. It is not totally gone, but 
we certainly know that it has changed drastically.
    One of the things that I think you have to deal with and we 
have to deal with is do we ever see that kind of economic 
sector again? And I think the answer is no. The technology has 
affected that greatly, and whether it is a 10-year cycle or a 
15-year cycle, we all understand that the ability for workers 
to find employment in large part means that they have to 
continue to have the ability to learn throughout their 
lifetime.
    Secretary Spellings, I think it starts with teaching 
teachers to teach children to learn, and I think we do a good 
job of teaching teachers to teach. There is a difference 
between that and having teachers to teach them to learn. But my 
fear is that--and I think Lamar put it very well--that we have 
got this effort that we cannot lose focus of, we have to do 
things in parallel. I would only tell you that there is a next 
generation effort and there is a current generation effort, and 
we have got to make sure that both of them are serviced in the 
most effective way, though they may be very different.
    Secretary Chao, you have responded extremely well from the 
Department of Labor to North Carolina's needs, and specifically 
the emergence of biotechnology as a new economic sector. And 
that was most recently felt with a grant to Forsyth Technical 
Community College, which was very effective. How through the 
reauthorization of the Workforce Investment Act can we create 
more examples like Forsyth Tech and the biotechnology industry 
to assure that workforce training is coordinated with job paths 
and job skills of tomorrow?
    Secretary Chao. Senator, as you well know, we have worked 
very hard on addressing some of the dislocation issues in your 
State. In particular, I have Emily DeRocco, the Assistant 
Secretary of Employment Training Administration, and I want to 
give her a lot of credit for assembling all of the Government's 
resources to help the workers of Kannapolis, for example.
    The President's reform package would offer flexibility 
because what is happening, for example, in the high tech will 
be very, very different from what is happening in North 
Carolina. Forsyth Community College is doing a great job in 
training workers for well-paying jobs in high growth industries 
like the life sciences, and we want to encourage that path. But 
each community is different, and so therefore the Workforce 
Investment System needs to have flexibility, and right now 
there are stovepipe funding mechanisms, silos, and there are 
good people in the system, but it is very hard for them to 
overcome the silo effect.
    So, for example, currently under the Workforce Investment 
Act, local areas are prohibited from serving incumbent workers. 
So if, for example, a textile worker came into a One-Stop 
Center seeking help in retraining for a career in 
biotechnology, financial services or health care services, let 
us say, which are growth industries, before they were laid off 
they would have been denied services. That does not make sense. 
If there was a long-term unemployed person and you would think 
that the whole Workforce Investment System is geared toward 
them, and yet many of the long-term unemployed cannot access 
Workforce Investment programs because of the very narrow 
definitions and the lack of flexibility.
    So this makes a little sense from a economic or a social 
point of view, and indeed it really restricts the ability of 
the local community to come together and help one another. So 
again, the Administration's reform proposal would free the 
States and the local communities to serve incumbent workers, 
long term unemployed workers on a more proactive basis, and 
also provide these individuals again with much better 
opportunities in accessing new opportunities.
    So we are also proposing within the President's reform 
packet, the New Innovation Training Accounts. That again will 
also help workers access a whole range of new resources as 
well. But you are absolutely right, the inflexibility within 
the system and the inability to focus on the high growth 
industries is not an optimum use of our resources, and we are 
not doing the best job that we can for these workers.
    Senator Burr. I will be very quick, Mr. Chairman.
    Secretary Spellings, it seems like I have a tendency to 
come to you and always talk about community colleges, and maybe 
it is because we do have such an infrastructure in North 
Carolina. How can we use North Carolina's or any State's 
community colleges to better utilize and bolster the transition 
from high school into postsecondary education and training?
    Secretary Spellings. We can do that first by the 
President's call for this $125 million Community College Access 
Grants, which does just that, which partners high schools and 
community colleges, allows for more dual enrollment, more 
articulation--to use our education word--between those two 
enterprises, around standards and certification programs and we 
are seeing more and more of that around the country, which I am 
really proud of.
    Having worked in a community college and worked in schools, 
I understand that we do not always speak the same language. The 
standards are not the same. We frequently see more rigorous 
academic content at the community college level and we have to 
get that down into the high school level or say we are not 
going to do that any more, we are going to let our community 
colleges do that.
    Senator in your comments, what I heard you saying is, how 
are we going to remain a world leader? And we have to ramp up 
the level of skills, and we need to focus in particular on math 
and science because that is where the jobs are. We do not have 
to have everybody get a baccalaureate degree, no doubt about 
that, but they must have higher levels of skills embedded in 
these standards of these technical training programs, and my 
experience is that community colleges do that really well.
    Senator Burr. Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Senator Isakson, who is the Subcommittee Chair for the 
labor issues, which covers the Workforce Investment Act, part 
of it. I mentioned that Senator Burr is the Subcommittee 
Chairman for the Bioterrorism and Public Health area. Our 
Subcommittee Chair for pensions is also in the Armed Services 
Committee and on the floor with a supplemental budget today.
    So Senator Isakson.
    Senator Isakson. Thank you, Mr. Chairman.
    Following up on Senator Burr's comment about students and 
community colleges, I want to ask you what I think is a very 
friendly question.
    Secretary Spellings. I hope so.
    [Laughter.]
    Senator Isakson. Secretary Spellings, the President's 
initiative at the high school to expand accountability and 
close the achievement gap as we have done in K-8 with No Child 
Left Behind is going to expand more opportunity for more 
students to in fact get a postsecondary education whether it be 
university, community college or adult and technical; would you 
not agree?
    Secretary Spellings. I would absolutely agree, and I would 
say that that is the genius of No Child Left Behind. Our high 
school investments I think could be used more wisely if we had 
more information to manage the enterprise.
    Senator Isakson. The reason I made that statement, Mr. 
Chairman, is I had a--I did not realize I would recite this 
event that happened yesterday today until Richard's question, 
your being here--but yesterday I had a phone call from Dr. 
Alvin Wilbanks, who is one of the top superintendents in the 
country and the superintendent at large in his public school 
system in Georgia, the Gwinnett County system, which also has 
some of the highest test scores, not only in Georgia but in the 
United States. His call was specifically to volunteer to see 
what he could to assist the Administration and help to spread 
the word on the need for this accountability and close the 
achievement gap at the high school level. I am going to do a 
little pandering here, wanted to see you, Ms. Spellings, to do 
just that.
    Secretary Spellings. Cannot wait to meet him.
    [Laughter.]
    Senator Isakson. My point on this is here you have a system 
which embraced from the beginning--in fact had a program called 
Gateway--this whole idea of achievement, assessment, 
accountability and intervention early rather than late, that is 
looking to take--and it is a high achieving system but wants to 
do more--is looking to see to it that we are not leaving 
anybody behind. I believe, just as the No Child Left Behind is 
proving it over time, is going to prove conclusively that we 
fundamentally changed the lives of many, many children, I think 
raising the element of No Child Left Behind at the high school 
will in fact have the same positive effect.
    I will call you on that, but I thought that was a great 
testimony that you ought to hear, not from me, but from Dr. 
Wilbanks.
    Secretary Spellings. Thank you.
    Senator Isakson. Secretary Chao, 30 years ago when I 
started in the Georgia legislature and we started a program 
called Quick Start in our adult and technical education 
schools, we would tell a company, ``if you will bring your 
company to Georgia, we will train the workers to do what you 
want them to do.'' A lot of that training sometimes bordered on 
advancing their reading and math skills before we could advance 
them on any other skills, meaning that the level of training 
was more remedial then than it should have been, and 
unfortunately today remains that way, which I think is why No 
Child Left Behind is such a great foundation to build on the 
skills of the 21st century workers in terms of their ability to 
learn skills.
    But to that end, I want to reflect on last year's debate in 
the House, and our work in the Education Labor Committee on the 
Administration's proposals with regard to WIA, and I wanted to 
comment that consolidation and flexibility and student focused 
training is going to be the key in the 21st century to us, 
allowing people to reach their dreams, and in fact, find the 
jobs of the 21st century.
    And I hope, Mr. Chairman, as we get to that markup that we 
will find ways, either through demonstrations or through actual 
programs, that we allow consolidation, we allow One-Stop, 
encourage One-Stop, we allow flexibility, and the Personal Re-
employment Accounts are a dynamic idea because they are an 
individual motivator and incentive for the very person we are 
trying to benefit with the One-Stop.
    So that is a statement and not a question and I apologize.
    [Laughter.]
    But I will give you my remaining 1 minute if you want to 
elaborate.
    [Laughter.]
    Secretary Chao. Senator Isakson, you are absolutely 
correct. We are trying to help workers, again, who are going 
through a very difficult period in their lifetime. So when they 
believe in us, the Workforce Investment System, and put their 
futures in our hands by coming to us for help, hoping that we 
will be able to indeed give them the new entre into a new life, 
we have a very big responsibility to carry through. So it is 
absolutely essential that these workers that are coming to us 
for help receive, number one, relevant training, that they are 
coming to an environment that is caring, that is client-based. 
As I mentioned, there are 17 different mandated funding 
streams, and it is very confusing for a worker to access all 
the different Government programs or to even know where to 
access and how to access the many different Government programs 
for which they are eligible, and that is the beauty of the One-
Stop Centers.
    It is supposed to be a One-Stop Center, an entryway into 
the many Government programs which are potentially accessible 
to them, and again, it has to be flexible and it has to be 
client-based, student-focused, as you mentioned, because I 
think the workers who are asking for this help deserve no less 
and we have a responsibility of ensuring that they are 
reconnected with the workforce.
    Thank you.
    Senator Isakson. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    And I want to thank Secretary Chao and Secretary Spellings 
for being here today, and I would mention that the record will 
stay open for another 10 days, and that is so that you can 
expand on any remarks that you want to. It is also so that 
members of the committee can submit questions. We try to keep 
the ones here of a more general nature. We have several that 
are more specific, but we found that has a tendency to put the 
people behind you to sleep.
    [Laughter.]
    It takes more time to really get the meat out of it, but 
there are some very specific things on the legislation that we 
will need your help on.
    I really appreciate your participation and all of the help 
that you have given us so far. Thank you for being here today.
    Secretary Chao. Thank you.
    Secretary Spellings. Thank you.
    The Chairman. At this point we will welcome the second 
panel. I will ask them to come forward. They are putting some 
name tags up at the front counter, switching out the water. 
While the switch is being made I will go ahead with the 
introductions.
    The first member of the panel is the Governor of Kansas, 
Kathleen Sebelius. Senator Roberts wanted to be here today to 
introduce the Governor of Kansas, Governor Kathleen Sebelius. 
Unfortunately, his duties as Chairman of the Senate 
Intelligence Committee are keeping him very busy today. He 
sends his regrets. He wanted me to share with the members of 
the committee that Governor Sebelius and Senator Roberts' 
families share a long history. In fact, Senator Roberts used to 
work for Governor Sebelius' father-in-law, the former Kansas 
Republican Congressman Keith Sebelius. He was Congressman 
Sebelius' administrative assistant for 12 years before 
Congressman Sebelius retired and Senator Roberts followed in 
his footsteps by representing that first district in Kansas for 
16 years.
    Governor Sebelius has steered the Kansas Economic Growth 
Act to passage and restructured the existing Comprehensive 
Highway Package, ensuring the timely completion of all 
projects. She has also proposed sweeping educational reforms 
and has put forward several common-sense health care proposals 
to reduce costs and increase insurance coverage.
    The second member of our panel is the Kentucky Governor, 
Ernie Fletcher, who just flew in.
    [Laughter.]
    One of Governor Fletcher's top priorities is economic 
development, and since coming into office more than 49,700 jobs 
have been created, ranking Kentucky as the fourth best among 
States. Pleased to have you here.
    The third member of our panel is former Congressman from 
Wisconsin, Steve Gunderson. He is the Director of the 
Washington Office of the Greystone Group, a strategic planning 
and research consulting firm. I have come to respect Steve's 
work even more after reading his book, and I recommend this 
book to everyone, The Jobs Revolution: Changing How America 
Works. Some great statistics. I quote from it frequently. I do 
not always credit it.
    [Laughter.]
    Our fourth panel member is Brian Fitzgerald, who is the 
Executive Director of the Business Higher Education Forum, a 
Washington-based organization that encourages dialog among 
leaders of the business and higher education sector on issues 
central to the role of higher education in the global economy. 
Brian previously served as the Staff Director of the Advisory 
Committee on Student Financial Assistance, which was 
established to advise Congress and the Secretary of Education.
    The final member of this panel is Ms. Pamela Boisvert. The 
first part of your name in Wyoming we would call ``Boyce'' 
because we have DuBoise, but Boisvert, I am sorry. The Vice 
President of the Colleges of Worcester Consortium, Inc., a not-
for-profit association of public and private accredited 
colleges and universities in Central Massachusetts.
    I welcome all of you. I assure you that your full statement 
will be a part of the record. I would ask you to condense your 
remarks to 5 minutes so that we will have time for questions 
before we have a vote that will be coming up.
    Governor Sebelius.

STATEMENT OF HON. KATHLEEN SEBELIUS, GOVERNOR OF KANSAS, CHAIR 
                  OF THE NGA EDUCATION, EARLY 
 CHILDHOOD AND WORKFORCE COMMITTEE, ON BEHALF OF THE NATIONAL 
                     GOVERNORS ASSOCIATION

    Governor Sebelius. Thank you, Senator Enzi and committee 
members. It is a great pleasure to have the chance to be with 
you today. I am Kathleen Sebelius, the Governor of Kansas, and 
this year I have the pleasure of being the Chair of the 
National Governors Association Committee on Education, Early 
Childhood and Workforce Training.
    You mentioned legislators from Wyoming, and I just noticed 
that there are some legislators from Kansas here also. The NCSL 
is meeting today, so I am glad to have some folks from our home 
State who are on the front lines really figuring out education 
and workforce training at the State level.
    A lot of what Secretaries Spellings and Chao said today we 
certainly agreed with, that our high schools particularly are 
in jeopardy. We have too many students dropping out, too many 
high school graduates unprepared for the demands of 
postsecondary education and work.
    Governor Fletcher, my colleague from Kentucky who is here 
is going to focus specifically on some of the initiatives on 
high school reform, and I am going to talk a little bit about 
the P-16 alignment which is going on in a lot of States across 
the country, as well as the Workforce Investment Act.
    To make this a little more specific, about 75 years ago I 
think, a Kansas child could have assumed that he or she would 
spend their lives on the family farm, producing wheat, soybeans 
and other crops, feeding Americans and the world, and today 
only 3 percent of our workers in Kansas are directly associated 
with farm jobs. That is a testimony to efficiency, but it means 
we also need to cultivate fertile minds as well as fertile soil 
in this day and age, and diversify that economic workforce.
    As we have already said, the world is changing dramatically 
and we need to be prepared for those changes. The cost of not 
doing what we are supposed to be doing is extremely high. 
Sixteen billion dollars is spent every year on fixing the lack 
of adequate preparation for kids going to college. It is paid 
for by businesses, by colleges and by the under-prepared high 
school students themselves.
    We think very strongly as Governors that aligning preschool 
through university education and workforce development need to 
work together. They are the best way to prepare an educated 
workforce and the best way to prepare for jobs for the future. 
There is a unique opportunity here in Congress, the pending 
reauthorizations of several major programs this year. The 
Workforce Investment Act, the Higher Education Act, Head Start, 
and the Carl Perkins Vocational and Technical Education Act 
represent an unprecedented opportunity to align Federal 
education laws and promote lifelong learning, the kind of P-16 
and beyond system.
    Governors really agree on a number of major requests. We 
hope that you here in the Senate and your colleagues in the 
House will embrace the state-coordinated P-16 efforts and 
support our lifelong learning initiatives, that you will 
provide--and both the Secretaries echoed this--greater 
flexibility to States, give Governors more authority to 
coordinate Federal funds. We are happy to be accountable for 
those funds and responsive to data requirements, but right now 
those data requirements are often duplicative and do not ask 
for the same sets of data, so a lot of time and energy and 
money, frankly, is spent on the bureaucratic requirements.
    Complementing our educational efforts are specific programs 
to improve the skills of our States' workforce. It is a 
daunting task. Workforce development challenges us all, and yet 
there are few opportunities that yield such promise. We have a 
different workforce today, ethnic and cultural challenges to 
deal with, the needs of working families and individuals with 
disabilities. We have to address literacy gaps of low-skill 
workers and language needs of some of our newly arrived 
workers, all within a diverse and dynamic economy.
    What we are concerned with is a one-size-fits-all program 
with rigid regulation and service delivery structures, does not 
really work well for States across the country. We are 
different. We in the heartland are different from Kentucky and 
California and need some flexibility to recognize those 
differences. Again, we support accountability but feel that 
coordination at the State and local level can give us the 
opportunity really to use the funds in the most appropriate 
measure.
    So the four or five things I would just like to highlight 
in the Workforce Investment Act would be:
    Provide flexibility to Governors to coordinate our funds at 
the State level, and the option to coordinate funding streams;
    Relieve some of the mandates that are currently in place 
like the amount of funding that must be spent on a specific 
category or group. We think State needs are different and State 
workforces are different;
    More flexibility in success and participation, that 
individuals should be able to easily enter and reenter the 
system at different times, as opposed to going through a 
mandated sequence of events;
    Serving the business community and fostering economic 
development. We in Kansas have just totally overhauled our 
workforce system to make it more market-driven, more nimble--
broaden community college training, but very much involve the 
community. That works in Kansas. A different format may work 
better in Kentucky. We are trying to make sure that we deal 
with accurate forecasting so that our business leaders have the 
job security for the future.
    Encourage innovation in States. Let us be the laboratories 
of what works and design programs in a way that we can give you 
the reports that are important, but also get rid of the limits 
on transferring the funds.
    Align more clearly the workforce and education programs, 
and coordinate management and performance information.
    Again, I appreciate the opportunity. We have submitted some 
detailed written testimony. We would be happy to answer some 
questions. We are eager to work with the Senate as you overhaul 
and review these programs so that we make sure that not only 
are all children prepared for success in the future, but that 
we have the best educated, best trained workforce for the 
future.
    Thank you, Mr. Chairman and members of the committee.
    The Chairman. Thank you very much.
    [The prepared statement of Governor Sebelius follows:]

              Prepared Statement of Hon. Kathleen Sebelius

    Chairman Enzi, Senator Kennedy and members of the committee, I am 
Kathleen Sebelius, Governor of the State of Kansas, and Chair of the 
National Governors Association Education, Early Childhood and Workforce 
Committee. I appreciate the opportunity to appear before you today on 
behalf of the Nation's Governors on lifelong learning.

                NEW NGA EDUCATION AND WORKFORCE POLICIES

    In February, the Nation's Governors approved three new policies 
that offer bipartisan recommendations to align Federal education laws, 
accelerate State high school redesign, and promote lifelong learning 
through the Workforce Investment Act (WIA). The full text of the new 
policies is attached. I'm very proud of our work on the NGA to reach a 
bipartisan agreement on these issues.
    Today, I'll limit my comments to Governors' new vision to align 
Federal education laws and to streamline workforce programs. Governor 
Fletcher will discuss how Congress can help accelerate State high 
school redesign action plans.

                       EDUCATION AND THE ECONOMY

    Our economy is changing, and we must change with it. Technology and 
trade have revolutionized the way companies do business. Manufacturers 
in Kansas must compete with manufacturers in Europe, Asia, and South 
America. What took 20 workers a full day to produce just a generation 
ago can now be handled by a single worker with the right machinery and 
a computer. A small shop owner in Frankfort can fill an order from 
Tokyo just as easily as a college student in Topeka can order from a 
store in Paris.
    What all of these scenarios require however is skilled and educated 
labor. The Bureau of Labor Statistics projects that by 2020, there will 
be a 22 percent increase in the number of jobs requiring some 
postsecondary education. Yet during the next 20 years, we will lose 46 
million skilled workers as baby boomers retire. Even with more people 
getting some form of secondary education, as many as 12 million jobs 
are likely to go unfilled; a loss that will disproportionately affect 
industries that are critical to our economic growth, including 
education, health care, technology, and manufacturing. This shortage 
constrains the productive capacity of key industries and jeopardizes 
the quality of services in others.
    But developing an educated and skilled workforce is not just good 
for business, it is good for people. Census data shows the median 
earnings of a high school graduate ($30,800) are 43 percent higher than 
those of a non-graduate ($21,600). Those of a college graduate are 62 
percent higher than those of a high school graduate. States stand to 
benefit too. Economist Anthony Carnevale estimates that if States 
expand college access among African Americans, Hispanics, and non-
Hispanic whites, (the resultant earnings improvements would certainly 
narrow income differences and could add as much as $230 billion in 
national wealth and $80 billion in new tax revenues every year.)

          NGA PRINCIPLES OF PRESCHOOL-COLLEGE (P-16) ALIGNMENT

    In the 21st century, the economic strength of the United States 
will depend on the ability of each State and our Nation to develop a 
coordinated and aligned education and workforce system that supports, 
trains, and prepares a skilled set of workers. Now is the time to take 
action to create a seamless American education system, by aligning 
Federal education laws to promote lifelong learning. The pending 
reauthorizations of the Workforce Investment Act, Higher Education Act, 
Head Start, and the Carl D. Perkins Vocational and Technical Education 
Act present an unprecedented opportunity to align Federal education 
laws and promote lifelong learning.
    The pathway to progress is clear. Federal education laws from pre-
school through college, commonly referred to as P-16, must be aligned 
to foster State innovation, eliminate costly duplication, and 
ultimately improve education outcomes for all students.
    NGA recently commissioned a study by Holland and Knight that 
examined the relationship between key provisions of these major laws: 
Head Start, the Individuals with Disabilities Education Act (IDEA), the 
No Child Left Behind Act (NCLB), the Carl D. Perkins Vocational 
Technical Education Act, the Higher Education Act (HEA), and the 
Workforce Investment Act (WIA). The initial analysis will inform 
congressional debates and will help the larger education and workforce 
community to begin a dialog on education alignment and coordination.
    The NGA's study of relevant laws revealed several important initial 
points. Some laws, such as NCLB and IDEA provisions related to 
improving student performance, ``read together'' and can be implemented 
in an integrated fashion. However in too many cases, Federal education 
laws:

     Do not reinforce each other's substantive requirements;
     Establish duplicative requirements that may result in 
unnecessary burden on States (most notably the duplication in reporting 
requirements and data collection);
     Create no clear, coherent system to effective and 
efficient reporting of information to the (1) public, (2) Federal 
agencies, or (3) Congress; and
     Provide funding in ways that discourage the integration 
and strategic use of all available Federal dollars for a common 
purpose.

    Too often, Federal education laws are isolated, one from another. 
But education begins in the early years and continues for a lifetime. 
The federal-state-local education system must be coordinated to serve 
the needs of all students, young and old. Limits and restrictions on 
State innovation generate costs that our Nation cannot afford.
    Governors believe that the Federal education laws should be aligned 
to:

     Embrace State coordinated P-16 efforts;
     Provide greater flexibility to States;
     Streamline Federal data reporting requirements;
     Expand gubernatorial authority to coordinate Federal 
funds;
     Recognize and reinforce constitutional gubernatorial 
authority over education in their States; and
     Support lifelong learning.

    From California to Georgia to Delaware, Governors are leading P-16 
reform efforts to oversee the integration of early, elementary, 
secondary and postsecondary education. Governors urge this committee to 
carefully consider how Federal education laws relate to each other. We 
need to break down the isolation, eliminate the duplication, and 
provide new flexibility, so that Governors can build more seamless 
education systems.

             TRANSITION TO AND PREPARING FOR THE WORKFORCE

    Education is the ultimate form of economic development. Education 
can not end at the classroom door. Rather its continuation is the 
cornerstone of developing and maintaining a competitive workforce. As 
Governors, we are continually working to ensure that our institutions 
of higher education and our workforce systems are ready to develop and 
sustain a skilled workforce for today's modern, global economy.
    Our workforce's increasing diversity and growing needs for skills 
offer new challenges in how we educate and train workers. We must 
accommodate ethnic and cultural differences; we must provide for the 
needs of working and individuals with disabilities; and we must address 
the literacy gaps of low-skilled workers and the language needs of 
immigrant workers.
    Exacerbating these challenges is the global economy that 
continually creates and eliminates jobs. Every year, up to a third of 
all jobs are either added or eliminated from the economy. This churning 
has contributed to the breakdown of the social contract between workers 
and employers and reduced the incentives for employers to invest in 
their workers. For many employees, the traditional concepts of job 
security, career ladders, and job progression simply do not exist. 
Increasingly, workers experience periods of dislocation and must have 
the tools to manage their own careers through first-rate labor exchange 
services. Lifelong education is a key part of moving through a career 
that consists of multiple jobs.
    To address these issues, our public workforce programs must have 
enough flexibility to meet the demands of an unpredictable economy and 
a changing worker population. These programs cannot be a one-size fits 
all systems with rigid regulations and service delivery structures. 
Rather, the programs must recognize the differences among States and 
communities, and thus provide Governors, working with local government, 
business, and labor to design flexible ways to meet distinct needs. At 
the same time, programs must remain accountable, given their reliance 
on public investments.

               REAUTHORIZING THE WORKFORCE INVESTMENT ACT

    WIA authorized Governors to initiate broad structural reforms in 
their workforce development systems. With this authority, the Nation's 
Governors have made significant progress in restructuring these systems 
and strengthening the essential partnerships between Federal, State, 
and local governments and the private sector. Yet State-by-State 
experiences reveal that many challenges remain, such as providing a 
comprehensive, highly integrated education, training, and employment 
services for workers. In addition, States need help in meeting 
reporting requirements, coping with resource constraints and fully 
engaging the business community as partners.
    On March 24th, the Nation's Governors sent a letter to the members 
of this committee enumerating our bipartisan recommendations for the 
reauthorization of the Workforce Investment Act. The full text of our 
policy is attached.
    Governors believe that WIA reauthorization presents a great 
opportunity to enhance the Federal-State workforce system, support 
State innovation, and provide greater authority to Governors in 
overseeing the implementation and coordination of workforce programs. 
Combining a comprehensive, integrated, and flexible workforce system 
with nimble State economic development strategies, the Nation will have 
the tools for speedy, effective responses to the changing needs of 
workers and businesses alike, as they compete in the global economy.
    To address those challenges and strengthen the Nation's workforce 
development system, Governors offer the following recommendations for 
any legislation to reauthorize WIA:

     Provide flexibility to coordinate funds: As noted by 
Secretary Chao, the Administration's proposal would consolidate four 
WIA programs: Adult Training, Dislocated Worker Training, Youth 
Training, and Employment Services. It also creates various options for 
consolidation with five other programs. Instead of consolidating 
Federal WIA programs, however, the Senate WIA bill should offer 
Governors the option and authority to coordinate WIA program funding to 
meet the unique needs of their States; and it should also include a 
hold harmless provision to protect against any diminished Federal 
investment in workforce and related programs. Congress should provide 
Governors with the option, at their discretion, to pool WIA, higher 
education, Temporary Assistance for Needy Families (TANF), and other 
sources of Federal training money to respond to the state-level needs 
of workers, businesses and other interests.
     Eliminate youth spending mandate: WIA should not mandate 
the amount of youth funding that must be spent on out-of-school or in-
school youth. Governors should be able to direct youth funds according 
to the needs of their respective States.
     Improve access and participation: Congress should ensure 
that individuals can easily enter and reenter the system at any point 
and access services as needed, not in a prescribed sequence. Congress 
should also work to fully engage businesses in the workforce system and 
eliminate barriers that prevent workers and businesses from receiving 
assistance in a timely and efficient manner.
     Serve the business community and foster economic 
development: WIA needs to better serve the business community and to 
connect with the economic development needs of the State. WIA 
reauthorization should also recognize the important partnerships among 
Federal, State, public, and private workforce programs and the 
Governors' authority to press for innovations. For these reasons, 
Congress should support strong State public-private partnerships to 
ensure an adequate supply of workers for high-growth occupations as 
determined by individual States. To facilitate the relationships 
between Governors and their business community, Congress should also 
encourage coordination by the U.S. Department of Labor.
     Encourage innovation: Congress should remove barriers to 
State innovation; these include, but not limited to, overly burdensome 
reporting requirements, inconsistent terms and definitions, and 
limitations on transferring funds.
     Align related workforce and education programs: 
Partnerships within One-Stop centers have proven difficult to foster; 
given myriad agencies, organizations, financing, and responsibilities 
involved in delivering the array of services in one location. Governors 
recommend that the Federal partner agencies develop a joint initiative 
to align Federal regulations and encourage support for and 
participation in One-Stop centers. Alignment efforts should encompass 
WIA, higher education, TANF, vocational rehabilitation, vocational and 
technical education, trade adjustment, veterans' employment, and other 
distinct programs. In particular, Governors strongly support efforts to 
coordinate WIA and TANF to give welfare recipients and other low-income 
workers easier, more effective access to education and training.
     Coordinate management and performance information: The 
initiative should address common management and performance 
information, including cost sharing, resource allocation, and joint 
case management, it should also facilitate the sharing, processing, and 
providing of services to participants. Establishing cross-system 
measures could support consistent information systems that span State 
and Federal workforce programs.
     Streamline the Workforce Boards: The Senate WIA bill 
should give Governors the authority to design and re-designate the 
local workforce areas without Federal interference.
     Eliminate Section 191: Section 191(A) of WIA has led to 
problems within some States by requiring that all WIA funds are subject 
to appropriation by the State legislature. This unnecessary provision 
should be eliminated to ensure that gubernatorial authority to allocate 
Federal funds.

                               CONCLUSION

    We must never stop learning. Congress should view today's workforce 
and education programs as part of a continuum of lifelong learning. 
Current and future workers should have the opportunity to equip and 
reequip themselves for productive work through training, education, and 
professional development. Governors stand ready to work with Congress 
and the Administration to ensure that our workers and economy continue 
to lead the world in the 21st century.
                    National Governors Association,
                                    Washington, D.C. 20001,
                                                    March 24, 2005.
Hon. Michael B. Enzi,
Chairman,
Committee on Health, Education, Labor, and Pensions,
U.S. Senate,
Washington, D.C. 20510.

Hon. Edward ``Ted'' M. Kennedy,
Ranking Member,
Committee on Health, Education, Labor, and Pensions,
U.S. Senate,
Washington, D.C. 20510.

    Dear Chairman Enzi and Senator Kennedy: On behalf of the Nation's 
governors, we are pleased to offer the following bipartisan 
recommendations for your consideration as you work to improve the 
Workforce Investment Act (W1A).
    WIA reauthorization presents an opportunity to enhance the Federal-
State workforce system, support State innovation, coordinate the 
delivery of services, and provide greater authority to governors to 
oversee the implementation and coordination of workforce programs. 
Through a comprehensive, integrated, and flexible workforce system and 
State economic development strategies, the Nation will be better 
equipped to quickly respond to the changing needs of its workers and 
businesses as they compete successfully in the global economy.
    Governors urge the Senate to strengthen the Nation's workforce 
development system by incorporating the following recommendations into 
any legislation to reauthorize WlA:

     Improve access and participation: Congress should ensure 
that individuals can easily enter and reenter the system at any point 
and access services as needed, not in a prescribed sequence. It should 
also work to fully engage businesses in the workforce system and 
eliminate barriers that prevent workers and businesses from receiving 
assistance in a timely and efficient manner.
     Provide flexibility to coordinate funds: Instead of a 
Federal consolidation of WIA programs. Congress should provide 
governors with the option and authority to coordinate WIA funding to 
meet the unique needs of States and include a hold harmless provision 
to ensure that the Federal investment in workforce and related programs 
is not diminished. Congress should provide governors with the option, 
at their discretion, to pool WIA and related sources of Federal 
training money at the State level.
     Encourage innovation: Congress should remove barriers to 
State innovation, including, but not limited to, overly burdensome 
reporting requirements, inconsistent terms and definitions, and 
limitations to transfer funds.
    Additional information and specifics regarding the governor 
position on WIA can be found in the attached NGA policy which was 
revised and reaffirmed last month at the NGA Winter Meeting.
    Governors look forward to working with you to improve and 
reauthorize WIA in the coming months. Thank you for considering our 
views.
            Sincerely,
                                Governor Kathleen Sebelius,
                                  Chair, Education, Early Childhood
                                           and Workforce Committee.
                                     Governor Tim Pawlenty,
                             Vice Chair, Education, Early Childhood
                                           and Workforce Committee.
                                 ______
                                 
                     National Governors Association
                            policy position

ECW-1. Governors' Principles to Ensure Workforce Excellence Policy

1.1 Preamble

    In the 21st century, the economic strength of the United States 
will depend on the ability of each state to compete successfully in the 
global economy. Today's jobs require workers to have more advanced 
training and higher levels of education. In order to compete most 
effectively, state economic development strategies must build a skilled 
workforce through lifelong learning and worker training.
    Governors recognize that a strong workforce development system must 
encompass education, human service, and economic development programs 
and ensure the attention and investment of all levels of government and 
the private sector. In this era of global competitiveness, an effective 
workforce development system should address the needs of all workers, 
regardless of the worker's skill level. Through a comprehensive, 
integrated, and flexible workforce system, the Nation will be equipped 
to quickly respond to the changing needs of its workers and businesses 
to compete successfully in the global economy.
    The Workforce Investment Act (WIA) authorized Governors to initiate 
broad structural reforms in their workforce development systems. With 
this authority, the Nation's Governors have made significant progress 
in restructuring their workforce development systems and strengthening 
partnerships among Federal, State, and local governments and the 
private sector. These reforms are producing highly skilled workforces 
that strengthen businesses and the economy. Yet experiences from States 
reveal that many challenges remain, such as providing a comprehensive, 
seamless system of education and training and employment services for 
workers; meeting reporting requirements; coping with resource 
constraints; and fully engaging the business community as partners. To 
address those challenges, Governors support additional efforts to 
strengthen the system and provide the following core principles and 
recommendations to guide actions by the Administration and Congress.

1.2 Principles for Workforce Excellence

    The Governors recommend the following principles to help ensure 
workforce excellence.
    1.2.1 A Comprehensive, Flexible, State-Based Workforce System. The 
workforce system should be a comprehensive and flexible state-based 
system that is centered on the needs of local regions and communities 
and accountable for results. The workforce system should be readily 
understood, accessible, and responsive to local and regional workers, 
job seekers, students, and businesses. These customers should receive 
information about the full array of services available from public and 
private sources and should be able to easily enter and reenter the 
system at any point and access services as needed, not in a prescribed 
sequence. Governors should have the flexibility to build on the current 
strengths in the system, including the authority to design and re-
designate the local workforce areas without Federal interference.
    1.2.2 Lifelong Learning Opportunities. Job training and education 
programs should be available to the entire workforce and the business 
community as part of a continuum of lifelong learning. Current and 
future workers should have the opportunity to equip and re-equip 
themselves for productive work through training, education, and 
professional development. Education and workforce partners should 
pursue new educational methodologies such as modularization of 
curriculum, portable credentials for students and workers, e-learning, 
and other distance learning opportunities. In addition, student 
financial aid guidelines should be revised to better serve working 
adults. Due to the vital role that job training and education programs 
play during an individual's lifetime, it is critical that Federal 
education and workforce programs be aligned to function most 
effectively to support the lifelong learning opportunities for 
individuals in state-determined high demand occupations.
    1.2.3 Education and Career Linkages for Students. In a knowledge- 
and skill-based economy, education is increasingly linked to economic 
success, with postsecondary education and training often leading to 
higher earnings and employment stability. WIA should reinforce with 
students the importance of acquiring basic skills, such as reading or 
math, that lead to a high school degree or equivalent, thus ensuring 
students have the foundation of skills and knowledge to enter any 
career and to support continued lifelong learning. For these reasons, 
the workforce development system should effectively support career 
exploration opportunities and should link education and work through 
work-based learning, internships, career guidance, youth 
apprenticeship, and other options that enable students to obtain the 
academic, occupational, and work-readiness skills needed for 
employment. Businesses, unions, schools, colleges and universities, 
community-based organizations, teachers, students, and all levels of 
government must share the responsibility to ensure that alignment of 
these programs produces economic success for students.
    1.2.4 Barriers to Innovation. Governors continue to develop 
innovative workforce systems that respond to customer needs, reduce 
fragmentation, promote accountability, deliver services efficiently, 
and engage the business community. To ensure a higher quality Federal-
State workforce system for America's workers. Congress should remove 
barriers to innovation including, but not limited to, overly burdensome 
reporting requirements, inconsistent terms and definition, and 
limitations to transfer funds.
    1.2.5 Governors' Leadership in Workforce Programs Innovation. WIA 
reauthorization should recognize the important partnerships among 
Federal, State, public, and private workforce programs and Governors' 
authority to develop an innovative workforce development system. 
Congress should encourage the U.S. Department of Labor (DOL) to 
coordinate with the Governor when working with a State's business 
community.
    1.2.6 Integral Role of the Private Sector. Workforce development 
has two major groups of customers--workers (both current and future) 
and businesses. Although WIA made strides in recognizing the needs of 
businesses, work remains to ensure that businesses are fully engaged in 
the law. Federal policy should not undermine the vast investment that 
private sector businesses have made to train workers. Also, Federal 
initiatives should be designed to support state-based programs, 
particularly State efforts to build partnerships with business. Federal 
WIA policy should support strong public/private partnerships and 
provide Governors the authority to build these partnerships to ensure 
an adequate supply of high-growth industries and occupations. Federal 
efforts should be designed to support state-based programs, including 
State efforts to partner with businesses.
    1.2.7 Efficient Assistance for Business Firms and Dislocated 
Workers. Federal dislocated worker initiatives and funding should be 
responsive and flexible to address the impact of economic changes on 
workers in States across the Nation. In addition, workers and 
businesses negatively affected by Federal policy decisions should 
receive adjustment assistance in a timely and efficient manner. Federal 
assistance should be provided through state-based networks and 
initiatives, and final authority to implement the provision of 
assistance should be determined by the Governor.

1.3 Recommendations for Strengthening the Workforce Development System

    The Nation's Governors strongly support the following 
recommendations to strengthen the workforce development system.
    1.3.1 Funding. Governors support an increase in the Federal 
Investment in WIA programs to support lifelong learning and economic 
development. WIA funding helps support critical workforce services to 
ensure that America's workers will remain competitive in the 21st 
century global economy. To adequately respond to the global economy. 
WIA funding should be flexible and responsive to worker shortages, high 
demand occupations as determined by each State, major shifts in the 
national economy, and State economic development goals.
    1.3.2 Flexibility to Coordinate or Transfer Funds. Congress should 
provide Governors with the option to coordinate WIA funding to meet the 
unique needs of their States and should include a hold harmless 
provision to ensure that the Federal investment in workforce and 
related programs is not diminished. At their discretion, Governors 
should be given the option to pool WIA, higher education, Temporary 
Assistance for Needy Families (TANF), and other sources of Federal 
training money at the State level to respond to the needs of workers 
and businesses.
    1.3.3 Performance Measures. Governors urge the development of a new 
streamlined--yet strong--performance measurement based on State and 
local input. The framework should include a core set of measures that 
are meaningful across workforce development programs. These measures 
should readily illustrate the value the workforce development system 
adds to meeting economic development goals. Governors should be closely 
consulted if any Federal measures are adopted. Performance measures 
should be flexible and easy to collect to allow the evaluation of 
short-term results on and long-term efforts by workers and businesses. 
The current multiplicity of measures and data collection impedes 
service delivery in States. Congress and DOL should also support the 
voluntarily development of State integrated performance measures and 
information systems that include common definitions and measures.
    1.3.4 Reporting Requirements. The current workforce system is 
fragmented and consists of inconsistent terms and definitions, as well 
as overly burdensome reporting requirements. This system impedes 
efficient service delivery in States and localities; deters 
participation of eligible job training providers, including educational 
institutions such as community colleges and apprenticeship programs; 
and discourages partnerships within one-stop centers. Governors urge 
Congress to streamline and improve Federal reporting requirements. 
Until Federal law is revised to provide such flexibility, Governors 
expect DOL to approve appropriate waivers of Federal regulations to 
reduce the financial burden of unnecessary paperwork and remove 
barriers to innovation.
    1.3.5 Regulations. Governors urge DOL to develop regulations in 
close consultation with States. Moreover, DOL should only develop 
regulations when the law is unclear and needs clarification, and these 
regulations must be consistent with the intent of Congress.
    1.3.6 Federal Partner Programs. Partnerships within one-stop 
centers have been difficult to foster given the myriad of agencies, 
organizations, financing, and responsibilities involved in delivering 
the array of services in one location. Governors recommend that the 
Federal partner agencies develop a joint initiative to align Federal 
regulations to consistently encourage support for and participation in 
one-stop centers. Alignment efforts should encompass WIA, higher 
education. TANF, vocational rehabilitation, vocational and technical 
education, trade adjustment, veterans' employment, and other distinct 
programs. In particular, Governors support efforts to coordinate WIA 
and TANF systems to help welfare recipients and other low-income 
workers better access education and training.
    The initiative should address common management and performance 
information, including cost sharing, resource allocation, and joint 
case management, as well as the sharing, processing, and providing of 
services to participants. Flexibility to establish cross-system 
measures could support consistent information systems across State and 
Federal workforce programs.
    1.3.7 Greater Access to WIA Training. Training is important in 
providing a continuum of skill development, ranging from initial 
preparation to ongoing career advancement. A basic tenet of WIA is to 
facilitate an efficient transition for qualified individuals through 
core, intensive, and training services. Govenors recommend that DOL 
work with States to issue clarifying guidance to ensure that enrollment 
in training is not blocked or delayed by a rigid application of WIA 
eligibility criteria for intensive services and training, particularly 
when a one-stop partner has already properly determined the need for 
training.
    1.3.8 Readjustment and Training for Dislocated Workers. Under 
current law, to be eligible for job training services, dislocated 
workers must first participate in the required sequence of services. 
Governors recommend that States and localities be given flexibility to 
apply eligibility criteria to permit rapid passage through the initial 
services when there is a ready presumption that other work is not 
available. To ensure training opportunities for unemployed workers, 
participation in WIA intensive and training services should be allowed 
to satisfy unemployment insurance work search requirements. 
Additionally, Governors recommend that the wage-replacement performance 
standard be eliminated because it inadvertently discourages enrollment 
of high-wage workers when replacement jobs are not available at similar 
pay levels.
    1.3.9 Flexibility for Youth Programs. Under current law, local WIA 
program administrators are required to contract-out training and 
development services for youth, regardless of a lack of qualified 
service providers. At the same time, Governors may grant waivers to 
local boards allowing them to consolidate service delivery for adults 
and dislocated workers in rural areas. Similar rules should apply to 
the WIA youth funding stream so that local boards may streamline 
program services in areas with insufficient numbers of qualified 
service providers.
    WIA should not mandate the amount of youth funding that must be 
spent on out-of-school or in-school youth. Governors should have the 
discretion to direct youth funds according to the needs of each State.
    1.3.10 Incentives for Comprehensive System Building. Incentives, 
including access to waiver authority and additional Federal funds, 
should be provided to all States to establish comprehensive workforce 
development systems in partnership with local governments and private 
sector leaders.
    1.3.11 Section 191. Section 191(A) has led to problems within some 
States by requiring that all WIA funds are subject to appropriation by 
the State legislature. This unnecessary provision should be eliminated 
to ensure that Governors retrain unfettered authority to allocate 
Federal funds.

Related Policies

    ECW-11, Employment Security System Policy
    ECW-15, Principles of Federal Preschool-College (P-16) Alignment
    HH S-21, Welfare Reform

    Time limited (effective Winter Meeting 2005 Winter Meeting 2007).
    Adopted Winter Meeting 1993; reaffirmed Winter Meeting 1995; 
revised and reaffirmed Winter Meeting 1997; revised Winter Meeting 
1998, Winter Meeting 2000, Winter Meeting 2002, Annual Meeting 2005, 
and Winter Meeting 2005 (formerly Policy HR-I).
                                 ______
                                 

ECW-13. High School Reform: Aligning Secondary and Postsecondary 
                    Education Policy

13:1 Preamble

    Governors are leaders in high school reform and Federal policy 
should support their authority, initiatives, and innovation. States are 
implementing and developing strategies to increase student 
participation in college preparatory courses, better align expectations 
between high school and postsecondary education, and ensure students 
graduate from high school ready for college or the workplace.
    Governors recognize that education is a fundamental State 
responsibility. To ensure the proper federal-state-local partnership, 
Federal education laws and regulations must be accompanied by broad 
flexibility. While States invest significant resources in education 
programs, Governors also recognize and appreciate the Federal 
Government's contribution to provide additional resources or assistance 
for those most in need.
    High school reform requires systemic change in Federal education 
policies to break down barriers, align and raise standards and 
expectations, and allow for greater flexibility at State and local 
levels. Also critical to reform will be an increased focus on rigor and 
relevance of secondary school for all students. Federal programs for 
middle school, high school, career and technical education, and 
postsecondary education must be aligned to support State high school 
reform efforts and to ensure that every child graduates from high 
school ready to succeed in the global economy. Federal funding must be 
appropriated to meet new school improvement goals and current mandates.

13.2 Principles for High School Reform

    Governors recommend the following principles for Federal high 
school reform.
     Support State efforts to reform high school.
     Recognize Governors' responsibilities in early education, 
kindergarten-12th grade (K-12), and postsecondary education, and 
strengthen their authority to coordinate statewide education policies 
across grades and education settings.
     Better align early education through college educational 
standards.
     Increase academic rigor for all students.
     Support State high school accountability through a range 
of testing and assessments.
     Support expanded and diverse learning options.
     Address literacy needs of adolescents.
     Expand guidance and counseling services to students.
     Better prepare high school students for college or work 
expectations.
     Support new models for teacher and school leader 
compensation.
     Expand professional development for secondary teachers and 
school leaders.

13.3 Recommendations for High School Reform

    Governors support the following recommendations to reform high 
school, align secondary school with postsecondary or college 
expectations, and promote lifelong learning.
    13.3.1 Preschool-College (P-l6) Alignment of Educational Standards, 
Systems, and Expectations. Governors have taken the lead in recognizing 
the fundamental State responsibility for a seamless progression from 
early childhood through lifelong learning opportunities. Recognition of 
this seamless educational continuum is important in fashioning 
education policies at the Fede14ral level. Congress should support 
State efforts to closely align high school standards with expectations 
and requirements for postsecondary education and work. Congress should 
encourage K-12 and postsecondary institutions, or provide incentives to 
States, to streamline high school assessments with college admission or 
readiness for work testing.
    13.3.2 K-12 Accountability. Governors support State efforts for 
rigorous testing and assessment of high school students. States have 
made considerable progress to institute standards-based testing and 
demand greater accountability in K-12 education. Governors urge 
Congress to closely consult with States on any Federal expansion of 
testing and to continue to respect Governors' authority over education. 
Any costs associated with federally mandated testing or Federal 
reporting on State exams must be completely covered by the Federal 
Government. Maximum flexibility in designing State accountability 
systems, including testing and other assessments, is critical to 
preserve the unique balance involving Federal funding, local control of 
education, and State responsibility for systemwide reform. Maximum 
flexibility in State testing will help improve how students are 
assessed for academic proficiency and postsecondary readiness.
    13.3.3 Professional Development for Teachers and School Leaders. 
High school reform will require new investments in the capacity of 
teachers and school leaders. Governors support expanded flexibility to 
increase professional development opportunities for secondary school 
teachers and school leaders, in particular those individuals working in 
hard-to-serve schools or critical shortage areas, such as math, 
science, reading, and special education.
    13.3.4 Models for Teacher and School Leader Compensation. Governors 
understand that systemic improvement in high school achievement, as 
well as college and workplace readiness, may require additional support 
for teachers and school leadership. High schools must compete with 
other more highly compensated professions for teachers and school 
leaders, especially in the areas of math and science. Congress should 
support state-administered pilot projects on performance pay, 
especially in critical shortage areas or hard-to-staff schools.
    13.3.5 Dual Enrollment and Early College. Governors recognize the 
importance of promoting innovation and integration among secondary, 
postsecondary, and industry-recognized institutions. Federal policies 
should encourage--not discourage--promising State efforts in dual 
enrollment programs that permit students to obtain college-level 
credits or provide the opportunity to earn an industry-recognized 
credential while still in secondary school. Specifically, Congress 
should encourage State dual enrollment or early college programs, and 
allow high school students participating in these programs to be 
eligible for Federal financial aid.
    13.3.6 High School Rigor. Across the Nation, high percentages of 
high school graduates are entering college, but increasingly they are 
not adequately prepared for the rigor of postsecondary courses. As a 
result, States, parents, and students are expending a great amount of 
resources on developmental courses instead of on college-level 
education, and students are taking longer to graduate or, are not 
attaining a degree. Congress should support State and local efforts to 
improve high school rigor, while working with colleges and universities 
to phase-out developmental courses. Congress should also support State 
collaborative efforts with high schools and postsecondary institutions 
to acquire information about attrition and academic progress.
    13.3.7 State Scholars. The State Scholars Initiative supports State 
efforts to voluntarily develop and promote more rigorous coursework for 
high school students and offers incentives to those students accepting 
the challenge. Governors believe that funding should be adequate so 
that any interested State could voluntarily participate in the program.
    13.3.8 Industry Certification, Advanced Placement, and 
International Baccalaureate Programs. Congress should provide financial 
incentives to States to support industry-recognized certification exams 
among high school and postsecondary school students. Congress also 
should support State efforts that encourage more students to enroll in 
Advanced Placement (AP) or International Baccalaureate (IB) coursework 
and pay for student AP testing.
    13.3.9 Diverse Learning Opportunities for Students of All Ages. A 
one-size-fit-all approach to high school learning is outdated and does 
not support the diverse needs of students. Governors encourage Congress 
to support State and local policies and programs that expand the 
availability of learning opportunities for students of all ages, 
including but not limited to, distance learning, service learning, 
internships, and the availability of financial aid.
    Diverse learning options can increase access to postsecondary 
education and lower costs. Governors urge Congress to afford students 
participating in state-accredited distance and online education 
programs full access to Federal student financial assistance. The 
Higher Education Act (HEA) should provide the U.S. Secretary of 
Education with the authority to exercise discretion to allow States and 
institutions to appropriately experiment with new ideas and approaches 
to meet the financial aid needs of students enrolled in such programs.
    13.3.10 Guidance and Counseling Services. Congress should expand 
Federal support for counseling services to secondary school students. 
Governors support Federal programs, such as Gaining Early Awareness and 
Readiness for Undergraduate Programs (GEAR-UP), the Leveraging 
Educational Assistance Partnership (LEAP), and the Elementary and 
Secondary School Counseling Program (ESSCP). In all three programs, 
Congress should provide States and local school districts with greater 
flexibility. Congress should also reauthorize GEAR-UP, and other 
Federal programs that encourage college attendance, in an equitable way 
that allows students to benefit from these opportunities in all States 
that apply for grants. Additionally, State innovation in this area 
should be further supported by Congress to broaden opportunities and 
encourage systemic improvements. Under the ESSCP program, local school 
districts should be given flexibility to allocate resources between the 
elementary or secondary school level for key Federal programs.
    Governors understand the importance of early college planning and 
preparation. Congress should support State strategies that promote 
early college awareness, including middle school programs that focus on 
the importance of high school to prepare for college and college 
admissions tests.

13.4 Carl D. Perkins Vocational and Technical Education Act

    The reauthorization of the Carl D. Perkins Vocational and Technical 
Education Act (Perkins) is an important component of high school 
reform. Career and technical education can bridge the transition 
between high school and postsecondary activities by providing students 
with real-world skills to better prepare for the 21st century 
workplace. In particular, the Perkins reauthorization should improve 
the academic rigor of career and technical education for students. To 
this end, Governors support increased Federal funding for Perkins' 
programs.
    13.4.1 State Leadership. Governors support the strong role for 
State leadership in Perkins. This role can only be maintained with 
adequate resources for administration, leadership, and innovation. 
Governors oppose any reduction in the Federal commitment to fund and 
support this important State role.
    13.4.2 Federal and State Alignment. The goals and objectives of 
career and technical education should align with other Federal 
education and workforce development programs to promote lifelong 
learning opportunities, work readiness, and school readiness. 
Furthermore, Governors believe that career and technical education 
programs must complement the academic mission of the No Child Left 
Behind (NCLB) Act. In recognizing the importance of coordination and 
alignment among different Federal programs, Governors support aligning 
Perkins with NCLB and eliminating duplicative reporting requirements 
fulfilled by NCLB.
    13.4.3 State Flexibility. Congress should maintain and enhance the 
flexibility to fashion career and technical education programs to meet 
each unique State situation. Governors support continuing and enhancing 
the flexibility currently allowed under Perkins, such as allowing 
States to determine the allocation of funds between secondary and 
postsecondary institutions. Congress also should give States the 
authority to combine Tech Prep with Basic State Grants.
    13.4.4 State Accountability. Federal policy should continue to 
recognize the critical State role of determining and setting 
performance standards and other measures to ensure student success in 
career and technical education programs. Governors support the use of 
State determined accountability measures.
    13.4.5 Paperwork Reduction: State Plans. Governors recognize the 
important objectives sought by the different provisions within Perkins. 
However, Governors believe that States should be able to file a single 
unified plan to substantially reduce the paperwork burden on State 
agencies and to increase collaboration between Perkins' programs.
    13.4.6 Data Collection and Maintenance. Governors recognize the 
importance of having reliable and useful data to measure student 
performance in career and technical education programs. Congress should 
allot additional Federal resources to develop, maintain, or support 
State data systems to comply with Perkins. To this end, Congress must 
cover any increase in the cost of administering or implementing new 
federally mandated data requirements.

13.5 Higher Education Act of 1965

    It is essential that postsecondary institutions keep pace with the 
ever-changing global economy and reforms implemented in elementary and 
secondary education. While the Higher Education Act of 1965 expanded 
opportunities for students, reform to the larger postsecondary system 
has been slow and graduation rates remain relatively stagnant. In this 
new economy and era of education reform, now is the time to reform 
postsecondary education by increasing relevance and rigor, 
accountability, linkages with K-12 education and the workplace, and by 
expanding financial aid to students of all ages. Governors urge the 
109th Congress to reauthorize HEA and to strengthen the State-Federal 
partnership in postsecondary education to serve the Nation well into 
the 21st century.
    13.5.1 Higher Education Act Principles. HEA provides the statutory 
framework for a wide range of student financial assistance that enables 
expanded access by all students to higher education institutions; 
ensures affordability for low- and moderate-income families; and 
provides for Federal programs to strengthen graduate education, 
minority-serving institutions, and international education. Governors 
recommend the following principles for HEA reauthorization.

     Support State strategies to improve enrollment and 
completion of postsecondary education.
     Make college more affordable for students.
     Simplify forms for the complex program of student 
financial assistance.
     Align HEA with other Federal education programs, including 
increased accountability in the system.
     Recognize the growing need for services and supports for 
nontraditional students to be successful.

    13.5.2 College Affordability for All Students. The Nation's 
Governors recognize the vital importance of financial aid programs to 
make college education more affordable for students, including part-
time and nontraditional students. In addition, Governors support a 
strong Federal commitment to ensure affordability through both Federal 
grant aid and loan programs. Congress should work to ensure that 
Federal higher education assistance substantially defrays education 
costs. Governors also appreciate that student loan consolidation 
provides students with another mechanism to address college 
affordability.
    13.5.3 Student Loan Financing Loophole. Congress should permanently 
close the student loan financing loophole and reinvest those savings 
into other Federal education programs. The closure of the loophole will 
save taxpayers money while expanding opportunity and support for 
students.
    13.5.4 Pell Grants for Students. Governors recognize the value of 
need-based financial aid programs, such as Pell grants. Governors are 
concerned with the historical inadequate funding of Pell grants to 
provide the maximum allowable awards to eligible students and believe 
that Congress should consider raising the Pell grant maximum. Governors 
believe that the Federal Government should review the Pell grant 
program to ensure that the purchasing value of this grant has not 
diminished over time. Congress should also fund an enhanced Pell grant 
for those students graduating in the top 10 percent of their high 
school class for the first 2 years of college, as long as there is no 
reduction in the total number or size of grants awarded to other Pell 
Grant recipients.
    The Pell grant program should be modernized to reflect the varied 
needs of today's high school and postsecondary school students, 
including independent students and those attending less than half-time. 
Governors also support extension of Pell grants for students whose 
educational pursuits extend beyond the typical calendar year. Pell 
grant eligibility should extend to summer classes and mid-term classes 
to allow these students to pursue their studies throughout the year, if 
possible.
    13.5.5 Leveraging Educational Assistance Partnerships. Congress 
should expand the Federal investment in the LEAP program to continue to 
spur State investments into need-based grant aid, merit scholarships 
for needy students, and need-based scholarship programs in specialized 
areas. The LEAP program represents an excellent Federal-State 
partnership to support and encourage eligible students to attend and 
stay in college. To better enable States to compete for these funds, 
Congress should add more flexibility to allow local and private fund 
matches to be counted towards the State maintenance-of-effort.
    13.5.6 Form and Program Simplification. Governors believe that the 
current Federal, State, and private student financial assistance 
programs have provided unprecedented opportunities for students in 
America. However, the array of Federal, State, and private 
scholarships, grants, loans, tax breaks, and work-study programs 
presents a complex and often confusing set of choices for students. The 
reauthorization of HEA should require coordination and collaboration 
between Federal Agencies to simplify the application process and forms, 
to utilize information technologies to facilitate navigation among the 
many choices and opportunities, and to strengthen the role of state-
based guarantee agencies in the financial aid process. Additional 
transparency and education about the Pell grant award process, as well 
as other programs of financial aid, should be encouraged.
    Moreover, Governors believe that the administrative burdens and 
excessive regulations associated with the Federal student financial aid 
process must be substantially improved for students, institutions of 
higher education, and States.
    13.5.7 Postsecondary Accountability. Accountability of higher 
education institutions is an important issue for Governors, and the 
Federal Government should defer to the States' leadership in this area. 
For this reason, Congress should require greater accountability from 
postsecondary institutions as defined by the State. Postsecondary 
institutions should strive to improve the retention and completion of 
all enrolled students and to increase postsecondary attainment. For 
this reason, Governors support the State development of clear, 
significant, and measurable goals for postsecondary institutions.
    13.5.8 Accountability for Teacher and School Leader Preparation 
Programs. HEA reauthorization should strengthen the Federal-State 
partnership for the preparation, training, and professional development 
of the next generation of the Nation's teachers and school leaders. 
Governors have taken the lead in their States advocating stricter 
standards for teacher preparation and performance. Governors urge the 
Federal Government to defer setting national standards, and instead 
allow States to give their own teacher preparation programs an 
opportunity to demonstrate their effectiveness. However, Congress 
should support and build on State reforms to expand accountability for 
teacher preparation programs and to align NCLB standards with HEA Title 
II programs.
    13.5.9 Coordination with Workforce Programs. An educated workforce 
is an essential element of a State's success in the new economy, and 
effective postsecondary education is a key factor for a successful 
economic development program today. Congress should strengthen the ties 
between postsecondary institutions and workforce programs by 
coordinating programs at the U.S. Department of Labor and the U.S. 
Department of Education that address workforce training and 
preparation.
    13.5.10 Access for Nontraditional Students. Governors recognize the 
diversity of today's postsecondary students. Governors support the 
removal of barriers within the financial aid systems that make it 
difficult for part-time, financially independent, or nontraditional 
students to qualify for financial aid.
    13.5.11 Loan Forgiveness for Teachers. Governors support 
congressional efforts to expand student loan forgiveness for teachers, 
specifically those teachers working in hard-to-staff schools, including 
schools identified as in need of improvement, or those teachers working 
in critical shortage areas, such as special education, math, reading, 
and science.
    13.5.12 Encouraging Families to Save for Their Children's Higher 
Education. Governors have taken the initiative in establishing college 
savings plans in their States that increase affordability of a 
postsecondary education for middle-income families. These programs 
should be supported and encouraged in the reauthorization of HEA 
according to the following principles of a Federal-State partnership.

     College savings incentives at the Federal level should be 
designed to simulate and complement, rather than preempt, similar 
policy initiatives by States and public and private higher education 
institutions.
     Congress should strive to simplify the tax code as it 
relates to college savings and tax credits wherever possible. An overly 
complex system can dissuade those most in need of financial aid from 
pursuing it.
     Reduced revenue resulting from tax incentives for savings 
for higher education should not lead to reductions in other vital 
Federal higher education programs.

Related Policies

    ECW-5, Great Expectations: The Importance of Rigorous Education 
Standards and K-12/Postsecondary Alignment
    ECW-12, Building Successful Literacy Initiatives
    ECW-15, Principles of Federal Preschool-College (P-16) Alignment

    Time limited (effective Winter Meeting 2005-Winter Meeting 2007).
    Adopted Winter Meeting 1998; reaffirmed Winter Meeting 2000; 
revised Winter Meeting 2001, Winter Meeting 2003, and Winter Meeting 
2005 (formerly Policy HR-44).
                                 ______
                                 

ECW-15. Principles of Federal Preschool-College (P-16) Alignment

15.1 Preamble

    In the 109th Congress, three of the five major education laws--Head 
Start, the Carl D. Perkins Vocational and Technical Education Act 
(Perkins), and the Higher Education Act (HEA)--are scheduled for 
reauthorization. Congress recently reauthorized the Individuals with 
Disabilities Education Act (IDEA) and is expected to review the No 
Child Left Behind (NCLB) Act in the next several years. Given the 
confluence of these significant education reauthorizations, Congress 
should take this unprecedented opportunity and make every effort to 
align the Federal education laws, as well as support State efforts to 
create an educational continuum from preschool through college, 
commonly referred to as P-16 alignment.
    The Nation's Governors have taken the lead in recognizing each 
States fundamental responsibility for a seamless progression in 
education for citizens from preschool through college and into lifelong 
learning. Governors are leading efforts to oversee the integration of 
early childhood, elementary, secondary, and postsecondary education, 
including creating and strengthening statewide P-16 councils or other 
collaborative efforts. Governors are also leading efforts to better 
monitor and assess student success throughout their education 
experience. Recognition of the need for a seamless educational system 
is important in fashioning education policies at the Federal, State, 
and local level.
    Congress should align Federal education laws so that legislation 
relates, supports, and builds upon each other. Federal education laws 
should no longer be silos of assistance providing support or 
opportunities to limited populations. Federal and State education 
reform must be systemic, coordinated, and aligned for student needs.
    Federal P-16 alignment is not a one-size-fits-all mandate--it is 
the alignment of existing and future Federal laws. If the Federal 
Government has issued a law, such as IDEA, then other Federal education 
laws should coordinate, support, and relate to IDEA. If the Federal 
Government has not preempted State or local rule on an issue, Congress 
should refrain from establishing any Federal mandates to ensure maximum 
State and local flexibility to create P-16 systems. To achieve this 
goal, Congress must provide States with greater flexibility and 
authority to align education systems and standards.
    Alignment of Federal P-16 laws will ultimately improve education 
for students of all ages by eliminating unnecessary government 
bureaucracy, reducing costly duplication, aligning academic rigor and 
preparation, expanding systemwide accountability, and promoting 
flexibility for innovation. For these reasons, Governors believe that 
the following principles of Federal P-l6 alignment should be 
incorporated in the reauthorizations of Head Start, NCLB, Perkins, HEA, 
IDEA, and related regulations and laws.

15.2 Principles of Federal P-16 Alignment

     Align Federal data reporting requirements. The U.S. 
Department of Education and related agencies should coordinate and 
simplify efforts to collect data from States and localities. Aligned 
Federal data reporting requirements can support State data systems, 
simplify data collection, and reduce duplication. Existing Federal data 
sets should be comparable from age-to-age and state-to-state. 
Duplication should be eliminated by Congress. The cost of any federally 
mandated data reporting requirements, including systems and personnel, 
should be fully covered by the Federal Government.

     Support state efforts to build the data capacity to track 
student progress from early childhood through postsecondary school or 
the workforce. Exemplary state data systems provide student-level 
information for accountability purposes, improve teaching and learning. 
and inform resource allocation decisions.
     Increase and align academic rigor for all students. 
Academic rigor should be increased across grades to ensure that 
students complete high school and prepare for college or work. All 
students benefit from the completion of more rigorous coursework.
     Align educational systems. Federal laws should support 
State alignment of standards across grades and education settings. 
Federal early education programs should be aligned with school 
readiness requirements for kindergarten, and high school standards 
should be aligned with requirements for postsecondary education and 
work activities. As a result, preschool children will be better 
prepared for kindergarten and high school students will be better 
prepared to be successful in college or work.
     Expand educational options and delivery methods for all 
students. Students learn in a variety of formats, methods, and 
settings. Federal education policy should support students' diverse 
learning needs as determined by States.
     Support state-level P-16 accountability systems. Exemplary 
state-level P-16 accountability systems hold all levels of the 
education system accountable for student progress and achievement. 
While NCLB placed new accountability requirements on K-12 education, 
factors influencing success in other grades remain largely unchanged in 
Federal education law. Teacher training, early education, and academic 
rigor in vocational education programs are factors that impact the 
success of students, teachers, and school leaders in elementary and 
secondary education. Public reporting of information will also help to 
empower parents, students, the public, and decisionmakers to evaluate 
education in their communities.
     Expand gubernatorial authority to coordinate Federal 
education funds. Governors should be given greater authority to 
coordinate Federal funds within education programs and across grade 
levels to create aligned P-16 systems to better serve students' unique 
and diverse needs.
     Support State efforts to create P-16 educational systems; 
oppose a one-size-fits-all Federal education system. P-16 alignment is 
complex and unique to each State. The Federal Government should 
recognize differences among States and support State innovation to 
create P-16 education systems, as well as refrain from setting any 
broad sweeping Federal mandates on States. Congress should support the 
State creation of strong P-16 councils and other collaborative efforts, 
as well as the development of State databases to collect longitudinal 
data on students' academic progress throughout the P-16 system.
     Centralize educational governance with Governors. 
Governors are the chief executive officers of States and are 
responsible for the education of their citizens. Unfortunately, Federal 
laws and regulations sometimes undermine, dilute, or create barriers to 
State efforts to align education programming. Congress should recognize 
and reinforce Governors' authority over education in their States.

Related Policies

    ECW-2, Education Reform
    ECW-3 An Active, Knowledgeable Citizenry
    ECW-4, Head Start: Strengthening Collaboration
    ECW-5, Great Expectations: The Importance of Rigorous Education 
Standards and K-12/Postsecondary Alignment
    ECW-7, Child Care and Early Education
    ECW-8, Individuals with Disabilities Education Act
    ECW-12, Building Successful Literacy Initiatives
    ECW-13, High School Reform: Aligning Secondary and Postsecondary 
Education
    ECW-14, Public Charter Schools

    Time limited (effective Winter Meeting 2005-Winter Meeting 2007).
    Adopted Winter Meeting 2005.

    Joan Wodiska, Director, Education, Early Childhood and Workforce 
Committee, 444 North Capitol Street, NW Suite 267, Washington, D.C. 
20001, (202) 624-5361 (202) 624-5313 [email protected].
                                 ______
                                 

    The Chairman. You mentioned that some of the legislators 
are here. Is your Chairman of Senate or House Education here? 
Raise your hand if you are.
    [Laughter.]
    Governor Sebelius. I did not see them as I looked around.
    The Chairman. The only reason I mention that is because the 
Wyoming Chairman of Education is here.
    Governor Sebelius. I know they are here in Washington, but 
I do not know that they are here in the room.
    The Chairman. He has been standing patiently in the back, 
and since we are short on seats, I would invite him to come up 
and have a seat up here in the front. And if any of the other 
Chairmen of Education from any of the States are here, you are 
welcome to come up and join us too.
    Governor Fletcher.

  STATEMENT OF HON. ERNIE FLETCHER, GOVERNOR OF KENTUCKY, ON 
          BEHALF OF THE NATIONAL GOVERNORS ASSOCIATION

    Governor Fletcher. Chairman Enzi, Senator Alexander, 
Senator Isakson, it is good to be with you. Thank you for this 
kind invitation and the honor. Certainly it is good to see 
Senator Isakson here. We spent some time together on the 
Education Committee on the House side, and I want to 
congratulate you for being here.
    I also want to recognize Secretary Spellings and Secretary 
Chao. Secretary Spellings will be visiting us in May in 
Kentucky, and Secretary Chao, I want to thank her for the work 
on WIA Plus. That will give States the flexibility to use 
workforce money to support economic development and create more 
jobs, and also thanks for her leadership as a great Kentuckian 
as well as a great Secretary.
    It is good to join Governor Sebelius here, and as she 
discussed, Governors are eager to align preschool through 
college education systems to ensure that America remains 
competitive. To promote this concept in Kentucky I have 
reorganized our education cabinet, bringing together all 
education and workforce development entities to make lifelong 
learning seamless and more effective. With me today I have 
Secretary Virginia Fox, who is Secretary of Education in 
Kentucky.
    We all recognize that high schools are our Nation's front 
line in the battle to strengthen America's global 
competitiveness, and acknowledge that education is economic 
development. Without question, high school completion is 
essential not only for postsecondary education, but also for 
work readiness and lifelong learning.
    Too many of our Nation's youth are dropping out of high 
school and too many high school graduates are unprepared for 
the demands of postsecondary education, and they are unprepared 
for the 21st century workplace.
    The Achieve Board and Achieve, Inc. and the NGA have 
developed data profiles indicating that nationally only 68 out 
of 100 students will graduate from high school on time. 
Furthermore, those numbers drop significantly when we look at 
the college success rates. Nationwide only 18 of those 68 high 
school graduates will complete college within 6 years. As such, 
Governors are working to improve the high school experience to 
ensure that our students are ready to earn and learn well 
beyond graduation day.
    NGA, with Chairman Governor Mark Warner, launched an 
initiative entitled Redesigning the American High School. This 
was done in partnership with the Wallace Foundation and four 
other national organizations. The NGA developed several 
publications including ``Getting it Done,'' and ``Ten Steps to 
a State Action Agenda'' to provide Governors with concrete 
strategies to redesign their high schools. In addition the NGA 
is convening six town hall meetings to listen to student 
suggestions to improve high schools.
    The 2005 Summit on High Schools drew nearly 50 Governors, 
Secretary Spellings, Senator Bingaman, and 2 members of the 
House. And Governors returned to their States with high school 
action plans in hand, and the NGA and its five-partner 
foundation announced a $42 million initiative to help States 
with this implementation.
    Governors would like to partner with Congress and the 
Administration to accelerate our high school redesign action 
plans. Let me point out some specific actions, how we might 
work with Congress to accomplish that.
    First, States are connecting classroom work to real life 
problems and are improving connections to postsecondary 
education. Congress can support State reform by lifting 
burdensome reporting requirements and allowing Governors 
greater flexibility to coordinate funds to serve unique student 
needs better. The Perkins Act will assist in this endeavor. 
Career and technical education can bridge the transition 
between high school and postsecondary education by providing 
students with real world skills to better prepare them for the 
modern workplace.
    Next, States are expanding opportunities that increase 
rigor and relevance for high school students. Congressional 
support to expand opportunities for students to participate in 
advanced placement, international baccalaureate, industry 
certification programs, distant learning, and the State 
scholars program will help us implement dual enrollment 
programs. One vehicle for this support is through tuition 
assistance program modification and flexibility.
    In addition, States are developing new targeted recruitment 
incentives to attract and retain teachers and principals. 
Additional Federal flexibility and incentives would further 
this critical work by expanding professional development and 
piloting alternative teacher compensation models. We 
additionally believe that permanently expanding loan 
forgiveness from 5,000 to 17,500 will facilitate the 
recruitment of teachers in the critical shortage areas and 
hard-to-staff schools.
    Also States are investing more resources into need-based 
aid to make college an option. We ask that you consider raising 
the maximum Pell grant award and provide new flexibility to 
respond to students' needs including extending eligibility 
beyond the typical calendar year. In addition, student 
financial aid guidelines should be better revised to better 
serve working adults.
    Finally, States are improving college and work-readiness 
assessments in high school, and we encourage consultation with 
States on any Federal expansion of testing, and to continue to 
respect States' responsibility and authority regarding 
education. Maximum flexibility in designing State 
accountability systems including testing and other assessments 
is critical to preserve the unique balance involving Federal 
funding, local control of education, and State responsibility 
for statewide reform.
    In closing, Governors hope to forge a new Federal/State 
partnership that strengthens State ingenuity and innovation. 
Every child, every teacher, every school and every State is 
unique. Our Nation must not fail to provide students with a 
foundation for lifelong learning. The cost to our children and 
our Nation is too high.
    The Nation's Governors stand ready to work with you to 
create a common vision to support lifelong learning and to 
redesign our Nation's high schools.
    Thank you for this opportunity.
    [The prepared statement of Governor Fletcher follows:]

               Prepared Statement of Hon. Ernie Fletcher

    Good morning Chairman Enzi, Senator Kennedy, and members of the 
committee. I am Ernie Fletcher, Governor of the Commonwealth of 
Kentucky, and I'd like to thank you for the invitation to testify on 
behalf of the Nation's governors regarding lifelong education. As 
Governor Sebelius has discussed, governors are eager to align 
preschool-college education systems to promote lifelong learning and to 
ensure American business and workers can remain competitive.
    High schools are our Nation's front line in the battle to restore 
America's global competitiveness. High school completion is the first 
step in the earnings and skill ladder and the bridge to postsecondary 
education, work readiness, and lifelong learning.

                            A CALL TO ACTION

    For more than a century, our Nation's high schools fulfilled this 
task and prepared students for good jobs at decent wages. As you 
already heard from Secretary Spellings, the legacy of our Nation's high 
schools is in jeopardy--too many of our Nation's youth are dropping out 
of high school and too many high school graduates are unprepared for 
the demands of postsecondary education or work.
    Three out of ten students who enter high school do not graduate. 
Four out of ten who graduate lack the skills and knowledge required to 
go to college or succeed in the workforce. Five out of ten who go to 
college do not finish.\1\
---------------------------------------------------------------------------
    \1\ National Center for Public Policy and Higher Education, Policy 
Alert: The Educational Pipeline: Big Investments, Big Returns (San 
Jose, Calif.: National Center for Public Policy and Higher Education, 
2004), at http://www.highereducation.org/reports/pipeline/pipeline.pdf.
---------------------------------------------------------------------------
    Our high school students' lack of preparation has serious 
implications for our economy and prosperity. Every year taxpayers pay 
$1 billion to $2 billion to fund remedial education to students at 
public universities and colleges.\2\ Shortfalls in basic skills cost 
businesses, colleges and under-prepared high school graduates, as much 
as $16 billion annually in lost productivity and remedial costs.\3\
---------------------------------------------------------------------------
    \2\ David Breneman and William Haarlow, Remediation in Higher 
Education (Washington, D.C.: Thomas B. Fordham Foundation, July 1998); 
and Ronald Phipps, College Remediation: What It Is, What It Costs, 
What's at Stake (Washington, D.C.: Institute for Higher Education 
Policy, December 1998.) An Action Agenda for Improving America's High 
Schools: 2005 National Education Summit on High School (Washington, 
D.C., February 2005).
    \3\ Jay P.Greene, The Cost of Remedial Education: How Much Michigan 
Pays When Students Fail to Learn Basic Skills (Midland, Mich: Mackinac 
Center for Public Policy, 2000). An Action Agenda for Improving 
America's High Schools: 2005 National Education Summit on High School 
(Washington, D.C., February 2005).
---------------------------------------------------------------------------
    Our Nation has a powerful incentive to plug the leaks in the 
education pipeline. In the next decade, two-thirds of new jobs will 
require some postsecondary education beyond a high school degree. To be 
competitive and create the conditions for strong economic growth, 
States need to help all their residents increase their skills and be 
prepared for lifelong learning. Much is at stake.

              NGA ``REDESIGNING THE AMERICAN HIGH SCHOOL''

    Governors are working to improve the high school experience to 
ensure that our students are ready to earn and learn well beyond 
graduation day. Under the leadership of NGA's Chairman, Virginia 
Governor Mark Warner, NGA launched an initiative--``Redesigning the 
American High School''--to spur State action and systemically change 
high schools. As part of the Chairman's initiative, NGA:

     Convened governors advisors from over 30 States to develop 
an understanding of the diverse problems in high schools and increased 
awareness of promising State best practices;
     Developed several publications such as Getting it Done: 
Ten Steps to a State Action Agenda to provide governors with concrete 
strategies to begin redesigning their high schools; and
     Convened town hall meetings in Cleveland, Ohio, Conway, 
Arkansas and Norfolk, Virginia to listen to students' suggestions on 
what governors can do to improve their State's high schools. Three 
additional town hall meetings are scheduled to take place in Baton 
Rouge, Louisiana; Portland, Maine; and Des Moines, Iowa.

    As a result of these efforts 26 governors made high school reform a 
priority in this year's State of the State addresses.

             2005 NATIONAL EDUCATION SUMMIT ON HIGH SCHOOL

    Most recently, NGA and Achieve convened the 2005 National Education 
Summit on High Schools. The summit addressed such core high school 
reform issues as strengthening high school graduation requirements, 
expanding options and supports for students to achieve higher 
standards, improving teaching and principal leadership, and 
strengthening high school and college data and accountability systems.
    An Action Agenda for Improving America's High Schools was released 
at the summit. The publication provides States with a framework to 
build their high school agendas. The framework calls for:

     Restoring Value to the High School Diploma by anchoring 
high school academic standards in the real world; upgrading high school 
coursework, and creating college and work ready tests.
     Redesigning High Schools by reorganizing low-performing 
high schools first; expanding school options in all communities; and 
providing support to low-performing schools.
     Giving High School Students the Excellent Teachers and 
Principals They Need by improving teacher knowledge and skills; 
providing incentives to recruit and keep teachers where they are needed 
most, and developing and supporting strong principal leadership.
     Setting Goals, Measuring Progress, and Holding High 
Schools and College Accountable by strengthening high school 
accountability, intervening in low-performing high schools, and 
strengthening postsecondary accountability.
     Streamlining and Improving Education Governance by 
building a stronger working relationship between elementary, secondary 
and postsecondary education.

    Nearly 50 governors took part in the Summit, which marked the fifth 
time since 1989 that governors, CEOs and education leaders gathered to 
address the urgent needs of America's educational system.

                 HIGH SCHOOL REFORM ``GETTING IT DONE''

    At the close of the NGA Winter Meeting and High School Summit, 
governors returned to their States with high school action plans in 
hand. Some governors will take immediate action to expand college-level 
learning opportunities in high schools, or fund supports to help 
students pass their high school exit exam. Other governors will develop 
long-term plans for aligning high school standards with the 
expectations of employers or universities to ensure that high quality 
teachers and principals teach in the neediest high schools.
    To ensure that ``Redesigning the American High School'' became a 
reality, NGA and five partner foundations--the Bill and Melinda Gates 
Foundation, the Michael and Susan Dell Foundation, The Wallace 
Foundation, The Prudential Foundation and the State Farm Foundation--
joined forces and announced a $42 million initiative to translate 
Summit discussions into State action to help States create and 
implement policy strategies to improve graduation and college-readiness 
rates. In addition, NGA's Center is also exploring partnerships with 
the GE Fund, Ewing Marion Kauffman Foundation, The Lumina Foundation, 
and the Bell South Foundation. This month, NGA released a Request for 
Proposals to all States interested in creating a high school redesign 
agenda.

                 NGA HIGH SCHOOL REFORM RECOMMENDATIONS

    Governors would like to partner with Congress and the 
Administration to accelerate our high school redesign action plans. 
Governors are leading innovative high school redesign across the 
Nation. Let me point to several specific ways that States are reforming 
high schools and how Federal policy can help spur State innovation and 
best practices:

     States are creating different high school models that 
strengthen student relationships with adults; connect classroom work to 
real-life problems; and improve connections to postsecondary education.
         Congress can support State reform by lifting 
        burdensome reporting requirements and allowing Governors 
        greater flexibility to coordinate funds. Congress should 
        provide greater gubernatorial authority to coordinate Federal 
        funds within education programs and across grade levels to 
        better serve students' unique and diverse needs.
         The Senate's recent action to reauthorize and improve 
        the Vocational Education Act will assist in this endeavor. 
        Perkins is an important component of high school reform. Career 
        and technical education can bridge the transition between high 
        school and postsecondary education by providing students with 
        real-world skills to better prepare for the 21st century 
        workplace. Perkins should improve the academic rigor and 
        preparation of career and technical education for all students.
     States are expanding high school opportunities that 
increase rigor and relevance of high school for all students.
         During the reauthorization of HEA and WIA, Congress 
        should support expanded opportunities for students to 
        participate in advanced placement, international baccalaureate, 
        early college, industry certification programs, distance-
        learning, and the State Scholars Program. State innovation can 
        be further supported by providing greater flexibility in 
        student financial aid eligibility requirements. Congress should 
        also encourage and provide incentives to States to create dual 
        enrollment programs that permit students to obtain college-
        level credits or provide the opportunity to earn an industry-
        recognized credential while still in secondary school.
     States are developing new targeted recruitment incentives 
to attract teachers where they are needed most, and provide support to 
retain them. States are also working to improve principal recruitment, 
preparation, and professional development.
         Congress should provide additional flexibility and 
        incentives to support this critical work by expanding 
        professional development and piloting alternative teacher 
        compensation models. Loan forgiveness should be permanently 
        expanded from $5,000 to $17,500 to recruit teachers into 
        critical shortage areas and hard-to-staff schools.
     States are developing more rigorous standards for teacher 
preparation and performance. Governors are committed to improving high 
school students' academic proficiency with stronger teaching.
         Congress can encourage State innovation and continuous 
        improvement by deferring national one-size-fits-all benchmarks 
        and allowing States time to refine their teacher preparation 
        programs. In addition, Congress should work with Governors 
        during HEA reauthorization to expand State accountability for 
        teacher preparation programs to align with the rigorous 
        requirements of NCLB.
     States are investing more resources into need based aid to 
make college an option.
         Federal policies to increase preparation and learning 
        opportunities should be matched with additional flexibility and 
        affordability in higher education. To help make college more 
        affordable, Congress should consider raising the maximum Pell 
        grant award and provide new flexibility to respond to students' 
        needs, including extending eligibility beyond the typical 
        calendar year. In addition, student financial aid guidelines 
        should be revised to better serve non-traditional students and 
        working adults. These reforms should be enacted in HEA.
     States are improving college and work-readiness 
assessments in high schools.
         Across the country, Governors have made considerable 
        progress to institute State-based accountability in K-12 
        education. Governors are also working hard to implement NCLB, 
        which expanded high school accountability by requiring States 
        to test students at least once in grades 10-12.
         Governors urge Congress to closely consult with States 
        on any Federal expansion of testing and to continue to respect 
        Governors' authority over education. Any costs associated with 
        federally-mandated testing or Federal reporting on State exams 
        must be completely covered by the Federal Government. Maximum 
        flexibility in designing State accountability systems, 
        including testing and other assessments, is critical to 
        preserve the unique balance involving Federal funding, local 
        control of education, and State responsibility for systemwide 
        reform. Maximum flexibility in State testing will also help 
        improve how students are assessed for academic proficiency and 
        postsecondary readiness.

                               CONCLUSION

    Working with businesses, education leaders, parents and students, 
governors understand the unique challenges our Nation faces in 
redesigning high schools. Governors also understand how much State 
flexibility is required to develop and implement meaningful solutions. 
There are no easy answers. Every child, every teacher, every school, 
and every State is different. Governors hope to forge a new Federal-
State partnership that strengthens State ingenuity and innovation.
    Our Nation must not fail to provide students with the foundation 
for lifelong learning--the cost to our children and our Nation is too 
high. The Nation's governors stand ready to work with you to create a 
common vision to support lifelong learning and redesign our Nation's 
high schools.

    The Chairman. Thank you very much.
    I really appreciate the two Governors completely 
rearranging their schedule so that they could be here today. 
You realize that by being here you become our State experts on 
education, and we will be directing a lot of questions--besides 
the ones that we do when we get to the question part--to you, 
because as Governor Sebelius said, you are the laboratories for 
education. None of it happens at the Federal level. I thank 
both of you for going to that special effort.
    Before we start questions we will get the rest of the 
testimony here though.
    Mr. Gunderson.

STATEMENT OF STEVE GUNDERSON, DIRECTOR, WASHINGTON OFFICE, THE 
                        GREYSTONE GROUP

    Mr. Gunderson. Mr. Chairman, Senator Alexander, Senator 
Isakson, I feel like I am coming home to friends both in terms 
of colleagues on the panel and the staff that is supporting you 
because I have had the privilege of working with so many of you 
for so long on the education and training issues of our 
country.
    The jobs revolution is to date a silent revolution. The 
media do not cover it. Our citizens do not recognize it. The 
business community only sporadically is concerned about it. 
Thus, policymakers have not made it a national priority. It is 
my hope that with your leadership, Mr. Chairman, we might 
engage in a national conversation leading to a national 
understanding and commitment of preparing workers for the 
future workforce and workplace.
    As the Nation considers proposals to reform and save Social 
Security, I would like to recall two key elements that are not 
being discussed. We talk of the Social Security Fund spending 
more money than it takes in starting in 2017 or 2018, but a 
full 10 years before that, in 2008, the baby boom generation 
begins retiring.
    Second, consider the impact education attainment, workforce 
skills, good jobs and good wages would have on extending the 
solvency of this fund. If we can double or triple salaries, we 
double or triple the contributions into Social Security 
solvency.
    Three factors, demographics, workplace skill demands, and 
the global economy are combining to create a jobs revolution. 
Any of these factors is a dramatic transition. Combined, they 
are nothing less than a revolution.
    Baby boomers are leaving, but there is no one to replace 
them. By 2030 some 76 million baby boomers will have retired, 
while only 46 million of Generation X and Y will have entered 
the workplace. Meanwhile, we are changing the face of the 
American workforce. By 2010 blacks will increase by 21 percent 
and hispanics by 43 percent. Until we provide them with equal 
education attainment this is just another false hope.
    Second, the workplace itself is changing. The average 
worker today entering the workplace will have 10 to 14 careers 
in their lifetime, as you have mentioned.
    Third, the global economy. We see India graduating twice as 
many students from college as America, while China is expected 
to graduate three times as many, and that is only half the 
story. Forty-two percent of the students in China earn 
undergraduate degrees in science and engineering compared to 5 
percent in the United States. What else can you call it but a 
revolution?
    We need also today to recognize that the workplace is 
requiring higher and higher skills, and thus an increasing 
number of individuals are unwilling to even seek employment 
knowing they will face rejection. For the past 3 consecutive 
months the civilian labor force participation rate in America 
has been 65.8 percent, the lowest since 1988.
    In our book The Jobs Revolution, my colleagues, Bob Jones, 
Kathryn Scanland and I make three points challenging both 
political parties. We agree with the Republicans that one 
cannot stop the emerging global economy and we should not try. 
But we agree with the Democrats that one cannot transition to a 
knowledge-based global economy on the cheap. Third, while post-
high school education used to be an opportunity, it is today a 
necessity. We must change our public educational commitment 
from K-12 to P-14 or beyond, as our Governors have suggested.
    As you consider various suggestions, let me just quickly 
highlight two or three.
    Prepare America's workforce for the 21st century. It begins 
with basic academic skills, but it must connect academics and 
career skills.
    Second, connect the programs. Today we are faced with 
disjointed programs and turf battles over money and 
responsibility.
    Third, recognize the importance of a mobile workforce to 
have employer-recognized, industry-based certificates that will 
be moving with them across the Nation.
    Fourth, promote a regional response. We have seen in recent 
days, in recent weeks, in recent years quite a battle between 
the President's proposal to send most of the training dollars 
to the Governors and the Workforce Investment Board's advocacy 
for maximum local control. One compromise might be for regional 
strategies. I am impressed by how economic development and 
workforce investment strategies are more and more done not on a 
statewide and not on a local, but rather on a regional basis.
    In closing, let me close from the last words of our book. 
``We are growing desperate for leaders who will go beyond 
speeches to action. America has 5, maybe 7 years in which to 
radically revamp its fundamental assumptions about workforce 
development and then to act. Whatever is going to be done to 
prepare us for shortages of workers and skills, increased 
global competition, disparities in achievement between ethnic 
American communities and technology that changes while we 
sleep--whatever we are going to do, must be done now.''
    Thank you very much.
    [The prepared statement of Mr. Gunderson follows:]

               Prepared Statement of Hon. Steve Gunderson

    Mr. Chairman and members of the committee, I am Steve Gunderson, a 
senior consultant with The Greystone Group, a strategic planning and 
research consulting firm based in Chicago, Grand Rapids, Michigan, and 
here in Washington, D.C. (Arlington, Virginia). I joined Greystone in 
1996 after the 16-year privilege of representing Western Wisconsin in 
the U.S. Congress. During my congressional years I became, and have 
remained, passionately involved with national issues of education and 
job training. Many of your colleagues on both sides of the aisle, and 
many of the staff for this committee, are long-time friends and 
associates. So it is not only a high honor but also a real joy to be 
with you again.
    The jobs revolution now occurring in America is almost certain to 
have more impact on the economic, social, and cultural future of this 
Nation than any other single factor. Even so, it is to date a silent 
revolution. The media do not cover it, our citizens do not recognize 
it, the business community is only sporadically concerned about it, 
thus policymakers have not made it a national priority. It is my hope 
that, with your leadership, Mr. Chairman, we might begin a national 
conversation leading to a national commitment to prepare our workforce 
and our workplace for the future.
    As the President, the Congress and the Nation consider proposals to 
reform and save Social Security, I'd like to recall two key facts that 
have been missing in this discussion.
    First, we talk of the Social Security Fund spending more money than 
it takes in starting in 2017 or 2018. But a full 10 years before that, 
in 2008, the baby boom generation begins retiring. This is a far more 
immediate crisis because 2008 is--in terms of budgets, proposals and 
action--upon us.
    Second, while we seek consensus on keeping Social Security solvent, 
consider the impact educational attainment, workforce skills, good jobs 
and good wages will have on extending the solvency of this fund. We 
could keep the system solvent much longer by lifting the incoming 
generation of workers' skills and incomes. Americans without a high 
school diploma generally earn about $30,000 per year. If we can extend 
their educational attainment and skills, we can reward them with 
incomes in the range of $55,000 with 2 years of postsecondary 
education, and $75,000 or more on average with a college degree. They 
will then be contributing two to three times as much into Social 
Security, offsetting losses that will begin very soon.

                          THE JOBS REVOLUTION

    Three factors--demographics, workplace skill demands, and the 
global economy--are combining to create a jobs revolution. Any one of 
these factors represents a dramatic transition in our economy. 
Combined, they create nothing less than a revolution.
    Look briefly at demographics. The primary reason we fear Social 
Security insolvency is the changing demographics of our population. In 
2008 the baby boomers begin retiring. In 2011 they begin qualifying for 
Medicare. But as baby boomers leave, no one is ready to replace them. 
By 2030, some 76 million baby boomers will have retired while only 46 
million people in Generation X and Y enter the workplace. Our labor 
force will decline in real numbers. Meanwhile, we're changing the face 
of America's workers. Tomorrow's workers are much more likely to be 
people of color--Hispanic, Black, and Asian. By 2010, Blacks in the 
workforce will increase by 21 percent and Hispanics will increase by 43 
percent. The good news is that due to changing populations, minorities 
will be given a greater chance at success in the American economy than 
ever before. But the bad news is that, until we provide them with equal 
educational attainments, this is just another false promise.
    Second, the workplace itself is changing. Former Secretary of 
Education Richard Riley has said the top 10 occupations in 2010 have 
not even been created yet. The Bureau of Labor Statistics tells us the 
average worker entering the workplace today is expected to have 10-14 
careers in their lifetime. Flexibility rooted in the ability to learn 
and relearn, with in-demand skills--these are the keys to success in 
such a workplace.
    Third, the global economy is often misunderstood. ``Outsourcing'' 
is just one element of today's global economy. Deloitte Research 
projects that, over the next 15 years, 80 percent of workforce growth 
in North America, Europe, and Asia will occur among people over 50 
years of age. On the other side of the globe we see India graduating 
twice as many students from college as America, while China is expected 
to graduate three times as many. And that's only part of the story. 
Forty-two percent of students in China earn undergraduate degrees in 
science and engineering compared to 5 percent in the United States.
    Combine these dynamics with the emerging global, knowledge-based 
economy and one soon realizes the magnitude of change before us. What 
else could this be called but a ``revolution.''

           THE NEED FOR LIFE-LONG LEARNING IS ALREADY PRESENT

    During 2004, we all rejoiced in the growth of 1.7 million jobs. 
Leading the way was professional and business services with 546,000 new 
jobs followed by 342,000 new health care jobs. We ended the year with a 
5.4 percent unemployment rate.
    But the reality is that, in today's workplace, unemployment rates 
are no longer a reliable guide for the Nation's economic health. It's a 
legacy of the Great Depression and offers little insight into either 
current or coming trends. We need, today, to reckon with a workplace 
requiring higher and higher skills and an increasing number of 
individuals unwilling to even seek employment knowing they will face 
rejection. For the past 3 consecutive months the civilian labor force 
participation rate in America has been 65.8 percent--the lowest since 
1988. These numbers suggest that 34 percent of the American citizens 
have chosen not to seek private sector employment, many--perhaps most--
because they're convinced they lack skills needed to be hired.
    The Washington Post recently published a series on the vanishing 
middle class. The articles described the experiences of workers who 
thought they had done everything right: high school graduation, 
marriage, suburban life and a steady job at a local manufacturing 
plant. But when this plant was closed, they lost their future. Since 
1967 we have lost 25 million factory workers in America. No wonder the 
category of ``temporary workers'' has increased five-fold over the past 
2 decades, leaving millions of families without insurance, without 
pensions and without hope of a permanent job.

                 PUTTING THIS IN HISTORICAL PERSPECTIVE

    To understand the magnitude of change, we must recognize that in 
1990 there was one Web site; today there are 50 million. We now expect 
as much change in the next 25 years as we've experienced in the last 
100.
    A ``revolution'' is a complete change, a re-organization, a 
transformation, an upheaval. During America's history we've had four 
experiences when economics and politics combined to change the way we 
live and work. They were:

     The American Revolution--when patriots originally sought 
less economic interference from Britain rather than a political 
revolution.
     The Agricultural Revolution--when America decided to move 
west and feed a global constituency.
     The Industrial Revolution--when America's children left 
the farms and moved into the cities to work, and
     The Information Revolution, based upon the creation of the 
microchip shortly after World War II.

    We are now living through a ``Jobs Revolution'' yielding seismic 
shifts in who works, when they work, where they work, how they work--
even whether they work. History will record the first years of the 21st 
century as a jobs revolution. It will also recall what we did in 
response to these changes.

                      THE WORKFORCE OF THE FUTURE

    Mr. Chairman, as you and your colleagues consider appropriate 
policies for tomorrow's workforce, I encourage you to keep some data at 
your fingertips.

     Of the 30 industrialized nations, the U.S. ranks first on 
the percentage of 45-64 year olds with high school diplomas. But we 
fell to 5th place for those in the 35-44 age group with high school 
diplomas, and are down to 10th place for those between 25 to 34 age 
bracket with high school diplomas. We could wish the opposite were 
true.
     Seventy-five percent of all ``new jobs'' will require some 
level of postsecondary education. The trend is against us.
     The average job will last 3 to 5 years. After that, 
workers are dependent on flexibility and skills to find their next new 
job.
     The Urban Institute reported that only 68 percent of those 
entering high school 4 years ago have graduated; for communities of 
color the graduation rate is 50 percent.
     Last fall, ACT released data showing that of those 
graduating from high school and planning for Technical College studies:
       only 10.8 percent have achieved Science Readiness,
       only 10.8 percent have achieved Math Readiness, and
       only 36.4 percent have achieved English readiness.
     Anthony Carnevale has suggested we are facing a skill 
shortage of 5.7 million by 2010 and 14 million 10 years later.

    Looking at the decade of employment change from 1992 to 2002, we 
see an actual decrease of 400,000 jobs requiring less than a high 
school education. Those with a high school diploma maintained their 
level of jobs (a 1 percent increase). But the demand for skills 
reflected in at least 2 years of postsecondary education became very 
evident. We witnessed a 2.4 million increase in jobs for workers with 
some college education, a 2.2 million increase for those with 2 years 
of academic preparation beyond high school, and a 2.6 million increase 
in technical degree jobs. Combined, those with some level of post-high 
school education and training exceeded the 6.4 million increase in jobs 
for those with a 4-year college degree. The message is clear. Not 
everyone needs a college degree to succeed in the future. But everyone 
does require some level of post-high school education. We are moving to 
a P-14 concept in educational preparation for our citizens; this is 
reality.
    And here is one point at which unemployment statistics are 
instructive: Take any recent month. Those with less than a high school 
education had an unemployment rate almost 1\1/2\ times the national 
average. On the other side of the equation, those with a college degree 
experienced an unemployment rate half the national average.

                         POLICY CONSIDERATIONS

    I realize, Mr. Chairman and members, that there are many important 
issues on your Congressional agenda and your personal schedules. But it 
is my fervent hope that you will help our Nation avoid the deadly 
collision of workforce demographics and workplace skills already 
putting our economic future at risk--both within our own economy and in 
the knowledge-based global economy of the 21st century.
    In our book, The Jobs Revolution, my colleagues Bob Jones, Kathryn 
Scanland and I make three key points challenging both political 
parties.
    1. We agree with the Republicans that one can't stop the emerging 
global economy. And we shouldn't try.
    2. We agree with the Democrats that one cannot transition to a 
knowledge-based global economy on the cheap. It will take a major 
commitment of public and private dollars, at all levels, to support 
this transition in the workforce and the workplace.
    3. Thus, while post-high school education used to be an 
opportunity, it is increasingly becoming a necessity. We must change 
our public educational commitment from K-12 to P-14. As the purpose of 
this hearing suggests, we must move toward a full understanding of and 
support for life-long learning.
    We don't suggest this is exclusively a Federal responsibility. But 
we do ask for your leadership in communicating the crisis, in 
developing the strategies for a holistic response, and in designing 
Federal programs that encourage value-added participation from all 
sectors.
    As you move through the many important legislative re-
authorizations and the difficult decisions over budget and 
appropriations I hope you will consider the following suggestions:
    1. Prepare America's workforce for the 21st century. This begins 
with the basic skills. It moves towards a direct relationship between 
academics and career skills. It continues with programs promoting 
flexibility and mobility in the workforce. It creates a Nation of life-
long learners.
    2. Connect the programs! I encourage one of you to consider 
introducing legislation that reauthorizes the Workforce Investment Act 
(WIA), the Higher Education Act, and the Perkins Vocational Education 
Act in one unified piece of legislation. Today, we are faced with 
disjointed programs and turf battles over money and responsibility. Yet 
the mission of these programs is totally connected within a strategy 
appropriate to the 21st century workforce.
    As you reauthorize these programs, find ways to bridge the gaps. 
Today, the Higher Education Act is the single most important tool in 
workforce training because of the student financial aid. Our problems 
in building cooperation between WIA and our Community Colleges is the 
disconnect that exists between the programs. WIA delivery must meet 
performance standards set by the Department of Labor while Community 
Colleges are financed by credit hours. No one's to blame, but in this 
situation it's very difficult to achieve the cooperation we--and the 
local providers--seek.
    3. We need to design our training protocols in ways that support 
the increased mobility of our workers. We must move towards employer-
recognized, industry-based certificates that will be recognized 
throughout the Nation. It is the best investment we can make in the 
future employability of a worker.
    4. Promote a regional response. We've seen in recent years quite a 
battle between the President's proposal to send most training dollars 
to the Governors and the Workforce Investment Board's advocacy for 
maximum local control. One compromise might be incentives for regional 
strategies. I'm impressed by how many of our economic development and 
workforce investment strategies are now built upon regions. This is 
appropriate. In today's world, economic development does not occur on 
either a statewide or a local community basis. It is done through 
regional economies. You should promote and encourage such thinking and 
cooperation.
    5. You must redesign unemployment insurance into some system of 
employment insurance. American workers, often through no fault of their 
own, will increasingly face job dislocation and transitions. We need to 
support the research and design of a system that can provide the skill 
training and the income insurance necessary to move from one job and 
profession to another. If we can insure cars, boats, stereo equipment 
and even pets, we should be able to design some limited program of 3-6 
months providing income insurance and retraining funds during a 
transition.
    6. We need to redesign our programs to make them appropriate for 
the 21st century workforce. I remind everyone that in 2003 we spent $42 
billion on unemployment insurance and only $6 billion on job training 
at the Federal level. Sometimes it's not just how much we spend--but 
how we spend it.
    7. Design your response appropriately for the global economy of 
today. I strongly encourage this committee to recognize the global 
realities of a 21st century workforce. Many of our new workers are 
immigrants. The only growth in the workforce in the northeastern part 
of the U.S. today comes from immigration.
    Europe, through their Bologna Accords, is designing a European-wide 
higher education system consisting of 3 years of college and 2 years of 
higher education related to specific careers. We need to be aware of 
such programs, and their impact on global competitiveness.
    8. Recognize the increased role of graduate education in workforce 
investment. We used to think of graduate education only in the context 
of research and Doctoral degrees. That is no longer the case. We now 
witness a growing interest in professional masters' degrees. And all of 
us with B.A. degrees who upgrade our skills are actually participating 
in some form of graduate education.
    9. Recognize the appropriate partnership between WIA and Community 
Colleges. As I travel the Nation and speak on the jobs revolution, I'm 
struck by the turf and money battles between our Workforce Investment 
Systems and our Community Colleges. The truth is that we need them 
both, and we need them to partner in the preparation of our future 
workforce. Local Workforce Investment Boards must provide the 
leadership in bringing together all sectors of the local business and 
education communities around current labor market information guiding 
their workforce investment strategies. Community Colleges must design 
and deliver flexible training, academics, and professional skills 
reflecting such vision and strategies for their region. We need both of 
them. We need them to work together and we need the funding streams to 
make clear the appropriate roles of each provider. Do everything you 
can to encourage coordination in the design and delivery of such 
programs.

                        VOICES FROM THE COUNTRY

    I want to share with you some thoughts regarding the delivery of 
our education and workforce programs from experts across the Nation. 
Here is a sampling of what they said:
    A. Recognize the role of P-12 education to our workforce. We need 
to constantly revisit the need for academic achievement, and its 
relationship to careers. Harold McGraw III (of McGraw Hill Companies) 
recently observed that across the Nation and ``twenty years after the 
urgent warnings of A Nation At Risk . . . the level of complacency at 
lackluster student performance is shocking.'' While School-to-Work 
programs no longer exist at the Federal level we must recognize that 
all students--not just the college-bound--need academic achievement. 
And for those most at risk, we can best accomplish this goal by making 
the appropriate connections to the workforce. The cost of complacency 
is staggering.
    B. An IBM Vice-President chairing New York State's WIB Board: 
``There is no process for Community Colleges to engage with business to 
fill existing needs in the workforce. The unstructured process and the 
lack of consistent funding hinders the ability of these colleges and 
business to work together to design and deliver an appropriate 
curriculum as needed.''
    C. Ohio: Our local WIB recently worked with Community Colleges to 
design two 1-week training programs. Each resulted in 100 percent 
employment for the graduates. We explained the needs as defined by our 
labor market research. Thus;
       The WIB determines the training needed.
       The WIB and the Community College work together to 
design the curriculum.
       The WIB pays for the training.
       The Community College provides the training.
       This needs to become the rule--not the exception of 
cooperation and program delivery.''
    D. Washington State: ``Sometimes it seems that Community Colleges 
see WIBs as nothing more than a checkbook for ideas and training. 
Rather we need to build partnerships at the local level using:
       The local labor market information to define emerging 
skill sets and jobs;
       The local One-Stop for assessments; and
       The local Community College for delivery of training.''
    E. Michigan: ``The agendas and focus of Community Colleges and 
Workforce Investment Programs seem to be growing apart--not closer 
together. Our mutual goals should be:
       serving our community, and
       serving our employer/employee needs.
       We must find ways to design and deliver a comprehensive, 
integrated system (K-12; CC's and WIB's).''
    F. Texas: ``We need to focus on the development and delivery of 
workforce issues--not our specific acts or programs. Today, policy and 
implementation are confused. There is a lack of integration. WIA looks 
at programs. Community Colleges look at courses. We both need to look 
at the big picture of training needs.
    WIA can not see training as a ``2nd chance system,'' and Community 
Colleges cannot see training as ``academic hours.''
    G. New York: ``Companies often use private trainers, due to the 
perceived ability of private trainers to tailor delivery and curriculum 
to a specific company's needs and timetables. We, together, need to 
figure out how to serve this need.''
    H. Florida: ``There are four keys to our mutual success!''
    1. Understand--what is important to each other. Community Colleges 
need to understand WIA performance measures; and WIA needs to 
understand Community Colleges' academic outcomes and funding streams.
    2. Flexible--Think about outcomes, not process.
    3. Speed--Develop a sense of urgency to get things done. Business 
thinks in terms of hours and minutes, not semesters.
    4. Personal Relationships--Business believes it is all about 
personal relationships!
    I. Massachusetts: ``The key to effective training is knowing your 
labor market. We must constantly review and upgrade our training based 
upon changes in our labor market--both in terms of worker needs and 
business demands.''
    J. California: ``If you want cooperation between Community Colleges 
and WIBs, you must start at the senior most levels--sending the message 
to everyone to work together, and quit fighting for turf. Clarify roles 
and responsibilities. WIBs are best at bringing people to the table. 
Community Colleges are best at doing the training.''

                               CONCLUSION

    This Congress will reauthorize the Workforce Investment Act, the 
Higher Education Act, and the Vocational Education Act. As you consider 
these issues it is important for the Congress and the Nation to 
recognize that we live in a very different workplace today than before. 
Today education is workforce investment and workforce investment is 
economic development. While we should think globally (recognizing the 
global knowledge-based economy), we must also act regionally. Today, 
economic development and workforce recruitment is done on a regional 
basis. And as we each chart our national, State, regional and local 
strategies, let us recognize this will require public-private 
partnership between government, education, and--most importantly--the 
private business community.
    In closing, I want to plead for your bipartisan leadership on 
behalf of the jobs revolution, and especially those Americans who will 
be most affected by it if we do nothing. And in making this request, I 
want to close my testimony with the same words we use in closing our 
book, The Jobs Revolution:

     ``We are growing desperate for leaders who will go beyond speeches 
            to action. America has 5, maybe 7, years in which to 
            radically revamp its fundamental assumptions about 
            workforce development and then to act. Whatever is going to 
            be done to prepare us for shortages of workers and skills, 
            increased global competition, disparities in achievement 
            between ethnic American communities and technology that 
            changes while we sleep--whatever we are going to do, must 
            be done now.
     All that is at stake is our children. And our communities. And our 
            future.''

    Thank you Mr. Chairman for this opportunity.

    The Chairman. Thank you.
    Mr. Fitzgerald.

STATEMENT OF BRIAN K. FITZGERALD, EXECUTIVE DIRECTOR, BUSINESS-
                     HIGHER EDUCATION FORUM

    Mr. Fitzgerald. Good morning, Mr. Chairman, members of the 
HELP Committee. I am pleased to testify before you today on 
behalf of the Business-Higher Education Forum.
    I might offer a special greeting to Senator Alexander who 
is an alumnus of the Business-Higher Education Forum from the 
time of his tenure as president of the University of Tennessee.
    Our mission, Mr. Chairman, is to encourage dialog among 
corporate and university leaders on issues central to the role 
of higher education in a global economy, and to provide the 
leadership in shaping sound policy. Our recent work has ranged 
from university and industry research collaborations to the 
changing nature of student skills needed in the workforce and 
improving access to higher education for an increasingly 
diverse population.
    In February 2005, the Forum released its most recent 
report, ``A Commitment to America's Future: Responding to the 
Crisis in Math and Science Education,'' which may represent our 
most challenging problem.
    Many of our members are CEOs of major U.S. based 
corporations and research universities and are keenly aware of 
the challenge the Nation faces in creating a workforce equipped 
with 21st century skills and the need to continue to advance 
learning long after our students have graduated from our high 
schools, colleges and graduate schools. Our members are also 
sensitive to the implications of a well-educated workforce for 
research, innovation and ultimately economic development and 
global competitiveness.
    Concerned by these challenges, our co-chairs, Bill Swanson, 
CEO of Raytheon and Warren Baker, President Cal-Poly Tech State 
University in California, led an initiative to explore the 
state of math and science education in this country, workforce 
trends, and effective policies for responding to what they see 
as a crisis.
    While it is common for groups to come before you and 
proclaim national crises, the data and trends our initiative 
collected are truly shocking. The demands for graduates who are 
literate in science, technology, engineering and math, the so-
called STEM disciplines, will surge over the decade while the 
production of Americans educated in these fields declines.
    Our research identified four disturbing trends: increasing 
demands for U.S. workers with higher levels of math and science 
skills, as you Mr. Chairman, have noted; disappointing 
performance trends of U.S. students on comparative 
international math and science assessment; decreasing numbers 
of science and engineering degrees awarded to U.S. citizens; 
and a critical shortage of qualified math and science teachers, 
which your bill, Mr. Chairman, seeks to address.
    Let me share just two estimates with you that I think 
capture these trends. NASA estimates that by 2008, 2 million 
science and engineering workers are expected to retire, 
resulting in a shortfall of more than 2 million workers; and 
second, the Department of Education estimates that we will need 
between 260,000 and 290,000 new math and science teachers in 
the 2008-2009 school year, and they are not in the pipeline 
today.
    These facts suggest a systemic problem in math and science 
that will limit our ability to create and maintain a 21st 
century workforce.
    Our report proposed several recommendations, but let me 
just focus on one--the Governors have talked about this--
establishing P-16 or P-20 councils in each State with balanced 
representations from corporations, education and policy leaders 
to define, benchmark and initiate P-16 plans for ensuring all 
students successfully complete high-quality math and science 
education.
    While these recommendations address only a small portion of 
the much broader systemic crisis in the STEM disciplines, the 
Forum is launching a second phase to develop Federal policy 
recommendations as part of a comprehensive strategy to address 
these problems.
    We will examine policies to attract more students into the 
STEM disciplines in community colleges as well as our 
universities. For example, more than half of students will 
first study math and science in community college.
    Provide incentives for students to choose careers in 
teaching these subject; encourage more collaboration among 
universities, corporations and Government to tackle the sources 
of the crisis, including lifelong learning; ensure that 
programs that support students in STEM disciplines and 
institutions conducting basic research are strengthened, 
especially programs in the National Science Foundation; and 
ensure that American postsecondary institutions and 
corporations can recruit the most talented foreign students, 
scholars and researchers.
    Unless we develop a systemic response to the crisis in STEM 
education beginning in middle school through lifelong learning, 
we risk ceding leadership in science, technology, research and 
innovation to other nations, which will have a profoundly 
negative consequence for the Nation's economic well-being. 
Unlike many crises there is consensus about the seriousness and 
implications of the problems and the tools at our disposal.
    The challenge we face is to generate consensus on how to 
act at the Federal, State, institutional and corporate levels. 
I can assure you, Mr. Chairman, that members of the Forum feel 
the urgency of these crises, they enthusiastically support the 
efforts of the National Governors Association for action at the 
State level, and they stand ready to help the committee in 
addressing these critical issues at the Federal level.
    I would be happy to address any questions you might have.
    [The prepared statement of Mr. Fitzgerald follows:]

           Prepared Statement of Brian K. Fitzgerald, Ed. D.

    Good morning, Mr. Chairman, Senator Kennedy and members of the 
Health, Education, Labor, and Pensions Committee. I am pleased to 
testify today for the Business-Higher Education Forum (The Forum). The 
Forum is a national non-profit membership organization of chief 
executives drawn from American corporations and higher education. I 
might offer a special greeting to Senator Alexander, an alumnus of the 
Forum, from the time of his tenure as President of the University of 
Tennessee.
    The Forum's mission is to encourage dialogue among leaders of the 
two sectors on issues central to the role of higher education in the 
global economy and to provide leadership in shaping sound policy around 
those issues. We achieve this through collaboration of corporate and 
academic members, the highest quality research, effective 
communication, and advocacy with Federal, State, institutional and 
corporate policy makers.
    Our recent work has centered, among other issues, on university-
industry research collaborations, the role of information technology in 
transforming teaching and learning, the changing nature of student 
skills needed in the workforce, and on the challenges of improving 
access to higher education to an increasingly diverse population. In 
February 2005, The Forum released its most recent report, A Commitment 
to America's Future: Responding to the Crisis in Mathematics & Science 
Education, an action plan for systemic reform.
    Many of our members are CEOs of major U.S.-based corporations and 
research universities. Indeed, our corporate members represent some of 
the largest research-based pharmaceutical and high-tech corporations in 
the Nation--among them are Pfizer and GlaxoSmithKline, Raytheon and 
Boeing, IBM and Sun Microsystems to name a few. Our academic members 
represent a critical mass of the Nation's research universities that 
both educate and employ substantial numbers of mathematicians, 
scientists, and engineers. As such, our membership is keenly aware of 
the challenges the Nation faces in creating a workforce equipped with 
the adequate 21st century skills and the need to continue to advance 
learning long after our students graduate from our high schools, 
colleges and graduate schools. These challenges are particularly acute 
in light of rapidly changing demographics, which will bring 
unprecedented numbers of minority youth to the doors of U.S. 
postsecondary education institutions and into our economy. Our members 
are also sensitive to the implications of a well-educated workforce for 
research, innovation and, intimately, for economic development and 
global competitiveness.
    Concerned by these challenges, in 2002, Forum members launched an 
initiative on the state of U.S. mathematics and science education. Led 
by co-chairs William H. Swanson (Chairman & CEO, Raytheon Company), 
Warren J. Baker (President, California Polytechnic State University), 
and L. Dennis Smith (President Emeritus, University of Nebraska) and 
supported by a working group of members, this effort explored indepth 
the state of mathematics and science education in this country, 
workforce trends, and effective policies for responding to what they 
defined as a crisis.
    While it is common for groups to come before the Senate and 
proclaim national crises, the data and trends that our initiative 
collected are truly shocking. Frankly, it has our corporate and 
university CEOs extremely worried, not just for U.S. corporations' 
ability to compete globally, but for the health and effectiveness of 
the Nation's schools and colleges as well. The trend lines for demand 
for graduates who are literate in science, technology, engineering and 
math will surge while the production of Americans educated in these 
fields declines.
    Our research identified four disturbing trends:

     Increasing demands for U.S. workers with higher levels of 
mathematics and science skills;
     Disappointing performance trends of U.S. students on 
comparative international mathematics and science assessments;
     Decreasing numbers of science and engineering degrees 
awarded to U.S. citizens; and
     A critical shortage of qualified mathematics and science 
teachers.

    Let me briefly share with you the data that demonstrate these 
trends:

                             RISING DEMAND

     Jobs requiring science, engineering, and technical 
training will increase by 51 percent between 1998 and 2008, four times 
faster than overall job growth (U.S. Department of Labor).
     By 2008, 6 million job openings for scientists, engineers, 
and technicians will exist. Of the 20 fastest-growing occupations 
projected through 2010, 15 of them require substantial mathematics or 
science preparation. (Bureau of Labor Statistics).
     More than 60 percent of new jobs will demand a solid high 
school education and some postsecondary education, while only 12 
percent of new jobs will be available to workers without a high school 
diploma (Council on Competitiveness).

              DISAPPOINTING TRENDS IN STUDENT PERFORMANCE

     U.S. student performance on international assessments show 
that: achievement in mathematics and science deteriorates from being 
significantly above average at grade 4 to near the bottom in high 
school; and, problem solving performance by grade 10 students is 
significantly lower than their peers in 25 countries. Shockingly, 58 
percent of U.S. students did not exceed the lowest level of problem 
solving achievement.
     In addition, recent NAEP (National Assessment of 
Educational Progress) results indicate that 30 percent or less of the 
students who take the test in the United States attain the proficiency 
level. In mathematics and science achievement, when results are broken 
down by race/ethnicity, we see African-American students lagging far 
behind other groups. Specifically, in 2003, student achievement in 4th- 
and 8th-grade mathematics showed percentages of African-American 
students at or above proficiency to be respectively 10 and 7 percent. 
In 2000, results in science achievement were no more encouraging, with 
percentages falling from 7 percent in grade 4 to 3 percent in grade 12 
(National Assessment of Educational Progress).
     Twenty-two percent of all American college freshmen do not 
meet the performance levels that are required for entry-level math and 
need remedial courses. Less than 40 percent of the students who plan to 
enter science and engineering majors graduate in 6 years from those 
fields.

                     DECREASING DEGREE PRODUCTIVITY

     In 2001, U.S. citizens and permanent residents comprised 
approximately 60 percent of full-time graduate students in science and 
engineering, down from 70 percent in 1994. In engineering, this 
percentage dropped from nearly 60 percent to a little more than 40 
percent; in computer science, from a little over 50 percent to 35 
percent (National Science Foundation).
     By 2008, 2 million science and engineering workers are 
expected to retire, resulting in a shortfall of more than 2 million 
workers (NASA).
     The European Union out-produces engineers two-to-one 
compared to the United States. The college population is increasing 10 
times faster in China than in the United States, where less than a 
third of students enter science and engineering programs, and nearly 75 
percent of the students in China are pursuing degree programs in 
science and engineering in universities that are increasingly high 
quality institutions (National Science Foundation).
     In 1999, America granted only approximately 61,000 
bachelor-level engineering degrees, compared to more than 134,000 in 
the European Union, 103,000 in Japan, and more than 195,000 in China. 
Only 7 percent of the 868,000 bachelor-level engineering degrees 
granted worldwide were earned in the United States (National Science 
Foundation).

                      SHORTAGE EXTENDS TO TEACHERS

     Between 260,000 and 290,000 new math and science secondary 
school teachers will be needed in the 2008-2009 school year (U.S. 
Department of Education).
     In 1999-2000, approximately 50,000 more teachers left the 
profession than entered it (The Christian Science Monitor).
     During 2002-2003, nationwide, districts hired more than 
10,000 foreign-born teachers with H1B visas in public and private 
schools. Decreases in numbers of available visas coupled with an 
international shortage of teachers are threatening offshore supply.

    These facts suggest a systemic problem with mathematics and science 
education in the United States that will limit our ability to create 
and maintain a 21st century workforce. They will affect: our ability to 
place qualified science and math teachers in our schools; qualified 
professors in our college classrooms and labs; conduct basic research 
in our university labs; limit our corporations' ability to compete 
globally; and, ultimately the ability to grow our economy in a globally 
competitive environment.
    The Forum recommends taking immediate action to address this crisis 
by working simultaneously on all the P-12 components of systems of 
education. In A Commitment to America's Future, we recommend several 
immediate actions for State policymakers and corporate leaders:
    Action 1: Establish a new element of State education 
infrastructure, a P-16 education council with balanced representation 
from corporations, education, and policy leaders. The council should be 
charged by the State to define, benchmark, and initiate a statewide P-
16 plan for ensuring that all P-12 students successfully complete a 
high-quality mathematics and science education.
    Action 2: Simultaneously address and align five key components of a 
P-12 education system. Effective mathematics and science education 
requires the close alignment of a P-12 system's student standards, 
curricula, student assessment, teacher quality, and accountability. 
Proposed change in any one of the five components demands attention to 
resultant effects in the other four. In particular, it demands 
attention to necessary changes in the policies and practices of higher 
education, corporations, and government.
    Action 3: Engage corporations and higher education in more 
effective P-12 reform roles. Corporations must accept responsibility 
for leading a State's P-16 council work; it also must align all 
corporate education outreach initiatives with the State's vision of 
standards-based improvement of P-12 mathematics and science education. 
Higher education must implement policies and programs that place the 
education of teachers--in particular, teachers of mathematics and 
science--at the center of its mission.
    Action 4: Implement coordinated national and State-specific public 
information programs. These two professionally designed programs must 
be based on a common set of core messages. The corporate-led national 
campaign should be designed to convince the public that a high-quality 
mathematics and science education is necessary to ensuring the adult 
educational, economic, and civic life of the students now in the 
schools. Each State-level campaign, developed in cooperation with the 
State's P-16 council, should localize and support the core messages of 
the national campaign.
    While these recommendations address only a small portion of a much 
broader systemic crisis in science, technology, engineering, and 
mathematics education (the so-called STEM disciplines), the Forum is 
launching the second phase of its work in this area by examining the 
problems that exist in lifelong learning programs, community colleges, 
colleges and universities, and graduate schools. Members of the Forum 
also will explore problems encountered in student visa and immigration 
policies and their impact on the flow of students, scholars, and 
researchers to U.S. institutions of higher education, laboratories and 
corporations.
    Our June meeting will bring together scholars and policymakers to 
begin a process for developing policy recommendations as part of a 
comprehensive strategy to address these problems. The Forum will 
examine policies to:

     Attract more students into the STEM disciplines.
     Provide incentives for these students to choose careers in 
teaching these subjects.
     Encourage more collaboration among universities, 
corporations and government to tackle the sources of the crisis.
     Ensure that the programs that support students in STEM 
disciplines and institutions conducting basic research are 
strengthened, especially programs in the National Science Foundation.
     Ensure that American postsecondary education institutions 
and corporations can recruit the most talented foreign students, 
scholars and researchers.

    Unless we develop a systemic response to the crisis in STEM 
education in the United States (beginning at middle school level), we 
risk ceding leadership in science, technology, research and innovation 
to other nations, which will have profoundly negative consequences for 
the Nation's economic well-being. Unlike many crises, there is 
consensus about the seriousness and implications of the problems, and 
the tools at our disposal to address these.
    The challenge we face is to generate consensus on how to act at the 
Federal, State, institutional and corporate levels. I can assure you, 
Mr. Chairman, that the members of the Forum feel the urgency of this 
crisis. They enthusiastically support the efforts by the National 
Governors Association for action in the States, and they stand ready to 
help the committee in addressing these critical issues at the Federal 
level.
    I will be happy to address any questions you might have.

    The Chairman. Thank you.
    Ms. Boisvert.

    STATEMENT OF PAMELA BOISVERT, VICE PRESIDENT, WORCESTER 
                           CONSORTIUM

    Ms. Boisvert. Chairman Enzi and distinguished members of 
the committee, I am very honored to testify before you today on 
the important topic of lifelong educational opportunities for 
all Americans.
    I serve as Vice President of the Colleges of Worcester 
Consortium in Worcester, Massachusetts. Among its other 
offerings, the Consortium provides educational counseling and 
placement services to low-income adults throughout 
Massachusetts through a Federal TRIO Educational Opportunity 
Center Grant.
    In this instance Massachusetts and Wyoming share another 
similarity, for in Wyoming as well, a Federal Educational 
Opportunity Center, hosted by the University of Wyoming, 
provided educational counseling services to adults throughout 
that State.
    I certainly join with the other witnesses in emphasizing 
the increasing need for lifelong learning programs with 
particular attention paid to low-income adults because this 
population is the least likely to participate in such 
activities, as seen in data from the National Center for 
Education Statistics. We see that adults with incomes of 
$20,000 or less participate in continuing education at only a 
28 percent rate, compared to a 59 percent rate for those with 
incomes of $75,000 or more. It is also true that adults from 
low-income households are the least likely to receive employer 
support for their educational activities.
    Certainly, the Federal TRIO community brings a long history 
to this issue. For example, the TRIO EOCs for Massachusetts 
program, which I direct and I have been involved with actually 
for the last 25 years, was first funded in 1974, currently 
serves over 7,000 clients per year, the majority of them low-
income and first generation potential college students at an 
annual cost of less than $150 per client.
    Services are offered at a network of six sites across the 
State and all six sites also provides services at satellite 
centers, including Career Centers, the One-Stop Centers that we 
have heard about today, welfare offices, vocational 
rehabilitation centers, public libraries, churches and schools. 
Where the clients go, we will go. In Wyoming I understand TRIO 
EOCs often operate from agricultural extension centers as well.
    Services offered by TRIO EOC programs are wide-ranging and 
consequently can be tailored to meet the needs of each 
individual client. They are both client-based as well as 
flexible, and we have certainly heard this morning about the 
importance of both of those characteristics. All services are 
offered to ensure that the clients are made aware of the 
importance of additional education, particularly postsecondary 
education, if appropriate, and the possibilities that such 
education provides.
    Individualized assistance is provided to ensure that the 
education program selected is appropriate to the client's 
abilities and career interests and life situation. Of course a 
key component of participation in continuing education for low-
income adult students is securing adequate financial aid. 
Accordingly, much emphasis is placed on assisting students and 
learning about financial aid availability and applying for that 
aid, and considering the advantages and disadvantages of 
various types of aid, particularly loans.
    All EOCs work closely with loan guarantee agencies to 
assist individuals who may have defaulted on previous loans to 
enter into an appropriate repayment plan so that their loan 
status does not jeopardize their ability to reenter a 
postsecondary program. This is really a critical part of what 
we do in order to ensure that these students can move forward.
    Low-income adult students generally must contend with great 
complexity in their lives, as I am sure you are all aware, and 
a limited network of support to manage that complexity. We 
often say that life happens. For example, 57 percent of low-
income adult students in postsecondary education work full 
time, compared to 33 percent of traditional students. 
Additionally, 64 percent of low-income adult students support 
dependent children, compared to only 8 percent of traditional 
students. So in addition to assisting students in identifying 
an appropriate academic program and securing the financial 
resources to enroll, it is often necessary to assist clients in 
securing support from other academic and social services. 
Whether it is tutoring, day care services, transportation, and 
so on, all of those services need to be in place if these 
clients are going to succeed.
    One of the major strengths of TRIO's Educational 
Opportunity Centers is that they are education brokers, not 
charged with filling seats in a particular program, but rather 
looking at the needs of each individual and providing them with 
the best academic fit possible. EOCs for Massachusetts program 
has an annual program enrollment rate of 45 percent.
    And as is true elsewhere and as we have heard, jobs of the 
future are going to require postsecondary programs. Education 
has historically been the pathway to viability, to self-
sustainability, to an individual taking care of their family 
and ensuring that they all have a brighter future.
    I would like to just take a minute to share with you one 
story to try to put a human face on all that we have heard this 
morning. Arianne arrived at the EOC office through the 
encouragement of her counselor at the local housing authority. 
This 35-year-old African-American single mother has struggled 
within the walls of poverty her whole life. Her undiagnosed 
learning disability prevented her from ever succeeding in 
school. She dropped out at an early age, gave birth to a son 16 
years ago and has struggled to provide for him ever since.
    She worked hard to obtain her GED and was able to finally 
have her disability diagnosed. Still she struggled to make ends 
meet. She lost her minimum wage job, found herself homeless and 
lost custody of her son, but again she struggled to find her 
way.
    Now receiving public assistance and through the 
encouragement and efforts of her EOC adviser and her self-
sufficiency counselor at the Housing Authority, she has been 
able to work with the State Rehab Center to obtain services 
related to the disability. Career assessment testing through 
EOC has set her on the right path. She will be taking summer 
courses this year to get the prerequisites necessary to enter 
an occupational therapy program at the local community college 
in the fall.
    This is just one of thousands and thousands of examples of 
people who have succeeded through education.
    Thank you very much.
    [The prepared statement of Ms. Boisvert follows:]

                 Prepared Statement of Pamela Boisvert

    Chairman Enzi, Senator Kennedy and distinguished members of 
the committee, I am very honored to testify before you today on 
the important topic of Lifelong Educational Opportunities for 
Americans. My name is Pamela Boisvert and I serve as Vice 
President of the Colleges of Worcester Consortium in Worcester, 
Massachusetts. Among its other offerings, the Consortium 
provides educational counseling and placement to low-income 
adults throughout Massachusetts through a Federal TRIO 
Educational Opportunity Center grant. In this instance, 
Massachusetts and Wyoming share another similarity, for in 
Wyoming as well, a Federal Educational Opportunity Center 
hosted by the University of Wyoming provides educational 
counseling and placement services to adults throughout the 
State.
    I certainly join with the other witnesses in emphasizing 
the increasing need for life-long learning programs with 
particular attention paid to low-income adults because low-
income adults are the least likely to participate in such 
activities, as seen in the following data from the National 
Center for Education Statistics.

     Percentage of Adults Engaged in Continuing Education by Income
------------------------------------------------------------------------

------------------------------------------------------------------------
$20,000 or less.........................................             28%
$20,001 to $35,000......................................             39%
$35,001 to $50,000......................................             48%
$50,001 to $75,000......................................             56%
$75,001 and above.......................................             59%
------------------------------------------------------------------------

    It is also true that adults from low-income households are 
the least likely to receive employer support for educational 
activities.

Percentage of Adults Receiving Employer Support for Continuing Education
                                by Income
------------------------------------------------------------------------

------------------------------------------------------------------------
$20,000 or less.........................................             48%
$20,001 to $35,000......................................             58%
$35,001 to $50,000......................................             66%
$50,001 to $75,000......................................             76%
$75,001 and above.......................................             75%
------------------------------------------------------------------------

    Certainly the Federal TRIO community brings a long history 
to this issue. For example, the TRIO EOCs for Massachusetts 
program, which I direct, was first funded in 1974 and currently 
serves over 7,000 clients per year at an annual cost of less 
than $150 per client. Services are offered at a network of 
sites throughout the State in Boston, New Bedford, Lynn, 
Worcester, Springfield and Pittsfield. All six sites also 
provide services at satellite centers including job services 
offices, welfare offices, vocational rehabilitation services 
offices, public libraries, churches and schools. In Wyoming, 
TRIO EOCs often operate from agricultural extension offices as 
well.
    Services offered by TRIO EOCs are wide-ranging and can be 
tailored to meet the needs of individual clients. All services 
are offered to ensure that the clients are made aware of the 
importance of additional education, particularly postsecondary 
education if appropriate, and the possibilities that such 
education provides. Individualized assistance is provided to 
ensure that the educational program selected is appropriate to 
the client's abilities and career interests.
    Of course, a key component of participation in continuing 
education for low-income adult students is securing adequate 
financial aid. Accordingly, a great deal of time is spent in 
assisting students in learning about financial aid available, 
and considering the advantages and disadvantages of various 
types of aid, particularly loans. The EOC works closely with 
loan guarantee agencies to assist individuals who may have 
defaulted on previous loans to enter into an appropriate 
repayment plan so that their loan status does not jeopardize 
their ability to re-enter a postsecondary program.
    Low-income adult students generally must contend with 
complexity in their lives and a limited network of support to 
manage that complexity. For example, 57 percent of low-income 
adult students in postsecondary education work full-time, 
compared to 33 percent of traditional students. Additionally, 
64 percent of low-income adult students support dependent 
children compared to 8 percent of traditional students. So in 
addition to assisting students in identifying an appropriate 
academic program and secure the resources to enroll, it is 
often necessary to assist clients in securing support from 
other academic and social services agencies.
    One of the major strengths of TRIO's Educational 
Opportunity Centers is that they are education brokers, not 
charged with filling seats in a particular program, but rather 
looking at the needs of each individual and providing them with 
the best academic ``fit'' possible. The EOCs for Massachusetts 
program has an annual program enrollment rate of 45 percent.
    Massachusetts is home to rapidly-growing immigrant 
populations, an expanding knowledge-based economy, and a 
shrinking ``native-born'' population. Education has 
historically been a cornerstone of our economy, both in terms 
of education-related jobs, as well as jobs requiring a higher 
education. Service related industries, including health fields 
and technology, are also showing significant growth. Self-
sufficiency in Massachusetts now demands some form of 
postsecondary education, and TRIO is well positioned to provide 
access services leading to the American dream.
    I would like to share two stories of current EOC clients 
with you.
    Story I. Arianne arrived at the EOC office through the 
encouragement of her counselor at the local housing authority. 
This 35-year-old African-American single mother has struggled 
within the walls of poverty her whole life. Her undiagnosed 
learning disability prevented her from ever succeeding in 
school. She dropped out at an early age, gave birth to a son 16 
years ago and has struggled to provide for him since. She 
worked hard to obtain her GED and was able to have her 
disability diagnosed.
    Still she struggled to make ends meet. She lost her minimum 
wage job, found herself homeless and lost custody of her child. 
Again she struggled to find her way. Now receiving public 
assistance, and through the encouragement and efforts of her 
Education Advisor at the EOC and her Self-Sufficiency counselor 
at the local housing authority, Arianne has been able to work 
with the State Rehabilitation Center to obtain services related 
to her disability. Career assessment testing through the EOC 
has confirmed that she has the strong interest and abilities 
necessary to achieve her dream of becoming an Occupational 
Therapist. Her desire is to help children with disabilities. 
She is now registered for summer semester classes at the local 
community college taking those prerequisites necessary to enter 
the occupational therapy assistant's program that she has been 
accepted to in the fall. Arianne and clients like her need so 
desperately to be able to rely on those services provided by 
EOC and its collaborations with local social service 
organizations. These collaborative efforts have been 
instrumental in assisting so many in achieving self-sufficiency 
and success.
    Story II. Edlira Gostivari came to America from Albania in 
May 1999. She has been using the Worcester EOC services since 
August 1999. At first, she got help in applying for the ESL 
program at Clark University and Quinsigamond Community College 
(QCC) to improve her limited English skills. We assisted her in 
both the admissions application process and the financial aid 
application process at those schools. In Spring 2002, Edlira 
completed the ESL program at QCC. In Fall 2002, she enrolled in 
the Business Office Support Specialist Associate in Science 
program at QCC. She will complete that program in May 2005. She 
plans to transfer to Becker College, Anna Maria College, or 
Worcester State College in Fall 2005 to earn a Bachelor's 
Degree in Political Science, History, or Legal Studies. She 
would like to attend Law School after she completes her 
Bachelor's Degree. The Worcester EOC has assisted Edlira 
effectively in achieving her educational goal successfully. 
Using our services, as an immigrant with limited English 
skills, she has become proficient in English and studied 
successfully in American colleges. I believe she will achieve 
her dream of becoming a lawyer with her strong will, high 
motivation, and the continuous efficient assistance from the 
Worcester EOC.

    The Chairman. Thank you very much.
    I appreciate all of the testimony that we have heard. I 
will begin with some questions.
    Governor Sebelius, in your testimony you mentioned the 
alignment of Federal education laws to promote lifelong 
learning. Do you have any suggestions or examples that might 
assist us as we consider the reauthorization of the Workforce 
Investment Act, the Higher Education Act, the Head Start Act, 
the Carl Perkins Vocational Technical Act, or any of the other 
38 that we are going to do to ensure that we provide 
opportunities for students and workers of all ages?
    Governor Sebelius. Well, thank you, Senator. Yes, I think 
that as our last panel has talked about, putting a sort of 
human face might make it a little easier. And let me just give 
you a hypothetical: Danny from Salina, Kansas, who is a low-
income, special needs child, and walk you through what happens 
when he hits school.
    First, hopefully we will get him into Head Start in Kansas, 
and that has its own set of requirements, Head Start or one of 
the other 69 programs that is available for preschool kids, 
which has its own funding streams and its own data 
requirements.
    Once he hits kindergarten, IDEA kicks into gear as well as 
No Child Left Behind, each with different reporting 
requirements for him and very little flexibility or ability to 
pool the funds and make sure that he gets specifically the 
training he needs.
    His teacher training comes under the Higher Education Act 
and loan forgiveness and other entities, so we have now got 
three Federal laws that impact him, as well as title I 
requirements in the school where he is.
    As he gets into high school, those requirements stay in 
place, but Perkins vocational training comes into being, again, 
with a different data set, different reporting requirements, 
different yearly titles. And hopefully we can either help move 
him successfully into a job or into higher education.
    I am just giving you a little example of a child in Kansas, 
and I think what we are saying at the State level is if we had 
some ability to pool a stream of funds, if we had some ability 
to give you one plan with a data set that was then able to be 
replicated for the various acts in charge, and if we had more 
ability really to look at two key transitions--what happens 
from early education into school, how we make those funds flow 
and make sure children are ready to learn, and what happens as 
children exit high school into either higher education or 
vocational training or hopefully both--again, pooling and 
streaming funds, alignment at those levels would make, I think, 
not only us able to be more successful, more nimble, more 
responsive to parents and teachers, but also make sure that we 
are getting the best bang for our buck.
    The Chairman. Thank you. Very succinct and comprehensive.
    Governor Sebelius. And there are probably those other 38 
acts that are going to kick in at some point.
    The Chairman. Yes, and the 69 preschool programs, yes, we 
will be working on those.
    Governor Fletcher, what best practices in local communities 
are creating better coordination of all available resources for 
youth to achieve positive outcomes after leaving formal 
secondary education programs, including the workforce, 
obtaining a college degree, or starting their own business? 
That is one of my favorites.
    Governor Fletcher. Well, in Kentucky--and not only in 
Kentucky, but I think the greater push for P-16 counsel is 
extremely helpful, especially in the Workforce Investment Act, 
flexibility would certainly help us there. The best practices 
that we have so far are strengthening P-16, and what we do is 
integrate economic development with education to make sure that 
not only are economic development individuals and interests 
interested in education, but education sees economic 
development as part of their responsibility.
    One of the things we are doing in postsecondary education 
is what we call stewards of place. Our universities and 
institutions have responsibility not only for recruitment, 
enrolling, and graduating, but see a greater responsibility for 
the economic development of their communities that they live 
in.
    That means that when we are looking at attracting 
businesses or trying to grow a particular industry, they can 
get involved in that from the outset, including curriculum, 
making sure that their students are ready for that type of 
workplace.
    I think the Workforce Investment Act would help us 
tremendously in the sense that we would not have silos. This 
year, we had $29 million that we could not access, but we could 
have used that money tremendously in other areas of 
postsecondary education to help educate workers in particular 
areas.
    The Chairman. Thank you. I am out of time, but I am going 
to take the Chairman's prerogative and do one more question 
before I go to written ones.
    Mr. Fitzgerald, how difficult is it for your member 
companies to find employees with skills to continue to compete? 
What are your concerns about the skill level of the workforce 
and the American businesses to compete internationally and our 
Nation's economic success?
    Mr. Fitzgerald. Mr. Chairman, our corporate members are 
extremely concerned about the ability to access the kind of 
skilled workforce. Many of our corporations are global 
corporations, and, frankly, they find it easier to find highly 
skilled talent in their laboratories and their plants in other 
parts of the world.
    I know many people talk to you about homeland security 
issues and the implications in the post-9/11 world, but let me 
give you one example of the implications of this real crisis in 
a qualified workforce.
    Two of our corporate members--in particular, Bill Swanson 
at Raytheon--they need to find American or at least U.S. 
citizens who can do work, classified work at the highest levels 
of research and development. Bill hoped actually to be here 
with you today but could not change his schedule. He is scared 
to death about the ability of, broadly speaking, our 
educational system to produce the kind of workforce we need. 
Companies like Pfizer find it much easier to find highly 
skilled, highly trained professionals, technicians, 
researchers, in places like India than here.
    We need to address this in our high schools, in our middle 
schools, but we also need to address this in our colleges and 
universities and support the stem disciplines and research, 
basic research at universities so that we have the workforce 
domestically that our corporations need to compete globally.
    The Chairman. Thank you.
    Senator Alexander.
    Senator Alexander. Thanks, Mr. Chairman, and thanks to all 
of the witnesses for very helpful testimony. I mentioned to 
Governor Sebelius that we have scheduled for the 20th of this 
month the first of a series of hearings and roundtables to try 
to take a look at the 69 early childhood education programs 
that help children under 6 and spend about 20 billion Federal 
dollars just to see what we might do to coordinate them better. 
So I know you will be interested in that, given your NGA 
position.
    I want to start with Mr. Gunderson because I know he has 
been around on these issues for a long time. I was Governor 
when CIDA was abolished and the Joint Training Partnership Act 
came in, and like a good soldier, I remember flying all around 
the State and forming all these councils and whooping it up and 
saying this is going to be a great thing, because on paper it 
is. You know, the idea is connect the employers and the 
community colleges and meet the new needs and get everybody 
working on the same thing together. And so we did that. I 
thought we did a really good job on it.
    The longer I have been around, the more I have been 
unimpressed with our ability to form councils and direct things 
from here, to review reports and papers, and the more impressed 
I have been with the higher education model, which I mentioned 
to the first panel, which is basically to give the money to the 
student or the out-of-work person or the person changing jobs 
and let them go look for the service they need.
    That is why I was interested in the personal retirement 
account that is being--I mean, that makes a lot of sense to me, 
that if I am sitting there having changed jobs and I get 
$3,000, then I can make a choice about whether to spend it 
here, here, here or here, then the whole system has to really 
respond to me. I think that is the real reason why we have the 
greatest system of colleges and universities in the world, is 
because we have emphasized autonomy for those institutions, a 
lot of Federal dollars, but it follows students to institutions 
they choose.
    I think as we articulate high schools and community 
colleges that high school money ought to be following students 
more to the community college in courses that they choose to 
take at the community college, that would require State and 
local decisionmaking. But I want to go to a recommendation you 
made and just ask you to elaborate on it a little bit, and if 
anyone else wants to comment and there is time, terrific.
    You suggest we reauthorize the Workforce Investment Act and 
the Higher Education Act and the Perkins Act all at once and 
take a look at it, simplify it. If I have got my numbers right, 
as an example, we spend about $4 billion in adult education 
through the Workforce Investment Act, some of it here, some of 
it at the State level, some of it here, some of it there. We 
spend $12 billion on Pell grants. I guess an alternative would 
be looking at that, take the whole $4 billion, and just spend 
it on Pell grants or just spend it on personal reinsurance 
accounts or to spend half of it on Pell grants and personal 
reinsurance accounts.
    Have you thought that through or do you have any 
recommendations for us about--or do you even agree that we 
would be better off with fewer councils, less bureaucracy, and 
more Federal dollars to go directly to the worker we are hoping 
to train, and then let that worker then seek out his training? 
I would expect it would often be with an employer or with a 
community college or a technical institute, or who knows, but 
as long as they are certified in some way.
    What would be your elaboration on those points?
    Mr. Gunderson. Let me try to be brief because we could 
speak for hours on this.
    I agree, first of all, and I think we need to recognize our 
problem. In the last reauthorization of WIA, we said the WIBs 
do not deliver the training, they just design. The problem is 
we have a WIA system that is guided by performance standards, 
and we have a community college system that is funded by credit 
hours. And there is a huge disconnect, and we have got to 
figure out how you connect these two so you get those outcomes. 
While we would like to have credit hours, let's recognize that 
we are more into employer-recognized, industry-based 
certificates that are going to be portable skills, that are not 
going to be built on credit hours. So that is why I think you 
have got to try to figure out how do you redesign and connect 
these in a way that gets them to talk to each other and works 
in ways that it does not today.
    The second thing I want to suggest to you, Senator, is you 
and I, because we are both Republican, believe in an ownership 
society. We are not going to have enough Federal or enough 
Federal and State dollars to meet the need that is going to be 
necessary in this area. One of the things I have suggested is 
that we create lifelong learning accounts. If we would take 
simply for a 20-year period, from age 25 to 45, if we would 
take 25 cents per hour--I don't care if it is employee or 
employer funded--and put that into that person's individual 
lifelong learning account, they would have well over $10,000 to 
spend on continued education or training. Cut it down to a 
dime, you have still got over $5,000 in that person's account.
    If every individual had that and it was said you could use 
this for your upgrading of skills or at the age of 65 you could 
convert it into a retirement account, we would change the 
culture in this country, number one. Number two, we would get 
the resources, unlike anything we anticipated, to meet the 
demand in this area. And, third, all of a sudden we would have 
the delivery mechanism that would look at ways where they could 
access and meet and serve those needs. We would not have the 
debates about whether incumbent workers were or were not 
eligible for a Federal program because every incumbent worker 
would have the resources to use to upgrade their skills.
    So, yes, I think you are moving in the right direction. I 
do think we have got to find a way to merge these Federal 
programs because what you do here impacts what happens down at 
the local level.
    A caution. With all due respect to our Governors, I was at 
a meeting recently with a bunch of State directors for WIB who 
said we are going to ask for some waivers so that we have 
discretionary money, but we are not going to do it until our 
State legislatures are out of session, because if our State 
legislators see that we have that discretionary money, they are 
going to automatically use that money and program that money to 
meet their State needs. So it is going to supplant that State 
funding.
    What we have got to do is make sure that we have the State 
dollars, we have the Federal dollars, we have the private 
sector dollars. There is not going to be enough. We cannot let 
one dollar replace another.
    Senator Alexander. Thank you very much. Thank you, Mr. 
Chairman. If I had had more time, I would have asked the 
Governors whether they support the President's proposal to 
extend No Child Left Behind to high school, but maybe someone 
else will do that.
    [Laughter.]
    The Chairman. I took some latitude. I will let you ask that 
question.
    Senator Alexander. Seriously, do you support or what is 
your comment on the President's proposal of extending No Child 
Left Behind to high school?
    Governor Sebelius. Well, Senator, I think my comment would 
be I would certainly support rigorous training and testing and 
think that we need to do measuring in high school. And it is 
part of what our high school reform effort at the National 
Governors level is about.
    There is clearly concern about underfunding, and I would 
say that at least in Kansas, we have experienced that the new 
layer of testing requirements, in addition to the testing 
requirements we already had in place in Kansas, has put us even 
further behind in trying to make our school system work for 
every child. So I would be very cautious about endorsement 
without the funding to go with it.
    One other area I would just point out, as long as we are 
here--and I will let my colleague, Governor Fletcher, answer 
also. But there are some inconsistencies--back to Senator 
Enzi's earlier question--in alignment. We have talked a lot 
about moving kids from high school into either workforce 
training or community college, doing that fairly seamlessly.
    One of the things we find with No Child Left Behind, 
teacher requirements, as we looked at it in Kansas, is that 
dual enrollment is problematic because a number of our teachers 
in our community colleges do not meet the qualified standards 
for No Child Left Behind. They cannot teach the high school 
kids because they do not have the adequate hours of training in 
the specific subject.
    So that is another issue that we might want to address. I 
think advancing and accelerating students' learning into higher 
education is great. But we are finding that it is complicated 
by the current structure of No Child Left Behind as it relates 
to teacher training.
    Senator Alexander. Thank you.
    Governor Fletcher. Senator Alexander, I first want to thank 
Congress. I was here at the time when the No Child Left Behind 
bill was passed, and it was a great bipartisan effort. I think 
it brought some local flexibility as well as accountability 
which had not been there previously. And certainly those 
principles I endorse and I believe most Governors endorse 
certainly the flexibility and that there does need to be 
accountability along with that.
    One of the things that I think is extremely important as 
you are looking at expansion is the fact of the flexibility of 
the State setting those standards. But, additionally, I think 
there should be along with that some incentives. As we know now 
and recognize--in high school graduation there is--the need of 
the knowledge based, through, for example, the American Diploma 
Project, is similar whether that child decides to go to a 
postsecondary educational institution or whether they decide to 
go into the workplace.
    And so once we realize that, then I think if there is an 
expansion of No Child Left Behind, it really needs to provide 
incentives for us to move toward redesign of the high school, 
toward that purpose and accountability.
    The other thing I would like to see, because of WIA's 
prescriptive measures in the different silos that exist there 
and the fact that we have dual courses, we have this seamless 
education that we are working toward. Some of the artificial 
barriers that are produced there prohibit us from having the 
flexibility of really preparing the workforce in a way that we 
can.
    So with those principles in mind, we certainly would look 
forward to working with you on the expansion of that, and 
always as we look toward education with these requirements, we 
certainly would encourage you looking at the funding as well.
    May I make a comment, too, if I might, Mr. Chairman, on the 
answer--there was one question that Senator Alexander had 
previous to this, and, you know, in looking at the money 
following the student, because I think as you look at improving 
education--we passed some tuition tax credits in Kentucky that 
we modeled after those tuition tax credits on the Federal 
level. But we gave a lot more flexibility in what institutions 
those would apply to and what diplomas or credentialing would 
require.
    That is a method that we use of allowing it to follow the 
student and allow them to have more choice. But we also give 
them the choice of going to some other institutions, and it 
provides up to $500 in our situation. We just passed that this 
year.
    Additionally, some flexibility as you are looking toward 
Pell grants and other tuition assistance programs would be 
helpful as you see that the tracks that a student takes may not 
be quite as traditional, but more focused on a specific 
vocation or profession. And if that can be blended with some 
flexibility of WIA grants, I think you could see that we would 
have a lot more tools as Governors to make sure that we get 
success toward developing individuals that are prepared for 
college that will be successful as well in the workplace.
    Thank you.
    The Chairman. Thank you.
    Senator Burr.
    Senator Burr. Thank you, Mr. Chairman.
    I want to thank this entire group of witnesses, and I will 
tell you up front that I will show some discretion and focus on 
those two guys in the middle. Steve, welcome back. And, Ernie, 
it is great to see you. You came this time with a little less 
fanfare than one of your last trips here.
    [Laughter.]
    Senator Burr. We thank you for that. Seldom do Johnny and I 
have the opportunity to have two of our former colleagues on 
the hot seat where we can get them, and I want to take 
advantage of it.
    Steve, you said something that was unbelievably important, 
and I think it reflects sort of the last 10 years, and it is 
evidence that we are learning. Ten years ago, we would do 
anything to block grant everything to the States. Ten years 
later, we look at our Governors that are here and we look at 
the other ones around the country, and I think the important 
question that we ask is: Do you really want us to do that? Can 
flexibility be designed in a way that does not create this 
competitive spirit, personal urge to find an easy way out of a 
State budget problem or to create new revenues for the General 
Assembly to look at and say, But it is written in a way that 
you could do this, only to be audited 10 years down the road 
and find out that you have a problem? Unfortunately, you may 
not be there, we may not be here, but the loss is a generation 
of kids that went through the system.
    The thing that has probably gone unsaid is that I think we 
need to be focused as we go through reauthorization, as we go 
through any new legislation, less on process and all on 
outcome. No future employer is going to look and say, How did 
you get to this point? They are just evaluating whether they 
got to the point they need them. And so we need to be less 
concerned with how we get there and more focused on getting 
there.
    Steve, I think in your testimony--it was incredible 
testimony--but I want to go right to something you said in the 
conclusion because I think it deserves saying publicly. Today, 
education is workforce investment, and workforce investment is 
economic development. The connection is already there. What we 
cannot do is break this up and then hope that it comes back 
together. It has to be designed as seamless.
    I would turn to the two Governors and just say, Can States 
make wise decisions if, in fact, we give you that flexibility? 
Or would you urge us not just to guess when the legislature is 
in or out?
    [Laughter.]
    Senator Burr. And be a little more prescriptive on how you 
access that money?
    Governor Sebelius. Well, Senator, I think not only can 
States do it, but we are doing it. And, frankly, if we do not 
do it, it does not get done.
    I think that there is an incredible innovation going on 
rethinking the whole seamless transition from school into 
workforce. And what, as Governor Fletcher has already 
articulated, we find over and over again are silos and data 
requirements and an inability to really deliver the end 
product, if you will, the educated worker to the business of 
tomorrow. It stumbles along the way.
    So I think you can have a maintenance of effort provision 
that makes sure that we do not transfer funds with the next 
crisis that happens. I would urge Congress to do the same thing 
as you reauthorize these acts. Maintain the effort. Do not 
under the guise of flexibility deliver less money with higher 
accountability standards and more demands, but that is a fair, 
I think, transfer, that is to say these efforts have to be 
directed. Ask for a State plan. Ask for a data set. Ask for 
accountability. And then let States be able to develop the 
workforce that is really needed in different parts of the 
country with different segments, with some flexibility.
    Governor Fletcher. Senator Burr, it is good to see you 
again, and we enjoyed working with you on Energy and Commerce 
in the House. Congratulations to you as well for your success 
in being here.
    One of the things I think we are seeing is the transition 
from what I call prescriptive accountability, which means that 
you prescribe on the Federal level the methods, and that is the 
accountability, and the reporting is back, that you follow that 
prescription.
    No Child Left Behind moved more to results accountability, 
which said we give you some flexibility--and we would ask for 
more--and measure the results.
    One of the things that I think is different now than what 
we had in previous generations is this global competitiveness. 
That means that we are moving from an agrarian, manufacturing 
society to advanced agriculture and advanced manufacturing, 
biotech, knowledge-based economy, which means that we have to 
have a much more educated workforce to compete. And for States 
to be successful--and we are competitive entities, one with 
another as well as globally--we have to succeed in providing 
that knowledge-based workforce in order to maintain the 
workforce in our States and to maintain our revenue basically.
    So I think the accountability is there from the fact that 
in order to continue to grow in the competitive economy, we 
have to attain results. We are all focusing and realize that 
education, unlike previous generations, is absolutely essential 
for economic development.
    There were decades ago where you had high labor-intensive 
industries that did not require the technical education. But as 
we see now, high school graduation, whether or not you go into 
the workforce or university, it requires the same skills. That 
has come about because we have to have those skills in our 
workforce to be competitive and increase productivity. 
Otherwise, we lose those jobs.
    So the answer to that is, yes, I think so. I think it is 
good to move from a prescriptive accountability to a results-
oriented accountability. And also you can roll into that there 
are some research-based methods that I think are important in 
education that can be utilized as well.
    Senator Burr. I will take the Chairman's silence as I get 
an opportunity to go one more time.
    Steve, you talked throughout your testimony about the 
global change, the global economy. I believe that one of the 
most significant things that has been overlooked is the fact 
that 20 years ago, innovation was something that we just--we 
hold here in the United States, in part because of the 
education, in part because we had a model that protected 
intellectual property and a lot of things.
    Innovation is global today. There is as much innovation 
that happens outside the United States as there does inside the 
United States.
    How does that change the way we look at job creation from a 
standpoint of the fact that we just cannot rely on innovation 
that takes place here at home to employ that group that we know 
are coming in the next generation?
    Mr. Gunderson. Well, it is serious, Senator, because it has 
been our competitive advantage. We did not have a problem 
outsourcing low-skilled manufacturing jobs. We did not even 
have too big a problem when we started outsourcing those 
medium-level jobs. All of a sudden when we see that we are now 
outsourcing research and innovation, America's leadership 
competitive advantage is at risk. All of the companies that 
Brian represents are seriously considering moving their R&D to 
the Southeast Pacific, not just because of low labor, but 
because of the brain power that is available there that is not 
available here. That talks about America's quality of life in 
the future.
    Second, you know, we love to beat up on Europe in this 
country, but we need to be real careful because if you look at 
the Bologna Accord, Europe has redesigned their entire higher 
education system. They have gone from 4 years to 3 years of 
basic academic skills, combined that with a 2-year career and 
academic training focus. So it is a 5-year program for creating 
a high-skilled, portable degree throughout the entire European 
Union.
    Now, if Europe gets their act together, which I think they 
are going to do in that, all of a sudden, again, we not only 
face that competitive disadvantage with the Southeast Pacific, 
but we are now facing it with Europe. And they have the same 
population that we do. America is going to lose what has become 
its major ability.
    The other sides of this, of course, is we are the one 
country that is going to teach the world how do we educate and 
train a diverse population of race and ethnicity and succeed at 
it or fail at it. And that is the question that is before all 
of us today.
    Senator Burr. Thank you very much.
    The Chairman. Thank you, and I appreciate the patience of 
Senator Isakson.
    Senator Isakson.
    Senator Isakson. I just love Senator Burr. I would give him 
all the time in the world--as long as it does not take away 
from mine.
    [Laughter.]
    Senator Isakson. [continuing.] Thank you, Mr. Chairman.
    Steve, on that great segue, at the end of your remarks, if 
I wrote it down right, you said one of the things to deal with 
is the fact that we cannot stop global competition, that you 
cannot educate on the cheap, and it is an absolute necessity to 
develop the workforce. You said we must connect academics and 
career skills, right?
    Mr. Gunderson. Yes.
    Senator Isakson. Then you just went into the EU model. 
Connecting academics and career skills in that comment 
manifests itself in the European concept in your mind of 3 
years of basic and then 2 years of career. Is that what you 
meant?
    Mr. Gunderson. I think that is one option. I do not think 
it is the only option. But, you know, what I have said in my 
testimony that I did not repeat in my brief summary is that we 
have to change this mind-set of workforce investment to be only 
those people who, quote, do not go to college. I mean, I am 
excited by the Council of Graduate Schools in this country that 
has become major players in workforce investment because every 
one of us in this room who has a B.A. degree who goes back to 
school--guess what?--we are in graduate education. We never 
thought of that as workforce investment. And if we are going to 
compete, we have got to begin looking at this holistic system, 
which is not even just P-16, it is P-16-plus, in a way that we 
have not redesigned that.
    We have had this concept in this country that graduate 
education is Ph.D. period. Somebody in the House of 
Representatives affectionately called graduate education as a 
prep school for college professors. You know, it is not that 
anymore. The reality is that we are now looking at graduate 
education in professional master's degrees as connecting 
workforce investment, those skills that you were talking about 
with Raytheon and others that are going to become necessary. It 
is not just a Ph.D. degree in order to be competitive and to 
keep this Nation competitive. That is why we have to look at 
that holistic set.
    Senator Isakson. OK. The reason I wanted to follow up on 
that is, following that line a little bit further, we are not 
doing a good enough job of exposing our young people to the 
potential of careers that we need. We glorify the absolute 
least productive things in our society, some of them almost 
destructive, and it is done more often than not through 
television. But we do not institutionalize in any way, it seems 
like to me, the images of those things that we need. And this 
is kind of a statement following up on what you said. But I 
agree.
    And the P-16, Governor Sebelius and Governor Fletcher, I 
was so glad to hear both of you mention it, and then Steve 
added that add-on, you know, past P-16 to actually the career. 
But we are beginning to move, to filter down, I think, at the 
lower level some of the benefits of good academics all the way 
through. And I commend you all on what you are doing.
    I want to thank you for something, too. Unfortunately, some 
of the people that needed to hear it are not here today, but 
both of you talked about--two words--flexibility and 
consolidation. And I want to commend you for doing that because 
you are where the rubber meets the road. We are not. And 
consolidating programs, which we strive so desperately to do in 
the Elementary and Secondary Education Act but failed in a lot 
of them, to give these programs allowable use titles and 
combine all the funds so you can choose within those uses which 
you best need I think is the way to go to expand that academic 
funding.
    And to that end, my question to you, Governor Sebelius, is: 
You mentioned Perkins money. Would you like Perkins to be a 
part of that type of concept of flexibility and consolidating 
programs? Or would you want it to remain isolated?
    Governor Sebelius. Well, Senator, I would say I think I 
would prefer maybe coordination to consolidation, and 
particularly consolidation that is chosen, you know, at some 
other level. What we need a lot more flexibility to do is 
coordinate streams of funding, and I think Perkins should very 
much be a part of that. And we are doing a lot of that right 
now in Kansas.
    We have done a major overhaul of our workforce initiatives 
with a program called Kansas First, where we have a market-
driven strategy with business leaders at the table coordinating 
with community college programs and workforce training efforts 
and kind of the one-stop shopping. And so our ability to pool 
those funds and design them so that they track the workers' 
needs and provide the program opportunities for those workers 
would be very beneficial.
    Senator Isakson. Well, the reason I ask the question is I 
am a big Perkins supporter, and there has been a fear that the 
consolidation of Perkins money was an end to that program. And 
Perkins deals with some of the things Steve is talking about 
and Ernie has talked about, everybody on the panel, because it 
is career-oriented training for the jobs of the 21st century. 
And I appreciate your changing the response--not changing the 
response but using coordination rather than consolidation when 
you got into that answer. And I think maybe that is where we 
may be missing it, Mr. Chairman. There may be some need to 
coordinate toward the outcomes we seek so as we consolidate we 
are not losing sight of the goals that we have. And unlike my 
North Carolina friend, I will not use any more time in case he 
has another question.
    Thank you, Mr. Chairman.
    [Laughter.]
    The Chairman. Thank you, and I want to thank all of the 
witnesses today. And as I mentioned, we will be leaving the 
record open for 10 days so that members who were not able to be 
here today can submit questions and so that you can expand on 
any remarks that you wish to expand on.
    As we talked about lifelong learning today, I think it came 
through very clearly that we need to concentrate our 
legislation on flexibility and coordination, counseling, and 
probably some emphasis on science and math.
    A couple of weeks ago, I held an inventors conference in 
Wyoming, and I had a fellow named Dean Kamen come out and be 
the keynote speaker. He invented the Segway. But that is kind 
of his hobby. He has 200 medical patents. One of them is heart 
stents. Another one is a diabetic pump. And he was lamenting 
the lack of science and math majors in the United States.
    Well, actually, we have a lot of science and math majors in 
college, but most of them are not from the United States. And 
that is going to result in some definite problems for us.
    He did point out, though, that you get what you celebrate, 
and we are celebrating entertainment and athletics. And he has 
an attempt to celebrate science and math. So something to keep 
in mind.
    Again, I appreciate everybody being here and the great 
testimony that we have had today.
    The hearing is adjourned.

[Editor's Note--Due to the high cost of printing, previously 
published materials submitted by witnesses may be found in the 
files of the commitee.]

                          ADDITIONAL MATERIAL

     Response to Questions of Senator DeWine by Margaret Spellings
    Question 1. In Ohio, we are far behind many other States in terms 
of the number of high school graduates who go on to higher education, 
with just 39 percent doing so. I believe this is an issue created by 
problems with students being or feeling ill-prepared for college and 
lacking the access to it. I have been a big supporter of Pell grants 
and other important loan programs to increase access to higher 
education. But with rising college costs, what more can we do to 
actually increase that access, not just maintain current enrollment 
numbers? And secondly, what more do we need to do to make sure students 
are more prepared for college?
    Answer 1. I agree that providing adequate financial support to 
students enrolled in postsecondary education is critical to ensuring 
access. That is why the President proposes to invest $19 billion in new 
funding over the next 10 years to increase the maximum Pell grant by 
$100 over each of the next 5 years and retire the program's 
longstanding funding shortfall. The 2006 Budget also includes a range 
of other proposals, such as increased student loan limits and new 
programs such as Loans for Short-Term Training, Presidential Math and 
Science Scholars, and an enhanced Pell grant for students who have 
completed the State Scholars curriculum, that would reduce financial 
barriers to higher education. The budget request also includes a $125 
million Community College Access grants initiative, which would support 
expansion of ``dual-enrollment'' programs under which high school 
students take postsecondary courses and receive both secondary and 
postsecondary credit. It would also help ensure that students 
completing such courses can continue and succeed in 4-year colleges and 
universities.
    With that said, simply increasing financial aid is not enough. As 
you suggest, we must ensure that students are prepared to enroll and 
succeed in college. That is why I believe the President's proposed $1.2 
billion High School Intervention Initiative is essential. Under that 
initiative, each State would develop a plan for improving high school 
education and increasing student achievement, especially the 
achievement of students at greatest risk of failing to meet challenging 
State standards and of dropping out of school. School districts 
receiving sub-grants from the States would be held accountable for 
increasing achievement, narrowing achievement gaps, and lowering the 
dropout rate, but they would have flexibility to provide the full range 
of services students need to ensure they are academically prepared for 
the transition to postsecondary education and the workforce. The 
initiative also would deepen the national knowledge base on what works 
in improving high schools and high school student achievement by 
supporting scientifically based research on specific interventions that 
have promise for improving outcomes.

    Question 2. In Ohio, we have had a rough time in terms of job 
losses the last few years. Since 2000, Ohio has lost more jobs than any 
other State in America--37 percent of all jobs lost nationwide. We know 
that manufacturing is never going to be the employment engine that it 
once was. We also know that we need to change the way we are teaching 
our children and youth so that they are prepared for the new high 
skills jobs which ARE being created. In 2003, U.S. employers submitted 
almost 285,000 applications to obtain work visas for skilled foreign 
born workers to fill available jobs in this country. How do you, 
Secretary Spellings and Secretary Chao, plan to work together to bridge 
this skills gap which we are currently facing and which could worsen if 
unchecked?
    Answer 2. Our two departments have established a strong, 
collaborative partnership to improve the preparation of today's and 
tomorrow's workers. By working closely together and ensuring that our 
programs and investments support and complement each other, we believe 
that we can make a powerful difference in bridging the Nation's skill 
gap. For that reason, the Department of Education's (ED) Assistant 
Secretary for Vocational and Adult Education and the Department of 
Labor's (DOL) Assistant Secretary for Employment and Training meet on a 
regular basis to coordinate our work and collaborate on projects of 
mutual interest. We include DOL officials in many of our public events. 
Most recently, ED sponsored a ``virtual summit'' on community college 
issues, and one of our featured speakers was the Assistant Secretary 
for Employment and Training. DOL has been equally inclusive. Education 
officials, for example, have participated in DOL's outreach meetings 
with representatives of high-growth industries and addressed their 
annual ``Workforce Innovations'' conferences and regional outreach 
events.
    Both agencies recognize that improving the academic preparation of 
our children and youth is an essential part of addressing the skills 
gap. Employers are demanding stronger reading, writing, and math skills 
of all of their workers--and reporting that too many recent high school 
graduates are not making the grade. Seventy-three percent of employers 
rate the writing skills of recent high school graduates as fair or 
poor, while 63 percent express dissatisfaction with graduates' math 
skills. Most of our students are leaving high school without the high-
level academic skills they need to land the fastest-growing, higher-
paying jobs in our economy. As noted above, the President's proposal 
for a new High School initiative will focus on improving student 
achievement at the high school level and, in particular, on the 
students who are most at risk of dropping out or leaving school without 
the skills and knowledge necessary for further education or employment.
    The Department of Labor has launched a complementary initiative to 
improve the outcomes of our most disadvantaged youth. Last fall, DOL 
organized regional forums to promote greater collaboration among State 
education, workforce, and juvenile justice officials to address the 
needs of disadvantaged youth. The Department of Education participated 
in the planning of these meetings, and encouraged State education 
officials to attend. We are now working with the DOL to develop a plan 
for providing joint technical assistance to State leaders as they seek 
to use resources from multiple Federal programs to support a common 
strategy for improving the outcomes of at-risk youth. This 
recommendation came out of proposals developed at the White House Task 
Force on Disadvantaged Youth, which I chaired at the Domestic Policy 
Council.
    No Child Left Behind and the President's High School Initiative 
will ensure that, over time, students graduate from high school with 
the knowledge and skills they need to succeed in postsecondary 
education and the workforce. Yet many adults who already have been left 
behind are looking for a second chance. Some departed school before 
graduating, some graduated lacking basic skills, and some are recent 
immigrants with limited English literacy skills. The Departments of 
Education and Labor are working together to ensure that these adults 
have access to the quality education and training they need to succeed 
in our economy.
    The President's reauthorization proposal for the Adult Education 
and Family Literacy Act demands accountability for results from States 
and local programs to ensure that both the hours adults invest in adult 
education and the Federal dollars we invest in the program are used 
most effectively. We would offer incentives for success to States and 
local programs, but we would also create more explicit consequences for 
those that fail to perform, including technical assistance and 
sanctions. We also want to create more choices for adults who want to 
improve their literacy skills. Our proposal would expand the number of 
workplace literacy programs, improve the capacity of community- and 
faith-based organizations to provide adult education, and promote 
greater use of technology to deliver instruction. This year, we are 
launching a 3-year national technology initiative that will expand the 
capability of adult education programs to use distance learning and 
other technologies and make distance education resources more 
accessible to adults with limited basic skills.
    Finally, a major vehicle for enabling American students to attain 
the skills and knowledge they need to prosper in the 21st Century 
economy is to provide student assistance that ensures access to 
postsecondary education. The President's proposal for raising the 
maximum Pell grant, providing enhanced Pell grants for students who 
have completed the State Scholars curriculum, and providing loans for 
short-term training, among other things, meets that need.

    [Whereupon, at 12:15 p.m., the hearing was adjourned.]
      
