[Senate Hearing 113-]
[From the U.S. Government Publishing Office]



 
  DEPARTMENTS OF LABOR, HEALTH AND HUMAN SERVICES, AND EDUCATION, AND 
          RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2014

                              ----------                              


                       WEDNESDAY, APRIL 17, 2013

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:07 a.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Tom Harkin (chairman) presiding.
    Present: Senators Harkin, Reed, Mikulski, Tester, Merkley, 
Moran, Cochran, Alexander, Johanns, and Boozman.

                        DEPARTMENT OF EDUCATION

STATEMENT OF ARNE DUNCAN, SECRETARY OF EDUCATION
ACCOMPANIED BY THOMAS SKELLY, DIRECTOR, BUDGET SERVICE


                opening statement of senator tom harkin


    Senator Harkin. The Appropriations Subcommittee on Labor, 
Health and Human Services, and Education will come to order.
    I want to first start by welcoming Senator Moran as our new 
ranking member of this subcommittee. Senator Moran has served 
on this subcommittee since 2011. I congratulate you on your new 
position in the most important subcommittee of the 
Appropriations Committee. And we were just talking. I know we 
share a real desire to get our appropriations process back on 
regular order and get a bill through. So I appreciate that and 
look forward to working with you on this committee.
    I'm very disappointed that Congress failed to enact an 
appropriations bill for this subcommittee last year. The 
omnibus package that Congress approved last month included five 
detailed spending bills, but Labor-HHS was put on autopilot for 
the second time in 3 years.
    As I have often said, this is no way to run a Government. 
We must return to the practice of marking up our appropriations 
bills, debating them on the Senate floor, having people offer 
amendments, and debate those and accept them or reject them, 
and going to conference with our House counterparts.
    I think this is especially important for education funding, 
the subject of our hearing this morning. The President has 
proposed some provocative ideas in his budget request. They 
deserve serious consideration. But none of them will be enacted 
if Congress fails once again to pass a Labor-HHS bill.


                      preschool for all initiative


    I am especially encouraged by the President's Preschool for 
All initiative, which would expand high-quality preschool 
programs to all 4-year-olds from low- and middle-income 
families. Much of this would be funded on the mandatory side, 
under the jurisdiction of the Health, Education, Labor, and 
Pensions (HELP) Committee, whose ranking member, of course, is 
Senator Alexander, whom I work very closely with on that 
authorizing committee. But the President has also requested 
$750 million in discretionary funds for Preschool Development 
Grants, which comes through this appropriations subcommittee to 
help the States get started, predevelopment grants, so to 
speak.
    I think experts agree, and all the data that we have seen 
confirms, that high-quality pre-kindergarten education is one 
of the best investments we can make in a student's academic 
future. So I'm looking forward to hearing more about this 
proposal.
    I am also pleased by the President's request to increase 
funding to turn around our lowest performing schools, extend 
the school day and school year, and make college more 
affordable for the middle class.


    title i and individuals with disabilities education act funding


    At the same time, I would have liked to see a higher 
priority on title I and Individuals with Disabilities Education 
Act (IDEA) Part B State grants. These are the two cornerstones 
of Federal support for public education. They're basically 
flat-funded in the President's budget. And I would have hoped 
that in the $3.2 billion increase that the President asked for 
that we would have had some more money directed to title I and 
IDEA.
    But overall, I believe the budget shows that the President 
understands the importance of education to our Nation's future. 
So I think it is a good starting point.
    I might also add that the best proof that the President 
cares very deeply about education is that he is keeping 
Secretary Duncan on for a second term. So, Mr. Secretary, I 
look forward to another 4 years of your outstanding leadership 
at the Department of Education.
    And before we hear from the Secretary, I yield to Senator 
Moran for his opening remarks.


                    statement of senator jerry moran


    Senator Moran. Mr. Chairman, thank you very much. Thank you 
for the welcome. I, too, look forward to working with you, and 
I think my Republican colleagues are very interested in 
returning to so-called regular order, something that has never 
been regular since the time I have been in the United States 
Senate. We would welcome the opportunity to move each of the 
bills through the committee--through the subcommittee and 
through the committee and through the Senate.
    I appreciate the relationship that you and I have. You 
would not, I would think, remember this, but I do. And at some 
point in time, I may pull out the note that you wrote me----
    Senator Harkin. Uh-oh. Uh-oh.
    Senator Moran [continuing]. During the 2000 farm bill. We 
were here in this building having a conference on the farm 
bill, and I expressed an opinion, perhaps voted a certain way. 
You got up from one side of the table and come over to my side 
of the table and hand me a note that says, ``Jerry, you have 
made a friend for life.''
    And so at some point in time, when it's particularly 
useful, I will----
    Senator Harkin. I'm putting my hand on my wallet right now.
    Senator Moran. I will redeem that note.
    So I look forward to being an ally as we try to develop a 
prudent and fiscal response to our country's needs in regard to 
health and education and labor.
    And Mr. Duncan, Secretary Duncan, thank you very much for 
being here. You and I have had several conversations over the 
years, and I appreciate the nature and the outcome of those 
conversations. I look forward to working with you in the 
Department of Education.
    We all have a belief that quality education is hugely 
important for Americans. It is opening doors and creating 
opportunity. The pursuit of the American dream is something 
that, in my view, involves the necessity, the desire of a 
society that understands the value of education.


                       early childhood education


    It does seem to me that the cornerstone for the 
Department's fiscal year 2014 budget is the $75 billion program 
to improve high-quality early-learning opportunities for 
preschool-aged children. And I certainly don't dispute that 
access to those learning experiences is critical for young 
children. It is important. I've been a long-time supporter of 
Head Start, for example. And it's important that Federal 
funding to improve the delivery of those preschool programs is 
coordinated and directed toward improving the quality of the 
programs for children who are most in need.


                      preschool development grants


    My home State of Kansas would benefit from funding for 
early-childhood education and preschool services. But in the 
past, no Federal funds have been awarded under the Race to the 
Top: Early Learning Challenge program. In fact, only a few 
States have benefited. And it would be discouraging if the 
administration's new discretionary request for preschool 
development grants prioritizes funding for States that have a 
more robust State-funded preschool program and not support 
those that need to develop that robust program. We need to make 
certain that early-childhood programs are available across the 
country.


             federal education k-12 formula grant programs


    In the same respect, I'm concerned that the fiscal year 
2014 budget signals a weakening of the Federal commitment to 
formula grant programs that are the primary source of Federal 
education. Chairman Harkin mentioned this in his opening 
comments. Of the $3.1 billion increase in the Department's 
budget, no resources are directed to increase funding for title 
I or special education or Impact Aid above the fiscal year 2012 
levels.


         race to the top: college affordability and completion


    Instead of increasing funding for the key formula K-12 
programs above the fiscal year 2012 levels, or even continuing 
support for past Race to the Top: State, District, and Early 
Learning competitions, the administration chose to fund a new, 
unauthorized $1 billion program called Race to the Top: College 
Affordability and Completion. This new competition would be the 
fourth component of Race to the Top, which to date has yet to 
demonstrate proven results that can be replicated and 
sustainable once funding is exhausted.
    The Department argues that the Race to the Top: College 
Affordability initiative will award funds to States with strong 
records of college affordability and quality, but only loosely 
outlines those parameters that will be required to meet those 
thresholds.
    I appreciate that every administration has the ability to 
request funding as they see fit. The Department of Education's 
budget request would invest heavily in new programs, many of 
them competitive not only on the discretionary side, but also 
on the mandatory side.


             mandatory funding in fiscal year 2014 request


    Beyond the Department's request for $75 billion in new 
mandatory funding for universal pre-kindergarten, the 
Department requests $21.7 billion in new mandatory funding 
efforts to support teacher stabilization and preparation, as 
well as new job-training initiatives. To put this request in 
perspective, $21.7 billion is equivalent to nearly one-third of 
the size of the budget of the Department of Education.
    We must ensure that our Nation's children are afforded 
every educational opportunity; however, just as critical is to 
ensure that they are not burdened by the national debt due to 
increased spending. Debt that is created today disadvantages 
future generations by creating a weaker economy and fewer job 
opportunities upon graduation. We need to make sure we have a 
highly educated population that can help us grow the economy 
and provide the necessary resources for funding of education 
and other important Government priorities.
    I thank you, Mr. Chairman.
    Senator Harkin. Thank you, Senator Moran.
    This is Secretary Duncan's fifth appearance before this 
subcommittee. He became the ninth Secretary of the U.S. 
Department of Education on January 20, 2009. Before his 
appointment, Secretary Duncan served as the Chief Executive 
Officer of the Chicago Public Schools. Before serving in 
Chicago, he ran the Ariel Education Initiative, which covered 
college costs for a group of inner-city youth, and he was 
instrumental in starting a new public elementary school, which 
ranks among the top schools in Chicago.
    So again, Secretary Duncan, welcome. We have your 
statement. And please proceed as you so desire.


                    summary statement of arne duncan


    Secretary Duncan. Thank you so much, and good morning, Mr. 
Chairman and members of the subcommittee.


                     gun violence and school safety


    This is not in my statement, but I just want to say 
quickly, as a parent, you guys are facing, I think, a really 
important vote possibly this afternoon on--to make it harder 
for a criminal to get access to a gun. And as a parent of two 
young elementary schoolchildren, this issue has been a very 
personal one for me for a long time. And I would just urge all 
of you to look inside your hearts and vote to make it harder 
for a criminal to have access to a gun. And 90 percent of the 
American public supports this; 80 percent of gun owners support 
this; 70 percent of the National Rifle Association (NRA) 
members support this. The two Senators who are providing 
leadership on this have historically had an A rating from the 
NRA. This is the furthest thing from an attack on Second 
Amendment rights.
    But I have to tell you, I've spent a lot of time back home 
in Chicago dealing with grieving families who have lost their 
children to gun violence. I've spent a lot of time with 
families in Newtown, Connecticut, the Sandy Hook community, 
with those teachers. And if we can do anything to reduce the 
number of families who have to deal with this absolute 
devastation, I would urge us to come together and work on that.
    I'm also happy to get back to why we're here today. I'm 
happy that the President's 2014 budget has been submitted to 
Congress. I look forward to discussing President Obama's 
priorities for our Department of Education. The President's 
budget demonstrates that we can make absolutely critical 
investments to strengthen the middle class, create jobs, and 
grow the economy, while still continuing to cut the deficit in 
a balanced way.


              progress during president obama's first term


    The good news in education today is that the investments 
we've made over the past 4 years are starting to pay off. Our 
Nation's students made important progress during the 
President's first term. The on-time high school graduation rate 
hit its highest level in three decades. And about 700,000 fewer 
teenagers, high school students, were trapped in what we call 
``drop-out factories'' in 2011 than in 2008. That's a huge step 
in the right direction.
    And instead of dummying down standards to make politicians 
look good, almost every State across the country voluntarily 
and courageously supported raising standards, going to higher 
standards that will show if students truly are college and 
career ready. The number of Pell grant recipients increased 
more than 50 percent. And that represents the biggest expansion 
of educational opportunity in higher education since the GI 
bill, without going back to taxpayers for a dime.
    Because of investments in public education and lots and 
lots of hard work, millions of Americans today have a better 
chance of getting a good job, owning their own home, and 
supporting a family. And I document these improvements in my 
formal statement, which I submit for the record.


                u.s. ranking in college graduation rates


    However, the bad news and, frankly, the brutal truth, is 
that the urgent need for education reform and improvement 
absolutely remains. Today, we rank 14th in the world in college 
graduation rates. Just one generation ago, we led the world. 
The fact that we have dropped from 1st to 14th--that is no 
badge of honor.


                  american education is falling behind


    Many of our economic competitors across the globe are 
making educational progress more rapidly than we are here in 
the United States. Simply put, they are out-educating us. And 
that means they will soon be out-competing us.
    In the end, I think we all believe that education is more 
than a set of numbers on the ledger; it is an investment and a 
statement on what we value. In fact, it's one of the most 
critical investments in the future that we as a Nation can 
make. Higher quality education is the surest path to building a 
thriving and an expanding middle class.
    It's also absolutely true that this is a time of real 
fiscal constraint, real fiscal challenges. But as the President 
said in his State of the Union, it's also a time to work for a 
smarter Government. Unfortunately, sequestration is not an 
example of smarter Government. Frankly, it is dumb, 
dysfunctional Government. Indiscriminate cuts to education, the 
military, and other critical public investments are a step 
backwards. And President Obama's budget would reverse the 
harmful impacts of sequestration.
    You don't see any of our high-performing international 
competitors de-funding education or driving their innovation 
agenda via something like sequester. In a knowledge-based, 
globally competitive economy, our competitors are determined to 
invest in education and better training for their workforce.
    For example, South Korea's investment in education as a 
percentage of gross domestic product (GDP) increased by nearly 
a third from 2000 to 2009, while our investment increased by 
just 6 percent. Education spending as a percentage of GDP rose 
at more than twice the U.S. rate in many countries, including 
Australia.


                    educational return on investment


    We should be asking not whether to invest in education, but 
what are the smartest investments we can make? The question is 
not ``How do we invest in the status quo?'' but rather, ``How 
do we invest in a vision of reform and increase student 
success?'' And that's why ROI, return on investment, was a huge 
factor in developing our 2014 budget request.
    The ROI for attending college is absolutely clear. The 
average college graduate earns $2.3 million over the course of 
his or her lifetime, $1 million more than the average high 
school graduate. Unfortunately, we all know paying for college 
is a formidable challenge today for many families.
    And that's why the President has proposed a $1 billion Race 
to the Top: College Affordability and Completion fund, and a 
$260 million First in the World fund, modeled after our i3 
program, to encourage innovation, to boost completion rates, 
and to drive down costs. Our focus on ROI and closing 
achievement gaps is also a key justification for the 
President's landmark Preschool for All proposal.


                      preschool for all initiative


    Senator Harkin, you have been a stalwart champion of high-
quality early learning for longer than I think I can remember. 
And I can't thank you enough for your passion and your 
leadership. For more than two decades, you have promoted the 
importance of providing access to high-quality early learning. 
And now, the President of the United States has proposed just 
such a program. Think what this could mean for our country, for 
our communities, and for our children if we could get this done 
before your tenure draws to a close.
    Now, contrary to what some members of this committee may 
have heard, the President's plan would not--let me be clear--
would not be a new Federal entitlement program or a new Federal 
mandate.
    Instead, his plan would create a new Federal-State 
partnership to enable States to provide universal high-quality 
preschool for 4-year-olds from low- and moderate-income 
families. States would use Federal funds to create or expand 
high-quality preschool programs.
    Senator, you asked about a State like Kansas. They would 
absolutely be eligible, and we can get into details in Q&A when 
that's appropriate.


            need for high-quality early childhood education


    For children ages 0 to 3, the President's budget would 
launch a new Early Head Start child care partnership at HHS and 
expand the administration's evidence-based home visiting 
initiative. Health and Human Services, with Secretary Sebelius, 
has been just a great partner in the Race to the Top: Early 
Learning Challenge. And our budget request reflects an ongoing 
commitment to that partnership and continued support of Head 
Start at HHS.
    Today, the urgent need for high-quality preschool is not in 
dispute. Fewer than 3 in 10--less than 30 percent of 4-year-
olds--are enrolled in high-quality preschool programs. And we 
know that, on average, when children from low-income families 
start kindergarten, they enter school already 12 to 14 months 
behind their peers in language development and pre-reading 
skills.
    That deficit represents a staggering opportunity gap that 
we must close. It makes no sense to me to have so many of our 
hardworking kindergarten teachers in the catch-up business year 
after year after year.
    The U.S. currently devotes less public spending to early 
learning as a percentage of GDP than 24 of 29 industrialized 
countries. Why is that okay for our children? High-quality 
preschool reduces placements in special education. It reduces 
grade retention. It boosts graduation rates. It increases the 
odds of holding a job and decreases crime.


              return on investment for preschool programs


    Rigorous longitudinal studies by Nobel laureate and 
economist James Heckman found a return of $7 to every $1 of 
public investment in high-quality preschool programs. A 
longitudinal study in Chicago also found an ROI of $7 to $1. 
That's a better return than any of us typically get in the 
stock market.


              benefits of high-quality preschool programs


    Studies from the past four decades demonstrate that high-
quality early learning gives children the foundation and the 
skills they need to succeed. We know that no study is perfect 
or fully representative of our Nation's diverse population. But 
the cumulative evidence that high-quality preschool works is 
compelling. And let me just quickly mention a few examples.
    Four-year-olds who have gone through Tulsa, Oklahoma's 
high-quality preschool program start kindergarten 7 months 
ahead in pre-literacy skills and 4 months ahead in math skills. 
The Tulsa program had small class sizes and well-trained 
teachers, both features of the President's proposal. Studies of 
preschoolers in Boston, New Jersey, and Tennessee showed 
substantial gains in both literacy and math.
    Some short-term studies find what's called a ``fadeout 
effect'' to learning gains after several years in elementary 
school. But the fadeout effect is due largely to differences in 
the quality of preschool and likely to the quality of schooling 
that follows. That makes sense.
    But, by contrast, long-term studies of high-quality 
preschool education consistently find big returns to high-
quality early learning. The non-cognitive benefits are hugely 
important over the long haul, things like the ability to pay 
attention, to regulate your behavior, and to demonstrate self-
control.


         state and local support for early childhood education


    No one thinks that high-quality early learning is a 
panacea. We know it must be followed by rich and robust 
educational opportunities. And it is absolutely a challenge to 
dramatically expand high-quality preschool. But I'm actually 
very optimistic, and I take real confidence from the leadership 
I already see across the country--leadership from both 
Republican and Democratic Governors.
    Twenty-seven Governors, more than half of our Nation's, 
referenced early learning in their State of the State Addresses 
this year. I don't know if that's ever happened before. And 
they're not just talking. They're putting their money where 
their mouth is. They are walking the walk. States like Oklahoma 
and Georgia are leading the way in creating universal preschool 
programs. And numerous States led by GOP Governors, including 
Alabama and Michigan, are investing in quality and expanding 
coverage to more 4-year-olds.
    Voters at the local level are also approving sales tax and 
property tax increases to fund preschool initiatives. Last 
November, voters in San Antonio, Denver, and St. Paul, 
Minnesota, all approved tax increases to support preschool 
programs in their local communities. The President's Preschool 
for All plan would help ensure that more than a million 
additional children, regardless of their ZIP Code or family 
income, are ready for kindergarten and on track to succeed.
    In America, education must fulfill its role as the great 
equalizer. It must be the one force that overcomes differences 
in race and privilege and national origin. Preschool for All is 
an essential investment to help our Nation fulfill that 
American promise of equal opportunity.


                           prepared statement


    As Governor Tom Corbett said in his State of the State 
Address this year, ``Why do we want to spend more on these 
programs? Because every child in Pennsylvania deserves an equal 
start in life. And I intend to see that promise kept.'' So, let 
us invest to bring every child to the same starting line. Let 
us keep our promises. Help us get our Nation's public schools 
out of the catch-up business. Help us once and for all to level 
the playing field. It's time, and our children and our country 
cannot wait.
    Thank you so much, and I'm happy to take your questions.
    [The statement follows:]
                   Prepared Statement of Arne Duncan
    Good morning, Mr. Chairman and members of the subcommittee. I'm 
pleased to be here today to talk with you about President Obama's 
priorities and plans for the Department of Education.
    I'm happy we were able to submit the President's 2014 budget to the 
Congress last week, and to have this opportunity to talk with you today 
about some of the President's major proposals.
    I want to begin by expressing my appreciation to Chairman Harkin 
and others on this subcommittee for your support over the past 4 years 
in making critical investments in our schools and our students. I am 
happy to report today that while we clearly have further to go, those 
investments are beginning to pay off.
    This morning I'll sketch out some important progress made in the 
President's first term. I will highlight urgent educational challenges 
that remain, not only for our Nation as a whole but in every 
congressional district and community in the country. And I will talk 
about the ROI--the return on investment in education spending--with 
special emphasis on the President's landmark preschool plan. Finally, I 
want to close by summarizing a number of other key elements of the 
President's education 2014 budget.
    The big takeaway message here is that education is more than a set 
of numbers on the ledger line. Education is not just an expense--it's 
an investment. In fact, it is one of the most critical investments in 
the future that we, as a Nation, can make. America cannot win the race 
for the future without investing in education--it's that simple.
    Budgets entail value choices. They reflect the aspirations of our 
citizens and leaders. And I am glad to say that, for the most part, 
Federal education funding has enjoyed bipartisan support, even in tough 
times. In America we invest in the future, not just in spite of 
challenges, but as the means of overcoming them.
    Dating back to even before the States ratified the Constitution, 
the fledgling Continental Congress passed the Land Ordinance of 1785 
and the Northwest Ordinance of 1787, granting Federal lands to States 
to create and support public schools. In my hometown of Chicago, one 
Federal land grant for schools is now Midway Airport.
    In the midst of the Civil War, President Lincoln signed the Morrill 
Act, creating our Nation's land grant colleges. FDR signed the GI bill 
during the midst of the epic battle of Normandy, expanding not only the 
opportunities for returning veterans but those of their children for 
generations to come.
    Fortunately, our Nation is not in the midst of World War II or the 
Civil War, and we are not in the midst of the Depression. But this is a 
time of fiscal challenges. And as President Obama said in his State of 
the Union Address, it is a time to work for ``smarter Government.'' We 
don't always live up to this goal in Washington. But I've yet to meet a 
lawmaker who has stated a preference for dumber Government.
    Unfortunately, sequestration, with its indiscriminate cuts to 
education, the military, and other critical public investments, is not 
an example of Government at its finest.
    You won't see our high-performing competitors funding education by 
sequester. In a knowledge-based, globally competitive economy, our 
competitors are determined to invest in education. They want to 
accelerate their progress, not cut back on public education.
    South Korea's investment in education, as a percentage of GDP, 
increased by nearly a third from 2000 to 2009, whereas our investment, 
as a percentage of GDP, increased by just 6 percent. Education spending 
as a percentage of GDP rose at more than twice the U.S. rate in many 
other countries as well during the last decade, including Australia (up 
15 percent), Denmark (18 percent), and the Netherlands (21 percent).
    Today, the U.S. is one of only four Organization for Economic Co-
operation and Development (OECD) countries where students in low-income 
schools have to cope with higher student-to-teacher ratios than their 
peers in more advantaged schools.
    But the question is not just whether we should continue to invest 
in education, but how can we make smarter investments in education? How 
can our education system become more productive? One way to answer 
these questions is to look at the return on investment in our education 
policies.
              progress during president obama's first term
    During the President's first term, the administration worked hand-
in-hand with the Congress to make critical new investments in 
education. We launched new programs like Race to the Top and Promise 
Neighborhoods, redesigned the School Improvement Grants (SIG) program, 
and dramatically expanded the Pell grant financial aid program for low-
income students. All of those efforts expanded educational opportunity 
and challenged the status quo where it had become unproductive.
    In a development that none of the experts foresaw, 46 States, plus 
the District of Columbia, came together to design and adopt the Common 
Core standards. For the first time, almost every State is supporting 
higher standards that show if students are truly college- and career-
ready--whether they are from Mississippi or Massachusetts. This was a 
sharp change from what we saw in the 4 years from 2005 to 2009, when 19 
States actually lowered their academic standards for students. We can 
thank courageous State leadership for stopping this insidious dummying 
down of standards.
    Today, we are starting to see the payoff of those first-term 
investments and setting higher expectations for our students. In 2010, 
the on-time high school graduation rate hit its highest level in three 
decades. In 2008, less than two-thirds of Hispanic students graduated 
on time from high school. Today, about 3 in 4 Hispanic high school 
students graduate with their class.
    Because the graduation rate of Latino students rose from 2008 to 
2011, an additional 164,000 Latino students graduated on time. That is 
164,000 people with a better chance of getting a good job, owning their 
own home, and supporting a family.
    On-time graduation rates for African-American students are up, too. 
In 2008, only about 3 in 5 black students graduated from high school on 
time. Today, 2 in 3 do so, resulting in an additional 83,000 African-
American students graduating on time in 2011.
    These gains are due in part to a sharp drop in the number of high 
school dropout factories--schools where fewer than 60 percent of ninth 
graders graduate 4 years later. Since 2008, the number of high school 
dropout factories has dropped by almost 20 percent, from about 1,750 
high schools to roughly 1,425 high schools.
    For our families, that means nearly 700,000 fewer teenagers are 
trapped in those high schools today than in 2008. That is a big step in 
the right direction.
    In higher education, we're seeing substantial increases in college 
enrollment, too, especially for Hispanic students. More than half-a-
million additional Hispanic students--about 550,000 in all--are 
enrolled in college today than were enrolled in 2008. That is 550,000 
more people who are getting their shot at the American dream and the 
opportunity to thrive in a globally competitive world. And overall, the 
number of Pell grant recipients has increased more than 50 percent, 
from 6.2 million in 2008 to more than 9 million 3 years later. That is 
the biggest expansion of educational opportunity in higher education 
since the GI bill.
    In a knowledge-based economy, the ROI (the return on investment) 
for many of the strategies the administration has pursued is huge. We 
believe our efforts to support and strengthen the teaching profession 
through improved teacher evaluation, better professional development, 
and the RESPECT program will pay large, long-term dividends for our 
children and our communities.
    Economists at Harvard and Columbia have documented that having a 
good teacher rather than an ineffective one can increase the lifetime 
earnings of a class of students by over $260,000. Multiply that by the 
number of classes a teacher would instruct over the course of her 
career, and it is clear that even a single good teacher can have a 
multi-million dollar effect on the economy.
    The ROI for attending college is huge, too. Unlike when I and many 
members of the committee were growing up, there are no good-paying jobs 
anymore for high school dropouts--and even those with a high school 
diploma struggle to make a living, with the average high school 
graduate making $1.3 million during his or her lifetime, compared to 
$2.3 million for the average college graduate.
    Our focus on ROI is a key justification for President Obama's 
groundbreaking preschool proposal.
        the theory of action for the president's preschool plan
    The President's Preschool for All proposal would create a new 
Federal-State partnership to enable States to provide universal high-
quality preschool for 4-year-olds from low- and moderate-income 
families, up to 200 percent of the poverty line.
    Contrary to what you may have heard, the President's plan would not 
be a new Federal entitlement program. States would use Federal funds to 
create or expand high-quality preschool programs in partnership with 
local school-based and community providers. States would provide an 
increasing match for the program, and every cent of the $75 billion 
provided by the Federal Government over the next 10 years would be paid 
for by increases in taxes on cigarettes and tobacco products.
    Our theory of action in expanding high-quality preschool is going 
to be the same as it was in the first term, with a strong emphasis on 
supporting and partnering with States, incentivizing innovation, and 
identifying what works to strengthen education and accelerate 
achievement. That means that at the Federal level, we should be tight 
on ends but loose on means. The Department should set a high bar for 
quality in preschool programs. But it should leave it up to State and 
local leaders to choose the best means for reaching that bar.
    Under the President's plan, States would be required to meet 
quality benchmarks linked to better outcomes for children--like having 
high-quality State-level standards for early learning, qualified and 
well-compensated teachers in all preschool classrooms, and a plan to 
implement comprehensive assessment and data systems.
    The urgent need today for greater access to high-quality preschool 
for children from low- and moderate-income families is not really in 
dispute. Fewer than 3 in 10 4-year-olds today are enrolled in high-
quality preschool programs. And we know that, on average, children from 
low-income families start kindergarten 12 to 14 months behind their 
peers in language development and pre-reading.
    I would ask permission to place in the record an article from the 
April 3rd New York Times that summarizes how the U.S. lags behind other 
nations in supporting early learning.
                                 ______
                                 
  [article from the new york times, by eduardo porter, april 2, 2013]
              Investments in Education May Be Misdirected
    James Heckman is one of the nation's top economists studying human 
development. Thirteen years ago, he shared the Nobel for economics. In 
February, he stood before the annual meeting of the Nebraska Chamber of 
Commerce and Industry, showed the assembled business executives a 
chart, and demolished the United States' entire approach to education.
    The chart showed the results of cognitive tests that were first 
performed in the 1980s on several hundred low-birthweight 3-year-olds, 
who were then retested at ages 5, 8 and 18. Children of mothers who had 
graduated from college scored much higher at age 3 than those whose 
mothers had dropped out of high school, proof of the advantage for 
young children of living in rich, stimulating environments.
    More surprising is that the difference in cognitive performance was 
just as big at age 18 as it had been at age 3.
    ``The gap is there before kids walk into kindergarten,'' Mr. 
Heckman told me. ``School neither increases nor reduces it.''
    If education is supposed to help redress inequities at birth and 
improve the lot of disadvantaged children as they grow up, it is not 
doing its job.
    It is not an isolated finding. Another study by Mr. Heckman and 
Flavio Cunha of the University of Pennsylvania found that the gap in 
math abilities between rich and poor children was not much different at 
age 12 than it was at age 6.
    The gap is enormous, one of the widest among the 65 countries 
taking part in the Program for International Student Achievement run by 
the Organization for Economic Cooperation and Development.
    American students from prosperous backgrounds scored on average 110 
points higher on reading tests than disadvantaged students, about the 
same disparity that exists between the average scores in the United 
States and Tunisia. It is perhaps the main reason income inequality in 
the United States is passed down the generations at a much higher rate 
than in most advanced nations.
    That's a scandal, considering how much the Government spends on 
education: about 5.5 percent of the nation's economic output in total, 
from preschool through college. And it suggests that the angry, worried 
debate over how to improve the nation's mediocre education--pitting the 
teachers' unions and the advocates of more money for public schools 
against the champions of school vouchers and standardized tests--is 
missing the most important part: infants and toddlers.
    Research by Mr. Heckman and others confirms that investment in the 
early education of disadvantaged children pays extremely high returns 
down the road. It improves not only their cognitive abilities but also 
crucial behavioral traits like sociability, motivation and self-esteem.
    Studies that have followed children through their adult lives 
confirm enormous payoffs for these investments, whether measured in 
improved success in college, higher income or even lower incarceration 
rates.
    The costs of not making these investments are also clear. Julia 
Isaacs, an expert in child policy at the Urban Institute in Washington, 
finds that more than half of poor 5-year-olds don't have the math, 
reading or behavioral skills needed to profitably start kindergarten. 
If children keep arriving in school with these deficits, no amount of 
money or teacher evaluations may be enough to improve their lot later 
in life.
    Much attention has focused lately on access to higher education.
    A typical worker with a bachelor's degree earns 80 percent more 
than a high school graduate. That's a premium of more than $500 a week, 
a not insubstantial incentive to stay in school. It is bigger than ever 
before. Yet the growth of college graduation rates has slowed for women 
and completely stalled for men.
    The Economic Report of the President released last month bemoaned 
how the nation's college completion rate had tumbled down the 
international rankings, where it now sits in 14th place among O.E.C.D. 
countries.
    The report restated the president's vow to increase the number of 
college graduates by 50 percent by 2020, and laid out how the Federal 
Government has spent billions in grants and tax breaks to help ease the 
effects of rising tuition and fees. Last year the Government spent 
almost $40 billion on Pell grants, more than twice as much as when 
President Obama came to office.
    Mr. Heckman's chart suggests that by the time most 5-year-olds from 
disadvantaged backgrounds reach college age, Pell grants are going to 
do them little good. ``Augmenting family income or reducing college 
tuition at the stage of the life cycle when a child goes to college 
does not go far in compensating for low levels of previous 
investment,'' Mr. Heckman and Mr. Cunha wrote.
    Mr. Heckman and Mr. Cunha estimated that raising high school 
graduation rates of the most disadvantaged children to 64 percent from 
41 percent would cost 35 to 50 percent more if the assistance arrived 
in their teens rather than before they turned 6.
    Erick Hanushek, an expert on the economics of education at 
Stanford, put it more directly: ``We are subsidizing the wrong people 
and the wrong way.''
    To its credit, the Obama administration understands the importance 
of early investments in children. The president has glowingly cited Mr. 
Heckman's research. In his State of the Union address, the president 
called for universal preschool education. ``Study after study shows 
that the earlier a child begins learning, the better he or she does 
down the road,'' Mr. Obama said at a speech in Decatur, Georgia, in 
February. But the fresh attention has not translated into money or a 
shift in priorities. Public spending on higher education is more than 
three times as large as spending on preschool, according to O.E.C.D. 
data from 2009. A study by Ms. Isaacs found that in 2008 Federal and 
state governments spent somewhat more than $10,000 per child in 
kindergarten through 12th grade. By contrast, 3- to 5-year-olds got 
less than $5,000 for their education and care. Children under 3 got 
$300.
    Mr. Heckman's proposals are not without critics. They argue that 
his conclusions about the stupendous returns to early education are 
mostly based on a limited number of expensive experiments in the 1960s 
and 1970s that provided rich early education and care to limited 
numbers of disadvantaged children. They were much more intensive 
endeavors than universal preschool. It may be overoptimistic to assume 
these programs could be ratcheted up effectively to a national scale at 
a reasonable cost.
    Yet the critique appears overly harsh in light of the meager 
improvements bought by the nation's investments in education today. A 
study by Mr. Hanushek found that scores in math tests improved only 
marginally from 1970 to 2000, even after spending per pupil doubled. 
Scores in reading and science declined.
    ``Early education is an essential piece if we are going to have a 
better education system,'' Barbara Bowman, an expert on early childhood 
education in Chicago who has advised the Education Department. ``We're 
inching in that direction.''
    Education is always portrayed in the American narrative as the 
great leveler. But it can't do its job if it leaves so many behind so 
early.

[www.nytimes.com/2013/04/03/business/studies-highlight-benefits-of-
early-
education.html?ref=eduardoporter&_r=1&]
                                 ______
                                 
    As the following charts demonstrate, out of 29 industrial nations, 
the U.S. devotes less public spending to early learning as a percentage 
of GDP than 24 countries. The Czech Republic and Chile devote more 
government spending to early learning, as do Iceland and Italy. The 
United States ranks 28th among OECD nations in our enrollment of 4-
year-olds in early learning.
        the united states ranks 28th in the world in enrollment



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


   the united states ranks 25th in public funding for early learning



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


        the return on investment on high-quality early learning
    In an era of tight budgets, it's essential that we ask ourselves, 
what is the smartest use of our education dollars? The answer, I 
believe, is that high-quality early learning is the best education 
investment we can make in our children, our communities, and our 
country. As President Obama has said, ``if you are looking for a good 
bang for your educational buck,'' high-quality preschool is the place 
to look.
    In the near-term, high-quality preschool reduces placements in 
special education. It reduces grade retention. It boosts graduation 
rates. In the long-term, high-quality preschool both increases the odds 
of holding a job and decreases crime and teen pregnancy.
    Rigorous, longitudinal studies by Nobel laureate James Heckman of 
the Perry Preschool project found a return of $7 to every $1 of public 
investment in high-quality preschool programs. A longitudinal study of 
the Chicago Child Parent Centers also found an ROI of 7 to 1. That is a 
much higher return on Government investment than one would typically 
get in the stock market.
    States like Oklahoma and Georgia know about these data and are 
leading the way in creating universal preschool programs. In fact, 
numerous States led by GOP Governors--including Alabama and Michigan--
are investing in quality and expanding coverage to more 4-year-olds.
    Not only are States investing in high-quality preschool, voters are 
approving sales tax and property tax increases to fund preschool 
initiatives. Last November, voters in San Antonio, Denver, and St. 
Paul, Minnesota, all approved tax increases to support preschool 
programs in their communities.
    Voters and parents understand that in today's global economy, 
ensuring access to high-quality preschool is not a luxury but a 
necessity. They understand that investing in high-quality preschool is 
a win-win proposition, with a big economic return. And they understand 
that we have to stop playing catch-up in education. We have to level 
the playing field for young children, so everyone can begin 
kindergarten at the same starting line.
    This is why the centerpiece of President Obama's education budget 
for fiscal year 2014 is a pair of major new investments in early 
learning: A $75 billion mandatory request, over 10 years, to support 
the Preschool for All initiative; along with a $750 million 
discretionary request for Preschool Development Grants.
    Preschool for All would create a new Federal-State cost-sharing 
partnership aimed at making high-quality public preschool available to 
all 4-year-olds from low- and moderate-income families while also 
providing incentives for States to serve additional children from 
middle-class families. The companion Preschool Development Grants 
proposal would help build State capacity to implement the high-quality 
preschool programs required by Preschool for All.
other priorities in the president's 2014 request for the department of 
                               education
    These preschool proposals are part of an overall request of $71.2 
billion in discretionary appropriations for the Department of Education 
in fiscal year 2014, an increase of $3.1 billion, or 4.5 percent, over 
the fiscal year 2012 level.
    In addition to early learning, this request is focused on 
strengthening K-12 education, making our schools safer and creating 
positive learning environments, supporting career-readiness for all, 
improving affordability and quality in postsecondary education, and 
supporting the administration's Ladders of Opportunity initiative for 
high-poverty communities.
                      strengthening k-12 education
    The 2014 request provides essential funding for traditional State 
formula grant programs that are the foundation of Federal support for 
State and local efforts to ensure that all students meet college- and 
career-ready standards, including a $14.5 billion request for the Title 
I Grants to Local Educational Agencies program and $11.6 billion for 
the Individuals with Disabilities Education Act Grants to States 
program. At the same time, we would continue our emphasis on creating 
meaningful incentives to leverage more effective use of Federal 
education funding in key areas such as putting a great teacher in every 
classroom and a great leader in every school; building local capacity 
to support successful school turnarounds; and improving teacher 
preparation and classroom instruction in science, technology, 
engineering, and mathematics (STEM).
         reforming federal support for effective stem education
    The administration is proposing a comprehensive reorganization of 
Federal STEM education programs as part of a Governmentwide realignment 
that would reorganize or restructure 114 programs across 13 agencies.
    Reforming Federal support to support an effective, cohesive 
national STEM education strategy is a top administration priority. 
Scientists and engineers are key innovators in our society. They play 
an essential role in developing new industries and opportunities that 
create jobs and spur economic growth. Our Nation depends on an 
innovation economy, and America's capacity to build and create should 
never be limited by a shortage of talent in the STEM fields.
    At the core of this strategy for improving K-12 STEM education is a 
$150 million request for STEM Innovation Networks, which would support 
creating partnerships among school districts, institutions of higher 
education, research institutions, museums, community partners, and 
business and industry. These networks would develop comprehensive plans 
for identifying, developing, testing, and scaling up evidence-based 
practices to provide rich STEM learning opportunities in participating 
local educational agencies (LEAs) and schools. They also would work to 
leverage better and more effective use of the wide range of STEM 
education resources available from Federal, State, local, and private 
entities, including federally supported science mission agencies.
    Other key elements of the Department's STEM request include $80 
million for STEM Teacher Pathways to support the President's goal of 
developing 100,000 new effective STEM teachers by recruiting, training, 
and placing talented recent college graduates and mid-career 
professionals in the STEM fields in high-need schools; and $35 million 
to establish a new STEM Master Teacher Corps, which would identify 
teacher leaders in STEM fields who would take on leadership and 
mentorship roles in their schools and communities aimed at improving 
STEM instruction and helping students excel in math and science.
               more effective teachers and school leaders
    Consistent with the administration's proposal to reauthorize the 
Elementary and Secondary Education Act (ESEA), the President's budget 
would provide $2.5 billion for Effective Teachers and Leaders State 
Grants to provide flexible, formula-based support for States and LEAs 
that commit to improving their teacher and principal evaluation systems 
and to ensuring that low-income and minority students have equitable 
access to teachers and principals who are effective at raising student 
achievement. We also would renew our request for a 25 percent national 
activities set-aside totaling nearly $617 million that would allow the 
Department to build evidence on how best to recruit, prepare, and 
support effective teachers and school leaders and to invest in efforts 
to enhance the teaching and leadership professions.
    In addition, the budget includes $400 million for the reauthorized 
Teacher and Leader Innovation Fund, an increase of $100 million over 
2012, to help States and LEAs improve the effectiveness of teachers and 
leaders in high-need LEAs and schools, in particular by creating the 
conditions to identify, recruit, prepare, support, retain, and advance 
effective and highly effective teachers, principals, and school 
leadership teams in those schools. We also are asking for $98 million 
to support a redesigned School Leadership Program that would more than 
triple the Federal investment in training for principals. This proposal 
would promote evidence-based professional development for current 
school leaders aimed at strengthening essential leadership skills--such 
as evaluating and providing feedback to teachers, analyzing student 
data, developing school leadership teams, and creating a positive 
school climate.
        supporting school turnarounds and data-based innovation
    We would expand our commitment to helping States and school 
districts turn around their lowest performing schools through a $659 
million request for the reauthorized School Turnaround Grants (STG) 
program. The request includes an increase of $125 million that would be 
used for competitive awards to help school districts build their 
capacity to implement effective interventions in persistently lowest 
achieving schools or priority schools, and to sustain progress in 
schools that have successfully completed a 3-year STG project. In 
addition, the Department could use up to $25 million of these funds to 
build district capacity by expanding the School Turnaround AmeriCorps 
initiative, a new partnership with the Corporation for National and 
Community Service that places AmeriCorps members in low-performing 
schools to support their school turnaround efforts.
    The request also would strengthen K-12 education through a $215 
million proposal for Investing in Innovation (i3), an increase of $66 
million, to expand support for using an evidence-based approach to test 
new ideas, validate what works, and scale up the most effective 
reforms. Up to $64 million would be available for the Advanced Research 
Projects Agency for Education (ARPA-ED), an initiative modeled on 
similar entities at the Departments of Defense and Energy that would 
aggressively pursue technological breakthroughs with the potential to 
dramatically improve the effectiveness and productivity of teaching and 
learning. And an $85 million request for statewide longitudinal data 
systems (SLDS) would provide an increase of $47 million to support the 
development of P-20 reports and tools to inform policy-making at the 
State and local levels, as well as the development of in-house analytic 
capacity for States and school districts.
                  supporting career-readiness for all
    To out-innovate and out-compete the rest of the world, secondary 
schools and postsecondary institutions need to strengthen the links in 
our education system to better support career training and skills. The 
President's 2014 budget seeks to promote career-readiness for all, in 
large part through a $1.1 billion request for a reauthorized Carl D. 
Perkins Career and Technical Education (CTE) program. The reauthorized 
CTE program would strengthen alignment among secondary and 
postsecondary CTE programs and business and industry, and create a 
better accountability system for improving academic outcomes, technical 
skills, and employability outcomes.
    We also are proposing $300 million for a new High School Redesign 
program, which would support partnerships of school districts, 
employers, and postsecondary institutions that would redesign high 
schools in innovative ways to ensure that all students graduate from 
high school with (1) college credit, earned through dual enrollment, 
Advanced Placement courses, or other postsecondary learning 
opportunities; and (2) career-related experiences or competencies, 
obtained through organized internships and mentorships, structured 
work-based learning, and other related experiences.
    In addition, we are asking for $42 million to fund a demonstration 
and evaluation of Dual Enrollment programs. This proposal would 
establish or expand dual enrollment programs, aligned with career 
pathways and local workforce needs, which offer high school and adult 
students the opportunity to earn college credits while enrolled in a 
high school or GED program. Research has shown that participation in 
dual-enrollment programs is linked to increased high school graduation, 
higher rates of college enrollment and persistence, and higher college 
credit accrual rates.
          affordability and quality in postsecondary education
    The 2014 request continues to support the President's ambitious 
goal that America will once again have the highest proportion of 
college graduates in the world by 2020. The urgent and growing need for 
higher education reflected in the 2020 goal comes at a time when paying 
for college is a challenge for many American families. As a 
consequence, the President's budget proposes comprehensive reforms to 
increase affordability and quality in higher education, including $1 
billion for a new Race to the Top: College Affordability and Completion 
competition. That competition would drive change in State higher 
education policies and practices to improve college access, 
affordability, completion, and quality. The request also includes $260 
million for a First in the World fund, modeled after the Investing in 
Innovation (i3) program, which would make competitive awards to 
encourage innovation in higher education to tackle and improve college 
completion rates, increase the productivity of higher education, build 
evidence of what works, and scale up proven strategies.
    In addition to promoting systemic reforms in higher education, the 
President's 2014 request includes student aid proposals that would make 
college more affordable, including linking student loan interest rates 
to market rates and preventing a scheduled July 1, 2013, doubling of 
Subsidized Stafford Loan rates from 3.4 percent to 6.8 percent. The 
President's budget would expand repayment options to ensure that loan 
repayments for all student borrowers do not exceed 10 percent of a 
borrower's discretionary income, and significantly increase aid 
available under the Campus-Based Aid programs. For example, the request 
includes a $150 million increase for the Work-Study program as part of 
an effort to double participation over 5 years, as well as reforms to 
the Perkins Loans program that would expand loan volume by some eight 
and one-half times, up to $8.5 billion, while making Perkins Loans 
available at up to an additional 2,700 college campuses.
           building ladders of opportunity--and promise zones
    The President's 2014 budget for education would help directly 
address the growing concern that too many communities in America--
urban, rural, and, increasingly, suburban--suffer from the negative 
effects of concentrated poverty, including developmental delays among 
young children, poor educational outcomes, high rates of crime and 
incarceration, health problems, and low employment. One new strategy 
for addressing the challenges of concentrated poverty is the Promise 
Zones initiative, which will revitalize high-poverty communities across 
the country by attracting private investment, increasing affordable 
housing, improving educational opportunities, providing tax incentives 
for hiring workers and investing in the Zones, and assisting local 
leaders in navigating Federal programs and cutting through red tape.
    This interagency effort will explore opportunities to make better 
use of all available resources--Federal, State, and local--to address 
the negative effects of concentrated poverty. The President's budget 
would support Promise Zones through significant requests in his 
signature place-based programs, including $300 million for the 
Department of Education's Promise Neighborhoods, a $400 million request 
for the Department of Housing and Urban Development's Choice 
Neighborhoods program, and $35 million for the Department of Justice's 
Byrne Criminal Justice Innovation Grants program, in addition to tax 
incentives to promote investment and economic growth.
                          making schools safer
    In January of 2013, President Obama released his plan to reduce gun 
violence, make schools safer, and increase access to mental health 
services. The 2014 request supports this plan's common-sense proposals 
with new investments designed to improve school emergency plans, create 
positive school climates, and counter the effects of pervasive violence 
on students. For example, we are asking for $30 million in one-time 
emergency management planning grants to States to help their LEAs 
develop, implement, and improve emergency management plans designed to 
enable districts and schools to prepare for, prevent and mitigate, 
respond to, and recover from emergencies and crisis events.
    The request also includes $50 million for School Climate 
Transformation Grants, to be coordinated with related proposals at the 
Departments of Justice and Health and Human Services. These grants 
would help create positive school climates that support effective 
education for all students through the use of evidence-based behavioral 
practices. Funds would be used to scale up a multi-tiered, 
decisionmaking framework that has been shown to reduce problem 
behaviors, decrease bullying and peer-victimization, improve the 
perception of school as a safe setting, and increase academic 
performance in reading and math. In addition, $25 million for Project 
Prevent grants would help school districts in communities with 
pervasive violence break the cycle of violence through the provision of 
mental health services to students suffering from trauma or anxiety 
(including PTSD), conflict resolution programs, and other school-based 
strategies to prevent future violence.
    I want to close by talking briefly about school safety and gun 
violence. This issue is very personal for me. Frankly, it's something 
that has haunted me from the time I was a little boy, growing up on the 
South Side of Chicago.
    I grew up playing basketball on the streets in many of Chicago's 
inner-city communities. I had older teenagers who looked out for me and 
who helped protect me. Far too many of them ended up being shot and 
killed. After graduating from college and playing ball overseas, I came 
back to Chicago to run an ``I Have a Dream'' program for a class of 
sixth graders. One of my first memories was of one of our young men, 
Terriance Wright, whose teenage brother was shot one afternoon.
    Going to that funeral, and trying to help that family through that 
process, was brutal. We have far too many parents burying their 
children--that is not the natural order of life. When I led the Chicago 
Public Schools, we lost one child due to gun violence every 2 weeks. 
That is a staggering rate of loss. In Chicago, we took steps that no 
public school system should ever have to take. We created burial funds 
for families that couldn't afford to bury their children.
    So, I absolutely refuse to accept the status quo. And I have two 
simple goals for change that everyone can agree on: first, that many 
fewer of our Nation's children die from gun violence; and second, that 
many more children grow up free from a life of fear.
    If we refuse to act now, if we refuse to show courage and 
collective will in the aftermath of the Sandy Hook massacre, I think we 
will never act.
    Sometimes the time picks you; sometimes you pick the time. Today, 
sadly, the time has picked us. If we don't move forward now in a 
thoughtful way to protect our children, then we, as adults, as parents, 
as leaders, have broken a trust with children to nurture them and keep 
them safe from harm.
    On my wall in my office in Chicago, I kept a picture that one of 
our teenagers had drawn for me. It was a picture of him as a fireman. 
And the caption that he wrote to go along with it was: ``If I grow up, 
I want to be a fireman.'' That's a deep statement about this young 
man's world. Think about what it means that so many of our youth today 
think about ``If I grow up,'' not ``When, I grow up.''
    Everything we are preaching to young people about going to college, 
building careers, deferring gratification, and planning for the future, 
is all undermined when a child is afraid they will get caught up in the 
craziness of gun violence. We need all our children, whether it is in 
Newtown, Connecticut, the South Side of Chicago, or Aurora, Colorado, 
to think of themselves in terms of ``when I grow up.''
    And when children do have that confidence, our opportunity gaps, 
our achievement gaps, will shrink. When that day comes, education will 
fulfill its role in America as the great equalizer. It will truly be 
the one force that overcomes differences in race, privilege, and 
national origin.
                               conclusion
    The need is urgent. And I say to the committee, whether you are 
Republican or Democrat, our children and our country cannot wait. We 
cannot postpone providing every child with a world-class education.
    I look forward to working with you to develop and implement a 
fiscal year 2014 budget for education that reflects the needs of our 
children and our Nation. And I would be happy to take any questions now 
that you may have.

    Senator Harkin. Thank you very much, Secretary Duncan.
    Before we get into questions, we are honored to have the 
presence of the Chair of the full Appropriations Committee, and 
also a member of this subcommittee, Honorable Senator Mikulski.
    Senator Mikulski. Thank you very much, Senator Harkin and 
Senator Moran.
    I just wanted to come by, first of all, as a member of the 
committee, and would like to stay longer for the questions. But 
I just wanted to make just a very brief set of comments.
    First of all, I want to thank you and Senator Moran for 
your leadership. I want to thank you for your help and support 
in moving the continuing funding resolution.
    And, Mr. Duncan, I want you to know after your excellent 
testimony at our sequester hearing, everybody at this table 
worked together to try to move the continuing funding 
resolution in whatever way we could so there would be no shut-
down slam-down lock-down. And I think what you sense here is a 
sense of bipartisanship and a desire to return to regular 
order. And I want you to know, in my role as the full committee 
chairwoman, to work with you on the allocation you need, but to 
also prod the process so we can follow regular order with an 
open amendment procedure.

            MARK UP OF FISCAL YEAR 2014 APPROPRIATIONS BILL

    We hope to be able to mark up our bill sometime after 
Memorial Day. We will be marking it up at the level of $1.058 
trillion. This is $92 billion more than the House. There will 
be tensions with the House, but there's always tensions with 
the House. We can work on that, and we can work it out. But we 
need to focus on the compelling needs of our country.
    This subcommittee is the second-largest subcommittee in the 
entire Appropriations. Number one is the Defense Appropriations 
Subcommittee. But this is also the defense of the Nation--our 
young people and the education they should have, the National 
Institutes of Health fighting diseases and looking for cures, 
and our Department of Labor focusing on the jobs today and the 
jobs tomorrow.
    So we want to work with you, Mr. Duncan. We're so glad, 
first of all, that you're staying. You know, continuity is an 
important thing. And thank you for what you've done already. 
We've reviewed your budget request for the Department of 
Education. I'm an enthusiastic supporter of universal 
preschool, Promise Neighborhoods, and some of the other 
programs that the administration is requesting we support in 
the next fiscal year. I think we have to take a closer look at 
IDEA and title I.
    But that will be the job of the subcommittee. My job is to 
prod the process. Their job is to come up with the right line-
item allocation. And I'm going to help them have what they need 
to work on this. So thank you very much, and I look forward to 
being an active member of the subcommittee.
    Senator Harkin. Thank you very much, Madam Chair, and I 
look forward to working with you to get a good bill through and 
on the floor and going to conference and on to the President.

                       EARLY CHILDHOOD EDUCATION

    Mr. Secretary, we will begin a round of 5-minute questions. 
I remember when I was at the State of the Union Message and the 
President talked about his preschool program. And as we were 
all walking out, I said to you, and I think Mr. Sperling, who 
was standing there--I said--I think one of you, I forget which 
one, said, ``How do you like that?'' I said, ``I love it. Now, 
let me see the budget.''
    And thank you. The budget is good. This is the right step 
forward in terms of preschool. Wait. I've got to bite my 
tongue. I used to always call it ``preschool.'' However, in 
1991, a report by the Committee on Economic Development that 
was set up to study education funding--actually, it was under 
the Reagan administration, and then they proceeded under the 
Bush administration. They finally came out with their findings 
in a report entitled, ``The Unfinished Agenda: A New Vision for 
Child Development and Education.''
    And their executive summary was very simple. It said that 
we must understand that education begins at birth. And the 
preparation for education begins before birth. This committee 
was made up of some of the leading industrialists, CEOs of our 
largest major corporations in America. I always kind of wave 
that book around. I don't have it with me today. So I use that. 
And I've been talking about that ever since, that here are the 
business leaders of America said, ``What we should do in 
education is focus on early-childhood education.'' That was 
1991.
    Twenty years later, the U.S. Chamber of Commerce came out 
with a study and a finding. This was just a couple of years 
ago. I remember I went down for the unveiling of it. And again, 
they called for a major investment in early-childhood 
education. This is, again, the business community of America. 
So you're right. I've been on this for a long time, saying that 
we've got to focus on this. And I used to call it 
``preschool.'' But now I'm thinking that school actually starts 
at birth. So I call it ``early learning,'' maybe not 
``preschool,'' but ``early learning programs.''
    So I want to congratulate you and the President for 
focusing on this. It's long overdue, but better to get started 
on it as soon as possible and encouraging States to develop 
really good early learning programs.

                  PRESCHOOL DEVELOPMENT GRANTS PROGRAM

    So I'd just like to start my first question by just saying 
that the $750 million that you've proposed for the Preschool 
Development Grants program, I want to focus on that. I guess a 
lot of times people say, ``Well, look. We've got Head Start. 
We've got Early Head Start. We've got child care development 
block grants, Race to the Top: Early Learning Challenge. So 
what would these preschool development grants do that these 
other programs don't? How do they fit in?''
    Secretary Duncan. So first, again, just thanks so much for 
your leadership over the years. And to actually have a chance 
to get this done and to go from 3 in 10 young children with 
access to high-quality preschool programs to a much higher 
number, I think is one of the most important things we can do 
for the country.
    So the $750 million, that would help States whether they 
are high capacity or low capacity or just getting in the game 
to develop infrastructure, to help develop their workforce 
capacity. Maybe it's facilities issues. We would have some 
flexibility there, but to give them a chance to really start to 
think this thing through in a systemic way.

    EDUCATION AND HEALTH AND HUMAN SERVICES COLLABORATION ON EARLY 
                           CHILDHOOD PROGRAMS

    Senator Harkin. I'm again curious, because, you know, I 
think if you were to ask the average person on the street, say, 
``Do you know about Head Start?'' ``Oh, yeah. Everybody's heard 
of Head Start.'' ``Well, what's Head Start?'' ``Oh, that's 
teaching young kids. That's teaching these kids early, early.'' 
I think the vast majority of American people have it fixed in 
their heads that Head Start is an early learning program.
    However, it's not under your jurisdiction. It's under HHS. 
It was not designed to be an early learning program. We've had 
a lot of measures over the years to try to increase the 
qualifications of our Head Start teachers or people who run 
Head Start programs.
    So I'm really curious of how we're going to both fold in 
Head Start and Early Head Start in with these development 
grants. It seems that we have an existing structure out there 
in Head Start. But we all know that the qualifications for the 
instructors and teachers in Head Start are not what's needed 
for really quality early education.
    So again, I want to again ask you for your thoughts on how 
we kind of bring these two together.
    Secretary Duncan. No, that's exactly right. And the teacher 
qualifications are too low. The compensation is too low.
    Senator Harkin. Right.
    Secretary Duncan. Strong Head Start programs are making a 
huge difference. And other times, we don't have the quality, 
it's not making a difference. And my goal here is not just to 
expand access; it's to expand quality. I think it's so 
important that we continue to partner very, very closely with 
HHS. Again, Kathleen Sebelius has been fantastic. But you and 
all of your colleagues should look at this as an ages 0-to-5 
initiative.
    What are we doing around the home visiting program? It's 
proven to be very, very effective. What are we doing around 
high-quality child care? What we are doing with Head Start with 
3- and 4-year-olds? And then how do we do more great 
preschool--Preschool for All--so that, ultimately, our 5-year-
olds are entering kindergarten ready to succeed?
    So it's got to be a continuity. I don't want parents 
worried about the funding source, whether it is us or HHS or 
any sort of other bureaucratic issues. We have to work 
together. And again, Kathleen Sebelius has been a wonderful 
partner. And we want to look at the entire birth-to-5 continuum 
in everything we're doing.
    Senator Harkin. Thank you, Mr. Secretary. I have some other 
questions, but my time has expired.
    I recognize Senator Moran.
    Senator Moran. Mr. Chairman, thank you.

              SUPPORT FOR EDUCATION FORMULA GRANT PROGRAMS

    Again, Mr. Secretary, good to see you. I indicated my 
concern or at least a desire to hear more about the President's 
budget in regard to programs that the chairperson of the full 
committee and Senator Harkin have both talked about this 
morning. We have a mandate upon our schools to provide special 
education, IDEA. A number of school districts in Kansas are 
significantly impacted and require--by the Federal presence, 
and require Impact Aid.
    And yet, in a $3.1 billion increase, compared to 2012 
levels, the only increase in formula grant programs is $20 
million for Special Education Grants for Infants and Families. 
There's no increase in title I, no increase in Special 
Education Grants to States, and no increase in Impact Aid.
    How does that lend itself toward improving quality, 
particularly when it's so important to the basics for a school? 
In regard to IDEA, it's a Federal mandate. So as we pursue 
additional quality of education, how is that accomplished if 
we're not supporting the Federal mandates and we're not 
supporting Impact Aid, areas in which schools have no choice 
but to spend resources on?
    Secretary Duncan. No, it's a great question. And first of 
all, to be very clear, because the President's budget would 
reverse the impact of sequester, it would actually net a 5-
percent increase. We're going back to where we were. All these 
programs have gotten hit under sequester. And those hits for 
communities that rely on Impact Aid have been very, very tough, 
as you know. And so we want to continue to invest.
    But I think it's just as important, as you look at our 
budget, to look not just at one funding line, but to look 
across funding lines, so things like we're trying to do to 
increase money for school improvement grants, to turn around 
the Nation's most underperforming schools. And obviously, the 
vast majority of children in those schools receive services 
funded by title I dollars. Many of them have special needs, 
often a disproportionate number of special needs.
    We're seeing real progress there. We want to continue to 
invest there very heavily. We're asking for significant 
resources to increase the Promise Neighborhoods program, which 
is working in our Nation's poorest communities, be that inner 
city urban or rural or remote. Obviously, the vast majority of 
children in those communities are title I recipients--again, 
often disproportionately with special needs.

       CROSS-GOVERNMENTAL INVOLVEMENT IN EARLY CHILDHOOD PROGRAMS

    So if you look at one line item, I think you sort of miss 
the comprehensive nature of what we're trying to do, and again, 
what we're trying to do not just in our budget, but across the 
administration--by partnering with HHS and on early children 
education, and partnering with the Department of Housing and 
Urban Development (HUD) and Department of Justice and HHS and 
Department of Agriculture around this Promise Neighborhoods 
initiative.
    So your basic commitment or question of, are we doing the 
most we can to help our Nation's most vulnerable children? 
That's an absolute rock-solid commitment, and we're trying to 
get at it in a more thoughtful, more comprehensive way.

                         COLLEGE AFFORDABILITY

    Senator Moran. In the remaining time, let me ask a question 
related to higher education.
    Efforts in addressing college affordability, it seems to me 
that some of the proposals in this budget would be better 
addressed in the overall context of reauthorization of the 
Higher Education Act. But you have a series of proposals 
outlined in the budget. Can you lay out for me the Department's 
planned changes to campus-based aid and the future of Federal 
Student Aid assistance, including any new requirements and 
obligations of higher education institutions within that 
framework?
    Secretary Duncan. Yes. So first, let me just start on the 
increasing costs of college. It's a huge challenge for not just 
disadvantaged families, but also middle-class families. So 
we're trying to come at this in a couple of different ways.
    We've found through Race to the Top--through carrots, 
through incentives, not through sticks--we've seen a huge 
amount of change and progress on the K-to-12 side in the early 
childhood space. We haven't yet played in the higher ed space.
    So what we'd like to do is put out a proposal to create 
incentives to do a couple of things. One, to incentivize States 
to invest in higher education. In the past year or 2, 40 
States, Republican and Democratic leadership, 80 percent of the 
country, cut funding to higher education. And when that 
happens, what happens often, you know, far too often, is that 
universities then jack up their tuition.
    So we want to incentivize States to invest, to not 
disinvest, in higher ed. We want to incentivize universities to 
keep their tuition down. Some are doing a wonderful job of 
maintaining costs and using technology in creative ways. At 
others, costs are spiraling much higher than the rate of 
inflation. And we want to incentivize universities to build 
cultures not just around access, but around completion. Access 
is clearly huge and important, but that is not the end goal. 
The end goal is completion.
    So those are the proposals we're trying to do to get 
States, us, and universities themselves better aligned. We're 
also proposing an increase in access to Perkins Loans. That's 
been limited to a smaller universe of colleges. We want to 
expand that to more institutions, so more students have a 
chance to have access to those dollars, as well.
    Senator Moran. My time has expired. I hope to ask some 
additional questions in future rounds. But I would point out 
that it does seem to me that many of these proposals belong in, 
what the Chairperson talked about, regular order. We need 
regular order within our authorizing committees as well as 
compared with the process of us making decisions here in the 
Appropriations Committee.
    Secretary Duncan. If I could, very quickly, just an early 
childhood piece, which you didn't ask about--Kansas would be 
eligible in this program for up to $60 million. So it's a very 
significant potential investment.
    Senator Moran. I'll follow up with you in the next round. 
Thank you, Mr. Secretary.
    Senator Harkin. Thank you, Senator Moran.
    I have here in order of appearance, then, Senator Tester, 
Senator Johanns, Senator Reed, Senator Alexander, and Senator 
Boozman.
    So, Senator Tester.
    Senator Tester. Well, thank you, Mr. Chairman. And I would 
say thank you for your leadership. It is great to be on this 
committee. This is my first time on this, and I can tell you 
that my grandfather had three daughters. All three of them were 
teachers; one of them was my mother, of course. And through 
that experience, I became a teacher, and I've got a daughter 
that's a teacher. And I served some of the toughest political 
years of my life on the local school board, 9 of those years, 5 
of which I was chairman. And I will tell you, that made this 
place look pretty tame.
    And the reason is because education is so very, very 
important. We need that investment. It doesn't happen without 
that investment. And how those dollars are spent, whether it's 
through IDEA programs or the No Child Left Behind Act (NCLB) or 
Race to the Top, and what the Federal role is and the State 
role is and the local role is, is critically important. And I 
think that this budget is a signal of where you are and the 
President is.
    And before I start on my question, we'll start with the 
TRIO 3 program. I do want to thank you, Mr. Secretary, for your 
service. And thank you for looking at education in creative 
ways, because we have our challenges in this worldwide economy. 
And if we're going to maintain the democracy that we've been so 
proud of, public education is the foundation of that. And I 
appreciate your commitment to that.

        TRIO PROGRAMS FUNDING IN FISCAL YEAR 2014 BUDGET REQUEST

    TRIO programs serve low-income and first-generation college 
kids. Montana has lost four of its nine programs. The 
Department of Education pointed to a lack of funding as being 
the major reason. Yet we see--and correct me if I'm wrong, I 
believe, flat funding for TRIO program, while Race to the Top 
programs are funded up.
    But I'm not being critical, although, just as the ranking 
member pointed out, Montana, I think it has a lot to do with 
the fact that we don't have a lot of kids in Montana. We've got 
a million people overall, and you've got school districts 
probably that big, places in this country. We don't--we just 
don't have the access to those kind of funds. And we'll get to 
that in a minute.
    The question is: Is TRIO part of the mix? Is it going to 
continue to be part of the mix? And flat funding it when we're 
losing programs that really do help kids--I mean, I've been 
there, seen them, and they are effective. Could you respond to 
that?
    Secretary Duncan. Yes. Programs like TRIO and Gaining Early 
Awareness and Readiness for Undergraduate Programs (GEAR UP) 
and Upward Bound, I think, are making a real difference in 
young people's lives. And again, just to be clear, sequester is 
cutting all these programs by 5 percent.
    Senator Tester. But this was cut before the sequester. I 
mean, our programs were cut before we lost five of our nine 
programs before sequester. Now they're even in worse shape.
    Secretary Duncan. So I don't know the details there. I will 
check that for you. But I think it's so important that we 
continue to invest and, again, increase those funds back up to 
where they were, the 5 percent, but also to make sure that 
college is affordable.
    And I'm worried desperately about how difficult it is for 
so many families now, again, not just disadvantaged, but 
middle-class families as well, to pay for college. And that's 
why we think it's really important to create this Race to the 
Top initiative on the higher education side, to incentivize 
States to invest in universities to keep down tuition.

        RACE TO THE TOP COMPETITIVE PROGRAMS AND RURAL DISTRICTS

    Senator Tester. Okay. So let's go to Race to the Top. And 
I'm not faulting the program. And we've had this conversation 
before. But what I am faulting is that it doesn't work real 
well for small school districts. And we've got all small school 
districts in Montana. I mean, our biggest school district is a 
small school district.
    What can be done so that we're not creating grant writers, 
but we are getting money to the ground to help kids move 
forward in these rural school districts?
    Secretary Duncan. So I think that's a really fair question: 
Whether it's Race to the Top or whether it's the Promise 
Neighborhoods initiative.
    Senator Tester. All of the above.
    Secretary Duncan. Investing in Innovation--are we reaching 
rural communities? I can go through sort of program-by-program 
what we've done there. I think we've done a good job. We can 
always work to do more. But there are some pretty fascinating 
grants in Native American country, in rural Appalachia, and we 
want to continue to invest in those communities.
    Senator Tester. What I would like you to do is just commit 
some of your staff to my staff to go through what you're doing 
with Race to the Top to make sure that rural America has access 
to it without pumping a bunch of money into administration. You 
know that money is hard to come by anyway. And every $1 we can 
keep in educating kids is dollars well spent, in my opinion.
    Secretary Duncan. Absolutely. And getting beyond Race to 
the Top, just quickly, on this Preschool for All proposal, this 
dwarfs anything else we've done--$75 billion. So our plan 
there, our hope there would be to invest in all 50 States. And 
Montana's potential share there is $25 million.
    Senator Tester. Very quickly, you don't have to respond to 
this. And it may be more for Congress to deal with than you. 
But special education, which has never been funded up to snuff, 
wasn't around when I was in school. It does great things. It 
continues to be underfunded and underfunded and underfunded. 
And I would hope that maybe we could work on getting that to a 
reasonable level. Those are dollars that do hit the ground and 
do help kids.
    Thank you, Mr. Chairman. Thank you, Secretary Duncan.
    Senator Harkin. Thank you, Senator Tester.
    Senator Johanns.
    Senator Johanns. Mr. Chairman, thank you.
    And, Mr. Secretary, it's good to see you. I was trying to 
think in the last 4 years if you and I have had a chance to sit 
down and get to know each other better. I don't think we have. 
I would welcome that opportunity.
    Let me offer a couple of thoughts before I get into more 
specific questions. You mentioned States' cutting funding to 
higher education. You mentioned tuition going up. It's a 
problem. I had a group of kids in my office yesterday who were 
talking about school loans and trying to get through college 
and the burden.
    I've had kind of the unique experience in my life of 
starting very much at the local level as county commissioner, 
city councilmember, then Mayor of Lincoln, Nebraska, and then 
Governor, before I joined the Bush Cabinet as Secretary of 
Agriculture.

               COMPETING DEMANDS FOR STATE BUDGET DOLLARS

    I think you could sit down with any Governor in any State 
and participate in their budget preparation, and you would find 
out very, very quickly why these things are happening. If you 
look at a State budget, there's really about a half-a-dozen 
things that you fund, major items, that is, major categories. 
You keep the bad guys in prison. You have a public safety 
element. You have higher education and K-12 education. And then 
you have Medicaid funding.
    And I will just tell you that what you are seeing is real 
in every State because every Governor is having to squeeze 
programs that they like and support because of the growth in 
that area of Medicaid spending. And believe me, Mr. Secretary, 
this isn't going to improve. I don't care who supports the 
healthcare act. The reality is it's going to get worse and 
worse and worse. And it's going to squeeze funding.

                            SEQUESTER IMPACT

    The second observation I want to offer is this: I hear what 
you're saying about sequester. It was passed in a bipartisan 
vote. It was signed by the President of the United States. Now 
many say that it's a dumb move. Maybe there's an argument that 
it was a dumb move. But the reality of what we're facing is 
also very, very bad for our children and grandchildren. The 
amount of debt that we are loading on them is frightening.
    So every Senate office--again, I'll guarantee you. If you 
came and spent a day with me or any other Senator, here is what 
you'd see. You would see people piling in, one after another, 
talking about the cuts. And, ``Please, Mike, don't do the cuts. 
Please. Is there anything you can do to save this program?'' 
And you know what they have in common? They're all 
discretionary spending. They're all discretionary spending.
    So until we get to the real root cause of what's driving 
our financial problems, I think that part of the budget gets 
worse and worse.
    My last observation is this: I don't have immediately at my 
fingertips the amount of money that the Federal Government puts 
into K-12 education, but it would be what, 10 percent of the 
total?
    Secretary Duncan. 8 to 10, on average. You're exactly 
right.
    Senator Johanns. 8 to 10 percent?
    Secretary Duncan. Yes.
    Senator Johanns. As a Governor, mayor, county commissioner, 
city councilmember, you know what I found irritating about 
that? What I found irritating was that the Federal Government 
was heavy-handed on the rules and regulations and very light-
handed on the funding. They wanted to tell us how to run our 
schools while being a very, very junior partner in the funding. 
The funding is basically coming from property tax, sales tax, 
and income tax. It's coming from Governors, and it's coming 
from school boards.

              RACE TO THE TOP AND COMMON CORE OF STANDARDS

    Well, I've used my time. But I'm going to ask you to look 
at one other thing. Senator Tester's comments are so 
appropriate, and he could have been making those comments on 
behalf of Nebraska. We have a nearly 88 percent high school 
graduation rate. We have higher-than-average ACT scores. We 
have school boards that are doing tremendous work, teachers 
that are doing tremendous work.
    And you know as well as I do, we don't even qualify for 
Race to the Top. Why? Because we haven't adopted the common 
core standards and the Federal Government's ``it will be our 
way or the highway'' approach to evaluations. So our kids in 
Nebraska, for that money, are written off. This program doesn't 
work for a kid in Nebraska because we disagree with you on 
these standards.

                      DEPARTMENT-STATE PARTNERSHIP

    So I just think there's a lot of work that the Department 
can do in terms of its partnership. And I'm not talking about 
using the words; I'm talking about real partnership, working 
with States, working with State differences. And I'd just 
encourage you to do that and show some flexibility so States 
like Montana, States like Nebraska can benefit from the 
programs you're talking about. Because quite honestly, we don't 
benefit at all.
    Thank you, Mr. Chairman.
    Secretary Duncan. It's a lot there. I'll try and quickly 
respond on a number of fronts. You make very legitimate points, 
and I spend an inordinate amount of my time with Governors 
across the political spectrum. So your summary there is pretty 
accurate. And obviously, you've lived it. The gentleman next to 
you has been a fantastic Governor. He's lived it as well.

                        STATE FUNDING PRIORITIES

    Just a couple of comments. I question when 40 States cut 
funding to higher education, when 40 States don't cut funding 
to prisons. Somehow, prisons become a larger priority than 
education. I would much rather fund the front end than the back 
end. You have Governors like Governor Haslam of Tennessee doing 
some really interesting things around performance-based 
funding, not just putting money into the current status quo, 
but really challenging higher education to do some things 
differently. And that thinking was really influential as we 
thought about Race to the Top for higher education.
    We have to be cognizant of reducing the budget. I think the 
President absolutely is. But I think we have to have a balanced 
approach as well. And we have to continue to invest in 
education, not in the status quo, but the fact that we're 14th 
in the world in college graduation rates, again, is not 
something I think any of us can or should be proud of. We're 
trying to keep good jobs in this country. We need to have the 
educated, competitive workforce. And I don't want other 
countries out-educating us. And frankly, that's what's 
happening right now.
    Going forward on this preschool program, just to be clear, 
Nebraska would be eligible for $35 million. This is a large-
enough sum that we think we could go to all 50 States. And the 
final thing, just to be clear, on standards--I've talked to, 
and have a great relationship with Governor Heineman there--all 
we ask is two things, like our waivers around No Child Left 
Behind, giving States more flexibility; they don't have to 
adopt the Common Core. All we ask is that the State institution 
of higher education, the University of Nebraska, certify that 
those standards are truly college- and career-ready.
    And the definition is very simple. They say if students 
pass these classes, they won't have to take remedial education. 
They don't have to take remedial classes. That's good enough 
for us. So it's not us imposing anything through the waiver 
process. It's saying, ``Have a high bar like the Common Core is 
or just have your institution of higher education certify that 
students who graduate from high school don't have to take 
remedial classes.'' So I think there's more flexibility there 
than you may be aware. But we're always looking.
    Your point about reducing paperwork, reducing bureaucracy--
we had a conversation last night about that. Whatever we can do 
to get our scarce resources out to help kids and out of 
bureaucracy, please challenge me and my team to do more and 
more in that area.
    Senator Harkin. Thank you very much, Senator Johanns.
    Senator Reed.
    Senator Reed. Thank you very much, Mr. Chairman. And, Mr. 
Secretary, thank you, too. I believe we all recognize the 
extraordinary energy and imagination and effort that you put 
into your leadership at the department in every level, from 
pre-K to elementary to every level. And my questions begin with 
that appreciation for what you've done and what you continue to 
do.

           EFFECTIVE TEACHING AND LEARNING: LITERACY PROGRAM

    But there are a few specific points. One is the innovative 
approach to the literacy program, the literacy program, which 
started off with the Department's putting out application 
information that was not entirely accurate. In response to 
inquiries by Senators Cochran, Grassley, Stabenow, Wicker, and 
I, the Department reformulated the application. But there was a 
short window for the application process. And so I appreciate 
your efforts to try to get it moving and hope that future 
competitions will be more timely and accurate.
    Can you just tell us what are you doing to ensure this 
program works? And in a broader issue, since access to books 
and media is so critical to education, both in libraries, 
public and school, and in the home, what are you doing to make 
sure that children, particularly disadvantaged children, have 
that access?
    Secretary Duncan. Yes. Our proposed Effective Teaching and 
Learning: Literacy program would replace current programs that 
are more fragmented, all over the map, and try and give States 
the flexibility to implement a more P-to-12 literacy strategy. 
So the question is sort of about mandates versus flexibility at 
the local level. We're attempting to move in that direction, 
and I'm happy to take your feedback suggestions on how to do it 
better. But that's the goal here. Less fractured, more 
comprehensive.
    Senator Reed. Enviable goal. And then it begs the question 
of: How are you going to measure that goal?
    Secretary Duncan. Well, I think in all this stuff, we're 
trying to do a much better job of being sophisticated about 
return on investment. Again, that's why this early childhood 
piece is so important. Study after study shows, you know, a 
$7--other studies go as high as $17--return for every $1 
investment. So we want to look at every single year, hold us 
accountable for our graduation rates going up, our dropout 
rates going down. Are more high school graduates college- and 
career-ready?
    Whether it's this program or anything else, we've made some 
pretty tough cuts in our budget, from nice-sounding programs, 
programs we like, but if we're not seeing a return on 
investment, these are tough economic times. We can't--I don't 
feel comfortable going back to taxpayers for that. So I want to 
know, in every single program across our entire budget, are we 
making a difference in young people's lives? And if we can't 
demonstrate that, then we have to ask some hard questions of 
ourselves.

                      STUDENT LOAN INTEREST RATES

    Senator Reed. Let me change quickly to another topic of 
immediate concern. It's sort of deja vu again. Student loan 
rates are set to double July 1, 3.4 percent to 6.8 percent, at 
a time when prevailing rates on 15-year mortgages are 2.8 
percent, et cetera. I know the administration, within the 
budget, has a long-term approach. Some of my colleagues have 
proposed long-term approaches, such as Senator Alexander and 
others.
    But do you believe there's a need for an immediate 
correction before July 1?
    Secretary Duncan. Yes. And, I would love to do a long-term 
fix. I sort of worry about doing this every single year. We got 
it done last year. Frankly, I don't know--you guys are smarter, 
much smarter politically than I. If we wouldn't have had a 
Presidential election, I don't know if we would have got that 
done last year. We don't have a Presidential election this 
year.
    So rather than trying to go every single year, sort of a 
Band-aid approach, I'm much more interested in a long-term 
solution and working together to get that done.
    Senator Reed. I, too, am interested in a long-term 
solution. And again, some of my colleagues have proposed some 
very, very thoughtful ideas of tying it to market rates and 
letting it vary with rates.
    But the reality I think we're going face in a very short 
period of time--45 days, 90 days----
    Secretary Duncan. Yes.
    Senator Reed. Suddenly, those interests have doubled. And 
the idea of pushing major legislation, especially the long-term 
carefully constructed legislation, even with the best 
intentions, might be beyond our capacity.
    Secretary Duncan. So, obviously, the last thing we want is 
for rates to double. So, we just urge this group and others to 
work together to figure this out. And I'm open to ideas, but I 
want to fix it for the long haul so we're not fighting this 
battle every single year. That just doesn't seem smart or 
effective to me.
    Senator Reed. Yes. You don't get to the long term without 
getting through the next couple of months.
    Secretary Duncan. I agree.

                    COLLEGE ACCESS CHALLENGE GRANTS

    Senator Reed. Thank you. The second point, too, and it's 
about the College Access Challenge Grants. The Department does 
have discretion to waive the maintenance effort to the States. 
It turns out the States--I don't have to tell you; all of my 
colleagues have said the same thing--they are in desperate 
situations.
    Secretary Duncan. Yes.
    Senator Reed. They cannot meet the maintenance of effort 
requirement, and they are returning money to the Department, 
which means that students are not getting this support to go on 
to college.
    Can you look at your waiver ability? We've got to work with 
the States?
    Secretary Duncan. Yes. We've worked--I've worked very 
directly with a number of States. I haven't worked directly 
with Rhode Island. I will check on that situation. And we want 
to be fair. We want to be flexible. We want to be clear.
    And have the Governor reach out to me directly, or I can 
call him if there are issues there. I wasn't aware of the Rhode 
Island issue.
    Senator Reed. I appreciate that very much. And just a final 
comment, as I've been very impressed with what Senator 
Alexander and his colleagues have proposed and what the long-
term fix that I think--the way we operate around here, we might 
have to do something in the short term. I just--I hope we can. 
Thank you.
    Senator Harkin. Thank you, Senator Reed.
    Senator Alexander.
    Senator Alexander. Thanks, Mr. Chairman.
    Mr. Secretary, I'm glad you're staying, too. I think you're 
terrific. You and I have some disagreements about the extent to 
which the Federal Government ought to supplant the decisions 
the State and local governments make, but I like your 
leadership, and I like working with you.

                      STUDENT LOAN INTEREST RATES

    Senator Reed is about to leave, but I look forward to 
talking with him more about how we deal with student loans--I 
mean, with student loans. I want to ask you a couple of 
questions about that. I'm not so sure we can--I mean, the 
President has recommended a variable rate, right, in his 
budget?
    Secretary Duncan. Yes, sir.
    Senator Alexander. So--and that's a recommendation of 
Senators Burr, Coburn, and I have made a similar 
recommendation. Many Democrats see that as sensible. I'm 
hopeful that--I mean, I don't put it out of my mind that 
working with the administration, since this seems to be an area 
where we agree that we can't get started on that before July 1. 
And I'm willing--I'm willing to work on that.
    Let me ask you. Your proposal is a little different than 
the one we proposed. About how much does it cost the 
Department, in addition to what it pays for the money--let's 
say it's 2.8 percent--to make the loans? That would be the 
collections, the defaults, the forgiveness, the costs. What do 
you have to add to your cost of money to pay your own costs of 
making the loans?
    Mr. Skelly. It varies by year, Senator Alexander. But it 
would be still another couple percentage points.
    Senator Alexander. Two percent. So if your cost of money 
was 2.8 or 3 percent, if you added 2 percent, that gets us to 
about 5 percent.
    Mr. Skelly. If it were, yes.
    Senator Alexander. But it is. I mean, it is 2.8 percent, 
right?
    Mr. Skelly. But I was suggesting that the rates we use are 
estimated interest rates over time, and they will change. We 
can't just look at the rate for today. We have to look at the 
rate that's going to be in effect in the future.
    Senator Alexander. But we can start by looking at the rate 
for today. So if we were to impose--if we were to change things 
to have that rate for today, students would be paying more in 
the neighborhood of 5 percent than in the neighborhood of 6.8 
percent on those 40 percent--on those unsubsidized loans.
    Mr. Skelly. On unsubsidized Stafford loans, yes.
    Senator Alexander. And that rate would continue during 
their--during the time they have the loan?
    Mr. Skelly. Under the President's proposal, the rate would 
be fixed, so students could be sure.
    Senator Alexander. It would be a fixed rate set at the time 
they get the loan.
    Secretary Duncan. You lock it in. You lock it in so there's 
no insecurity going forward.
    Senator Alexander. So the idea would be, in my view anyway, 
that that would be fair to students. Certainly today, it would 
be a lower rate than they have today and fair to taxpayers over 
the long run. They, students, wouldn't be paying more than they 
should. And later, taxpayers wouldn't be subsidizing more than 
they should.
    So there's a basis for agreement there, I would think. And 
I would like to work with you and Senator Reed and others, 
Senator Harkin, and see what we can do, both for the short term 
and the long term.

            SCORING THE STUDENT LOAN INTEREST RATE PROPOSAL

    Do you know the cost of the President's proposal to the 
Federal budget? Has it been scored?
    Mr. Skelly. Under our estimates, the proposal would be cost 
neutral. There wouldn't be additional cost. Again, rates change 
over years. The rates for subsidized loans would actually be 
lower than the current-law rate of 6.8 percent for all 10 years 
of the proposal. The rates, beginning in 2017, for the 
unsubsidized loans and the PLUS loans would be slightly higher 
than the current law.
    Senator Alexander. Yes. Our proposal would just set a set 
rate for all three types of loans. But we can talk about the 
differences there. I would recommend that we go to work on that 
pretty quickly and see if we can avoid this year-to-year trauma 
for students, Senators, parents, colleges, taxpayers. So I 
thank the President for his proposal, and I thank Senator Reed 
for his interest as well.

           MEDICAID PROGRAM IMPACT ON STATE EDUCATION BUDGETS

    May I switch gears just a little bit? Without--I don't want 
to pursue this, because, Mr. Secretary, you and the Chairman 
and I had a lengthy discussion about this yesterday. Senator 
Johanns is exactly right. I mean, the first reason college 
costs are up is because of the Medicaid program. Federal 
Medicaid mandates are structured in such a way that over the 
last 30 years, this is not President Obama, over the last 30 
years, the cost of Medicaid to States has gone from 8 percent 
of the State budget in Tennessee to 26 percent.
    And the money mostly comes from higher education. That's 
the main reason. That's the main reason that Tennessee reduced 
its support of higher education. And because of Federal rules, 
it had to keep spending the same thing for Medicaid. So higher 
education spending went down 15 percent, tuition went up, and 
TennCare went up higher.

          HIGHER EDUCATION ACT REAUTHORIZATION AND REGULATIONS

    So one can say, ``Well, Tennessee doesn't have to take the 
money,'' but that's the partnership we have. And I have a 
question I'd like to ask. My time is up. One other reason costs 
are high is because of excessive regulation. The President of 
Stanford says it's 7 percent or more of all his costs. I think 
that's a scenario we also agree on.
    Senator Mikulski and Senator Bennet and Senator Burr and I, 
and we've discussed this with the Chairman, would like to work 
with you to set up a process so we could systematically go 
through the well-intentioned regulations and suggestions that 
we've made through the law--our fault--turn them into 
regulations, various secretaries, and see if we can reduce that 
stack of regulations as we meet toward reauthorization of the 
Higher Education Act.
    Would you work with that with us and make that a priority?
    Secretary Duncan. Absolutely. Just coincidentally, I met 
with the President of Stanford University yesterday prior to 
meeting with you and had this exact conversation. But whether 
it's on reauthorizing the Elementary and Secondary Education 
Act (ESEA), whether it's on the interest rate issue, whether 
it's on reducing regulations, I just absolutely appreciate your 
leadership and thoughtfulness and would more than welcome the 
opportunity to do that.
    I will say it's one of the things I've been more frustrated 
on. We've done some things to reduce burden in regulation. But 
whenever I go out, I hear this. And I say to people, ``Please 
email me. Please call me. Please tell me what I can stop doing 
tomorrow to make your life better.'' It's amazing how little I 
get back.
    So I think I've struggled to articulate it clearly or to 
get good feedback. So I've been, I think, less effective than I 
would have liked to have been up to this point. And having you 
and Senator Bennet and others help partner on that, would love 
to engage in that.
    Senator Alexander. Well, I did worse than you did when I 
had your job, in that respect. And I think we need a process 
that goes on for awhile that people can--so let's try and see 
if we can make that work. I think lots of Senators would enjoy 
participating.
    Secretary Duncan. We're asking so much of everybody. The 
least we can do is make their job easy and let them focus on 
students and not on paperwork and bureaucracy.
    Senator Alexander. Thanks, Mr. Chairman.
    Senator Harkin. Thank you, Senator Alexander.
    Let's see. Now, that would be Senator Merkley. He's already 
gone. Then Senator--what happened to Boozman?
    Senator Merkley. Thank you very much, Mr. Chairman, and 
thank you all for coming. Welcome, Mr. Secretary.

               EARLY PELL GRANT COMMITMENT DEMONSTRATION

    We had testimony--oh, it must have been about a year ago by 
someone who talked about the early Federal Pell grant 
commitment demonstration program. And the argument he made was 
that, ``Look, if high school students knew at the start of 
their high school that there would be financial aid to help 
them get to college, it would change their performance in high 
school. Or at a minimum, we should study this to see if it 
changes their performance in high school.''
    And I can tell you, because I live in a working-class 
community, I know that many kids when they start high school, 
they assume they'll never be able to afford to go to college. 
It's just kind of--the assumption is, ``How would I ever afford 
that? My parents aren't able to afford it. It's more expensive 
now. Scholarships are hard to get.'' So they're almost defeated 
before they begin.
    I thought, well, that's a pretty interesting idea to be 
able to meet with kids and say, ``Based on your family income, 
here's a commitment. And here's how you're going to be able to 
go to college.''
    This program has never been funded. It's been authorized, 
but not funded. Has your Department looked at this program? Do 
you have thoughts on it? If not, would you be willing to take a 
look at it and carry on a conversation about whether this might 
be worth a pilot project?
    Secretary Duncan. Absolutely. It's a hugely important 
issue. And I worry tremendously about the young people who have 
the academic ability and the desire to go on to higher 
education, but to your point, just think it's beyond their 
means, it's for rich folks, it's not for people like them.

            ENCOURAGING STUDENTS ABOUT COLLEGE AFFORDABILITY

    So there are a number of things that we're looking at and 
would like to pursue with you. We've talked about whether we 
send a letter to sophomores, to juniors, to every student in 
the country, saying, you know, ``Right now--we don't know how 
your family situation is going to change financially--but right 
now, this is what you would qualify for,'' just to give them a 
sense, ``Wow. There is real money out there, and there is an 
opportunity to take that next step.''
    We've tried to provide a lot more transparency around 
college costs so parents could comparison shop, and community 
colleges are a great option. There have been interesting 
approaches in some places. For example, Governor Daniels in 
Indiana--just something very interesting where, if you 
graduated in 3 years from high school, what would have been the 
cost of your senior year in high school--let's say it costs $10 
grand--that $10 grand would walk with you to college as an 
additional scholarship.
    So I think there are things we can do financially. There 
are things we can do in terms of being better at getting out 
information, more transparency. So we'd love to continue that 
conversation with you and your team. And there are so many 
deserving, hardworking students who get scared, get intimidated 
by just the difficulty of the process. You know, first-
generation college-goers, English language learners, it's been 
way too hard. It's been way too opaque.
    So we're working hard there. But whatever additional steps 
we can make, I'm all in. And please push us to be a good 
partner there.
    Senator Merkley. Thank you. I look forward to pursuing this 
with you. I was reading about a school that named each of its 
classrooms after a different university, a high school that did 
this. And sat down with students when they came into the 
school--working-class world--and said, ``This is how you will 
be able to go.''
    So students get that embedded right from the very beginning 
that this is a possible route. And I think that's something 
that is missing as we talk about these high, high goals. And I 
know, coming from a family where I was the first in my family 
to go to college, there was no--we had no idea. None of my 
neighbors had been to college. My family hadn't been to 
college. We had no idea as a community how the heck you got 
into college. And so that's very helpful.

                          COLLEGE UNDER-MATCH

    Secretary Duncan. So again, one other piece that's 
important, a little bit different. But there's been a lot of 
really important research lately on what I call the under-match 
of really high-quality students from poor communities, and from 
rural communities, who don't have access to some of the more 
elite universities. And again, those universities have tons of 
money and would like them. But they don't have a way to find 
them or connect.
    And so that's another piece of this puzzle to make sure 
young people who have done extraordinary work have a chance to 
go to the best university possible, whatever that might be.

                          STEM REORGANIZATION

    Senator Merkley. I wanted to turn in my last 50 seconds to 
science, technology, engineering, and mathematics (STEM) 
reorganization. And I was surprised to hear that there were 
100--well, more than--226 different STEM programs across 13 
agencies. And you're working hard to consolidate that number.
    I think most of that diversity is in the college level, not 
the K-12 level, if that's right. And it makes sense to me, 
without knowing the details. But could you expand just a little 
bit on how to make our STEM programs more effective?
    Secretary Duncan. I appreciate you bringing this up, 
because this is a big deal and the President has provided a lot 
of direct, personal leadership on this. I've engaged with the 
Democratic Policy Committee (DPC). Again, this is not a 
President Obama thing. There has been for decades, I assume, a 
huge number of diffuse programs across the Government. The STEM 
area has been, obviously, so critical, as so many of the jobs 
of the future are going to be for folks with STEM skills.
    So the fact that administration-wide we haven't been as 
efficient or as effective as we need to be, that's untenable. 
So what the President has really challenged us to do is to 
consolidate the number of programs, to work much more closely 
together. He's asked us in the Department of Education to step 
up and provide a lot of that leadership on the K-to-12 side.
    Two big pieces of our puzzle would be a STEM master 
teachers program to figure out how we attract and retain great 
talent. We've had a shortage of STEM teachers for far too long. 
Having a great master teacher corps to help support and have a 
better pipeline is very, very important.
    And then we want to really partner with local communities 
through what we're calling STEM Innovation grants, innovation 
networks. And I think it's so important. What we've learned in 
Race to the Top and other things is that our resources are 
helpful, but the real leadership comes at the local community 
level. It doesn't come from us. I think, historically, too many 
of the Federal STEM programs have been top-down.
    What we want to do is say, ``Here are some resources. But 
what is your local community going to do? What are they going 
to work to accomplish? How are they going to work together? 
Higher education, the private sector, businesses, K-to-12 
education with the community, what do you guys want to come 
together to do to create a much better pipeline?''
    And so with some really exciting ideas, this is an area 
where, again, different agencies need to not be sort of turf-
conscious. We need to work together. I think there's a real 
chance here to do something very creative and to take to scale 
what is working. So this is very important to the President 
personally. And we're committed to doing whatever we can to 
make sure that across the administration, we're much more 
effective in the STEM area.
    Senator Merkley. Thank you very much. Thank you.
    Senator Harkin. Thank you, Senator Merkley.
    Senator Boozman.
    Senator Boozman. Thank you, Mr. Chairman. And thank you for 
being here, Secretary Duncan. We appreciate your service.
    I don't have a question because I think it's already been 
asked by Senators Tester and Johanns, and others have 
commented. But I do have concerns. I also was on the school 
board for 7 years. And that is a test by fire, so important. 
But I do have concerns representing a rural State. When you 
look at the panel, we're all rural up here. But I do have 
concerns.

        CAPABILITY TO COMPETE FOR FEDERAL GRANTS; STUDENT LOANS

    As you really expand the envelope on the competitive grants 
and things like that, it does make it difficult for our 
districts that are working hard, good schools, but they simply 
don't have the resources to compete with the most able to 
compete playing the grant-writing game.
    It's not a secret that student loan debt is a growing 
problem. Institutions are accountable for default rates that 
are the result of many unqualified buyers, students being given 
massive amounts of money while not understanding many of the 
inherent responsibilities involved in receiving the loan. Would 
greater discretion by local institutions over the amount of 
student loan money disbursed to financial risk or underprepared 
students--would that be a beneficial thing to consider?

          COMPETITIVE VERSUS FORMULA-BASED EDUCATION PROGRAMS

    Secretary Duncan. So a couple of quick things. First of 
all, just for the record, I'm going to be really clear that the 
overwhelming majority of our money is not competitive. It's 
formula, 84-85 percent of our request is formula-based. And 
that has not--it's changed like a percent or two in the past 
year. So the vast majority, you know, again, 85 cents of every 
$1 has been and will continue to be distributed on a formula 
basis.
    On the Preschool for All program, just to be clear, 
Arkansas would be eligible for up to $70 million. And again, 
that pot is big enough for us to invest in every State. It's 
really our goal to do that.

                      STUDENT LOAN INTEREST RATES

    On student loans and interest rate caps, we need to think 
about all these things. And as you may have seen, we actually 
put out earlier this week--we want to regulate or get 
information around the Parent PLUS loans. So it's not just the 
loans to students, but loans to parents are often huge and put 
parents in a very tough situation. So we want to have a very 
public conversation on this stuff, to be very transparent.
    And we want to--our challenge is to align the interests of 
taxpayers, of students, of parents, and institutions of higher 
education in trying to get that balance right. So any thoughts 
you have, I'm more than open to it. We want to help everyone go 
to college. We don't want them ending up in a worse financial 
situation than when they started or putting parents in a 
situation from which they can never recover.
    And the worst possible thing is when students and parents 
take out these massive loans, and then the students don't 
graduate. So, you know, they have nothing to show for it. So 
real issues there, happy to talk offline. But around the Parent 
PLUS loans in particular, we want to have a very, very public 
conversation, figure out, are we exactly in the right spot or 
not? And make any commonsense changes we need to make.
    Senator Boozman. No, I appreciate that. I think the 
committee appreciates that. And perhaps working with this 
committee and the authorizing committee, we can actually work 
together and move in that direction. Because it does seem like 
it's a commonsense thing to help students that aren't prepared, 
don't understand what they're taking on.

         RACE TO THE TOP: COLLEGE AFFORDABILITY AND COMPLETION

    Secretary Duncan. And I was just going to quickly add that 
this is where, for me, the Race to the Top for higher education 
is so important. We have to get more States to invest in higher 
ed. And when they walk away from that commitment, I understand 
the constraints. I understand the competing priorities. But 
when States stop investing in higher education, the Federal 
Government can't do this by itself--shouldn't have to. This has 
to be about shared responsibility. So we have to attack this 
from multiple fronts. That's part of how we're trying to get at 
this issue.

               TECHNOLOGY IN SCHOOLS AND RURAL DISTRICTS

    Senator Boozman. One of the things I've heard recently, 
again from rural districts, is that--especially rural 
districts, we have a situation where the budget really doesn't 
help with technology in schools. And yet, in 2014-2015, online 
assessment testing is expected as a result of the Race to the 
Top assessment program grants for developing new generations of 
testing. So you've kind of got a situation.
    We're all concerned, as an old school board member, in 
these unfunded mandates. And essentially, that seems to be kind 
of what this is.
    Secretary Duncan. Yes. So it's a huge topic, and I don't 
want to take too much time. But I think technology in rural 
communities, in Native American communities, and in the inner 
city can be a huge equalizer in terms of providing much greater 
equity for children and a chance for excellence, to learn 
anything you want anytime you want. So for me, this is a huge, 
huge deal.

            DISTRICTS MOVING FROM PRINT TO DIGITAL TEXTBOOKS

    One challenge that former school board members need to 
think about is, we spend several billions of dollars each year 
on textbooks, on paper. And what we're seeing is a number of 
districts--you know, not a critical mass yet--but that stop 
investing in textbooks and use all that money for technology.
    I'll give you one quick example. In North Carolina, there's 
a district, Mooresville, which is, I think, about 117 in terms 
of funding. So they're way down the list. Years ago, they got 
out of the textbook business, made some hard decisions, put all 
their money into technology and into teacher training there. 
They're seeing some pretty remarkable results in terms of 
teacher engagement, graduation rates way up, test score results 
going up.
    And so we all would love more money. I'm the biggest 
advocate for more money. But we have to think about an 
education. We're not good at stopping doing certain things. And 
this trade of textbooks, paper, you know, print to digital--
there's a set of districts that are starting to provide real 
leadership there without a lot of resources. And I'd urge 
districts in your States to take a look at that--there are a 
number of places, with Mooresville being probably near the top 
of that list.
    Senator Boozman. Thank you, Mr. Secretary.

                   ADVANCED PLACEMENT COURSES ONLINE

    Senator Harkin. I just want to say to my friend from 
Arkansas that some years ago, back in the 1990s, I and my other 
colleagues from Iowa provided startup funding for AP online, 
advanced placement courses online, because we have small towns 
like you do, Mississippi, Arkansas, Kansas. And they just 
didn't have AP courses. They didn't have them. So they went 
online.
    And so that structure that was set up in Iowa, I just was 
informed yesterday--I had someone come in--that over 7,000 kids 
since that time have taken AP courses. Kids that are in small 
schools--100 kids in a school and stuff like that--have taken 
that. So I don't know what Arkansas or other States have done. 
But that's the kind of technology that helps equalize those big 
cities with our kids in small schools.
    Secretary Duncan. It is. Quickly--there again, I spend more 
and more of my time looking at our international competitors. 
There are a number of other nations that are moving from print 
to digital as a nation. And I want us not to be a lagger here. 
I want us to be a leader.
    Senator Harkin. Thank you. I'll be glad to talk to you. I 
don't know what your States are doing. Maybe they're already 
doing that stuff. But this--what we've done----
    Senator Boozman. I would love to visit with you, Mr. 
Chairman.
    Senator Harkin. It's been interesting the way they've done 
it in Iowa. Okay. Thank you.
    Senator Cochran.
    Senator Cochran. Mr. Chairman, thank you.
    Mr. Secretary, welcome. We appreciate your service as 
Secretary of Education. And we appreciate the personal vigor 
you've brought to the challenges being faced by our Government 
at the highest level in trying to figure out ways to help local 
school boards and schools and teachers and principals to do a 
better job educating our Nation's children.
    I grew up in a schoolteacher family, and it was really 
sacrosanct. School came first no matter what. Every time they 
opened the doors over there, whether it was for a basketball 
game or officers' meeting, faculty meeting, all the rest, we 
all showed up, my brother and I and my parents, because we were 
growing up and they couldn't afford babysitters. So we were 
there at the school almost all the time.
    And that was a great benefit, really, because I guess we 
just sort of, by osmosis, assimilated respect for and interest 
in education and the challenges of learning.

                          REWARDS FOR SUCCESS

    And I wonder about some of the things that are being 
suggested. And I notice the title I rewards program. I was 
excited when, you know, the other title programs started up and 
that meant more funding for education programs in my State. I'm 
not sure this one is going to do that--and the negative aspect 
would be that we would benefit from the current programs--when 
you start adding on some new programs and diverting funds from 
the programs that are just now getting assimilated and used to 
the benefit of the students, and we end up getting a short 
appropriation or allocation of funding because of a new rewards 
program.
    FYI, be sure you don't hurt the ones who are benefiting 
from the programs as they were prioritized--because that's the 
new word. You've got to verbalize every noun in Washington. 
That's the new thing to learn.
    But have you had anybody point that out? Or is that 
something that you're aware of?
    Secretary Duncan. It's a very fair question. I think one 
thing we're trying to do a much better job of, which I don't 
think we do enough in education, is to spotlight success and 
highlight success. And one of the things I hated about No Child 
Left Behind is there were no rewards for success. The only 
reward for success is you weren't labeled a failure.
    And we think there are many schools, there are districts, 
there are States that are doing a great job of raising 
achievement for children who receive title I resources, our 
most disadvantaged--our Nation's most disadvantaged children. 
So, what we want to do is shine a spotlight there, learn from 
those best practices, not just talk about the failures, but 
talk about where we're closing achievement gaps.
    And so I totally understand you don't want to hurt folks 
who are doing the hard work. But I would challenge you in 
Mississippi, challenge anyone else, do you know who the 10 or 
the 20 schools are that are doing the best job with poor 
children? Most times, folks don't know. And to me, that's just 
a crying shame. And we should be figuring out who they are. We 
should be learning from them. We should be replicating, sharing 
best practices.
    And so in everything we want to do, whether it's children 
with special needs or, you know, working with poor children, we 
want to find out what's working and try and take it to scale. 
So that's part of--that's the philosophy behind this. But I 
understand the caveat and the concern.
    Senator Cochran. Thank you.
    Senator Harkin. Thank you, Senator Cochran.

                COLLEGE AFFORDABILITY AND STATE BUDGETS

    Being the second round, I just have one question I wanted 
to follow up on. Mr. Secretary, according to a report issued 
last month from the Center on Budget and Policy Priorities, 
States are spending 28 percent less per student on higher 
education than they did in 2008.
    So colleges and universities are partially making up for 
that by shifting the cost burden to students and their 
families, through tuition hikes and higher fees. That's why 
we've had a series of hearings in the HELP Committee that I 
chair on this very issue. We just had the fourth in a series of 
hearings yesterday on that.
    Now, I've heard from others that say, ``Well, you know, 
Medicaid, increased funding for Medicaid is crowding this 
out.'' But this has happened--the increase in Medicaid in 
States, basically, has happened because we've got more poor 
people. If you look at the recent downturn in the economy, 
that's what happens. When people are out of work, they become 
poor. You follow? Then they go on Medicaid. You reduce 
unemployment down to 4 to 5 percent, a lot of those problems of 
Medicaid disappear.
    So we've had that. But this idea that the States are 
backing off because of that does not track in terms of past 
time. This has been going on for the last 20-some years, where 
States keep providing us less. And what State legislatures have 
figured out is we don't have to fund higher education. That 
means the schools will raise tuition and fees, and the students 
will go to the Federal Government, get higher Pell grants, get 
more student loans. So there's been this shift in States.
    So I'm very concerned about that and the impact on 
affordability and the increase of debt always on students. Now, 
your budget request includes two programs to support higher 
education reform--a new Race to the Top competition and the 
First in the World competition. So my question basically is: 
How will these programs incentivize States and institutions to 
make college more affordable?
    Secretary Duncan. So I think it's a really good summary 
there. The other challenge I hear when I talk to Governors is 
they feel, rightly or wrongly, but many Governors feel that 
when they ask for better outcomes and increased graduation 
rates, they feel resistance from higher education there. They 
sort of feel that higher education just wants a blank check.
    So I think all of us have to come to the middle. We have to 
find common ground. I want to challenge Governors to invest in 
States, to invest--to be clear, I'm not telling them to invest 
in the status quo. We've got to get to some kind of focus on 
outcomes, focus on completion, focus on helping first-
generation college goers and Pell grant recipients get through. 
It's not just about access; it's about completion.

                 RACE TO THE TOP AND FIRST IN THE WORLD

    So what we want to do is, obviously, the Race to the Top 
higher education program would focus on States and institutions 
of higher education, again, investing, keeping costs down, 
working on completion. And then with First in the World--
there's a lot of really interesting work going on around course 
redesign and using technology in very different ways. And it's 
fascinating to me. You have universities who used to 
historically take pride in saying this at every intro-class: 
``Look to your left. Look to your right. One of these people 
isn't going to make it through.'' And that was like a source of 
pride. Well, that's not the goal. The goal is to increase 
graduation rates, not to throw people out the back end.
    So what can we do with technology in different ways? We're 
very interested in moving away from a focus on seat time to 
competency. If someone knows the content, do they need to sit 
in that chair for an entire semester, an entire year? Or can we 
get them credit for what they actually know? So what we want to 
do is to spur innovation and to do it at sort of the micro 
level through First in the World, but at the macro level 
through Race to the Top.
    Senator Harkin. Thank you very much, Mr. Secretary.
    Senator Moran.
    Senator Moran. Mr. Secretary, thank you very much. Just a 
couple of follow-up questions.

                EDUCATION FUNDING FOR RURAL COMMUNITIES

    First of all, it seems to me there's a theme here, and 
particularly, I guess, the rural nature of the makeup of this 
subcommittee. But what do you take from the kind of consistent 
concerns that are expressed here about the inability for rural 
States to compete for Race to the Top funding or other grant 
programs? What is it that the Department can do to assure 
Kansans that they're going to be adequately able to compete for 
those grants? It just doesn't happen.
    Secretary Duncan. Well, it's not quite that stark. It's a 
real issue, and I want to address it head-on. But, just to give 
you a counter example again--so when we started the School 
Improvement Grant program, turning around the Nation's 
underperforming schools, I heard a lot of, you know, legitimate 
concern from the rural community: ``We can't compete. We can't 
do whatever. My numbers won't be perfect.''
    But of the number of schools that need to be turned around, 
about 20 percent are in rural communities. The rural 
communities have actually gotten 23-24 percent of the money. So 
they've actually gotten a disproportionate share of the 
resources, slightly. So a lot of those fears, we think, again, 
given the facts, the reality on the ground, don't bear that 
out. I can take you sort of program-by-program, offline, 
through what has been invested in innovation, what we've done 
in terms of absolute priorities and set-asides, through Promise 
Neighborhoods. You should absolutely hold us accountable for 
that.

                           PRESCHOOL FOR ALL

    And again, the big thing on this Preschool for All is this 
is a large enough pot for all to benefit. Our goal would be to 
invest in every State, if States--again, to be clear, this is 
not a free lunch--States would have to invest in early 
childhood education, have to meet us, you know, have to be in a 
partnership there. But we want to play in rural communities. We 
have played in rural communities. We know how important that is 
to our country and to our country's economy.
    And I've spent--being a boy from Chicago, obviously, it was 
not my background--but, I promise you, I've spent a huge amount 
of my time in rural areas to listen, to learn, to understand 
the challenges. Technology is a piece of that. We got into 
that. But again, happy to have a further conversation there.

            COMPETITIVE ABILITY OF RURAL EDUCATION DISTRICTS

    Senator Moran. I'm interested in your response, of course. 
But it does seem like there's a consistent theme here this 
morning that we all have concerns. And maybe your answer is 
that our concerns--I know you wouldn't say this in these words. 
But you're suggesting, though, that they're unjustified, that 
we're actually receiving a larger percentage than----
    Secretary Duncan. No. No. I gave you one example. I'm not 
suggesting they're unjustified at all. I'm just trying to 
suggest that we take it very, very seriously. And where it is 
justified, we want to hold ourselves accountable and figure out 
how we can be smarter. And hopefully, you'll see now with the 
evolution of the past couple of years, I think we've gotten 
more sophisticated in terms of absolute priorities and 
competitive priorities for competitive grants to make sure that 
rural communities are represented in what we do.
    Senator Moran. I think one of the problems is that, you 
know, rural school districts don't have the personnel to do the 
application process, and the Federal regulations related to 
this are huge. The application is, I don't know, 40 pages. And 
in many instances, I would guess we don't apply. But it's the 
burden in the application that causes us not to apply.
    Secretary Duncan. Yes.
    Senator Moran. I appreciate your interest in spending time 
in rural schools. You and I had a conversation a couple of 
years ago. I'd like to re-invite you back to Kansas. You were 
kind enough, wise enough to grant McPherson, Kansas, a waiver 
from No Child Left Behind. They had a different plan using ACT 
scores. And we'd love to come show you a rural setting in which 
no Federal money, just a decision by a local board of education 
tried to do something better.
    Secretary Duncan. That wasn't our wisdom. That was their 
courage and leadership. And again, wherever anyone is raising 
the bar and not lowering the bar, we have to partner. We have 
to be all ears. So we get none of the credit there, and they 
get all of the credit. And I would love to follow up and see 
how things are going there.
    Senator Moran. We would love to have you come to Kansas and 
have this conversation.

               TRIO PROGRAMS AND COMPETITIVE PREFERENCES

    Finally, let me follow up on Senator Tester's comments 
about TRIO programs. We had four Upward Bound programs, one-
third of our Upward Bound programs eliminated in the last 
competition. And it seems to us, and we've communicated this 
with the Department, that there was a change in something. 
Several competitive preference priorities changed.
    In my view, without the knowledge of the applicants who 
were seeking those funds, and it excluded a number of those 
programs in Kansas. And we would continue to try to work with 
the Department of Education to make sure there is not--and what 
those competitive preferences, the results seemed to be a bias 
against rural programs, small high schools. So we would 
continue to promote the aspect of the rural nature and work 
with the Department to try to solve that problem.
    Secretary Duncan. We will do. And just again to go back or 
again, look at what we've done around absolute priorities in 
rural communities, look at what we've done to encourage 
districts to apply, not individually, but as consortia so that 
there's not one district doing it by themselves.
    But where you think we're not doing enough or where you 
have creative ideas of how we can do a better job, again, we 
absolutely want to be a good partner there.
    Senator Moran. Mr. Secretary, thank you. Thank you for your 
service.
    Senator Harkin. Thank you, Senator Moran.
    Let's see. Senator Tester.
    Senator Tester. Yes, thank you, Mr. Chairman.
    I want to talk about two things. The second one is college 
affordability, and we've talked about that ad nauseam, but I 
haven't said anything about it, so I'm going to do it.

             IMPORTANCE OF QUALITY PRINCIPALS AND TEACHERS

    But the first thing is that--I mean, we've talked a lot 
about technology, and we've talked a lot about innovation. And 
maybe I'm stuck in the 1960s and 1970s when I went to school. 
But we haven't talked much about teachers. And when I was in 
school, you know, you had to have a--I mean, the kids who had a 
good family had an advantage. People who had some dough had an 
advantage. But, man, those teachers can make such a big 
difference.
    And in order, you know--the problem I had with No Child 
Left Behind wasn't that, and you make a good point, wasn't that 
we pointed out the ones that failed. It was that we taught kids 
how to take tests. And that doesn't do one thing for us. We 
need to teach kids how to think and how to think critically.
    And is there anything in this budget that you think helps 
empower teachers to be able to be creative and be able to touch 
kids and be able to move forth in a way that gets to those 
kids, especially those at-risk kids? I mean, that's what's 
going to drive our economy, from my--and that's going to keep 
the kids off of Medicaid. And that's going to get them a good 
job and make them into taxpayers and all those things. Can you 
talk about that for a second?
    Secretary Duncan. There's nothing more important that we 
can do than to get a great principal into every school, because 
leadership matters tremendously, and to get great teachers into 
every classroom. And I think some folks think technology is 
replacing teachers. That's never going to happen. To me, it's 
great technology to empower great teachers to better serve 
their students. And so there's no--people love to create 
conflict. There's no conflict there.

                           RESPECT INITIATIVE

    So there's a number of things we haven't talked about. But 
one of what we ask for in the budget is a $5 billion program 
behind what we're calling our RESPECT initiative. And we want 
to do everything we can to attract the next generation of great 
talent into teaching, to better support that talent already in 
teaching, to build better career ladders. And we want to make a 
massive investment here. It's been something the President 
talked about last year in the State of the Union. It didn't get 
funded. We're coming back at it.
    But I think there's so much we need to do to attract a 
larger pool of talent to come in to better mentor and support 
them and to build better career ladders.

                            TEACHER SALARIES

    Senator Tester. Can you just tell me how that's going to 
happen? How are you going to attract--how are we going to 
attract them? I mean, there are some great people out there who 
are teachers who become something else, who would be great 
teachers who do something else simply--let me give you an 
example.
    Two kids, one of them is a teacher, one of them is a nurse. 
Right out of school, the nurse started making probably $15 
grand a year more than a teacher. Both important positions.
    Secretary Duncan. Yes. So I've been very public that I 
think we need to pay teachers significantly more. We need to 
start teachers at much higher salaries. I think a great teacher 
should be able to make $140-$150 grand. You pick a number. 
That's an investment. But again, great teachers--there is a 
fascinating study by economists named Raj Chetty, John 
Friedman, and Jonah Rockoff, that states the impact of 
replacing one mediocre teacher with one good teacher meant 
$266,000 more in lifetime earnings for a single classroom of 
students.
    So we want to start teachers at better salaries. We want to 
better support them. We want to have meaningful career ladders. 
And we want them to be able to make a lot more money over the 
course of their career.

       RECOGNIZING SUCCESS, PROFESSIONAL AND TEACHING EXCELLENCE

    Senator Tester. Okay. So the $5 billion is going to be used 
for what?
    Secretary Duncan. The $5 billion for REPECT would support--
again, all this stuff. We want to have local buy-in. But we 
would invest in either districts or in States who would be 
willing to think about these things in an entirely different 
way. How we recruit, how we support, how we compensate, how we 
build career ladders.

         COLLEGE AFFORDABILITY AND STUDENT LOAN INTEREST RATES

    Senator Tester. Okay. A lot of folks have talked about 
college affordability. And the administration has proposed a 
new system--and correct me if I'm wrong--where new rates would 
be set each year based on market rates and then left flat. Jack 
talked about it a little bit, and others have talked about it. 
It sounds really good right now when interest rates probably 
aren't going to get any lower than they are right now.
    But I remember in the 1980s when interest rates were 20 
percent, it wouldn't sound very good under those circumstances. 
Have you guys thought about caps at all, number one? And number 
two, have you thought about ways to be able to cushion it? 
Because, quite frankly, if interest rates are high, we're in 
trouble.
    Secretary Duncan. Yes. No, we'll be having conversation on 
all these things. Again, I just go back to the premise where I 
started. I want to get out of trying to fix this every single 
year and want to try and fix it for the long haul.
    Senator Tester. Yes. I agree.
    Secretary Duncan. So how we get there, that's something we 
need to work out with all of you. We don't want to put students 
in a bad position. But we want to have a long-term fix.

                       STUDENT LOAN DEFAULT RATES

    Senator Tester. Okay. And this may be a question for Tom. 
What are the default rates for college kids, college loans?
    Mr. Skelly. The rates have been going up.
    Senator Tester. The default rates?
    Secretary Duncan. Yes.
    Mr. Skelly. The default rates have been going up during the 
bad patch in the economy. They've slipped up. They're more like 
8 percent now. They were lower. They were down around 5 
percent. We're looking--we look at rates now over a 3-year 
period, the cohort default rate for the 3 years after kids 
finish. That was a recent change in the law. And schools that 
have higher default rates have to take steps or they get kicked 
out of the program.
    Senator Tester. Have you guys thought about--I mean, giving 
some kids some advantages if they pay those loans off so that 
if they pay those loans off they can actually maybe get a loan 
for a house or something like that? Have you talked to our 
friend in HUD to see if there's any possibility of--well, I 
don't care; just thinking outside the box--so that if we can 
drop those default rates, then you drop that 2 percent that you 
have to tack onto those rates down pretty dramatically, right?
    Mr. Skelly. That comes down, yes.
    Senator Tester. Yes.
    Mr. Skelly. We also do a good job of collecting on 
defaulted loans. Loans do go into default and delinquency, and 
we try to get them back into repayment quickly.

                      STUDENT LOAN REPAYMENT PLANS

    Secretary Duncan. We also put in place some things like Pay 
As You Earn, so trying to cap, you know, loan repayments going 
forward to 10 percent of income so folks making more money pay 
more; folks making less pay less. And then if you go into 
public service, after 10 years, loan forgiveness.
    Senator Tester. Okay. Yes. You're right in a lot of those 
things. I just think that college affordability for my kids was 
a whole lot different than college affordability was for my 
parents or me. And it's gotten a lot worse in the last 10 or 15 
years.
    Secretary Duncan. Whether I'm at the dry cleaners or the 
grocery store, or on an airplane, this is a huge issue that is, 
unfortunately, almost crushing too many American families.
    Senator Tester. Well, thank you. You've got a tough job. I 
appreciate your work, and I look forward to working with you.
    Senator Harkin. Senator Cochran.
    Senator Merkley.
    Senator Merkley. Thank you, Mr. Chair.

          ACADEMIC CALENDAR AND INSTRUCTIONAL TIME IN SCHOOLS

    Mr. Secretary, I wanted to ask. And I ask this from the 
viewpoint of a parent with children in the same high school 
that I attended. It seems like the school hours have decreased 
significantly in my State.
    Secretary Duncan. Increased or decreased?
    Senator Merkley. Decreased.
    Secretary Duncan. Decreased. Yes.
    Senator Merkley. Have decreased significantly--longer 
breaks, more half-days, more full days. When we look at the 
United States over, say, the last 30 years, has there been a 
decrease in school hours of instruction? And when we compare 
the United States to other developed nations with which we 
compete in a global knowledge economy, how do our K-12 hours of 
instruction compare?
    Secretary Duncan. We are putting our children at a 
competitive disadvantage. And if we average whatever it is 175, 
180 days, depending on the State--in many other countries, it's 
200, 210, 220, 225. And it is a very, very real concern. And 
so, I usually get booed by children when I talk about this, and 
parents appreciate it, but longer days, longer weeks, longer 
years would be good.
    As you know, our school calendar is based upon the agrarian 
economy. Not too many of our kids will work in the fields 
anymore. And the fact that we have so much, what I call, summer 
reading loss, where teachers work hard and get children to a 
certain point in June and they come back in the fall and 
they're further behind than when they left, makes no sense 
whatsoever.
    And so we have pushed very, very hard to try and go in the 
opposite direction. This is difficult in tough economic times. 
There are some States, some outside foundations, that are doing 
some really creative things.
    But to be very, very clear, I'm very concerned that our 
children are at a competitive disadvantage versus children in 
other countries who have more time in the academic calendar.

            RESOURCES FOR PRESCHOOL OR LONGER ACADEMIC YEAR

    Senator Merkley. So for, more or less, 175 days--I assume 
that's kind of equalized by hours per day and so forth versus 
210 in other developing or other developed economies. One thing 
I wrestle with is, for example, the initiative we're talking 
about now that the Department has put a lot of weight on, on 
early childhood education, funding for pre-K. I know the more 
we learn about the brain, the more we know how important those 
early years are.
    Does that make more sense, and I guess the answer is yes 
because that's what you're proposing than trying to regain 
school days and be somewhere closer to the world standard in 
instructional time?
    Secretary Duncan. So it's a great question. I think we have 
to, in my mind, we have to try and do all of these things 
simultaneously. So I'm just convinced we have so many children 
coming to kindergarten, entering school a year, a year-and-a-
half behind. That to me is just untenable. I keep saying we 
have to get out of the catch-up business. So for me, we have to 
get that early learning foundation to a better spot. And again, 
the ROI, the return on investment for this for the young 
people--you know, for the next four decades is pretty 
extraordinary. So from a taxpayer standpoint, it's arguably the 
best investment we can make.
    Simultaneously, we need to work on having longer days. And 
the different ways to do it--you know, bring in more nonprofit 
partners, community-based organizations after school. For me, 
the school buildings have to be open longer. You can have 
sports and dance and art and drama and music and tutoring and 
GED for parents and ESL and family literacy and the whole 
variety of things where schools become community centers that 
are really important, to me, where it doesn't take a lot more 
money.
    We also have to invest in higher ed. So I wish we had the 
luxury of just doing one thing for a couple of years. We don't 
have that luxury. So I think the investment in early childhood 
education is critically, critically important. And we have to 
get that done. But if we get that done, it's not like we can 
sort of step back and say, ``We're there.'' We have to work on 
K-to-12, and we have to work on higher ed, and we have to do it 
all at the same time.

                   COST OF EXTRACURRICULAR ACTIVITIES

    Senator Merkley. So one more thing I've observed, just on 
the ground in terms of my own community and the kind of effect, 
is my son went through the doors of the high school 40 years 
after I did. So it's a four-decade gap. My daughter is a year 
behind my son. But when I went through, again in a working-
class community, the extracurricular activities were free. They 
were free. Now there are fees on all kinds of activities.
    And what we're seeing--and I'm saying this just in terms of 
my community--it appears like greatly decreased participation 
by students. And I'm wondering to what degree this has been 
looked at, because my suspicion is that, as children don't join 
the extracurricular activities, which help them burn off energy 
in sports and help them be excited about being part of school 
and so forth, that their academic performance as well would be 
affected.
    Are school fees for participation in extracurricular 
activities a problem in our system?
    Secretary Duncan. It's a huge problem, and this comes to 
our Nation's disinvestment in education. And it's not just in 
fees. There are a lot of places where these programs have been 
eliminated. And again, whether it's drama, art, or sports, or 
debate, or academic decathlon, or yearbook, or whatever, model 
UN, whatever it might be, those extracurriculars are critical 
to keeping young people engaged in school and excited about 
coming to school.
    I always joke, I didn't necessarily love to go to high 
school to take Algebra II. But I wanted to play on the 
basketball team. To do that, I had to do well academically. And 
what is so frustrating to me, Senator, is that--you hit the 
nail on the head--that I promise you in wealthier communities, 
these things aren't extra. This is part of the norm. This is 
what kids get.

               DISENGAGEMENT OF STUDENTS AND DROPOUT RATE

    And for all the improvements I talked about, our dropout 
rate in this country is unacceptably high. We have about a 25 
percent dropout rate. Those young people have no chance to make 
it in today's economy.
    And so if you want to reduce the dropout rate, one of the 
best things you can do is to have more extracurricular 
activities and keep students engaged in their learning every 
single day. And so when we, as a Nation, walk away from those 
kinds of things, I just think we do our children, and 
ultimately our country, a real disservice. There's no upside 
there. There's none.
    Senator Merkley. I'll just summarize by saying that the 
overall conversation we're having about shrinking school days, 
fees on extracurricular activities having a detrimental impact, 
discouragement among students because of the high cost, the 
daunting cost, of college equates to we are doing a poorer job 
of providing education to our children than our parents did for 
us. And that is completely unacceptable. It's--we should be all 
ashamed of that. And we must figure out how to do it 
differently.
    Secretary Duncan. And just to be very clear, this is not 
the tack, this is not the strategy that our international 
competitors are taking. They are investing in education. They 
are investing in innovation. There's a real commitment there. 
They know that's the best way to build a strong and vibrant 
economy.
    Senator Merkley. Thank you.
    Senator Harkin. Thank you, Senator Merkley.
    I sent a letter to the Inspector General of the Department 
of Education, Kathleen Tighe, in which she sent her response. I 
would like to submit both letters to be included in the record.
          United States Senate, Committee on Appropriations
                                     Washington, DC, April 15, 2013
The Honorable Kathleen Tighe
Inspector General
United States Department of Education
Office of Inspector General
400 Maryland Avenue, SW
Washington, DC 20202-1500
    Dear Inspector General Tighe: Thank you for your leadership of the 
Office of the Inspector General (OIG) and your efforts to promote the 
efficiency, effectiveness and integrity of the Department of 
Education's programs and activities. Your office plays a critical role 
in ensuring that taxpayer resources are spent in the most efficient and 
effective manner possible.
    To that end, I am interested in receiving your view of the greatest 
threats and vulnerabilities to programs and activities of the 
Department of Education. I would also like you to provide the status of 
recommendations from the OIG's work for each of the past 4 years and 
discuss any recurring issues within the Department that need to be 
addressed by the Department. I am particularly interested in seeing 
your evaluation of the effectiveness of the Department's improved audit 
follow-up process. As you are aware, timely closure of audit 
recommendations is a critical element of preventing future issues and 
recovering any misused or misspent funds identified during the course 
of the OIG's work. Lastly, I would like to receive specific information 
about the impact of sequestration on the OIG's staffing and work in the 
current fiscal year. I will make your response to these issues a part 
of the hearing record for the April 17, 2013, hearing with Secretary 
Duncan.
    Thanks again for your leadership of the OIG and for the role you 
play in making sure that resources provided to the Department are spent 
as intended.
            Sincerely,
                                                         Tom Harkin
                                                           Chairman
                           Subcommittee on Labor, Health and Human 
                     Services, and Education, and Related Agencies.
                                 ______
                                 
                     United States Department of Education,
                                Office of Inspector General
                                     Washington, DC, April 26, 2013
 responses to questions for the record, subcommittee on labor, health 
        and human services, and education, and related agencies
    Question. What is your view of the greatest threats and 
vulnerabilities to programs and activities of the U.S. Department of 
Education (Department)?

    The Office of Inspector General (OIG) presents its view of the 
greatest threats and vulnerabilities to the Department's programs and 
activities through its annual Management Challenges report. As required 
by the Reports Consolidation Act of 2000, OIG must identify and report 
annually on the most serious management challenges facing the 
Department. For fiscal year (FY) 2013, we identified four management 
challenges facing the Department: (1) improper payments, (2) 
information technology security, (3) oversight and monitoring, and (4) 
data quality and reporting. A summary of each of these challenges is 
below. A more detailed discussion of these challenges can be found in 
our FY 2013 Management Challenges report, which is available on our Web 
site (http://www2.ed.gov/about/offices/list/oig/misc/
MgmtChall2013a.pdf). We believe that this report is a valuable tool for 
Department officials to use in their efforts to address the management 
and performance issues identified, and we are committed to helping them 
do so. This includes conducting additional work in these challenge 
areas throughout FY 2013. You will find detailed information on these 
and our other high-priority efforts in our FY 2013 Annual Plan, which 
is available on our Web site (http://www2.ed.gov/about/offices/list/
oig/misc/wp2013.pdf).
Management Challenge--Improper Payments
    In FY 2010, the Office of Management and Budget designated the 
Federal Pell Grant (Pell) program as a high-priority program. The 
Department estimated that the Pell program had $993 million in improper 
payments in FY 2011 and $829 million in FY 2012. The Department also 
identified the William D. Ford Federal Direct Loan (Direct Loan) 
program and Federal Family Education Loan (FFEL) program as susceptible 
to significant improper payments in FY 2012. Our recent work has found 
that although the Department is making progress, it must intensify its 
efforts to successfully prevent, identify, and recapture improper 
payments. For example, our March 2013 audit of the Department's 
compliance with improper payment requirements found flaws in the 
Department's methodologies for the Pell, Direct Loan, and FFEL 
programs.
Management Challenge--Information Technology Security
    The Department collects, processes, and stores a large amount of 
sensitive personally identifiable information, such as names and social 
security numbers of employees, students, and other program 
participants. OIG has identified repeated problems in the Department's 
information technology security and its ability to combat threats and 
vulnerabilities to its systems and data. For example, OIG's FY 2012 
report on the Department's compliance with the Federal Information 
Security Management Act of 2002 noted that 6 of the 11 security control 
areas reviewed contained repeat findings from OIG reports issued during 
the prior 3 years. Further, the last three audits of the Department's 
financial statements identified information technology controls at the 
Department as a significant deficiency. Although the Department has 
provided corrective action plans to address most of our 
recommendations, vulnerabilities continue to exist.
Management Challenge--Oversight and Monitoring
    Effective oversight and monitoring is a significant responsibility 
for the Department given the number of different entities and programs 
requiring monitoring and oversight, the amount of funding that flows 
through the Department, and the impact that ineffective monitoring 
could have on stakeholders. Four areas included in this management 
challenge are (1) student financial aid program participants, (2) 
distance education, (3) grantees, and (4) contractors.
            Student Financial Aid Program Participants
    The Department must effectively oversee and monitor student 
financial aid program participants to ensure that the programs are not 
subject to fraud, waste, abuse, or mismanagement. The Department 
estimated that $193.5 billion will be used for Federal student aid in 
FY 2013. We completed several reviews in FY 2011 and FY 2012 that 
identified weaknesses relating to the Federal Student Aid office's 
(FSA) oversight and monitoring activities. Additionally, our external 
audits of individual program participants have frequently identified 
noncompliance, waste, and abuse of Federal student aid program funds. 
OIG investigations have identified various schemes by student financial 
aid program participants to fraudulently obtain Federal student aid 
funds. Although the Department is working to address weaknesses and 
deficiencies in student financial aid oversight and monitoring, our 
work continues to identify serious problems.
            Distance Education
    Management of distance education programs presents a challenge for 
the Department and school officials because of limited or no physical 
contact to verify the student's identity or attendance. OIG audit work 
has found that for distance education programs, schools face a 
challenge in determining when a student attends, withdraws from school, 
or drops a course. These factors are critical because they are used to 
determine the student's eligibility for Federal student aid and to 
calculate the return of funds if the student withdraws or drops out. 
Another area of concern involves distance education ``fraud rings''--
large, loosely affiliated groups of criminals who seek to exploit 
distance education programs in order to fraudulently obtain Federal 
student aid. Because all aspects of distance education take place 
through the Internet, students are not required to present themselves 
in person at any point, and institutions are not required to verify 
prospective and enrolled students' identities. As a result, fraud 
ringleaders have been able to use the identities of others (with or 
without their consent) to target distance education programs. Fraud 
rings mainly target lower cost institutions because the Federal student 
aid awards are sufficient to pay institutional charges, such as 
tuition, and the student receives the award balance to use for other 
educational expenses, such as books, room and board, and commuting. In 
2011, we issued a report on fraud rings that offered nine specific 
actions for the Department to take to address this type of fraud. 
Although the Department has taken some action to mitigate fraud rings, 
work still remains. In January 2013, we provided the Department with 
the results of our risk analysis related to student aid fraud rings, 
which estimated a probable loss of more than $187 million in Federal 
student aid funds from 2009 through 2012 as a result of these criminal 
enterprises.
            Grantees
    The Department's early learning, elementary, and secondary programs 
annually serve more than 13,000 public school districts and 49 million 
students attending more than 98,000 public schools and 28,000 private 
schools. The Department is responsible for monitoring the activities of 
grantees to ensure compliance with applicable Federal requirements and 
that performance goals are being achieved. OIG audit and investigative 
work has identified a number of weaknesses in grantee oversight and 
monitoring. These involve weaknesses in fiscal and internal controls at 
State and local educational agencies and in the Department's oversight 
processes. The OIG also identified fraud perpetrated by officials at 
State and local educational agencies and charter schools.
            Contractors
    The value of the Department's active contracts as of November 30, 
2012, was about $5.3 billion. Once a contract is awarded, the 
Department must effectively monitor performance to ensure that it 
receives the correct quantity and quality of products or services for 
which it is paying. OIG has identified issues relating to the lack of 
effective oversight and monitoring of contracts and contractor 
performance, including the appropriateness of contract prices and 
payments and the effectiveness of contract management. In 2012 we found 
that the Debt Management Collection System 2 (DMCS2), FSA's system for 
managing defaulted student loans that was updated by a contractor, was 
unable to accept transfer of certain defaulted student loans from FSA's 
loan servicers. Since DMCS2 was implemented in October 2011, the 
entities that service Federal student aid loans have accumulated more 
than $1.1 billion in defaulted student loans that should be transferred 
to the Department for management and collection. Because DMCS2 has been 
unable to accept transfer of these loans, the Department is not 
pursuing collection remedies and borrowers are unable to take steps to 
remove their loans from default status. The inability of DMCS2 to 
accept these transfers also contributed to a material weakness in 
internal control over financial reporting that was identified in FSA's 
fiscal year 2012 financial statement audit. Based on our interaction 
with FSA officials to date, FSA has yet to implement effective 
corrective action to bring these affected loans into collection, 
correct the problems with DMCS2, and pursue contractual remedies.
Management Challenge--Data Quality and Reporting
    The Department, its grantees, and its subgrantees must have 
controls in place and effectively operating to ensure that accurate, 
reliable data are reported. The Department uses data to make funding 
decisions, evaluate program performance, and support a number of 
management decisions. State educational agencies annually collect data 
from local educational agencies and report various program data to the 
Department. Our work has identified a variety of weaknesses in the 
quality of reported data and recommended improvements at the State and 
local level, as well as actions the Department can take to clarify 
requirements and provide additional guidance. Ensuring that accurate 
and complete data are reported is critical to support effective 
management decisions.

    Question. What is the status of recommendations made from the OIG's 
work for each of the past 4 years, and discuss any recurring issues 
within the Department that need to be addressed?

    Office of Management and Budget A-50 Circular, ``Audit Followup'', 
requires agencies to establish systems to assure the prompt and proper 
resolution and implementation of OIG audit recommendations. The 
Circular states, ``Resolution shall be made within a maximum of 6 
months after issuance of a final report . . . Corrective action should 
proceed as rapidly as possible.'' The Circular provides definitions as 
follows:
  --Audit Resolution.--The point at which the audit organization and 
        agency management or contracting officials agree on actions to 
        be taken on reported findings and recommendations.
  --Corrective Action.--Measures taken to implement resolved audit 
        findings and recommendations.
    The Department tracks audit resolution and implementation of 
corrective actions related to OIG products in its Audit Accountability 
and Resolution Tracking System (AARTS). The Office of the Chief 
Financial Officer maintains this system, which includes input from OIG 
and responsible program officials. AARTS includes recommendation-level 
detail for all reports where the Department is directly responsible for 
implementing corrective action (internal audits). The system includes 
less detailed information on the status of individual recommendations 
made to non-Federal entities, such as State educational agencies, local 
educational agencies, institutions of higher education, contractors, or 
other grantees (external audits.) To address this question, we focus 
only on internal audit reports--reports that include recommendations 
for which the Department is directly responsible for implementing 
corrective action.
    For the time period requested (April 1, 2009, through April 17, 
2013), OIG issued a total of 71 internal audit products that contained 
564 recommendations. For those 564 recommendations, the data in AARTS 
shows that:
  --466 recommendations have been resolved, with all corrective actions 
        completed.
    --356, or about 76 percent, of these recommendations were resolved 
            timely.
  --80 recommendations have been resolved, but corrective actions not 
        yet implemented.
    --63, or about 79 percent, of these recommendations were resolved 
            timely.
  --18 recommendations have not yet been resolved. Those 18 
        recommendations are categorized as follows:
    --8 of the recommendations were included in audit products issued 
            within the last 6 months (November 1, 2012, through April 
            17, 2013). These recommendations are not considered overdue 
            for resolution.
    --9 of the recommendations were included in audit products issued 
            between 6 and 12 months ago (April 1, 2012, through 
            November 1, 2012). These recommendations are considered 
            overdue for resolution.
    --1 of the recommendations was included in an audit product issued 
            more than 12 months ago. This recommendation is considered 
            overdue for resolution.
    While the Department is more successful in addressing 
recommendations in internal audit reports, it has a significant backlog 
in addressing recommendations in external audit reports. In 2012, we 
issued an audit of the Department's external audit resolution 
processes. The audit reported longstanding challenges in the 
Department's external audit resolution processes, including:
  --Untimely resolution of audits that has (1) impacted the potential 
        recovery of funds due to the statute of limitations applicable 
        to monetary recommendations made in audits of entities (such as 
        State educational agencies and local educational agencies) and 
        (2) delayed corrective actions by auditees;
  --Ineffective internal controls over audit resolution and followup, 
        such as the failure to ensure compliance with OMB Circular A-
        50; and
  --A lack of the following: staff to conduct resolution activities, 
        training so that staff has sufficient knowledge to effectively 
        conduct resolution activity, organizational priority placed on 
        audit resolution activities, and overall accountability.
    As stated above, because the Department does not maintain 
recommendation-level detail for external audits in AARTS, the number of 
open recommendations and recommendations that have been implemented 
cannot be determined without an in-depth review of each audit report 
and confirmation of the status of corrective actions taken by the 
external entities. The Department, unlike other agencies, has various 
legal requirements for State and local educational agencies that it 
must apply before it can require the return of funds as a result of an 
audit finding. As a result, external audits with potential monetary 
recoveries require additional work by the Department and can require 
more time to resolve than external audits with only non-monetary 
findings or internal audits.
    The key recurring issues that we have identified from our audit 
work are highlighted in our management challenges discussed above. In 
particular, our work on information technology security has resulted in 
repeat findings in areas where the Department has put in place 
corrective action plans to address our past work. We have also found 
recurring issues in the areas of grantee and contractor oversight and 
monitoring and in data quality and reporting.

    Question. Have you evaluated the effectiveness of the Department's 
improved audit follow-up process?

    In November 2012, in response to our audit of the Department's 
external audit followup process and under the direction of the Deputy 
Secretary, the Department convened a high-level audit governance panel 
to improve the audit resolution process. The OIG is serving on this 
panel in an advisory role. The panel has been meeting periodically and 
as of April 2013, it has identified categories of problems with the 
current audit resolution process. Examples of problems include human 
resources, quality and timeliness, communication, and workload 
capacity. The panel is formulating corrective action plans and goals to 
address each problem area. At the same time, the Department has 
established an improved tracking system and better communication 
between offices. The attention of senior management has already 
resulted in reductions to the backlog of open internal audits.
    We will continue to monitor the Department's progress and will 
evaluate the effectiveness of the Department's improved audit followup 
process and corrective actions to address audit recommendations.

    Question. Please share specific information about the impact of 
sequestration on the OIG's staffing and work in the current fiscal 
year.

    The sequestration resulted in a 5 percent cut to OIG's budget, 
which had already been flat-lined at approximately $60 million for the 
last three fiscal years (FY). Further, another .2 percent reduction was 
levied on our sequestered budget for FY 2013. We have been trying to 
make the most of our limited resources in order to meet our mission. 
Doing so, however, has not been without difficulty, given the increased 
costs in nearly all aspects of our operations. Our budget will result 
in fewer OIG employees and a consequent decrease in audits and 
investigations, as well as reduced travel and training that will impact 
the breadth of our work.
Staffing
    For more than 32 years, the OIG has worked to promote the 
efficiency, effectiveness, and integrity of the Department's programs 
and operations. We conduct independent audits, investigations, 
inspections, and other reviews, and based on our findings, make 
recommendations to the Department to address systemic weaknesses and 
initiate administrative actions. We also recommend changes needed in 
Federal laws, regulations, and in the guidance the Department provides 
to its grantees, partners, and program participants. Performing this 
work requires a variety of specialized professionals, including 
financial and performance auditors, criminal investigators, financial 
analysts, information technology professionals, inspectors, management 
and budget analysts, attorneys, and other business and support 
professionals. In FY 2005, we operated with 305 employees. At the start 
of FY 2013, we were operating with approximately 272 full time and term 
employees on board. As a result of our limited budget and 
sequestration, we eliminated a number of expenditures that support our 
work (e.g., non-mandatory training, supplies, subscriptions, 
reimbursement programs). However, because employee pay, compensation, 
and benefits comprise 69 percent of our overall budget, by far OIG's 
largest expense, reductions in our staffing level were unavoidable. 
Thus, we took or will take the following actions:
  --In FY 2012, we limited our hiring to replace only essential 
        positions.
  --In FY 2013, we imposed an overall hiring freeze.
  --As of May 3, 2013, we will have released the remaining 4 term 
        employees and will be operating with approximately 267 full 
        time staff.
  --For FY 2014, we anticipate using the Voluntary Early Retirement 
        Authority and Voluntary Separation Incentive Payment authority 
        in an effort to reduce our staff by another 5 to 15 employees 
        in order to provide adequate funds to meet our operational 
        needs at the sequestered level we now find ourselves.
    In testimony that I presented before the Government Oversight and 
Reform Committee of the U.S. House of Representatives in March, I 
stated that we expected to furlough all OIG staff for approximately 10 
days. Since then, however, the Department has told us that it proposes 
to use its transfer authority to provide some funding to the OIG, which 
would reduce our expected furlough days by at least half and perhaps 
more. After undertaking an independence analysis both in terms of the 
Inspector General Act and Federal Government auditing standards, we 
determined that nothing prohibited our accepting this additional 
funding. We will use it to pay for our portion of the statutory 
financial statement audit, which is performed by an independent 
auditing firm under our supervision. We notified our Congressional 
appropriators of the possible funds transfer.
Training
    As mentioned above, the work we conduct requires specialized and 
knowledgeable professionals. A number of these professionals must 
maintain specific certifications and normally take additional training 
to expand existing skills, learn new techniques and best practices, and 
understand emerging forms of fraud in Government programs so that they 
can best combat them. Our auditors are required to comply with a 
Federal Government auditing standard requirement that they receive 80 
hours of professional training every 2 years. Further, our criminal 
investigators are also required to receive specific quarterly firearms 
training in order to maintain their law enforcement authority. Our 
auditors and investigators compose approximately 72 percent of OIG 
staff. For FY 2013, we reduced our already slim training budget by 61 
percent, thereby eliminating all training except mandatory training, 
training for professional certifications, and law enforcement training. 
Although this reduction allowed us to continue to meet our bare minimum 
training requirements, it resulted in reliance on a body of free or 
low-cost training that, over the long run, will not allow us to fully 
address our staff's training and development requirements.
Travel
    For FY 2013, we have reduced our travel budget by 11 percent. To 
date, we have eliminated training-related travel, eliminated all travel 
by managers to regional offices, and delayed starting several audit 
projects that involved large amounts of travel.
    Although the reduction in our travel budget will not impact the 
quality of our work, it will, particularly when combined with our 
reduction in staff, impact the reach of our efforts. We are an office 
that depends in large part on travel to meet our audit and 
investigation mission requirements. With the cuts to travel, we 
anticipate that nationwide audit projects may need to be scaled back to 
cover fewer sites (i.e., State educational agencies, local educational 
agencies, institutions of higher education). This may be the case with 
two of our more significant planned audits where we would like to 
incorporate as many sites as possible--our audit of Race to the Top 
(RTT) recipient performance, which seeks to determine whether selected 
recipients are making substantial progress within the RTT educational 
reform areas, and our audit of the impact of Elementary and Secondary 
Education Act (ESEA) flexibility waivers, which seeks to determine 
whether approved State educational agencies are successfully 
implementing selected aspects of the plans contained in their 
applications for ESEA flexibility.
    We expect that we will also need to limit the number of criminal 
investigations we open and focus our investigative resources in 
geographic areas that can be serviced more effectively and without 
incurring high travel costs.
Impact on Work
    As your letter correctly points out, sequestration will have both 
an immediate and longer-term impact on our oversight and investigatory 
abilities. The reduction in our funding leads to a reduction in staff 
and a reduction in tools staff need to perform their jobs, such as 
travel, which reduces our work output. For example:
  --We must first complete our statutory audit assignments that we are 
        required to conduct each year, followed by only our highest 
        priority work. This limits our ability to identify potential 
        waste, fraud, and abuse.
  --We have cancelled contractor support for our Federal Information 
        Security Management Act audit that has caused us to downsize 
        the scope and coverage of the audit and limit the type of 
        technical testing we will conduct on the Department's and FSA's 
        data systems and infrastructure.
  --We have cancelled contractor support for our development of 
        analytical tools and risk models that will reduce our ability 
        to identify patterns of fraud and emerging risk and better 
        target our audit and investigative work.
  --Our approach to nationwide audit projects may need to be revised as 
        a result of reduced travel funds, while continuing to assure 
        adequate audit coverage.
  --Reductions in staff will reduce the number of audit-related 
        assignments we can conduct in a year and the timeliness of our 
        work.
  --Reductions in staff and resources will force our investigators to 
        be much more selective about the types and locations of cases 
        we can commit to investigating and significantly increase our 
        financial loss threshold for commencing an investigation.
  --Prosecutions and recoveries may be reduced due to the reduction in 
        investigative staff and the number of cases they can handle.
  --It is unlikely that we will have the staff or other resources to 
        conduct unplanned work in a timely manner that is often 
        requested by our stakeholders, including the Department and 
        Members of Congress.
    As you can see from the information provided above, we have already 
downsized our operations as a result of our flat-lined appropriations 
over the last several years. The reductions mandated by the 
sequestration, however, have accelerated downsizing to the point where 
we simply will not be able to provide the audit and investigative 
coverage we feel is necessary to best ensure that Department programs 
and operations are achieving intended results. We will, however, 
continue to make the most of our limited resources and ensure that all 
the work we do continues to provide value to the Department, taxpayers, 
and most importantly, to America's students.
                                                  Kathleen S. Tighe
                                                 Inspector General,
                                      U.S. Department of Education.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Harkin. Thank you, Secretary Duncan, and thank you 
for your great leadership of the Department of Education. We 
look forward to working with you. We will develop this bill. I 
think Senator Moran and I might have some disagreements on this 
and that, but the one thing I think we do agree on is moving 
the process and getting a bill through and having an open 
amendment process and letting people be heard and let them 
offer amendments and move the darn thing along.
    So, hopefully, we can get that done. Look forward to 
working with you as we do that.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
               Questions Submitted by Senator Tom Harkin
                      preschool development grants
    Question. The President's fiscal year 2014 budget proposes 
significant investments in increasing the quality of early learning 
experiences available to children, particularly those from low- and 
middle-income families. The Department's budget includes $750 million 
for Preschool Development Grants that would be made to 8 to 15 States. 
The Federal Government has several programs that are related in some 
way to early childhood education, including Head Start, Early Head 
Start, Child Care Development Block Grants, and Race to the Top: Early 
Learning Challenge. What would these Preschool Development Grants do 
that these other programs don't? Please be specific.
    Answer. Preschool Development Grants would be designed specifically 
to support the fundamental needs of States willing to create or expand 
preschool systems that can serve all 4-year-olds in the State. States 
could use Preschool Development Grant funds to support such quality 
improvement efforts as making facilities appropriate for preschool-aged 
children, developing the preschool workforce, and scaling up existing 
high-quality programs. These efforts would not duplicate the services 
provided by existing early childhood education programs.
          preschool development grants to low-capacity states
    Question. In addition, how many of these awards will go to low-
capacity States, or those with small State preschool programs or 
lacking them altogether?
    Answer. The Department has not established a target number of 
Preschool Development Grants that would be awarded to low-capacity 
States.
             use of preschool development grants by states
    Question. How does the Department anticipate funds being used by 
both low and higher capacity States?
    Answer. The Department anticipates all States would use the funds 
to improve the quality of preschool programs and meet the eligibility 
criteria for Preschool for All. For example, higher capacity States 
could use program funds to ensure that existing preschool programs meet 
the definition of high quality in Preschool for All and to expand such 
programs to serve more 4-year-olds. Low-capacity States would likely 
use grant funds to develop the physical and program quality 
infrastructure necessary for high-quality preschool, including creating 
and improving facilities designed for 4-year-olds, and supporting the 
development of preschool teachers and staff.
          school improvement grants--school turnaround efforts
    Question. The President's budget targets a proposed increase in 
School Improvement Grants to strengthen district capacity to undertake 
and sustain effective school improvement practices. Please describe 
what efforts districts would undertake with these funds that support 
school turnaround efforts?
    Answer. As discussed in the fiscal year 2014 request for School 
Turnaround Grants, through our monitoring and technical assistance the 
Department has identified the often limited capacity of local 
educational agencies (LEAs) to support school turnarounds as a 
significant barrier to successful implementation. The $125 million 
request for the proposed Supporting and Sustaining School Turnaround 
Grants competition would support a wide range of LEA-level strategies 
to address locally identified needs. These strategies include adopting 
LEA-wide policies for teacher and leader assignment in support of 
school-level reforms; recruiting and training turnaround leaders; 
implementing data-based accountability and performance-management 
tools; creating networks of low-performing schools or pairing low-
performing schools with high-performing schools to share turnaround 
strategies and improve oversight; and increasing parent and community 
involvement in turnaround planning and implementation. The proposal 
would also provide resources to help LEAs sustain interventions 
successfully implemented under the current School Improvement Grants 
(SIG) program following the end of the regular SIG award period.
          defining effectiveness in school turnaround efforts
    Question. How would the Department define entities that have 
demonstrated effectiveness in turning around low-performing schools?
    Answer. We are currently considering how best to define 
effectiveness in turning around low-performing schools for purposes of 
giving priority for Supporting and Sustaining School Turnaround Grants 
to applicants partnering with entities with such effectiveness. As 
indicated in response to the following question, the Department might 
pursue notice-and-comment rulemaking for the first grant competition 
under this proposed authority and, if so, would include such a priority 
in that rulemaking.
 rulemaking and strengthening district capacity for improvement efforts
    Question. Would these new uses of funds require a new rulemaking 
effort in this area?
    Answer. The Department is permitted under the General Education 
Provisions Act (GEPA) to exempt from notice-and-comment rulemaking 
requirements the first grant competition under a new or substantially 
revised program authority. We have not yet decided whether we would 
make use of that GEPA provision in this case.
 addressing monitoring and gao findings in school improvement programs
    Question. Would the Department also address other issues identified 
through monitoring and the Government Accountability Office (GAO) 
reports through such a rulemaking or national activities funds?
    Answer. The Department is taking a number of steps to improve our 
support for school turnaround efforts and to address issues identified 
through School Improvement Grants (SIG) program monitoring and reports 
from the Government Accountability Office (GAO). For instance, we are 
currently drafting nonregulatory guidance, which we expect to release 
in the near future, that among other things will help States decide 
whether to renew local educational agency (LEA) SIG subgrants with 
respect to individual schools and will help LEAs select and monitor 
external turnaround providers, as recommended in a 2012 GAO report. We 
are also using SIG national activities funds to continue to facilitate 
peer-to-peer exchanges, which enable States that through monitoring 
might be identified as having a particular implementation difficulty to 
connect with and learn from other States with greater success in that 
area. Lastly, absent reauthorization of the Elementary and Secondary 
Education Act, the Department anticipates issuing revised SIG formula 
grant regulations for fiscal year 2014 that implement lessons learned 
during the 5 years of program implementation under the current 
regulations.
                   mental health programs in schools
    Question. This subcommittee led an effort to support grants from 
fiscal year 2005 through 2010 for the integration of mental health in 
schools. Such grants needed to demonstrate a strong commitment to 
making evaluation an integral part of their planning and implementation 
activities. What did the Department learn from these grants and how 
will these lessons inform future Department actions in this area?
    Answer. The goal of the program was to increase student access to 
quality mental healthcare by developing innovative programs that link 
school systems with local mental health systems. The last cohort of 
grants was funded in fiscal year 2010.
    To achieve this goal, grantees were to enhance or develop 
collaborative efforts between school-based service systems, juvenile 
justice, and mental health service systems; enhance the availability of 
crisis intervention services; improve capacity to make appropriate 
referrals for students potentially in need of mental health services; 
and provide training for the school personnel and mental health 
professionals. They were required to put in place detailed linkage 
protocols outlining inter-agency agreements among partners, and submit 
a comprehensive evaluation plan that would be used to identify needs, 
analyze community resources and barriers, and evaluate outcomes for 
students.
    Local evaluation of the project to assess progress in meeting 
required GPRA program measures, as well project specific goals and 
objectives was a required element of the grant application. The 
following GPRA performance measures were put in place to evaluate the 
overarching success of the program.
Measure 1:
    The percentage of schools served by the grant that have 
comprehensive, detailed linkage protocols in place.
Measure 2:
    The percentage of school personnel served by the grant who are 
trained to make appropriate referrals to mental health services.
    For the 2006, 2007, 2008, and 2009 grant cohorts, 89 percent, 95 
percent, 99 percent, and 96 percent of schools served by the grants in 
the respective cohorts had, at the end of their project period, 
comprehensive, detailed linkage protocols in place (GPRA measure 1). 
For the 2006, 2007, 2008, and 2009 grant cohorts, 79 percent, 70 
percent, 86 percent, and 84 percent of school personnel served by the 
grant were trained to make appropriate referrals to mental health 
services, respectively (GPRA measure 2).
    In addition to the required GPRA program measures, grantees 
developed, as part of the ongoing required local evaluation, project 
specific process measures to assist in ongoing assessment and 
continuous improvement. Grantees developed project specific outcome 
measures to focus on system change, and a plan for a long-term, 
outcomes-based evaluation that would extend past the grant period. One 
of the key lessons learned from these evaluation efforts is grantees 
were much more intentional and strategic in setting specific goals and 
objectives that served the collective interests across agencies as well 
as thinking about long-term sustainability, in terms of ultimate 
outcomes, when they knew they would be measuring and reporting on 
progress. This resulted in closer alignment of their work with their 
strategic plan, leveraging of resources across agencies, and further 
reach in terms of the services within the community served. The lessons 
learned on creating school and community linkages, and implementing 
related project requirements has informed the development of the new 
proposed programs (schools and mental health) outlined in the 
President's fiscal year 2014 budget request.
                 safe schools/healthy students grantees
    Question. Also related to mental health, what explains the 
significant drop in the percentage of Safe Schools/Healthy Students 
grantees that report an increase in referrals for students that result 
in mental health services being provided in the community?
    Answer. We believe that the reduction in referrals for students 
that result in the provision of mental health services likely reflects 
the success, over the grant period, of the comprehensive strategies 
implemented by grantees under the Safe Schools/Healthy Students grant 
program in reducing the need for such services.
    More specifically, successful implementation of other programmatic 
elements of Safe Schools/Healthy Students projects, such as those that 
address substance use and violent behavior, behavior modifications, and 
improvements in school climate, may lessen the need for students to 
receive community-based mental health services.
                    stem innovation networks program
    Question. With regard to the proposed STEM Innovation Networks 
program, how will the Department define ``evidence-based practices'' 
and ``effective STEM innovations'' that would be supported with funds 
requested for this program?
    Answer. The Department's supplemental priorities for discretionary 
grant competitions include priorities for projects that are supported 
by evidence of effectiveness and for projects that will contribute to 
the evidence base for an intervention. The Department has also proposed 
and, as of June 2013, is in the process of finalizing general 
administrative regulations that establish procedures for giving special 
consideration to projects supported by evidence of effectiveness as 
well as selection criteria regarding a project's evidence base and 
ability to produce evidence of effectiveness. These regulations are 
based on the Institute of Education Sciences's What Works Clearinghouse 
Evidence Standards, which as you know have been incorporated with 
success into existing grant programs such as Investing in Innovation. 
We expect to use these regulatory tools as appropriate in competitions 
under the proposed STEM Innovation Networks program if funded.
vocational rehabilitation state grant funds--disability innovation fund 
            proposals in the fiscal year 2014 budget request
    Question. The President's budget request includes language that 
would continue funding for the PROMISE initiative using Vocational 
Rehabilitation (VR) State Grant funds that remain available after 
reallotment. The budget request also proposes to use the remaining VR 
funds available after funding PROMISE for three new proposals: (1) $5 
million for a cross-agency project to improve outcomes for disconnected 
youth with disabilities; (2) an unspecified amount for SSA to conduct 
an SSDI/SSI demonstration project; and (3) the balance of funds for 
other innovative activities to improve services and employment outcomes 
for individuals with disabilities.
    Please provide details on the three additional projects for which 
the Department of Education (ED) is requesting funding, including, but 
not limited to, eligible grantees, targeted populations, specific 
metrics on desired outcomes and how the projects would differ from the 
PROMISE initiative.
    Answer. After covering the costs of PROMISE continuations, the 
Department would use any remaining VR State Grants funds to support new 
initiatives under a Disability Innovation Fund (DIF). DIF is part of 
the administration's broader efforts to create, test, and apply 
interventions that improve the employment and life outcomes of people 
with disabilities. As with PROMISE, we would propose to rigorously 
evaluate promising strategies to improve outcomes for people with 
disabilities, while developing the evidence-base and laying the 
groundwork for future innovation. Like PROMISE, the proposed projects 
would focus on individuals with disabilities who are at risk of 
becoming disconnected from the workforce. However, while PROMISE's 
target population is restricted to youth with disabilities who are 
child SSI recipients, DIF projects would focus on improving employment 
outcomes for a wider range of people with disabilities. Like PROMISE, 
the proposed projects would bring together multiple Federal partners in 
support of coordinated, State-led interventions and focus on metrics 
related to improving education and employment outcomes and self-
sufficiency. We envision that eligible applicants for activities funded 
under the DIF would most likely be State and local agencies and 
nonprofit organizations.
Disconnected Youth
    Over the past year, the Interagency Forum for Disconnected Youth 
has been convening agencies, soliciting information from the field, and 
engaging stakeholders to identify how federally funded programs and 
systems could more effectively address the needs of disconnected youth 
and their communities. The 2014 budget request includes $25 million 
across Education and Labor for programs supporting youth who are at a 
high-risk of disengagement or are already disengaged from the education 
and employment systems. The $5 million proposed to be set aside under 
the DIF would be used to help ensure that the Disconnected Youth 
initiative includes activities that target disconnected youth with 
disabilities. While PROMISE is focused on early intervention with child 
SSI recipients beginning at age 14 to 16 who are typically still 
connected to the education system, the Disconnected Youth initiative 
would target youth with disabilities between the ages of 14 and 24 who 
are homeless, in foster care, involved in the justice system, or are 
neither employed nor enrolled in an educational institution. We 
envision that many of these youth with disabilities may be eligible to 
receive services under the VR State Grants program, which would play a 
part in helping these youth reconnect to the education and workforce 
systems to prepare for and engage in gainful employment.
SSI/SSDI Demonstration Project
    The fiscal year 2014 budget requests that the Social Security 
Administration be provided enhanced disability demonstration authority 
that, in addition to allowing SSA to test effective ways to support 
current beneficiaries seeking to return to work, would allow SSA and 
partner agencies to test innovative early intervention strategies aimed 
at preserving the wellbeing and work ability of the individuals most at 
risk of becoming severely impaired due to a psychiatric disability. 
Funds available under the DIF could be used to help support a joint ED-
SSA demonstration targeted at individuals with psychiatric disabilities 
who are likely eligible for services under the VR State Grants program 
and are at-risk of becoming future SSI or SSDI beneficiaries.
    One example of the type of promising interventions that the DIF 
could support under a joint demonstration project would be providing 
``rapid re-employment'' and vocational support services to individuals 
who have had recent psychotic episodes that threaten their ability to 
work. There have been small randomized controlled trials that have 
shown the promise of coordinating a medical treatment and vocational 
support approach. A joint ED-SSA demonstration could help to evaluate 
this approach on a larger scale.
Transition Model
    We are also exploring the possibility of investing in the 
development and testing of a model to improve the delivery of 
transition services that would involve a coordinated system of 
transition planning and supports to improve the postsecondary results 
for youth with disabilities. Expected outcomes would include: (1) 
identification of key components of a core comprehensive transition 
model based on best practices and available research; (2) practical 
guidelines for effective implementation of model transition services; 
(3) sharing of data and skill-building tools to support the 
effectiveness of the delivery of the transition model; (4) the 
development, implementation, dissemination and evaluation of tools 
designed to help youth actively plan their transitions; and (5) a 
repository of empirical information and resources. The target 
population would be broader than under the PROMISE program and would 
include youth with disabilities ages 14 to 24 who are enrolled in 
special education or receive services through a section 504 plan, as 
well as youth with disabilities who have dropped out or are at risk of 
dropping out of high school, including youth in urban and rural 
settings.
    We cannot predict the extent to which there will be VR State Grants 
funds available after State reallotment in fiscal year 2014. However, 
we believe that using any such available funds to foster innovation is 
a wise investment that will accelerate progress in developing 
effective, evidence-based strategies to improve long-term outcomes for 
people with disabilities. We welcome the opportunity to further discuss 
possible DIF investments.
                   national student loan data system
    Question. The President's budget request includes a $9 million 
increase for the National Student Loan Data System (NSLDS) in the 
Student Aid Administration account to improve enrollment reporting and 
monitoring of persistence and completion among Federal student aid 
recipients. Please provide details on how the request would support the 
collection of additional information related to enrollment, persistence 
and completion as well as how the information would be used to improve 
student outcomes.
    Answer. The $9 million increase in the President's budget request 
will help improve the completeness of NSLDS data and ED's analytic 
capacity for using such data to evaluate the effectiveness of Federal 
student aid programs. In addition to improving enrollment reporting and 
monitoring persistence and completion among Federal student aid 
recipients, Federal Student Aid (FSA) is exploring the addition of new 
data fields, such as degree level and program of study, to strengthen 
implementation of laws and regulations governing student loans. With 
these proposed enhancements, ED can get a more complete and accurate 
picture of student outcomes for Federal student aid recipients, 
especially since ED's enrollment, persistence, and completion data are 
based on aggregated institution-level data collected through the 
Integrated Postsecondary Education Data System (IPEDS). The $9 million 
will also support longer term improvements to NSLDS, such as upgrades 
to system integration and data quality checks.
 uniform student complaint system for recipients of federal education 
                                benefits
    Question. The Department of Education is working in conjunction 
with other Executive Branch agencies, including the Department of 
Veterans Affairs (VA), the Department of Defense (DOD) and the Federal 
Trade Commission, to develop a uniform student complaint system for 
students receiving education benefits from the VA and DOD pursuant to 
Executive Order 13607. Please describe how the Department of Education 
intends to utilize this new infrastructure to ensure that the complaint 
system becomes available for all students attending an institution of 
higher education and not just Federal aid recipients, including how the 
Department intends to provide access comparable to that available to 
students receiving military educational benefits.
    In your response, please include answers to the following 
questions: (1) will the ability to file a complaint be noted on the 
front page of the Department Web site; (2) will the Department create a 
student-friendly portal by topic; (3) will the Department make the 
complaint system easily accessible to web-based searching; and (4) will 
all students or all title IV recipients be made aware of the complaint 
system?
    Answer. Federal Student Aid (FSA) is developing a targeted outreach 
campaign to support current and past members of our Armed Services who 
have Federal student loans. The objective of the campaign is to better 
inform service members and veterans of the many available benefits to 
help them manage their Federal student loan obligations. In addition to 
more detailed guidance from our student loan servicers when members 
call with questions, our servicers have developed a brochure outlining 
the benefits and providing tips to members of the military, contact 
information and useful resources.
    FSA will also publicize on its student facing Web site, 
StudentAid.gov, in the Announcement and Military Sections, the process 
for submitting complaints to the Department of Education regarding 
institutional issues. This will initially be targeted to veterans, 
service members and their families, followed by announcements to the 
general public. The Announcement section will provide a general 
overview of the complaint system and links to additional webpages for 
more information about how to use the system. Information and language 
regarding the complaint system should be available to the public before 
the end of fiscal year 2013.
    A specific mailbox will be designated for receipt of these 
complaints. To maintain the privacy of the complaint and the integrity 
of the information shared between recipient and FSA, complaints will 
not be accessible through a searchable Web-based feature. The 
information from ED's complaint system will be submitted to the Federal 
Trade Commission's Consumer Sentinel database, which has been 
designated as the consolidated host site for complaints received from 
all three agencies identified in the Executive order.
    Additionally, FSA's Office of Program Compliance within the 
Department of Education receives and addresses complaints from students 
to ensure compliance with the title IV regulations by postsecondary 
institutions in their administration of the title IV aid programs.
                                 ______
                                 
            Questions Submitted by Senator Mary L. Landrieu
                         charter school program
    Question. I am very supportive of the increase in funding for the 
Charter Schools Program (CSP) as detailed in the President's budget. In 
particular, I appreciate the increase for the Charter Management 
Organization (CMO) Replication and Expansion Grant. However, the 
President's budget does not allocate any new funds for SEA grants at a 
time when the majority of current funds are locked in continuation 
grants.
    For the second consecutive fiscal year (2013 and 2014), States will 
not receive Charter Schools Program grants. As you know, the SEA grant 
is critical for ensuring start-up funds for new charter schools. The 
State of Louisiana alone has received more than $71 million in funding 
for start-up grants since the start of the CSP program.
    Can the Department outline when it anticipates being able to 
conduct a new SEA grant competition?
    Answer. The Department anticipates conducting a competition for new 
Charter Schools Program grants to State educational agencies (SEAs) in 
fiscal year 2015. In fiscal year 2013, the Department will provide 
current SEA grantees with approximately $175 million, or over 72 
percent of the total Charter Schools appropriation, in continuation 
funding to support the start-up of new charter schools and anticipates 
providing another $170 million in continuations to these grantees in 
fiscal year 2014.
                    promoting evidence-based policy
    Question. As our Nation continues to deal with shrinking budgets 
and growing demand for services, the Federal Government needs to find 
ways to invest scarce Federal resources more efficiently and more 
effectively in evidence-based, results-driven solutions. I was pleased 
to see that the administration's fiscal year 2014 budget proposed that 
the Secretary of Labor set aside 1 percent of funds from all major 
Department of Labor programs for evaluations.
    While the provision in the fiscal year 2014 budget request that 
proposes that the Secretary of Education set-aside 0.5 percent of funds 
from all major Department of Education programs except the Pell grant 
program is an important step in the right direction, I believe that the 
Secretary of Education should have the same 1 percent set-aside 
authority.
    Setting aside 1 percent for rigorous, independent, third party 
evaluations would enable the Secretary of Education to: evaluate 
diverse approaches, grantees and initiatives; build the evidence base 
of which interventions are most effective and why; identify policies 
that limit opportunity for innovation and continuous improvement; and 
streamline policies or programs to allow funds to be driven towards 
those that result in the most success and the highest return on 
taxpayer investment. This evaluation provision would also provide 
Members of Congress and the administration with reliable information to 
gauge program effectiveness and to make policy and funding decisions 
based on facts.
    How is the Department working with OMB and other Federal agencies 
to develop and use a common evidence framework to inform program design 
and management across the Federal Government?
    Answer. The Department of Education has been in the vanguard of 
cross-agency efforts to develop common evidence guidelines. For 
example, over the past 2 years, ED has worked with the National Science 
Foundation (NSF) to establish shared definitions of broad categories of 
research and to clarify requirements for how potential grantees should 
build on and contribute to evidence in the field. The intent of these 
guidelines is to allow ED and NSF to build on each other's investments 
in research, thereby increasing the pace at which the field develops 
evidence about the most effective programs and strategies in education. 
The guidelines were presented in draft form in April 2013 at the 
American Educational Research Association conference and a document 
describing the guidelines in detail is expected to be released in June 
2013.
     using performance and outcome data to inform policy and drive 
                              improvement
    Question. How is the Department using evidence, data and 
information about performance and outcomes to inform policy and drive 
continuous improvement in its programs and grantee interventions?
    Answer. A key example of Department efforts to use evidence and 
information about performance and outcomes to drive continuous 
improvement was the development of new final requirements for the 
School Improvement Grants (SIG) program authorized under section 
1003(g) of the ESEA. The new SIG requirements responded to evaluation 
and other data indicating that the school improvement measures required 
by section 1116 of the ESEA, including the restructuring options 
required for chronically low-performing schools, were having little 
impact on turning around low-performing title I schools. More 
specifically, the new regulations restructured the SIG program to 
require competitive SEA awards to LEAs that agreed to use rigorous, 
research-based school intervention models that involved significant 
changes in school leadership, staffing, instruction, and school 
operations (e.g., increased learning time).
    The Department also has taken significant steps to develop 
performance measures for all of its funded programs, and placed a 
priority on developing, whenever appropriate, outcome measures that 
could be used to inform program priorities and budget decisions. 
Examples of measures for large-scale categorical programs include:
  --Trends in the percentage of economically disadvantaged students 
        grades 3-8 who score at or above proficiency on State reading 
        and math assessments to measure progress under title I of the 
        Elementary and Secondary Education Act; and
  --Trends in the percentage of students with disabilities who score at 
        or above Basic on the National Assessment of Educational 
        Progress (NAEP) to measure progress under the Individuals with 
        Disabilities Education Act (IDEA).
    Discretionary grant programs also include performance measures to 
assess progress toward meeting grant objectives and program outcomes. 
These measures are often included in required annual performance 
reports, which document the progress of individual grants. Results of 
outcome and implementation measures are used to target monitoring and 
technical assistance.
    Department programs serving students in elementary and secondary 
grades also receive support in improving the development, reporting, 
and use of performance measures to inform programmatic and budget 
decisions through the Data Quality Initiative (DQI). Most recently, as 
part of the DQI, the Office of Elementary and Secondary Education 
initiated a process to support programs in developing leading 
indicators to guide data-driven decisions in program management. The 
process will result in indicators that provide program staff with early 
measures of progress toward intended outcomes, and inform interventions 
through monitoring and technical assistance.
       focus on innovation and flexibility as well as compliance
    Question. How is the Department promoting innovation and 
flexibility and focusing on outcomes rather than simply on compliance?
    Answer. We have been working hard to shift our focus from 
emphasizing compliance with statutory and regulatory requirements to 
partnering with our grantees, particularly States and school districts, 
to support their efforts to improve outcomes for students while 
enacting ambitious reforms. Our work with States under Race to the Top 
and ESEA Flexibility demonstrates the great innovation that can 
flourish under these partnerships.
    In particular, under ESEA flexibility, the Department has provided 
States with freedom from inflexible statutory requirements related to 
the determination of adequate yearly progress and the provision of 
supplemental educational services and public school choice options in 
exchange for State-led efforts to create more nuanced accountability 
systems based on multiple measures of student and school performance. 
These new accountability systems allow States and LEAs to escape the 
one-size-fits-all rigidity of current law and to design their own 
improvement strategies that target limited resources on the lowest 
performing schools with the greatest need for assistance, including 
those schools with the largest achievement gaps, while still ensuring 
that all schools address subgroup performance challenges.
    Department staff also have designed our monitoring process for ESEA 
flexibility to move beyond a focus only on compliance and toward more 
effective support for a State's implementation of ESEA flexibility and 
the State-level systems and processes needed to support that 
implementation. This procedure is intended to make sure that States are 
maximizing the impact of their new systems and are making progress 
toward ultimately increasing student achievement and improving the 
quality of instruction for all students. Monitoring will be 
differentiated and customized for each State based on the State's 
specific plans, and information from monitoring will then be used to 
inform the selection and delivery of technical assistance to States to 
support continuous improvement.
              designing programs to build an evidence-base
    Question. How is the Department building an evidence-base for what 
works to achieve important outcomes by designing programs and granting 
funds with that as an explicit goal?
    Answer. The Department's primary vehicle for building evidence is 
the Institute of Education Sciences (IES) research grant program, 
supplemented by model grant programs throughout the Department that 
encourage both the development of new approaches and rigorous testing 
of fully developed programs or strategies and rigorous evaluations that 
provide information on effective practice.
  --IES Research Grant Program.--For a decade, IES has provided grant 
        support for different types of research to improve student 
        outcomes. This research ranges from development of innovative 
        approaches in education, to wide-scale testing of strategies 
        that show evidence of promise. IES has been recognized for its 
        clear explanations to applicants about the types of empirical 
        and theoretical justifications required to earn consideration 
        for a research grant.
  --Model Grant Programs.--A key example of a grant program designed to 
        build evidence is the 2010 Investing in Innovation (i3) 
        competition, which clearly defined three categories of grants 
        broadly corresponding to an evidence pipeline. ``Development 
        grants'' support the creation of new approaches; ``Validation 
        grants'' involve smaller scale testing of approaches with 
        initial evidence of promise; and ``Scale-up grants'' require 
        wide-scale testing of approaches with substantial evidence of 
        impact at a small scale. Each of these three categories 
        included entrance criteria (evidence requirements for obtaining 
        a grant) and exit criteria (the expected scale and rigor of the 
        evaluations conducted as part of the grant).The i3 program 
        described not only provided clarity about how each type of 
        research contributes to the evidence base about what works in 
        education but also linked the most substantial funding amounts 
        to projects with greater evidence of promise. Validation 
        grants, for example, could be funded at up to $30 million over 
        5 years, while scale-up grants could receive up to $50 million. 
        This differential reflects the costlier work of validating an 
        approach on a wide scale. The three categories of studies also 
        ensured that the Department supported development of new ideas 
        as well as testing those with greater evidence. The success of 
        the i3 approach has encouraged the Department to modify its 
        standard rules for grant making (EDGAR--Education Department 
        General Administrative Regulations) to allow other grant 
        competitions to employ a similar tiered-evidence approach. 
        During fiscal year 2013, a number of other grant competitions 
        are using evidence as a competitive or absolute priority.
  --Evaluation and Related Activities.--The Department's evaluations 
        are designed to provide information on implementation and 
        impact of agency programs, providing information to improve 
        practice, to recommend changes in program implementation, and 
        to inform program reauthorization. A key goal is to provide 
        both practitioners and policymakers with actionable 
        information. In addition, the Department's What Works 
        Clearinghouse (WWC) serves as an independent, credible reviewer 
        of research studies. In the context of tiered-evidence grant 
        making, it provides the infrastructure for efficient review of 
        studies put forward by prospective grantees in support of their 
        applications. The What Works Clearinghouse standards are public 
        and widely distributed, and the Department regularly conducts 
        training for researchers in the use of WWC standards to review 
        studies. These trainings create a cadre of independent 
        researchers who are able to carry out the reviews or to help 
        prospective grantees determine whether there is strong evidence 
        in support of their application.
        investment in and evaluation of effective interventions
    Question. How is the Department increasingly targeting investments 
in interventions with the strongest evidence of effectiveness, as well 
as supporting the development and rigorous evaluation of promising, 
innovative interventions?
    Answer. The Department is encouraging the use, where appropriate, 
of the Secretary's supplemental priorities that are designed to build 
evidence of effectiveness (Priority #14) or to support programs, 
practices, or strategies for which there is strong or moderate evidence 
of effectiveness in competitive grant programs (Priority #15). In 2013, 
programs using these priorities include:
  --The Higher Education Strengthening Institutions Program (SIP), 
        which helps eligible institutions of higher education become 
        self-sufficient and expand their capacity to serve low-income 
        students by providing funds to improve and strengthen the 
        academic quality, institutional management, and fiscal 
        stability of eligible institutions, will use Priority #14 as a 
        competitive preference priority, awarding up to 5 points to 
        applicants that successfully address the priority.
  --The 2013 Arts in Education Model Development & Dissemination 
        competition, which will provide grants to support the 
        enhancement, expansion, documentation, evaluation, and 
        dissemination of innovative, cohesive models that are based on 
        research, will award up to 10 points to applicants that address 
        Priority #14 and up to 10 points to applicants that address 
        Priority #15.
  --Through the Supporting Effective Educator Development (SEED) Grant 
        Program, the Department will award grants to national non-
        profit organizations for projects that support teacher or 
        principal training or professional enhancement activities and 
        are supported by at least moderate evidence of effectiveness. 
        In addition, the Department will award up to 5 points to 
        applicants that propose projects that are supported by strong 
        evidence of effectiveness.
            promoting and investing in community-wide change
    Question. How is the Department seeking opportunities to promote 
and invest in systems and communities that are collaborating to achieve 
significant community-wide impact or change at scale?
    Answer. The Department is committed to supporting programs that 
achieve wide-spread impact. For example, the Promise Neighborhoods 
Program, which supports 1-year planning grants and implementation 
grants lasting for up to 5 years, seeks to significantly improve the 
educational and developmental outcomes of children and youth in our 
most distressed communities. Implementation grantees use grant funds to 
develop the administrative capacity necessary to successfully implement 
a continuum of solutions, such as through managing partnerships, 
integrating multiple funding sources, and supporting longitudinal data 
systems. What these grantees do and learn will provide us with 
information on how the Department can achieve community-wide impact or 
change at scale.
    As part of the fiscal year 2014 budget request, the Department 
would expand the contribution of Promise Neighborhoods to Promise 
Zones, which would address the needs of high-poverty communities by 
creating jobs, attracting private investment, increasing economic 
activity, expanding educational opportunity, and reducing violent 
crime. Agencies, including the Department of Education, would provide 
assistance to these communities to help them break down regulatory 
barriers and use existing Federal funds in a more coordinated and 
effective way. Promise Zones would align the work of multiple Federal 
programs in communities that have both substantial needs and a strong 
plan to address those needs.
    elementary and secondary education act authority for funding of 
                              evaluations
    Question. The No Child Left Behind Act (NCLB) currently authorizes 
the U.S. Secretary of Education to reserve up to 0.5 percent of 
Elementary and Secondary Education Act (ESEA) program funds for 
evaluations (except title I, title III, and other ESEA programs with 
their own evaluation set-asides). Has the Secretary ever used this 
authority--if not, why not? And, if the Secretary has used this 
authority, how many funds, by program, have been set-aside for 
evaluations under this authority each year?
    Answer. The Department has funded evaluations of ESEA programs 
under the general ESEA evaluation authority, ESEA IX-F section 9601. 
For example, under title II of ESEA, Improving Teacher Quality State 
Grants, the Department has most recently funded and completed studies 
on different models of pre-service training, promising approaches to 
in-service training, and induction programs as a means to identify 
promising teacher retention strategies. Improving Teacher Quality State 
Grants is a large program, and under the broad ESEA evaluation 
authority, used over $12 million for title II evaluation activities in 
2012.
    For small programs, however, the 0.5 percent set-aside does not 
provide sufficient funding for rigorous evaluation, and because current 
law does not permit pooling funds across programs, it has been 
difficult to use the authority to evaluate smaller programs that have 
only small amounts of funding available for evaluations. Therefore, the 
administration has proposed a reauthorization strategy that would allow 
the Department to pool funds for evaluation, to include up to 0.5 
percent of the funds appropriated for title I and up to 1.5 percent of 
funds appropriated for all other ESEA programs. Each year the 
Department would determine which programs to evaluate, based on many 
factors, including the need for information and the status of the 
available research and data.
    The table below shows the amounts used or planned for evaluation in 
2012 and 2013 under the general authority.

FUNDED PROGRAMS THAT USED ESEA IX-F SECTION 9601 EVALUATION AUTHORITY IN
      2012 OR 2013, AND THE AMOUNTS USED OR PLANNED FOR EVALUATION
                             [Whole dollars]
------------------------------------------------------------------------
                                                            Fiscal year
           Account and program              Fiscal year        2013
                                               2012         (estimated)
------------------------------------------------------------------------
Innovation and Improvement:
    Transition to teaching..............         130,268         130,268
Safe Schools and Citizenship Education:
    Physical education..................         393,464         122,326
School Improvement Programs:
    Improving teacher quality State           12,324,380      11,689,150
     grants.............................
    Mathematics and science partnerships         875,635         748,583
    Rural education.....................         895,769  ..............
------------------------------------------------------------------------

   departmental administrative responsibility for program evaluations
    Question. The U.S. Department of Labor has a Chief Evaluation 
Officer who oversees all of their program evaluations. Can you explain 
who in your Department has this responsibility, and, if this 
responsibility is divided between multiple staff members at the 
Department, please describe how this work is divided between them.
    Answer. Responsibility for carrying out the Department of 
Education's evaluation activities rests primarily with the Institute of 
Education Sciences (IES). The Education Sciences Reform Act of 2002 
established IES as an independent entity within the Department of 
Education. In this legislation, IES was granted publication authority, 
which allows it to release reports free of departmental clearance 
requirements. Within IES, the National Center for Education Evaluation 
and Regional Assistance (NCEE) is responsible for carrying out both 
impact and implementation evaluations. IES conducts the Department's 
impact evaluations and long-term implementation evaluations, with its 
work supported by evaluation set-asides in program funding as well as 
dedicated funding for evaluation. The Policy and Program Studies 
Service (PPSS) in the Department's Office of Planning, Evaluation, and 
Policy Development (OPEPD) is responsible for conducting short-term 
program implementation studies.
    Evaluations are coordinated through an evidence planning team 
comprised of staff from OPEPD, IES/NCEE, and the Office of Innovation 
and Improvement. The team works with key staff throughout the 
Department to identify high priority questions and needs for 
information, ensure that evidence-building activities are responsive to 
needs, and avoid duplication.
    NCEE participates in an annual evaluation planning process that is 
led by OPEPD. Through this annual process, program offices work with 
the evidence planning leadership team, including NCEE, to identify 
evaluation priorities and opportunities and make decisions about which 
evaluations will move forward in the coming year.
                program-specific evaluation authorities
    Question. Can you outline which Department of Education programs 
currently have their own authorizations allowing or requiring set-
asides of program funds for evaluations, and, how much of these funds, 
by program, were spent on evaluations in fiscal year 2012 and are 
expected to be spent in fiscal year 2013 and fiscal year 2014?
    Answer. The following table provides information on which programs 
in the Career, Technical, and Adult Education; Education for the 
Disadvantaged; English Language Acquisition; Higher Education; Indian 
Education; Innovation and Improvement; Rehabilitation Services and 
Disability Research; Safe Schools and Citizenship Education; School 
Improvement; and Special Education accounts are authorized to use 
program funds for evaluation, and the amount of money the Department 
obligated in 2012 and plans to obligate in 2013 for evaluation. In 
addition, the Institute of Education Sciences account receives funding 
for evaluation in the Special Education Studies and Evaluations and 
Research, Development, and Dissemination programs. The Department is 
refining its plans for evaluations in 2014 and anticipates having 
updated information available later in the summer.

  PROGRAMS FUNDED IN FISCAL YEAR 2012 OR 2013 THAT CONTAIN SPECIFIC AUTHORITY TO USE FUNDS FOR EVALUATION, AND
                     AMOUNTS USED FOR EVALUATION IN 2012 AND PLANNED FOR EVALUATION IN 2013
----------------------------------------------------------------------------------------------------------------
                                                                                                    Fiscal year
              Account and program                     Evaluation authority          Fiscal year        2013
                                                                                       2012         (estimated)
----------------------------------------------------------------------------------------------------------------
Career, Technical, and Adult Education:
    Adult Education: National leadership        WIA II-A Sec. 243 and
     activities.                                 Appropriations Language.
    Career and Technical Education: National    Sec. 114 of the Carl D. Perkins   ..............        $286,940
     programs.                                   Career and Technical Education
                                                 Improvement Act of 2006.
Education for the Disadvantaged:
    High School Graduation Initiative.........  ESEA I-H sec. 1830 and 1811.....        $500,000  ..............
    School Improvement Grants National          Appropriations language.........  ..............         656,402
     Activities.
    Striving Readers..........................  ESEA I-E sec. 1502..............  ..............  ..............
    Title I Evaluation........................  ESEA I-E........................       3,193,952       3,026,889
    Title I Neglected and delinquent..........  ESEA I-D sec. 1419..............  ..............  ..............
English Language Acquisition:
    English Language Acquisition..............  ESEA III sec. 3111..............         610,991       1,700,000
Higher Education:
    Federal TRIO programs.....................  HEA 402H........................  ..............       2,000,000
    Gaining early awareness and readiness for   HEA 404G........................       1,494,378       1,421,541
     undergraduate programs (GEARUP).
    GPRA data/HEA program evaluation..........  Appropriations language.........         606,851         575,109
    International education and foreign         HEA section 635.................         199,199           6,500
     language studies: Domestic programs.
    International education and foreign         Appropriations language.........          39,711           6,000
     language studies: Overseas programs.
Indian Education:
    Indian Education national activities......  ESEA VII sec. 7131..............  ..............  ..............
Innovation and Improvement:
    Arts in education.........................  ESEA V-D sec. 5551..............  ..............  ..............
    Charter schools grants....................  ESEA V-B-I sec. 5205(a) and              106,208  ..............
                                                 Appropriations language.
    FIE programs of national signifi- cance...  ESEA V-D sec. 5411..............  ..............  ..............
    Investing in innovation...................  Appropriations language.........       3,600,000       4,500,000
    Magnet schools assistance.................  ESEA V-C sec. 5310..............         243,792  ..............
    Race to the Top...........................  Appropriations language.........       5,723,251         826,435
    Teacher incentive fund....................  ESEA V-D and Appropriations            2,000,000       4,500,000
                                                 language.
Rehabilitation Services and Disability
 Research:
    Independent living centers................  Rehabilitation Act 722(a) and     ..............  ..............
                                                 723(a).
    National Institute on Disability and        RA II, section 200..............       1,562,771         348,667
     Rehabilitation Research.
    Vocational rehabilitation demonstration     RA section 303..................  ..............  ..............
     and training programs.
Safe Schools and Citizenship Education:
    Elementary and secondary school counseling  ESEA V-D sec. 5421..............  ..............  ..............
    Promise Neighborhoods.....................  ESEA I-D sec. 5411..............          25,000  ..............
    SDFSC National activities.................  ESEA sections 4121 and 4122.....  ..............  ..............
School Improvement Programs:
    21st century community learning centers...  ESEA IV-B sec. 4202(a)(2).......       2,117,771       1,000,000
    Comprehensive centers.....................  ETAA II, sec. 204...............  ..............       1,600,000
    Education for homeless children and youths  MVHAA Title VII-B sec. 724......  ..............  ..............
Special Education:
    Special Education Parent information        IDEA section 682................  ..............  ..............
     centers.
    Special education personnel preparation...  IDEA section 682................  ..............  ..............
    Special education technical assistance and  IDEA section 682................  ..............  ..............
     dissemination.
    Special education technology and media      IDEA section 682................  ..............  ..............
     services.
----------------------------------------------------------------------------------------------------------------
NOTE: Amounts shown are the amounts obligated in each fiscal year and for programs with multi-year funding may
  not be from the appropriation for that fiscal year.

                     education program evaluations
    Question. How long do Department of Education program evaluations 
take on average, and what is the average cost of these evaluations?
    Answer. The purpose and design of Department of Education program 
evaluations largely determines their time to completion and cost. In 
general, the Department conducts three types of evaluations: impact 
evaluations and long-term implementation evaluations, which are 
overseen by the National Center for Education Evaluation and Regional 
Assistance (NCEE) in the Institute of Education Sciences (IES), and 
short-term program implementation studies, which are overseen by the 
Policy and Program Studies Service (PPSS) in the Office of Planning, 
Evaluation, and Policy Development (OPEPD).
  --Impact and implementation evaluations at NCEE, on average, are 
        fully completed in 5 years from the time of contract award, 
        although in some cases the contract may need to be extended to 
        allow completion of the final report. The minimum time for an 
        evaluation that includes data collection, analysis, and report 
        preparation and scholarly peer review is approximately 3.5 
        years. The average cost of the seven evaluation contracts 
        awarded in fiscal year 2011 and fiscal year 2012 was 
        $10,860,248, with a range of $6 million to $18 million. Each 
        study typically produces several reports, including interim and 
        final reports of effectiveness as well as implementation 
        reports. The time and cost of completing an evaluation at IES 
        depends primarily on the number and scope of data collections, 
        with the most expensive components being classroom observations 
        and administration of student achievement assessments.
  --PPSS oversees short-term program implementation and analytic 
        studies. The 12 implementation studies and analyses of program 
        practices awarded in the past 3 years averaged 2 years to 
        complete, at an average cost of $671,000.
            administration of education program evaluations
    Question. Are these evaluations conducted by external evaluators or 
by Department staff?
    Answer. Evaluations typically are conducted by research firms 
operating under contract to the Department. Competitions are conducted 
separately for each evaluation study, with contractors selected on the 
basis of technical skill and content expertise, and cost. As a result, 
the Department has developed a strong track record of using the best 
firms and most skilled contract researchers in the field to conduct its 
evaluations. In addition, the Department is building the analytical 
capability of its own staff to analyze extant data to inform program 
management.
                                 ______
                                 
            Question Submitted by Senator Richard J. Durbin
     heavily impacted aid status--north chicago school district 187
    Question. The North Chicago School District, located near the Great 
Lakes Naval Training Center, educates children in military-connected 
families and civilian families on the community. Given the presence of 
the Navy and the lack of a strong economic base, North Chicago has had 
heavily impacted aid status for decades.
    In 2005, a base housing project was initiated that would move some 
families out of North Chicago, thereby decreasing the number of 
military-connected students in the district.
    In a 2005 letter, the Department of Education informed us that the 
North Chicago School District would continue to receive heavily 
impacted aid payments until the housing privatization project is 
complete and that heavily impacted aid payments are based on data from 
3 years preceding the payments. Therefore, North Chicago would expect 
to continue receiving payments for 3 years after the housing 
privatization project is complete or has ended.
    Can the administration confirm that the North Chicago School 
District will continue to receive heavily impacted aid payments for 3 
years following the United States Navy officially notifying the 
Department of Education that the housing privatization project is 
complete?
    Answer. Under current law and assuming that the North Chicago 
School District continues to meet all other program eligibility 
requirements, if the district has a qualifying military housing project 
underway or pending (as is currently the case with North Chicago), the 
district is treated as though it continues to meet the eligibility 
requirements and it receives heavily impacted payments until the 
project is completed. Payments for districts with pending or completed 
projects are subject to the heavily impacted 3-year data provisions. 
Thus, for example, if the project completes in 2014, they could expect 
to receive payments for 2014, 2015, and 2016.
    Because the status of the qualifying military housing project is 
still pending, the Department will continue to evaluate the situation 
annually and rely upon senior Navy officials to provide status updates 
on this unfunded project.
    In the rare case where a pending housing project is terminated 
before completion, we believe that a district's eligibility status 
would immediately cease because the district would no longer have 
eligible military housing units undergoing conversion, as required by 
section 8003(b)(2)(H). Current law still provides for a district to 
receive a hold-harmless payment in the year that ineligibility may 
occur.
                                 ______
                                 
              Questions Submitted by Senator Mark L. Pryor
             mc nair postbaccalaureate achievement program
    Question. As you know, the McNair Postbaccalaureate Achievement 
Program awards funding to institutions of higher education to help 
prepare disadvantaged students for post-graduate studies up to and 
including a Ph.D. Arkansas State University (ASU) has participated in 
the McNair Program. While ASU received funding from fiscal years 2003 
to 2007, and again from 2009 to 2013, they have learned that the 
funding will not be extended. ASU's McNair Program has played a pivotal 
role in opening up the world of higher education to previously 
underserved students in one of the most economically challenged areas 
of the country--the Arkansas Delta. ASU has a demonstrated commitment 
to utilizing its location and serving first-generation students. Will 
you work with ASU to build on its accomplishments and explore options 
to establish a consistent, long-term McNair program?
    Answer. Under the McNair Program, the Department awards grants on a 
competitive basis. The Department conducted a competition for new 
McNair awards in fiscal year 2012. ASU submitted an application in that 
competition and it was evaluated and scored by non-Federal reviewers. 
However, ASU's application did not score high enough in the competition 
to be funded. In September 2012, ASU received its final non-competitive 
continuation award from the grant the Department initially awarded to 
ASU in fiscal year 2009 and is currently implementing the final year of 
the project.
         poor and rural school districts and competitive grants
    Question. You testified that about 84 percent of the Department of 
Education's funding allocation remains formula based. However, a number 
of my constituents express concern that they do not have the ability or 
the resources necessary to effectively compete for the remaining 16 
percent of funding in competitive grants. Does the fiscal year 2014 
budget take into account the unique challenges poor and rural school 
districts face when they apply for competitive grants?
    Answer. The administration recognizes that more than half of all 
school districts and about one-third of all public schools are located 
in rural areas, many of which have unique needs and face unique 
challenges. We have worked hard to ensure that such districts and 
schools have a fair opportunity to compete for Federal education funds 
in past years and will continue to do so in fiscal year 2014.
    Under the Race to the Top--District competition, for example, the 
Department has included an absolute priority for rural districts to 
help ensure that students from all locales and of all sizes are served 
by the program. We also allowed consortia of districts to apply, which 
was helpful to rural districts, since they often have difficulty 
competing on their own. Nearly half of the districts that won Race to 
the Top--District funds are rural. In the Early Learning Challenge 
competitions, we awarded grants to many States with large rural 
populations, such as Tennessee, Georgia, North Carolina, Minnesota, 
Ohio, Kentucky, and Louisiana.
    Under the Promise Neighborhoods program, we established an absolute 
priority for applicants that propose to serve at least one rural 
community. The Investing in Innovation (i3) competition also has an 
absolute priority that focuses on students in rural communities. As a 
result, rural entities have been well represented among the grantees in 
both of these programs.
    Rural schools have been well represented under the School 
Improvement Grants (SIG) competition as well. In fiscal year 2009, 
rural schools constituted 20 percent of SIG-eligible schools, but were 
more than 23 percent of the schools that received awards. In fiscal 
year 2010, 17.5 percent of SIG-eligible schools were rural while 19 
percent of SIG awards went to rural schools.
    Finally, the Department continues to provide technical assistance 
to and work with potential applicants, including rural districts and 
States that have large numbers and proportions of rural districts. Many 
ED programs provide technical assistance workshops and webinars 
specific to their grant competitions, including efforts targeted to 
rural districts and communities. We also encourage rural districts to 
form consortia and partnerships to increase their capacity and work 
with education service agencies, colleges, and universities, and we 
have engaged the philanthropic and nonprofit communities in an effort 
to better support high-need rural schools. These efforts can help 
applicants serving rural areas compensate for capacity issues, making 
them more competitive applicants.
                  promise neighborhood planning grants
    Question. During your testimony, you mentioned the administration's 
continued commitment to the Promise Neighborhood program. In fiscal 
year 2010, the University of Arkansas at Little Rock (UALR) was one of 
21 communities to receive a Promise Neighborhood planning grant. As you 
know, UALR was not awarded an implementation grant in fiscal year 2011. 
The President's fiscal year 2014 budget proposes to increase funding 
for the Promise Neighborhood program to $300 million from $60 million 
in fiscal year 2012. What portion of the increased funding would be 
used to award planning grants versus implementation grants?
    Answer. In fiscal year 2014, we have proposed to award an estimated 
$209 million to fund new implementation grants and an estimated $15 
million to fund additional planning grants. Funds totaling $61 million 
would also support continuation awards for the 12 implementation grants 
made in fiscal year 2011 and fiscal year 2012.
               promise neighborhood implementation grants
    Question. When evaluating applicants for implementation grants, 
does the fiscal year 2014 budget prioritize applicants whose programs 
focus on students of a particular age?
    Answer. The fiscal year 2014 request for the Promise Neighborhoods 
program does not include a requirement that applicants focus on 
students or community members of any particular age. The program is 
designed such that applicants must build a continuum of solutions for 
community members from cradle through college and to career. However, 
because we know how important it is to address the educational and 
developmental needs of children when they are young, we require 
applicants to indicate how they propose to include high-quality early 
learning programs and services for children from birth through third 
grade. In addition, in the fiscal year 2011 and fiscal year 2012 
competitions, the Department has awarded additional points (up to two) 
for applicants that propose to expand, enhance, or modify an existing 
network of early learning programs and services to ensure they are 
high-quality and comprehensive for children from birth through third 
grade.
                                 ______
                                 
         Questions Submitted by Chairwoman Barbara A. Mikulski
          mitigating the impact of the sequester on education
    Question. There are many concerns regarding the impact of sequester 
on education. The State of Maryland alone has over 842,000 students. 
While Maryland has received funding for the support of low-income 
families and the needs of students with disabilities, sequester will 
cause irreparable harm towards education. Furthermore, these cuts will 
lead to less funding for schools, fewer students being served, and a 
loss of teachers, aides, and staff.
    I recall the warning you gave before my Appropriations Committee 
regarding the negative impact of sequester and I understand the 
importance of Congress and the administration needing to work together 
to replace sequester. However, while sequester remains in effect, 
Maryland's school administrators are trying to limit its damage. Can 
you tell us what your Department is doing to mitigate the harmful 
impact of sequester?
    Answer. The Department believes the indiscriminate cuts of the 
sequester will have an adverse impact on the ability of States and 
school districts to provide essential support and services to high-need 
students and schools. The sequester eliminated more than $1.3 billion 
for the title I, part A and special education grants to States 
programs, resulting in a reduction of more than $20 million in funding 
that helps the State of Maryland meet the needs of students with 
disabilities and students from disadvantaged backgrounds.
    The Department has proactively reached out to States and school 
administrators across the country, so they can plan ahead to minimize 
the negative impact of these cuts. We know, however, that it will be 
difficult for States to make up for lost Federal education dollars, 
particularly since these cuts come at a time when State and local 
education funding levels have not recovered from the economic 
recession. A 2012 report by the Center on Budget and Policy Priorities 
found that in the 2012-2013 school year, 35 States spent less on 
education than in 2008. With so many districts still reeling from the 
impact of the economic recession, it is unlikely that they will be able 
to weather these cuts without directly affecting the staff and services 
for vulnerable students. The Department will continue to work with 
States and districts to provide flexibility and support authorized 
under law; however, unless Congress reverses these cuts, students will 
be negatively affected.
  support for gifted and talented children--center for talented youth
    Question. I am troubled by the considerable lack of support for 
gifted and talented students in the President's fiscal year 2014 budget 
request. The only Federal program that supported these students has 
been the Jacob Javits Gifted and Talented Education Program. This 
program provides grants to States to help modify identification of 
gifted and talented students and prepare teachers. Unfortunately, it 
has not been funded since 2010.
    While there is still a perception that gifted children are rich, 
that is simply not the case. Gifted and talented kids can be found in 
all walks of life. I know that you are familiar with programs that 
promote the advancement of these gifted and talented students, such as 
the Center for Talented Youth. Too often, these children are 
overlooked. What does the administration's budget proposal do for this 
population of students; more specifically, how can the Federal 
Government support programs like the Center for Talented Youth?
    Answer. The President and I believe that we must improve 
educational opportunities for students across the performance spectrum, 
including those performing at advanced levels. Our fiscal year 2014 
budget request includes $102.2 million for the proposed College 
Pathways and Accelerated Learning program, which would replace the 
Javits Gifted and Talented Education program and other programs under 
current law with a single, more flexible program that supports efforts 
to increase preparation for college matriculation and success by 
providing college-level and other accelerated courses and instruction 
in high-poverty secondary schools. Gifted and talented students would 
be an important target population for this program because they are 
likely to need an advanced or accelerated curriculum in order to 
progress academically consistent with their abilities. Further, the 
program would support accelerated achievement projects, such as those 
of the Center for Talented Youth, which target students who are 
traditionally underrepresented in gifted and talented education.
    Gifted and talented students would also benefit from States' new 
assessment and accountability systems, which under the administration's 
proposal to reauthorize the Elementary and Secondary Education Act 
would measure and encourage growth beyond proficiency. In addition, 
activities to strengthen the education of gifted and talented students 
could be funded through the proposed Effective Teachers and Leaders 
program, which would provide funds for professional development for 
teachers and school leaders, particularly in high-need or low-
performing schools.
                 integrated services--wrap around model
    Question. There is a need to prioritize wrap-around services with 
regards to schools. Wrap-around services are those services provided to 
children and their family members to meet their health, nutrition, and 
education needs. By providing these essential services to children and 
their families, schools serve as the center of the community and become 
a community investment.
    One example of this community investment is the Promise 
Neighborhoods program. This program works to combat the effects of 
poverty, improving education and life outcomes for children, and 
consistently provides the aforementioned services from cradle to 
career. That being said, can you tell us what the administration's 
budget proposal does for Promise Neighborhoods; more specifically, how 
can the Federal Government support programs like this?
    Answer. The administration's fiscal year 2014 request would expand 
the program to reach the many communities that have submitted high-
quality applications for Promise Neighborhoods funding but have not 
received funding due to the limited amount of available funds. Over a 
3-year period, the Department has been able to fund only 46 planning 
grants and 12 implementation grants. The almost 40 communities that 
have received planning grants, but not implementation grants, represent 
a pool of potential high-quality candidates for implementation awards 
in fiscal year 2014, along with other communities that are well 
positioned to apply. The fiscal year 2014 request would allow the 
Department to make an estimated 35 new implementation grants as well as 
30 additional planning grants. In addition, the request would expand 
the contribution of the Promise Neighborhoods program to the 
President's Promise Zones, a key strategy in the administration's new 
Ladders of Opportunity initiative. Communities would compete to earn a 
Promise Zone designation by identifying a set of positive outcomes for 
their proposed Zone and its residents, developing an evidence-based 
strategy and implementation plan, encouraging private investment, and 
realigning Federal, State, local, and tribal resources to achieve those 
outcomes.
                                 ______
                                 
             Questions Submitted by Senator Jeanne Shaheen
                          stem reorganization
    Question. Data shows that the jobs of the future will be in the 
STEM fields. And as we all know, our country's economic competitiveness 
and national security relies on being a global leader in science and 
technology. In New Hampshire alone, it is projected that we will need 
to fill 43,000 STEM-related jobs by 2018.
    I have long supported STEM education, particularly nontraditional 
STEM teaching activities, like those that are promoted by FIRST 
Robotics in New Hampshire. I am concerned that the United States 
education system is not keeping pace to produce the workers to keep up 
with demand. Further, I am concerned that a gender gap exists within 
the STEM fields which must be addressed. Currently women comprise 48 
percent of the U.S. workforce, but just 24 percent of the STEM 
workforce.
    The budget proposes to realign and reorganize a number of Federal 
STEM education programs, moving them to the Department of Education, 
National Science Foundation and the Smithsonian. Some of the programs 
that have been marked for consolidation, such as those funded at NASA, 
support efforts like FIRST Robotics that inspire an interest in STEM 
fields in a way that is impossible during the school day.
    I'm concerned about this proposal and what it would do to that 
program, which helps thousands of young people discover a passion for 
STEM every year. How will the Department of Education ensure that 
effective STEM out-of-school time programs will be continued under the 
consolidation program?
    Answer. Thank you for your support for STEM education. I agree that 
promoting STEM education beyond the classroom is key to improving 
student engagement and achievement in STEM fields. Our STEM Innovation 
Networks proposal would provide continued support for meaningful 
informal and out-of-school experiences (such as FIRST Robotics 
competitions) alongside efforts to put more effective teachers in STEM 
classrooms and accelerate adoption of effective STEM instructional 
practices in elementary and secondary schools. In addition, we are 
exploring ways to work with our Federal agency partners to promote 
engaging out-of-school experiences in STEM through the 21st Century 
Community Learning Centers program, which supports the establishment 
and expansion of centers that provide before- and after-school learning 
opportunities as well as summer programs to students attending schools 
with concentrations of students from low-income families.
                          competitive funding
    Question. I applaud you for your strong commitment to education in 
this budget. Like you, I believe that in this difficult budget climate, 
such investments are critical to prepare students for careers in the 
21st century economy. Your focus on quality education for all ages--
from pre-school to higher education--is also laudable.
    As a former Governor, I understand the importance of Federal 
investment in education at the State level. As I speak to educators in 
New Hampshire, they are concerned about your administration's shift to 
competitively awarded grants. While this budget does contain a number 
of important formula funded priorities, a number of your new 
initiatives, including the Race to the Top: College Affordability and 
Completion program, are competitive grants.
    With the continuation of the competitive grants, what protections 
and assistance is the Department going to provide for small, rural 
States like New Hampshire, so that they can be competitive in receiving 
these grants?
    Answer. We recognize that our emphasis on competitive grants to 
spur States and districts to improve their current approaches to 
education requires a special effort to ensure that all States and 
school districts, including rural States and districts, have a fair 
opportunity to compete for these grants. We have worked hard to provide 
needed technical assistance and guidance to applicants for competitive 
grants, and to create priorities in our competitions to help level the 
playing field for rural States and districts. And we think these 
efforts are paying off, as evidenced by the success of rural applicants 
as well as applicants serving significant numbers of rural students. 
For example, in the State Race to the Top and Early Learning Challenge 
competitions, we awarded grants to many States with large rural 
populations, such as Tennessee, Georgia, North Carolina, Minnesota, 
Ohio, Kentucky, and Louisiana. Nearly half of the districts that 
received funds under the Race to the Top District program are rural, 
and rural districts and schools have been very successful in the School 
Improvement Grants program, with rural schools representing 23 percent 
of SIG-awarded schools despite constituting just 20 percent of SIG-
eligible schools.
    I also would note that the size of a State does not necessarily 
constitute a barrier to success in competitive programs like Race to 
the Top. Delaware was one of the first two States receiving a Race to 
the Top award; Rhode Island also won a Race to the Top grant, and both 
of these small States have been successful in the Race to the Top: 
Early Learning Challenge competition. So we truly believe that all 
States and districts can be successful in competitive grant programs 
and, more importantly, in demonstrating the bold leadership needed to 
improve our education system for all Americans, no matter where they 
live. I know that your State of New Hampshire is showing exactly this 
kind of leadership in developing its ESEA Flexibility request, and I am 
confident that States like New Hampshire also will be able to win their 
fair share of awards under our competitive grant proposals.
               college pathways and accelerated learning
    Question. For almost 15 years, the Community College System of New 
Hampshire has been operating the Running Start program, a partnership 
between the State's community and colleges and high schools that allow 
high school students the opportunity to take courses at the college 
level. The program has met with incredible success in the State, and 
students have been able to seamlessly transfer credits earned to many 
4-year colleges and excel in the career of their choice.
    I am particularly intrigued by your $102 million request for the 
College Pathways and Accelerated Learning program. I would welcome the 
opportunity to work with you on that initiative and wonder if you can 
comment on your vision for the new program, and how you see it being 
implemented across the country.
    Answer. Thank you for your support for our proposed College 
Pathways and Accelerated Learning program. The President and I believe 
that we must redouble our efforts to improve the educational 
experiences and outcomes of students in our high-poverty secondary 
schools so that these students are truly prepared for college and 
careers. Our College Pathways and Accelerated Learning proposal is 
designed to help achieve that goal while responding flexibly to locally 
determined needs and would support, among other things, the expansion 
of: (1) accelerated learning options such as Advanced Placement and 
International Baccalaureate courses; (2) dual-enrollment programs, like 
New Hampshire's Running Start program, that allow students to take 
college-level courses (including courses in career and technical 
education) and earn college credit while in high school; and (3) 
``early college high schools'' that allow students to earn a high 
school degree and an associate's degree or 2 years of college credit 
simultaneously.
    Research suggests that making such accelerated learning 
opportunities more widely available to our underserved students holds 
promise. Regarding dual-enrollment programs, a Department-funded 2007 
report by the Community College Research Center found that participants 
had more positive outcomes on a range of short- and long-term measures 
than did similar non-participants. Moreover, students from groups 
underrepresented in higher education, such as males and those from low-
income families, appeared to benefit from dual-enrollment participation 
to a greater degree than other participants. And besides introducing 
``college culture'' to secondary school students whose parents 
generally did not receive a college degree, dual-enrollment programs 
allow students from low-income families to reduce education costs by 
avoiding remedial courses and graduating from college early or on time.
    As you know, the administration's fiscal year 2014 budget request 
also includes $300 million for a new High School Redesign initiative. 
This initiative calls on local educational agencies to dramatically 
overhaul the high school experience and provide more rigorous and 
relevant education that prepares students for the demands of careers in 
today's globally competitive economy. Under this initiative, the 
Department will seek to promote models of high school redesign that 
ensure students graduate from high school with both college credit and 
career-related experiences or competencies, including through 
partnerships with community colleges and other institutions of higher 
education. I look forward to your support for this exciting new 
proposal as well.
    We would be interested in learning more about the Running Start 
program and in sharing ideas for ways to help ensure that students from 
low-income families have the opportunity for accelerated learning that 
puts them on a path to college and careers.
                       school leadership program
    Question. There are many factors that go into creating a successful 
school. An effective principal can help to create a positive climate 
for educating students, cultivate leadership in others and help shape a 
vision of academic success for all students. Your budget proposal calls 
for more than tripling the Federal investment in training principals.
    How will your new School Leadership Program build off what is 
already being funded at the Department of Education, and what more do 
you envision doing with additional funding?
    Answer. With the substantial increase in funding proposed for 
fiscal year 2014, the Department would dramatically expand the scope of 
the School Leadership Program (SLP) to focus on training highly 
effective leaders for high-need schools and districts. This expansion 
would build on our current effort to develop the evidence base on 
principal preparation and professional development programs that have a 
positive effect on teaching and learning. The fiscal year 2013 School 
Leadership Program competition for new grant awards is encouraging 
applicants to address the challenges of preparing and supporting 
principals by creating or enhancing projects that contribute to the 
limited body of high-quality evidence on principal preparation, 
professional development for principals, or both. More specifically, 
under the selection criteria, applicants are encouraged to include an 
evaluation plan that is likely to produce valid, reliable, and rigorous 
evidence of the SLP-funded project's impact on producing effective 
principals, as measured, at least in part, using student outcome data. 
We have also invited applicants to design projects that will provide 
professional development for current principals in persistently low-
achieving schools or in schools that their State has identified as 
priority schools or focus schools, in order to (1) help those 
principals master essential school leadership skills, such as 
evaluating and providing feedback to teachers, analyzing student data, 
developing school leadership teams, and creating a positive school 
environment; and (2) enable them to support instruction in their 
schools aligned to college- and career-ready standards.
    The fiscal year 2014 request would expand on this year's 
competition by supporting grants for high-quality, large-scale 
professional development for a broader set of school leaders while 
continuing to build evidence of effectiveness. In particular, the 
Department would give priority to projects that propose to help current 
principals and school leadership teams master essential school 
leadership skills (such as evaluating and providing feedback to 
teachers, analyzing student data, developing school leadership teams, 
and creating a positive school climate), and deepen school leaders' 
understanding of college- and career-ready standards and effective 
instruction aligned to those standards. In addition, in response to 
research showing that district-level staff play an important role in 
helping develop and retain effective and highly effective principals, 
grantees serving current school leaders would also provide training on 
how to support and evaluate school leaders to principal managers (such 
as district superintendents).
    The Department would also create incentives for applicants to set 
ambitious goals for their professional development programs, including 
goals related to student achievement gains, and to adopt reforms that 
would enable strong school leaders to put their training to good use 
and perform their jobs effectively, such as providing effective 
principals with greater autonomy.
    Finally, the request is designed to complement the administration's 
other budget proposals. For example, the Department would reserve a 
portion of Effective Teachers and Leaders State Grants funds to prepare 
school leaders and develop school leadership teams who are able to turn 
around low-performing schools. The Department would also make 
competitive Teacher and Leader Innovation Fund grants to support 
innovative strategies undertaken by States and LEAs to raise the 
quality of teaching and school leadership, including by empowering 
principals in high-need schools with greater authority to select 
effective instructional teams for their schools.
                    community college to career fund
    Question. In New Hampshire, our community college system has 
developed a program to identify labor needs, develop curricula in 
coordination with businesses throughout the State, and train current 
and future employees. While this program is still relatively new, 
companies, many of them manufacturers in the high tech sector, are 
already starting to see the benefits. It's a great model for how 
community colleges can work with area businesses and leverage 
educational resources to add value to the labor market.
    In your budget proposal, you propose $4 billion in mandatory funds, 
to begin in fiscal year 2015, for a Community College to Career Fund. 
Will this funding be used for existing models, new programs, or both?
    Answer. We expect that these funds would support both the expansion 
of existing models and the development and implementation of new 
programs.
      community college to career fund--additional uses of funding
    Question. How else do you see this program being utilized?
    Answer. Funds could be used to (1) identify pressing workforce 
needs and develop solutions such as standardizing industry 
certifications, development of new training technologies, and 
competency-based assessments that can give credit for prior learning 
and accelerate time to credential; (2) expand work-based training and 
other ``earn and learn'' opportunities that allow students to earn 
credit while gaining relevant employment experience in a high-wage, 
high-skill field; and (3) promote the availability of and access to 
data on student outcomes, including employment and earnings, by program 
of study.
                       computer science teachers
    Question. STEM education is something that is so important to the 
country, and yet when we talk about it in policy discussions, we all 
think we mean the same thing, and we almost never do. For some, STEM 
education is math, cybersecurity or the new science standards. For 
others, it's engineering curriculum or getting more computers into K-12 
schools. I'm concerned that our Federal policies don't recognize all of 
the subjects that fall under the ``STEM'' moniker that calls out just 
four disciplines, and I have heard that computer science teachers in 
New Hampshire have difficulty finding professional development 
opportunities because of the interactions of Federal education 
policies--like the highly qualified teacher definitions, the list of 
core academic subjects and the narrow statutory definition of STEM 
itself.
    How can we work with you to make sure that our policies don't 
inadvertently keep computer science and other important disciplines out 
of our schools at the very time the country needs them the most?
    Answer. The administration's longstanding interpretation of 
``science'' as a core academic subject under section 9101(11) of the 
Elementary and Secondary Education Act encompasses a wide range of 
scientific disciplines, including computer science. In our fiscal year 
2014 budget request, including our proposed STEM Innovation Networks 
program, we continue to support efforts to improve student engagement 
and achievement across the scientific disciplines while flexibly 
responding to the needs of local educational agencies and schools.
                                 ______
                                 
               Questions Submitted by Senator Jerry Moran
                 race to the top: college affordability
    Question. In a time of fiscal uncertainty, what is the Department's 
rationale for proposing to award funds for new unauthorized and 
unproven competitive initiatives, such as the new Race to the Top: 
College Affordability program, while electing not to increase existing 
formula grant programs that are the primary source of Federal education 
investments?
    Answer. Funding for State formula grant programs, like title I and 
IDEA grants to States, comprises the vast majority of the President's 
fiscal year 2014 budget request for the Department of Education's non-
Pell grant discretionary programs. These crucial programs are, and will 
remain, the cornerstone of the Department's mission and activities. 
However, none of these programs addresses an issue that is becoming 
increasingly problematic for individuals and families across the 
country--increasing college costs. While college attainment is more 
essential for success in the labor market than ever before, it is also 
becoming increasingly unaffordable for many Americans. Consequently, 
the President has requested funds to apply the Race to the Top model to 
the Nation's higher education system to drive change in State higher 
education policies and practices in order to improve college access, 
affordability, completion, and quality. The Department would use funds 
provided under this program to support grants to States that can 
demonstrate the capacity and willingness to undertake reforms and 
innovations to improve college access, affordability, and quality, 
achieve better student outcomes, and increase institutional capacity to 
graduate more students from college with high-quality credentials.
                 preschool development grants to states
    Question. Mr. Secretary, I am concerned by the Department's 
proposal to direct new discretionary funding for Preschool Development 
Grants to States with already robust State-funded preschool systems, as 
well as States that have already received Race to the Top: Early 
Learning Challenge funds. While I understand the rationale for 
rewarding those States, what considerations will be made for States 
that lack the capacity to establish high-quality pre-kindergarten 
systems and have more limited State-funded pre-kindergarten programs, 
especially recognizing that many of these States often serve the most 
disadvantaged children?
    Answer. While the Preschool Development Grant proposal would help 
meet the needs of both high-capacity States and those States with lower 
capacity, the focus would be on States that are not yet ready to meet 
the requirements for participation in Preschool for All. Consequently, 
States with the most robust preschool systems would likely not be 
eligible for a Preschool Development Grant. States would use Preschool 
Development Grant funds to build capacity and support such quality 
improvement efforts as making facilities appropriate for preschool-aged 
children, developing the preschool workforce, and scaling up existing 
high-quality programs.
   preschool development grants and race to the top: early learning 
                            challenge grants
    Question. The Race to the Top: Early Learning Challenge Grants 
program is in only the second year of implementation and as a result 
has yet to show a proven record of success. Despite only beginning an 
investment in the Race to the Top: Early Learning Challenge Grants 
program in fiscal year 2011, the Department has now chosen not to fund 
this initiative leading to questions of whether the Federal investment 
was effective or a waste of Federal funding. The fiscal year 2014 
budget instead requests funding for yet another new, unproven program--
Preschool Development Grants. Why should this subcommittee provide 
funding for another new early childhood quality initiative prior to 
understanding the impact of funding already directed to the Race to the 
Top: Early Learning Challenge Grants program?
    Answer. The Race to the Top: Early Learning Challenge Grants (RTT-
ELC) program provides grants to States to improve early learning and 
development programs for children from birth to 5, specifically by 
designing and implementing integrated systems of high-quality early 
learning and development programs and services. RTT-ELC funds State 
efforts to sustain and build on the strengths of numerous existing 
programs that support early learning (including Head Start, the Child 
Care and Development Fund program, and Parts B and C of the Individuals 
with Disabilities Education Act (IDEA)), acknowledge and appreciate 
their differences, reduce inefficiency, improve quality, and ultimately 
deliver a coordinated set of services and experiences that support 
young children's success in school and beyond.
    The Preschool Development Grants program would focus specifically 
on State efforts to improve and expand high-quality preschool programs 
for 4-year-olds. These grants will not duplicate the work of RTT-ELC. 
Instead of providing funds to States to coordinate and integrate 
existing early learning systems, Preschool Development Grants would be 
targeted to State efforts to increase the quality and capacity of 
preschool for 4-year-olds.
    race to the top: early learning challenge grants program impact
    Question. Please provide specific information on the results to 
date of the Race to the Top: Early Learning Challenge Grants program, 
in particular, progress in developing quality systems that serve birth 
to age 5 children, including preschool-aged children.
    Answer. On February 15, 2013, Race to the Top: Early Learning 
Challenge Grants (RTT-ELC) grantees submitted their first Annual 
Performance Reports (APR) covering the grant period from January 1 to 
December 31, 2012. The APRs were designed to mirror the selection 
criteria and priorities in State applications. Grantees were asked to 
report on progress in all the selection criteria areas relevant to 
their application, including performance data, demographic data, and a 
first year budget report.
    These initial APRs and APR Summary documents are available at: 
http://www2.ed.gov/programs/racetothetop-earlylearningchallenge/
index.html.
    The Departments of Education (ED) and Health and Human Services 
(HHS) are working collaboratively with HHS's Office of the Assistant 
Secretary for Planning and Evaluation to conduct an analysis of the 
fiscal year 2013 APRs. Through this analysis the Departments hope to 
have more information available in August 2013, regarding the progress 
of participating States in developing quality systems that serve 
children birth to age 5.
  preschool development and race to the top: early learning challenge 
                                 grants
    Question. Will the Department commit to prioritizing funding for 
Preschool Development Grants to States that have yet to receive Race to 
the Top: Early Learning Challenge Grants, so that those States can 
develop high-quality pre-kindergarten systems?
    Answer. We do not expect to consider whether a State has received a 
Race to the Top: Early Learning Challenge grant in making Preschool 
Development Grant awards. Additionally, both low-capacity and high-
capacity States would be eligible for Preschool Development Grants.
     preschool development grants--distribution of funds to states
    Question. What specific percentage or specific dollar amount of the 
requested $750 million for Preschool Development Grants will be awarded 
to States with more limited State-funded pre-kindergarten systems and 
what specific percentage of funds or specific dollar amount will be 
awarded to States with more robust pre-kindergarten systems?
    Answer. The Department has not specified a specific percentage or 
dollar amount to be awarded to States with low- or high-capacity under 
the Preschool Development Grants program at this time.
    preschool development grants--high-quality program requirements
    Question. When does the Department expect that all States will meet 
the requirement of offering high-quality programs to be able to access 
mandatory funds and what level of commitment will be required by States 
to receive funding?
    Answer. The Department expects that all States would be eligible to 
participate in Preschool for All by the third year of the program. To 
be eligible for Preschool for All, States would have to demonstrate 
that they have (1) early learning and development standards across the 
essential domains of school readiness; (2) high-quality program 
standards; (3) requirements for teacher and staff qualifications; and 
(4) the ability to link preschool data with K-12 data. Additionally, 
States would be required to contribute non-Federal matching funds. This 
match would be modest in the early years, beginning at 10 percent of 
the Federal investment, and would increase over time. A State would 
also be eligible for a reduced match rate if it has a plan to serve 
additional children from middle-income families.
                      preschool for all initiative
    Question. If mandatory funds are not provided for the Preschool for 
All initiative, why should this subcommittee provide discretionary 
funding for Preschool Development Grants, which the budget request 
states would pave the way for the successful implementation of 
Preschool for All?
    Answer. Multiple studies have shown the benefits of high-quality 
preschool, particularly for children from low-income families. Children 
who attend high-quality preschool are better prepared for school, less 
likely to be retained in grade, score higher on reading and math 
assessments in the elementary grades, and are more likely to graduate 
from high school than children who do not attend such programs. Even in 
the absence of Preschool for All, States would benefit from targeted 
quality investments funded through Preschool Development Grants that 
would help prepare them to offer high-quality preschool to 4-year-olds 
from low- and moderate-income families.
           identifying high-quality pre-kindergarten programs
    Question. Could you please lay out the performance measures, 
standards, and appropriate assessments that the Department will use to 
ensure that pre-kindergarten programs are delivered in a ``high-
quality'' manner?
    Answer. The definition of high-quality preschool, based on 
nationally recognized standards, includes, at a minimum, the following 
elements: (1) high staff qualifications, including a bachelor's degree 
for teachers; (2) professional development for teachers and staff; (3) 
low staff-child ratios and small class sizes; (4) a full-day program; 
(5) developmentally appropriate, evidence-based curricula and learning 
environments that are aligned with the State early learning standards; 
(6) employee salaries that are comparable to those for K-12 teaching 
staff; (7) ongoing program evaluation to ensure continuous improvement; 
and (8) onsite comprehensive services for children.
    The Department has yet not developed performance measures for 
Preschool for All or Preschool Development Grants. However, such 
measures would, at a minimum, track a State's progress in (1) increased 
school readiness; (2) decreased educational gaps; (3) decreased 
placement in special education programs and services; and (4) decreased 
need for remediation in the early elementary grades.
                impact aid payments for federal property
    Question. The fiscal year 2014 budget requests no funds for 
Payments for Federal Property under Impact Aid on the basis that these 
payments compensate school districts for lost property tax revenue 
without regard to whether those districts educate any federally 
connected children. However, this justification ignores that in some 
communities the Federal Government is the largest landowner, which 
significantly diminishes a school district's revenue source. How would 
the elimination of Payments for Federal Property impact the educational 
opportunities of students in districts that currently benefit from such 
payments due to the presence of Federal land?
    Answer. The policy of the administration is to use available Impact 
Aid funds to help pay for the education of federally connected 
children, including children of members of the uniformed services, 
children of Federal employees who both live and work on Federal 
property, children of foreign military officers, children living on 
Indian lands, and children residing in federally assisted low-rent 
housing projects. Given the restrictions imposed by the Budget Control 
Act of 2011, the administration has proposed to maintain $1.2 billion 
in funding to four Impact Aid programs (Basic Support Payments, 
Payments for Children with Disabilities, Construction and Facilities 
Maintenance) and a continued commitment to the educational outcomes of 
federally connected students supported by those Impact Aid programs.
    Unlike other Impact Aid programs, Payments for Federal Property are 
made to LEAs without regard to the presence of federally connected 
children and do not necessarily provide for educational services for 
such children. When the Payments for Federal property authority was 
first established in 1950, its purpose was to provide assistance to 
LEAs in which the Federal Government had imposed a substantial and 
continuing burden by acquiring a considerable portion of real property 
in the LEA. The law applied only to property acquired since 1938 
because, in general, LEAs had been able to adjust to acquisitions that 
occurred before that time. Over 64 percent of districts that currently 
receive Payments for Federal Property first applied before 1970. We 
believe that the majority of LEAs receiving assistance under this 
program have now had sufficient time to adjust to the removal of the 
property from their tax rolls.
    In addition, many LEAs receiving funds under this authority 
consists of two or more LEAs that consolidated, at least one of which 
originally met the eligibility criterion of a loss of 10 percent of the 
aggregate assessed value of real property removed from the tax rolls. 
The current statute allows such LEAs to retain eligibility even though 
they are no longer demonstrably burdened. The continuing receipt of 
funds by these LEAs further weakens the case for continuing the 
program.
   rural communities and competitive career and technical education 
                                programs
    Question. High school students living in rural communities often 
benefit from career and technical education (CTE) programs and services 
that align curricula with the needs of industries in the community, as 
well as provide agriculture work-based learning experiences. If career 
and technical education funds were to be distributed in a manner 
consistent with the Department's reauthorization proposal, it is my 
understanding that States would be required to award funds on a 
competitive basis to local providers. This could exacerbate the ability 
to serve students from rural areas as rural school districts, 
historically, have a lower success rate in Department of Education 
competitions. How will the Department make certain that States have the 
ability to provide their students access to career and technical 
education services, particularly from the perspective of rural 
communities?
    Answer. Our more recent experience with programs like Race to the 
Top, School Improvement Grants, and Promise Neighborhoods suggests that 
rural school districts can win their fair share of funds in Federal 
grant competitions, particularly when those competitions are designed 
carefully to take into account the needs of rural areas and the 
importance of serving them effectively. The Department envisions that 
the Perkins reauthorization proposal would address the needs of rural 
students through a combination of strategies, including structuring 
State-level requirements to ensure that the economic needs of rural 
communities are considered in the creation of CTE programs; requiring 
that resources are made available to provide rural students with access 
to rigorous, high-quality CTE programs; promoting the use of distance 
learning technology to increase access to high-quality learning 
opportunities; and using consortia of LEAs and postsecondary 
institutions to ensure that rural students are connected to 
postsecondary institutions, even in rural communities where there are 
no postsecondary institutions nearby.
                             stem education
    Question. I recently had the opportunity to visit the Kansas 
Academy for Mathematics and Science at Fort Hays State University. Each 
year, 40 high school juniors from around Kansas move into a campus 
dorm, where they complete their last 2 years of high school while also 
taking college math and science courses. This visit reaffirmed my 
belief in the continued need for a highly educated and innovative STEM 
workforce to ensure our Nation's competitiveness. Within the Department 
of Education, how will the Governmentwide realignment of Federal STEM 
programs eliminate inefficiency within the Department and inspire a 
generation of innovators who have the science, technology, engineering, 
and math skills to solve the challenges our Nation will face in the 
21st century?
    Answer. The administration's proposed STEM education reorganization 
calls on the Congress to support a cohesive national STEM education 
strategy and eliminate the patchwork of STEM education programs that 
have proliferated in Federal agencies over time. At the Department of 
Education, this proposal focuses on more effective investment in 
elementary and secondary STEM education through a new, coordinated STEM 
Innovation initiative. The STEM Innovation initiative is designed to 
help ensure that our Nation's children are prepared to succeed in a 
global economy increasingly reliant on STEM knowledge and skills by 
identifying and spreading the use of effective STEM instructional 
practices in elementary and secondary schools; increasing student 
engagement in STEM fields, including through out-of-school experiences; 
and recruiting, preparing, and further developing highly effective STEM 
teachers.
                   ensuring quality in stem education
    Question. What steps is the Department taking to see that students 
who are being taught in traditional classrooms have access to the 
quality of STEM learning opportunities provided to students at the 
Kansas Academy of Mathematics and Science?
    Answer. One of the goals of our proposed STEM Innovation Networks 
program is to replicate and expand efforts to provide students with 
access to accelerated learning opportunities such as those of the 
Kansas Academy of Mathematics and Science. Under our proposal, which 
would provide competitive grants to local educational agencies and 
partner entities to transform STEM teaching and learning in elementary 
and secondary schools, a central element of the comprehensive plans 
that grantees would develop and implement is the provision of advanced 
coursework, including through dual enrollment and other options for 
earning credit toward a postsecondary credential. The fiscal year 2014 
budget request also includes targeted support for accelerated learning 
through the proposed High School Redesign and College Pathways and 
Accelerated Learning programs, which would promote, among other things, 
the expansion of advanced courses, such as Advanced Placement and 
International Baccalaureate courses; dual-enrollment programs; and 
``early college high schools'' that allow students to earn a high 
school diploma and an associate's degree or 2 years of college credit 
simultaneously.
         student financial aid fiscal year 2014 budget request
    Question. Access to quality higher education opportunities is 
essential to moving out of poverty and into the productive workforce. 
That being said, I am concerned about the long-term sustainability of 
the Pell Grant program and the impact of the budget request on campus-
based aid programs, including the Perkins program. Can you please 
provide more detail on the future of student financial assistance under 
the fiscal year 2014 budget request, particularly as it relates to 
students from low-income and disadvantaged backgrounds?
    Answer. We see student financial assistance as being the shared 
responsibility of States, institutions, the Federal Government (both 
the administration and Congress), and students. The Department's role 
in this is to maintain its commitment to providing students with the 
resources they need to complete their program, and generally doing what 
it can to ensure college remains affordable. This includes ensuring 
Pell is fully funded and on a financially sustainable path.
    In the 2014 budget, one of the biggest ways we hope to make college 
more affordable is by reforming campus-based aid to target it to 
institutions that will provide quality education at a reasonable price. 
The types of institutions that would be successful under this new 
formula would be those that offer relatively lower tuition and/or 
restrain tuition growth, and those that offer high quality education 
and training to prepare their graduates for jobs and repay their 
student loan obligations. Importantly for low-income students, how well 
an institution is able to enroll and graduate a high number of their 
Pell-eligible students would also be a consideration.
    The budget also introduces a reformed student loan interest rate 
structure, but, significantly, one that would continue the current 
practice of offering lower rates to students with the greatest 
financial need (those who qualify for subsidized Stafford loans). And 
it also provides borrowers with more loan repayment options, with the 
expansion of the Pay As You Earn plan. Borrowers who select this 
repayment plan would be required to pay a reasonable monthly repayment 
amount more closely aligned with the discretionary income available 
based on their earnings than in other plans.
   campus-based aid proposals in the fiscal year 2014 budget request
    Question. It is my understanding that the Department's plan for 
changes to campus-based aid programs could increase the burden of 
reporting requirements and regulations for higher education 
institutions, which would likely come at an increased cost to these 
institutions. Additionally, a recent Government Accountability Office 
report found there should be better coordination of Federal student aid 
assistance. Therefore, could introducing another level of complexity 
and regulation into the delivery of campus-based aid programs without a 
clear plan for implementation increase costs to higher education 
institutions, which would then most certainly be passed onto students 
in the form of higher tuition costs?
    Answer. Unfortunately, the higher education landscape has already 
been marked by ever-rising college costs, with families and students 
struggling to keep up. This is why President Obama has called for 
changes--including reforming how campus-based aid is distributed, 
setting student loan rates comparable with the market, increasing 
access to Perkins loan funds, and others--to drive college 
affordability. Through the campus-based aid proposal, we continue this 
work by encouraging a better system of distributing financial aid funds 
to institutions based on measures like access, quality, and completion. 
In fact, under the budget policy, institutions that are not able to 
restrain tuition increases will see aid shifted away from them and 
toward institutions that do it better.
    We don't believe this plan would be burdensome for institutions, 
because it would be developed in consultation with accrediting agencies 
and the institutions, with the goal that it be reasonably easy to 
implement, and be sustainable long-term. It is vital that all actors--
institutions, the Federal Government, States, and accrediting 
agencies--``buy-in'' to any system changes, because we all have a 
shared responsibility to improve higher education and get the best 
possible outcomes for students.
  accreditation of higher education institutions and eligibility for 
                          federal student aid
    Question. Following the President's State of the Union address, 
supplemental documents were released that stated, ``The President will 
call on Congress to consider value, affordability, and student outcomes 
in making determinations about which colleges and universities receive 
access to Federal student aid, either by incorporating measures of 
value and affordability into the existing accreditation system; or by 
establishing a new, alternative system of accreditation that would 
provide pathways for higher education models and colleges to receive 
Federal student aid based on performance and results.'' As the budget 
request does not appear to lay out the administration's plan with 
regard to the accreditation process in relation to institutional 
eligibility for Federal student aid, when can this Subcommittee expect 
to receive additional information? Please provide specific details of 
this proposal.
    Answer. We believe it should be up to Congress, in consultation 
with higher education institutions, to determine whether the current 
accreditation system should be reformed to consider value and 
affordability, or an alternative system be put into place that would 
use performance and results on which an institution's participation in 
the student aid programs would be based. The benchmarks for all of 
these metrics would also be determined through this process, not 
dictated by the Department. However, we do believe that it is necessary 
to include these and similar factors to create a student financial aid 
system with the integrity to not reward institutions that fail 
students. We are committed to working with Congress and the higher 
education community to develop a system that serves students first and 
foremost.
higher education institution accreditation and state authorization rule
    Question. It is my understanding concerns have been raised 
regarding the Department's recent interpretation of the State 
authorization rule that would disqualify higher education institutions 
that achieved State approval based on their accreditation status. Could 
you please provide this Subcommittee with an update on the status of 
this issue, as well as the impact of the July 1, 2013, deadline for 
compliance on higher education institutions?
    Answer. The State authorization regulations provide that, for 
institutions that are established by a State as an educational 
institution, the State may provide an approval based on the 
institution's accreditation status. For institutions that are 
established by a State on the basis of an authorization to conduct 
business in the State or to operate as a nonprofit charitable 
institution (not established by the State as an educational 
institution), the regulations explicitly provide that such institutions 
cannot be exempted from the State's licensure or approval requirements 
solely on the basis of an institution's accreditation status. However, 
an institution's accreditation status may be included as part of the 
State's approval process provided that the State has a substantive 
approval process beyond simply verifying an institution's accreditation 
status.
      federal trio programs in the fiscal year 2014 budget request
    Question. I recently met with college students from Kansas that 
have benefited from the services offered under Federal TRIO programs. 
In particular, I spoke with Clint Jensen who explained that as an Iraq 
war veteran and first-generation college student, the TRIO program at 
the University of Kansas played a crucial role in providing student 
support and advising services. He commended TRIO for recognizing and 
supporting students, especially from rural communities, that have the 
potential to succeed. Please provide detail on the impact of the fiscal 
year 2014 budget request on TRIO programs and services.
    Answer. The administration has requested $839,932,000 for the 
Federal TRIO programs in fiscal year 2014, which represents a 5.5 
percent increase over the fiscal year 2013 level after sequestration. 
At this level, the Department expects to support approximately 2,792 
projects providing support services to approximately 792,000 students.
                           distance education
    Question. Adult, continuing, and especially distance education 
services are crucial in States with a dispersed population and an 
economy that increasingly demands a highly skilled workforce. What 
efforts can the Department of Education undertake, within the 
constraints of the current budget, to establish a consistent and 
predictable process that encourages higher education institutions to 
support distance education initiatives to reach all students, 
particularly rural students?
    Answer. The administration believes that institutions of higher 
education should continue to explore alternative methods of providing 
educational instruction, including online learning, while pursuing 
alternative learning measurement strategies, including competency-based 
education, experiential, and prior-learning credit. The 
administration's 2014 budget request includes funds for two new 
initiatives--Race to the Top: College Affordability and Completion 
(RTTCAC) and the First in the World (FITW) Fund--that would offer 
incentives to States, institutions of higher education, and nonprofit 
organizations to undertake reforms and innovations, including in the 
ways in which college students receive instruction and demonstrate 
competencies. In particular, RTTCAC would support grants to States that 
can demonstrate a capacity and willingness to undertake certain 
reforms, including removing barriers preventing the creation of 
innovative methods of student learning and new degree pathways. The 
FITW competition, to be administered under the Fund for the Improvement 
of Postsecondary Education (FIPSE), would provide grants to 
institutions of higher education proposing innovative and evidence-
based strategies to improve student learning outcomes. It would also 
provide funds to help create third-party validation systems that could 
make it easier for the creation of competency-based learning systems 
and experiment with pay-for-success awards to encourage all types of 
providers to offer low-cost 2-year degrees.
                  statewide longitudinal data systems
    Question. One of the biggest challenges that States face in linking 
relationships between communities, schools, opportunities to learn, and 
student outcomes is the nature of data that is available. Investments 
in systems that allow researchers and policy makers to design and 
collect robust data to help States invest wisely in education 
initiatives are critical to improving outcomes for all students. 
Recognizing the importance of robust data, Kansas has worked diligently 
to establish a statewide longitudinal data system. How does this budget 
invest in efforts that make it possible for States to sustain and 
improve these data systems?
    Answer. The administration has requested $85 million for the 
Statewide Data Systems program in 2014, an increase of nearly $49 
million from the 2013 level. This increase would allow the Department 
to support $36 million in new grants, as well as a $10 million 
postsecondary data initiative designed to improve information on 
students as they progress from high school to postsecondary education 
and the workforce. The new grants would support State activities to 
create linkages with early childhood data systems and expand the ways 
that States are using data to improve student achievement and support 
education reforms. At the request level, we would be able to support 
approximately 25 new grant awards.
    In addition, the Department would continue to support activities to 
improve data quality, coordination, and use.
      new mandatory funding in the fiscal year 2014 budget request
    Question. The Department's request for new mandatory funding would 
increase taxes and grow the size of the Government at a time when we 
should be reigning in spending on mandatory programs. As the Department 
also requests a $3.1 billion increase in discretionary funding above 
fiscal year 2012 levels, why did the Department not seek funding 
through the discretionary process for these initiatives?
    Answer. As is the case with the discretionary increases in our 
budget, the mandatory funds we requested are part of a comprehensive 
and balanced plan that reduces the deficit while investing in our 
economic future. Every new education initiative in the plan is fully 
paid for in other parts of the fiscal year 2014 budget, so they do not 
add a single dime to the deficit. In fact, the President's budget 
includes $1.8 trillion of additional deficit reduction over 10 years, 
bringing total deficit reduction to $4.3 trillion.
    In the case of Preschool for All, the President would pay the full 
cost of this new mandatory program by increasing the Federal tax on 
tobacco. In proposing this offset, we are following the example of a 
number of States--both red and blue--that have used funds tied to 
tobacco to pay for programs that benefit children's health and 
education, either through their own State tobacco tax or from funds 
from States' 1998 settlement with the tobacco industry. In addition to 
helping to finance universal Pre-K education, increasing the tax on 
tobacco would discourage unhealthy habits that harm adults and children 
and strain our healthcare system and economy. As the Federal tax goes 
up, we should expect the popularity of this unhealthy habit to continue 
to decline. This will lead to fewer deaths and lower healthcare costs 
and millions more children ready for school--that's a double benefit.
                                 ______
                                 
            Questions Submitted by Senator Richard C. Shelby
        high-need, rural areas and competitively funded programs
    Question. The President's budget proposal includes a substantial 
increase in the amount of discretionary funding that would be 
competitively awarded. In fact, despite a $3.1 billion increase in the 
Department's budget, there is only one requested increase for a formula 
funded program. I remain concerned that prioritizing funding increases 
and new funding for programs distributed competitively rather than 
formula funded programs results in the redirection of critical Federal 
funds from rural States to urban areas. As we have seen from the Race 
to the Top program, rural States do not receive funding at the same 
level as those with large, urban populations. For example, Alabama, 
Kansas, and Iowa did not receive any funding through the various Race 
to the Top competitions. Why is the Department not addressing the clear 
need to fund education programs in high-need areas?
    Answer. We have maintained strong continued support for key 
``foundational'' Federal education formula grant programs, such as 
title I and special education grants to States, while at the same time 
investing new resources in competitive grants to spur innovation by 
States and districts aimed, in part, at helping to leverage more 
effective use of Federal formula grant funds. I would also note that we 
are proposing a very significant mandatory program--$75 billion over 10 
years for Preschool for All--that would be allocated to States by a 
need-based formula.
    Competitive grant programs are not designed to produce awards for 
every State, but the Race to the Top program has awarded grants to many 
States with large rural populations, such as Tennessee, Georgia, North 
Carolina, Minnesota, Ohio, Kentucky, and Louisiana. In addition, nearly 
half of the districts that received funds under the Race to the Top 
District program are rural, and rural schools actually have been 
overrepresented in the School Improvement Grants program, with the 
rural share of SIG-awarded schools exceeding the rural share of SIG-
eligible schools.
    We do agree that it is important to maintain a level playing field 
in our competitive grant programs, and we have worked hard to achieve 
this goal through such efforts as awarding competitive priority points 
for applicants proposing to serve rural districts and schools and 
encouraging applications from consortia that can help address capacity 
issues faced by many smaller, rural States and districts. Under our 
fiscal year 2014 request we would continue these efforts in order to 
bring the benefits and incentives of competition to bear on meeting the 
widest possible range of challenges faced by educators across America, 
including those in rural States.
   mathematics and science partnerships program and stem innovation 
                           networks proposal
    Question. Mr. Secretary, the United States continues to fall behind 
other developed countries in math and science education. I believe it 
is critical to direct funding to close the growing achievement gap 
between the United States and our global competitors in this area. The 
jobs of the future depend on an educated workforce that is strong in 
math and science skills. In Alabama, the Mathematics and Science 
Partnerships program has helped fund the highly successful Alabama 
Math, Science, and Technology Initiative that is a leading model for 
math and science education across the Nation. Could you please lay out 
in detail the Department's plan for changes to the awarding of 
subgrants under the Mathematics and Science Partnerships program to 
align with the evidence-based STEM Innovation Networks proposal?
    Answer. If the Congress funds the administration's proposal for a 
new STEM Innovation Networks program, we would want to ensure, through 
appropriations language, that the activities of grantees under both 
this program and the Mathematics and Science Partnerships (MSP) program 
can be aligned and leveraged to produce the greatest impact in 
improving the quality of STEM instruction, particularly in high-need 
schools. This could mean, for example, authorizing States to use MSP 
funds to support an expanded set of evidenced-based activities 
consistent with those under the STEM Innovation Networks proposal and 
to give priority in their competitions for MSP subgrants to applicants 
whose proposed projects are coordinated with the comprehensive plans 
for improving STEM learning opportunities that STEM Innovation Networks 
grantees would develop and implement.
    In addition, the Department is currently developing regulations to 
help ensure that MSP-funded partnerships implement projects on a 
schoolwide basis (and not only for a handful of teachers in a school, 
resulting in uneven within-school impact too often seen under the 
current program structure) and have the commitment of school 
administrators.
          distance education and program integrity regulations
    Question. Secretary Duncan, I continue to voice my concerns 
regarding State authorization provisions under the proposed Program 
Integrity regulations and the potential impact on access to distance 
education at higher education institutions. At the risk of losing 
Federal financial aid, colleges and universities will be required to 
request permission to offer their distance education programs in every 
State in which a student is located. Many States already have 
legislation that requires registration. This requirement is 
duplicative, costly, time-consuming, and academically unnecessary. Mr. 
Secretary, why does the Department of Education believe it must 
interfere where States already have efficient and equitable policies in 
place regarding distance learning?
    Answer. Institutions have always been responsible for complying 
with all State laws concerning State authorization requirements, 
including requirements for institutions providing distance education, 
to be considered eligible institutions under the Title IV Federal 
Student Aid programs. The regulatory requirements under 34 CFR 
600.9(c), commonly known as the State authorization distance education 
regulations, specifically provide that, if an institution is offering 
postsecondary education through distance or correspondence education to 
students in a State in which the institution is not physically located 
or in which it is otherwise subject to State jurisdiction as determined 
by the State, the institution would be required to meet any State 
requirements for it to legally offer postsecondary distance or 
correspondence education in that State.
    On July 12, 2011, in response to a legal challenge by the Career 
College Association, the U.S. District Court for the District of 
Columbia vacated the regulation under 34 CFR 600.9(c) on procedural 
grounds (Career College Ass'n v. Duncan, 796 F. Supp. 2d 108 (D.D.C. 
2011). On August 14, 2012, on appeal, the U.S. Court of Appeals for the 
D.C. Circuit affirmed the decision of the district court and ruled that 
the regulation under 34 CFR 600.9(c) is not a logical outgrowth of the 
Department's proposed rules. It remanded the case to the district court 
with instructions to remand the regulation to the Department for 
reconsideration consistent with the D.C. Circuit's opinion (Ass'n of 
Private Sector Colleges and Universities v. Duncan, 681 F.3d 427 (D.C. 
Cir. 2012). In order to address the procedural concerns identified by 
the D.C. Circuit, the Department is now considering regulatory changes 
related to State authorization for programs offered through distance 
education or correspondence education.
 gao report on coordination and duplication of federal assistance for 
                            higher education
    Question. I am aware that a recent Government Accountability Office 
(GAO) report on fragmentation, overlap, and duplication found that 
Federal agencies providing financial assistance for higher education 
should better coordinate to improve program administration and help 
reduce fragmentation. The report states that, ``For over 10 years, GAO 
has identified weaknesses in the coordination of Federal assistance for 
higher education, as well as a lack of evaluative research on the 
effectiveness of this assistance.'' What steps does the Department take 
in the fiscal year 2014 budget request to address the findings of the 
recent Government Accountability Office report?
    Answer. In the report you reference, the Government Accountability 
Office recommended that the Department ``sponsor and conduct evaluative 
research into the effectiveness of Title IV programs.'' In the fiscal 
year 2014 budget, the administration requested an additional $67 
million in the GPRA Data/HEA Program Evaluation account to support 
research, evaluations, and demonstrations to study student financial 
aid delivery. This research would focus on approaches that promote 
postsecondary access, program completion, and high-quality, affordable 
education programs. Specific research proposals presented in the budget 
which would utilize these funds include the on-going evaluation of the 
experimental sites study, and a demonstration and evaluation of dual 
enrollment programs.
    Currently underway, the experimental sites study looks at the 
effects of offering Pell Grants for job training to students who are 
income-eligible, but would not qualify for Pell funding either because 
they had a bachelor's degree or because they planned to enroll in 
shorter term training than currently allowed under the program. The 5-
year study will examine the effects of expanded access on Pell Grants 
on students' employment and earnings.
    The dual enrollment proposal, meanwhile, is a new initiative 
designed to allow approximately 20,000 high school and adult students 
earn postsecondary credit while still in high school or studying for a 
high school equivalency credential. Funds would go directly to 
partnerships of higher education institutions and State and local 
educational agencies--awarded through a competitive grant process with 
priority to those programs most cost-effective--which apply for support 
service grants to cover required tuition, fees, books, and supplies 
costs of participating students. A portion of this funding would also 
go toward evaluating the effectiveness of providing student aid as a 
way to increase access to dual enrollment programs, and whether these 
programs improve college enrollment, credential attainment, and future 
earnings. The Department would use approximately $32 million of the 
requested GPRA/HEA funds, together with $10 million from Career and 
Technical Education (CTE) National Programs, for this project.
    At the fiscal year 2014 request level, the Department also plans 
additional studies to improve postsecondary success and outcomes, which 
may include:
  --evaluating the impacts of different loan counseling models on 
        borrower behavior;
  --examining the effectiveness of risk-sharing in the Pell grant 
        program to encourage increased success for low-income students; 
        and
  --examining the impacts of consumer information on aid application 
        and college selection.
                                 ______
                                 
             Questions Submitted by Senator Lamar Alexander
            autonomy of the institute of education sciences
    Question. Research funding is a core responsibility of the 
Institute of Education Sciences (IES) and I appreciate your recognition 
of the important role that research plays in reforming and improving 
teaching and learning. The role of education research works best, 
however, when it is shielded from political forces or any other 
influence. Policymakers and educators depend on unbiased information 
and results. What aspects of your budget requests, or other activities, 
is the Department of Education undertaking to ensure the autonomy of 
IES and its research funding activities?
    Answer. The Secretary of Education has delegated to the Director of 
the Institute of Education Sciences all the programmatic authorities 
contained in the Education Sciences Reform Act. This written delegation 
ensures the autonomy of the Institute and its research funding 
activities. The National Board for Education Sciences approves the 
Director's research priorities and the Institute's procedures for peer 
review of both grant applications and Institute reports and 
publications. In addition, the Institute has its own independent 
publication authority, with its reports subjected to peer review, but 
not to departmental clearance.
                 federal student aid and loan defaults
    Question. According to the fiscal year 2014 budget documents, the 
Department of Education is anticipated to make over $106 billion in 
direct loans to students in fiscal year 2013 and will make over $112 
billion in fiscal year 2014. Moreover, the Department will deliver and 
support nearly $177 billion in grant aid, work-study funds, and loans 
to students from 2012-2013. What is the Department doing, both from a 
budgetary standpoint and operationally, to manage this growing 
portfolio of loans as student default numbers continue to rise?
    Answer. Passage of the Health Care and Education Reconciliation Act 
of 2010 (HCERA) resulted in significant changes to the Federal student 
loan programs. The biggest change was that, beginning July 1, 2010, all 
new Stafford, PLUS, and Consolidation loans would be made under the 
William D. Ford Federal Direct Loan (Direct Loan) Program.
    The Department of Education's office of Federal Student Aid (FSA) 
went to great lengths to update its systems and increase its capacity. 
Beginning in 2008, FSA increased the Direct Loan origination capacity 
of its Common Origination and Disbursement (COD) system. FSA also 
augmented its back-end servicing capacity with the award of four loan 
servicing contracts to private-sector companies--Nelnet Servicing, 
Great Lakes Educational Loan Services, Sallie Mae, and the Pennsylvania 
Higher Education Assistance Agency (PHEAA). These contracts compete 
amongst themselves for servicing volume through performance-based 
contracts. The contracts are designed to encourage servicers to have 
borrowers remain in repayment status and drive borrowers to this status 
if they have gone delinquent. Annual volume allocations are determined 
by five metrics with two measuring default prevention efforts through 
the percentage of borrowers and percentage of dollars in each 
servicer's portfolio that go into default.
    At the time, FSA also began reaching out to the higher education 
community to offer assistance and guidance as schools contemplated 
joining the Direct Loan Program. FSA established and published the 
``Direct Loan Source'', a monthly newsletter for schools considering a 
transition to the Direct Loan Program. FSA representatives attended 
over 40 regional and State financial aid conferences held throughout 
the country providing training to 10,000 financial aid professionals in 
attendance.
    FSA also established and implemented a comprehensive training plan 
designed to assist schools wishing to transition to the Direct Loan 
Program. FSA hosts an annual training conference for financial aid 
professionals from schools across the country and abroad, as well as 
webinars throughout the year. Direct Loan training has been offered and 
provided to thousands of financial aid professionals.
    Additionally, the Department has started to analyze customer 
segmentation data in order to better counsel student loan borrowers. 
For example, data on student loan debt levels is used to inform 
recommendations about communications and outreach related to income-
based repayment.
StudentAid.gov
  --In July 2012, the administration introduced StudentAid.gov, a 
        consolidated Web site that provides straightforward and easy-
        to-understand information about planning and paying for 
        college. The new Web site, which is mobile optimized, also 
        offers short videos and infographics to help make complex 
        financial aid topics easier to understand.
  --Topics covered on the site include: how to prepare for 
        postsecondary education, the various types of student aid 
        available (such as loans, grants, scholarships, and work-study 
        jobs), who is eligible to receive loans and grants, how to 
        apply, and how to manage student loans after leaving school.
Financial Awareness Counseling Tool (FACT)
  --In June 2012, the administration introduced the Financial Awareness 
        Counseling Tool to provide students with financial management 
        basics, information about their current loan debt, and 
        estimates for student loan debt levels after graduation. The 
        tool offers five interactive tutorials covering topics ranging 
        from managing a budget to avoiding default. Students are able 
        to access their individual loan history and receive personal 
        feedback that can help them better understand their financial 
        obligations.
Repayment Estimator
  --New tool launched by Department to help borrowers better understand 
        the different repayment plans available to them.
  --Using borrowers actual loan history, the Repayment Estimator 
        provides borrowers with actual repayment amounts and loan terms 
        as well as principal and interest paid under each of the 
        Department's repayment options.
Model Award Letter (The Shopping Sheet)
  --The Model Award Letter, also known as The Shopping Sheet, is 
        intended to make it easier for students and their families to 
        compare college costs and make informed decisions about 
        college. The Shopping Sheet standardizes financial aid award 
        letters, making it easier for students and their families to 
        truly understand college costs and make comparisons between 
        competing college offers.
    FSA has also implemented several income-driven student loan 
repayment plans which help borrowers manage their student loan 
obligations.
The Income-Based Repayment (IBR) Plan
  --IBR is a repayment plan for many types of Federal student loans 
        that caps the required monthly payment at an affordable amount 
        based on income and family size. Under an IBR, student loan 
        payments are capped at 15 percent of the borrowers 
        discretionary income.
The Pay As You Earn (PAYE) Repayment Plan
  --The Pay As You Earn Repayment Plan helps borrowers reduce their 
        student loan burden by limiting monthly payments to 10 percent 
        of their discretionary income. PAYE was made available to 
        borrowers beginning on December 21, 2012.
The Public Service Loan Forgiveness (PSLF) Plan
  --The PSLF Program encourages individuals to enter public service 
        and, when used in conjunction with an income-driven repayment 
        plan, may qualify borrowers for forgiveness of a portion of 
        their Federal student loans. Employees of Government and non-
        profit organizations are eligible for PSLF.
                    student loan default collection
    We also take our default collection efforts seriously in the 
Department and want to make sure that we are striking the right balance 
between helping borrowers who have hit hard times and honoring our 
responsibility to be good stewards of taxpayer dollars. Our entire 
approach to default collection is structured to encourage full 
repayment while ensuring borrowers are aware of both the consequences 
of their failure to repay and the options available to help them get 
out of default. Our monitoring, oversight, and complaint resolution 
processes are all geared toward ensuring that borrowers are counseled 
promptly and professionally and that vendor collection efforts do not 
exceed the boundaries set under the contracts. We review our 
contractors' performance on an ongoing basis and modify our guidance 
and agreements as needed to maintain a reasonable balance between 
student and taxpayer interests.
  --To assist borrowers to better manage their Federal obligations, we 
        implemented a new methodology for determining reasonable and 
        affordable payments for borrowers attempting to rehabilitate 
        their loans.
      data integrity support in student aid administration request
    Question. In February 2013, the Department delayed the release of 
cohort default rates (CDRs) to institutions of higher education without 
mentioning a reason for the delay. I have heard from a number of 
colleges and universities that question the accuracy of the Federal 
student debt data in the College Scorecard from the White House. In 
April 2011, the Department notified institutions that it had 
erroneously inflated CDRs for a number of institutions. This abridged 
history of mismanagement of key metrics is troubling. How will the 
Department ensure that data integrity is of highest concern and 
priority in the Department's fiscal year 2014 budget request for 
Federal Student Aid administration?
    Answer. The Department strives to ensure accurate data in its 
programs. In the collection of data, the Department is investing in 
FAFSA--Free Application for Federal Student Aid--enhancements to 
improve program accuracy and integrity of data by improving data fields 
to get more complete financial information and to better identify 
potential discrepancies.
    In the fiscal year 2014 budget request, the Department requested $9 
million to upgrade the National Student Loan Data System (NSLDS). The 
NSLDS is used to calculate cohort default rates. These upgrades will be 
data enhancements, system integration, and data quality. These 
improvements may include the creation of data linkages that facilitate 
a better understanding of borrowers with multiple loans and conducting 
more rigorous data quality checks. Moreover, NSLDS will become the main 
system for enrollment reporting on certain loan and grant recipients. 
Schools are required to confirm and report to the Secretary the 
enrollment status of attending students who receive Direct Federal 
Loans and Teacher Education Assistance for College and Higher Education 
(TEACH) Grants. A student's enrollment status determines deferment 
eligibility, grace periods, and repayment schedules, as well as the 
Government's payment of interest subsidies.
    Additionally, FSA has established a Data Governance Board to 
address the critical need to create a strong governance process around 
data and data-related requirements. The primary goals of the Board are 
to develop and implement a strong data governance policy that fosters 
strong data management practices across the organization. The board 
also identifies data needs and concerns and develops integrated 
solutions. Lastly, the Board looks to understand, document, and improve 
on the ways FSA uses, stores, accesses, and protects its data.
 gainful employment regulation and higher education act reauthorization
    Question. The Department recently announced their intention to 
begin rulemaking on postsecondary education. Included in the list of 
agenda items was the controversial gainful employment regulation. Given 
the House of Representative's vote to defund the implementation of the 
gainful employment regulation, the District Court for the District of 
Columbia's decision to vacate the bulk of the gainful employment 
regulation, and many concerns from the higher education community, why 
is the Department pursuing regulation when the Congress is scheduled to 
reauthorize the Higher Education Act when it expires at the end of 
2013?
    Answer. Although Congress is scheduled to reauthorize the Higher 
Education Act (HEA) when it expires at the end of 2013, the Department 
remains accountable at all times for using the tools available to it, 
including rulemaking, in those instances in which it identifies 
opportunities existing under current law for significantly improving 
the administration of the Title IV programs for the benefit of students 
and taxpayers. Gainful employment presents opportunities of that 
nature. We note that although the court found that we had not 
adequately explained one of the eligibility thresholds in our gainful 
employment regulations, and that that threshold was too intertwined 
with certain other provisions to permit those related provisions to 
stand, the court explicitly supported the Department's authority to 
regulate in this area.
    We believe that the Department can put new regulations in place to 
provide significant benefits to students and taxpayers on gainful 
employment, while the HEA reauthorization is underway. The interactions 
with the higher education community through an engaged series of 
discussions and negotiations on gainful employment, as well as a range 
of other issues, will inform the rulemaking process. The comment and 
testimony we gather at these hearings will inform the regulatory agenda 
for the negotiated rulemaking committee that we plan to convene this 
fall. The negotiated rulemaking process gives students, institutions, 
and other interested parties an opportunity to work together to improve 
the existing regulations that implement the HEA.
         institutional management of federal student aid funds
    Question. Can you please explain in greater detail the need to 
examine and enhance regulations on how institutions invest and manage 
Federal student aid funds, and what the Department means by ``other 
issues on this topic'' in the latest announcement regarding the 
upcoming negotiated rulemaking sessions?
    Answer. In regard to ``other issues on this topic,'' the Department 
is considering developing regulations governing how an institution may 
use or invest Title IV Federal Student Aid program funds held in its 
Federal or operating accounts or, if the institution transfers the 
funds to a third-party servicer to make disbursements to students, how 
those funds are managed by the provider.
                                 ______
                                 
              Questions Submitted by Senator John Boozman
    mcnair postbaccalaureate achievement program at arkansas state 
                               university
    Question. As you know, the McNair program was enacted by Congress 
in 1987 and added as one of the Federal TRIO programs. Arkansas State 
University (ASU) has participated in this program for a number of years 
to prepare disadvantaged students to pursue post-graduate studies. ASU 
first received McNair funding from 2003 to 2007. In 2007, programmatic 
funding was not renewed and apparently ASU lost points on their 
application score because they were a relatively new program. In 2009 
ASU received McNair funding again, but has now been told once more that 
programmatic funding will not be renewed.
    ASU is located in the Arkansas Delta region, which is one of the 
most economically challenged areas in the country. The university has a 
20 percent minority enrollment, and between 30-38 percent of students 
are the first generation in their families to attend college in any 
given school year. It is difficult to get a good program up and running 
when funding is cut off every couple of years. Given the population 
that ASU serves, and its strategic location in the Delta Region, can I 
have your commitment to build on what has already been accomplished at 
ASU to get a consistent, long-term McNair program established?
    Answer. Under the McNair Program, the Department awards grants on a 
competitive basis. The Department conducted a competition for new 
McNair awards in fiscal year 2012. ASU submitted an application in that 
competition and it was evaluated and scored by non-Federal reviewers. 
However, ASU's application did not score high enough in the competition 
to be funded. In September 2012, ASU received its final non-competitive 
continuation award from the grant the Department initially awarded to 
ASU in fiscal year 2009 and is currently implementing the final year of 
the project.
   federal student aid support and state support for higher education
    Question. Most colleges and universities have seen their overall 
State aid per student steadily decline during the last several years. I 
recognize that the Department cannot control how much and by what 
measure States appropriate their State funding to colleges and 
universities. What policies is the Department of Education advocating 
that will not adversely affect college and university standings for 
administering campus-based Federal financial aid, while they are seeing 
their costs rise and State funding, flat or declining?
    Answer. The administration has made affordability and quality in 
postsecondary education a priority in this year's President's budget. 
Because we share this responsibility to educate students, we encourage 
institutions to show the same commitment. Through our campus-based aid 
proposal, those institutions that have this commitment and are able to 
engage in innovation to this end--such as by getting students, 
particularly those from low-incomes into their institutions, through to 
graduation and into careers--will be rewarded for their success. It is 
important the Federal Government maintains its investment in students, 
but it does not make sense to keep investing in those institutions that 
continually fail students.
    Reductions in State appropriations must not reduce the ability of 
any student, especially a low-income student, to afford to attend 
higher education. That is why the administration has also found savings 
through reforms to student aid programs to use to keep the Pell grant 
program fully funded--and allow needy students to continue to receive 
the full award for which they are eligible. The budget also proposes to 
provide additional funds to an increased number of borrowers and 
institutions through the expanded and reformed Perkins Loan program. 
Currently serving 1,700 institutions, the new program is anticipated to 
expand to serve nearly 4,400, and provide $8.5 billion in loan volume 
to borrowers annually.
    Finally, because ensuring affordability and quality is a shared 
responsibility, we also support a $1 billion Race to the Top: College 
Affordability and Completion competition that would provide 
supplemental higher education funding to States. In exchange for 
funding, States would need to commit to reforms in areas such as: (1) 
sustaining fiscal support for higher education while modernizing 
funding policies to constrain costs and improve outcomes, (2) removing 
barriers preventing the creation of innovative methods of student 
learning and new degree pathways, (3) empowering consumer choice 
through increased transparency, and (4) smoothing transitions into 
college and between institutions of higher education.
         school performance assessments--4-year graduation rate
    Question. I have heard several concerns from Arkansas high schools 
that 4-year graduation rates are a metric by which they are being 
measured and given improvement guidance from the Department. This 
metric does not seem to incorporate the possibility that many school 
districts, particularly low-income school districts, have students that 
need longer than 4 years to graduate high school (sometimes just an 
additional semester). Are students graduating after the 4-year mark 
being calculated in that school's performance assessment/``report 
card'' and, if not, why not?
    Answer. The Department strongly believes that 4-year graduation 
rates are a central component of systems to hold schools accountable 
for improving academic achievement and outcomes for all students. Under 
the Department's 2008 regulations for Title I of the Elementary and 
Secondary Education Act (ESEA), all States must calculate and report on 
State and local report cards, in the aggregate and for different 
subgroups of students, a 4-year adjusted cohort graduation rate. 
Further, all States--including States like Arkansas that have been 
approved for ESEA flexibility--must use those rates meaningfully in 
identifying schools for interventions and support.
    While all States must report on and use 4-year graduation rates, 
States may also report and use an extended-year adjusted cohort 
graduation rate, such as a 5-year or 6-year rate, in addition to a 4-
year rate, thereby allowing local educational agencies and schools to 
receive credit for successfully graduating students who for various 
reasons might need more time to graduate with a regular high school 
diploma.
    higher education preparedness--enhancing math and writing skills
    Question. At Northwest Arkansas Community College in Bentonville, 
74 percent of first-time students in the fall of 2012 were not ready 
for college level math. Of this same cohort of students, 34 percent 
were not ready for college level writing. This placement data has not 
varied significantly for several years while No Child Left Behind 
mandates to our K-12 schools have been in place for many years. What 
incentives or disincentives is the Department advocating for K-12 
schools, so that colleges and universities do not have to continue 
spending such a high percentage of their precious funding to ``re-
educate'' students who are not ready?
    Answer. Virtually all of this administration's core elementary and 
secondary education reform initiatives are aimed at addressing your 
well-founded concern that we currently are not preparing secondary 
students for the challenges of college and careers. It also is 
important to point out that in focusing on college- and career-
readiness, we actually are following the lead of States, nearly all of 
which are currently implementing common core State standards 
specifically designed to help ensure that all graduating high school 
students are prepared to do college-level work without remediation. 
Through the Race to the Top program, for example, we have worked with 
Congress to provide more than $6 billion in competitive awards to 
States and school districts that provide an incentive to put in place 
next generation accountability systems and related supports that are 
based on college- and career-ready standards. We also have offered ESEA 
Flexibility to States working to successfully implement college- and 
career-ready standards and aligned assessments, and nearly 40 States 
have taken us up on that offer. Finally, our ESEA reauthorization 
proposal would require the adoption and implementation of college- and 
career-ready standards as the linchpin of State education 
accountability systems.

                          SUBCOMMITTEE RECESS

    Senator Harkin. Before I adjourn, an announcement just came 
over. I don't know why we didn't hear it. We are to avoid the 
first and third floors of the Hart Building, including the 
atrium. I don't know anything more than that. So avoid the 
first and third floors of Hart, including the atrium.
    With that, thank you all very much. The committee will 
stand adjourned. Thank you, Mr. Secretary.
    Secretary Duncan. Thank you for your leadership.
    [Whereupon, at 11:52 a.m., Wednesday, April 17, the 
subcommittee was recessed, to reconvene at 10 a.m., Wednesday, 
April 24.]
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